ACR News 05.01.15—A New Member for Ways and Means

>> Federal: Washington Roundup
>> Federal: Ways and Means Adds New Member
>> Federal: Business Tax Reform Possible, Pass-Throughs Remain a Potential Problem
>> Federal: Charitable Giving Coalition Rejects Washington Post View on Charitable Deduction
>> Federal: ACR Webinar
>> Consider This: Fly on the Wall
>> Top Reads: Donor-Advised Funds Drive Millions to Nepal Relief

Washington Roundup

House and Senate negotiators reached a final budget agreement early this week. The House passed the budget resolution Thursday by a vote of 226 to 197. The Senate is expected to consider the resolution next week. Should it pass in the Senate, follow-up legislation would be required to appropriate federal spending according to the levels spelled out in the budget agreement, which is expected to take place before the end of the fiscal year.

Ways and Means Adds New Member

Illinois Republican Bob Dold replaced former Representative Aaron Schock (R-IL) on the House Ways and Means Committee, following Schock’s resignation last month. The House Republican Conference formally approved Dold for the seat on April 28. In a statement, Dold said, “Serving on the Ways and Means Committee gives the 10th District an even larger role in advancing solutions to some of the most pressing challenges we face.” Dold previously served on the House Financial Services Committee, but gave up that position to serve on Ways and Means.

Business Tax Reform Possible, Pass-Throughs Remain a Potential Problem

Last week, House Speaker John Boehner (R-OH) said corporate tax reform has only a 50-50 chance of being enacted by Congress this year, citing pass-through businesses that organize on the individual side of the tax code as a major stumbling block. “It will be very difficult to do corporate tax reform without also [addressing] the pass-through entities,” he said. Lawmakers remain wary of reforms that would disadvantage small businesses on the individual side of the code, which would not benefit from a corporate rate reduction and remain subject to the higher individual tax rates.

Similarly, Senate Finance Committee Ranking Member Ron Wyden (D-OR) said on April 17 that leaving pass-through businesses out of corporate tax reform would “kill the effort in the crib.” Wyden added, “I don’t think you can do tax reform if the American people walk away with the idea that tax reform is just for big guys.” Wyden declined to endorse any specific business tax reform proposals, noting there are “a number of ideas in circulation.”

House Ways and Means Chairman Paul Ryan (R-WI) said on Thursday that his Committee is working to complete a limited tax overhaul plan by the end of the summer. During a breakfast with reporters, he said the Committee would consider this a “down payment” on comprehensive tax reform, which Ryan said he “sees…as a 2017 project.” Ryan added he is committed to lowering corporate tax rates while ensuring that rates for pass-throughs, businesses that organize on the individual side of the code, are also addressed.

More details should emerge as the Senate Finance Committee concludes its working group process at the end of May.

Charitable Giving Coalition Rejects Washington Post View on Charitable Deduction

On April 22, the Washington Post’s Editorial Board, while discussing presidential candidate Hillary Clinton’s potential economic platform, suggested that the charitable deduction carries an “unduly high cost in inequality,” and that it, along with other deductions, should be “limited or abolished.” The members of the Charitable Giving Coalition penned a response saying they “firmly disagree with that assertion and encourage the Post’s Editorial Board to consider the drastic effects that ‘limit[ing] or abolish[ing]’ the charitable deduction would have on those Americans who are less fortunate.” Their response also notes that no “other tax policy can match the benefit [the charitable deduction] delivers for the country.”

ACR Webinar

You are invited to join us on May 5 at 2:30 p.m. EST for the next presentation in the ACR webinar series: The Politics of Tax Reform in 2015.

Our policy experts will outline how the political landscape of 2015 could shape the progress of tax reform and what that means for the sector. We will also recap highlights from the 2015 ACR Summit and our recent meetings with lawmakers to discuss how you and your allies can continue to urge lawmakers to protect philanthropic freedom and private giving. If you are unfamiliar with ACR webinars, we have previous webinars on donor-advised funds and the economic impact of the nonprofit sector available to view on our website.

To RSVP for this webinar, please click the button below.

Consider This: Fly on the Wall

Next week, Senate Finance Committee members are due to go behind closed doors to talk about recommendations from the first of five working groups, reportedly the international group. Wouldn’t we love to be a fly on the wall during that session and the sessions that follow?

What can we expect when they get to the individual working group closed door session, which covers a lot of the issues we care about like the charitable deduction?  The individual working group could be the toughest group of all given much of what they’ve been asked to consider is, “Should we raise taxes on individuals?”  The short (and almost universal) answer to that question amongst Republicans is a hearty “no.”  But a majority of Democrats, when asked about raising taxes on higher earner, higher wealth individuals, would probably say, “definitely maybe.”

This means the individual group may be unable to reach agreement on anything of real substance. That being said, be mindful that curbs and floors on the charitable deduction have come from all quarters, including from both the President and the Republican candidate who opposed him.

Absent some newfangled technology, we won’t be a fly on the wall during the behind-closed-doors session on the taxation of individuals. However, we assure you we will do our level best to make sure ACR’s views are well-represented in that forum. 

Top Reads

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Charitable Giving Coalition Defends Charitable Deduction in Response to Washington Post

In a letter sent to the Washington Post on April 28, the Charitable Giving Coalition defended the charitable deduction from the editorial board’s assertion that the deduction serves only the wealthy. Read the entire letter below.

While discussing Hillary Clinton’s economic message, The Washington Post’s editorial board suggested on April 22 that the charitable deduction is simply a tax expenditure that only benefits the rich. We firmly disagree with that assertion and encourage The Post’s editorial board to consider the drastic effects that “limit[ing] or abolish[ing]” the charitable deduction would have on those Americans who are less fortunate.

From healing and educating to enriching lives through the arts to feeding the hungry and providing relief in times of crisis, the charitable sector, built upon philanthropic contributions leveraged by the charitable deduction, is inextricably linked to our communities. The charitable deduction is unique as it is the only tax provision that encourages an individual to give away a portion of income for the benefit of others.

As Ranking Member Ron Wyden (D-OR) of the Senate Finance Committee wrote on January 23, 2014, the charitable deduction is “a lifeline, not a loophole” and has been for almost 100 years. No other tax policy can match the benefit it delivers for the country. It is overwhelmingly supported by the majority of Americans, provides help for those most in need , buoys the economy and relieves thinly-stretched government service programs, all the while providing no direct benefit to the donor beyond the deduction. Sen. Benjamin Cardin (D-MD)’s tax reform proposal (that The Post’s editorial board applauded on Feb. 23, 2015) recognizes the uniqueness of this vital provision by preserving the full scope and value of the charitable deduction.

In 2013 Americans gave away $335 billion to charitable causes, according to the annual Giving USA report. While donors do not choose to give to charity because of the tax deduction, it very much affects the amount they are able to give and how often they give. Why else has Congress extended the deadline for claiming a charitable deduction for certain charitable needs, such as recovery from Typhoon Haiyan or the murder of New York City police officers? The charitable deduction works, and lawmakers know it.

What’s more, the money donated to America’s nonprofits is leveraged beyond simply providing charitable services. The nonprofit sector employs 10 percent of the U.S. workforce, generates more than $1 trillion every year in jobs and services, and accounts for more than five percent of the gross domestic product.  Approximately 62.6 million Americans, or 25.4 percent of the adult population, gave 7.7 billion hours of volunteer service worth $173 billion in 2013.

Limiting the deduction, as The Post suggests, would be devastating to nonprofit organizations. For example, if the charitable deduction were capped at 28 percent—as has been proposed by the President in every budget he has submitted to Congress—the nonprofit sector could lose as much as $9 billion in the first year alone according to the American Enterprise Institute.

Similarly, the two percent of adjusted gross income (AGI) floor included in former House Ways and Means Committee Chairman Camp’s Tax Reform Act of 2014 could result in a loss of up to $10.5 billion in charitable contributions based upon Urban-Brookings Tax Policy Center estimates. These potential reductions in giving would debilitate the nonprofit sector and undermine our recovering economy—not to mention the harm it would do to those who rely significantly on charitable services.

Although The Washington Post’s editorial board is correct in saying that the policy goals behind the charitable deduction “are being achieved,” it is not at an “unduly high cost in inequality.” The charitable deduction encourages people to give away money that is then utilized by nonprofits for the benefit of others—it fuels an intrinsic redistribution of funds and/or property. If anything, tax provisions like the charitable deduction that invigorate philanthropic giving form the foundation for rectifying inequality.

About The Charitable Giving Coalition

Formed in 2009, the Charitable Giving Coalition’s members include more than 60 diverse organizations representing private and community foundations, their grantees and independent charities, as well as nonprofit organizations and the associations and umbrella groups that serve their needs. The coalition is dedicated to preserving the charitable tax deduction, which is crucial to ensuring our nation’s charities receive the funds necessary to fulfill their essential philanthropic missions. The coalition provides a unique and unified voice on Capitol Hill, including lobbying and grassroots advocacy, on issues affecting the charitable deduction.

Philanthropic Achievement of the Week

1833:American Anti-Slavery Society

The powerful religious and moral revival in America during the early 1800s, known as the Second Great Awakening, spawned an outpouring of voluntary giving and the creation of many new charitable societies aimed at spreading Christianity and reducing social ills like drunkenness, violence, and slavery.

One of the most consequential of these new charities was the American Anti-Slavery Society. It was established in 1833 with financing from major philanthropists Arthur and Lewis Tappan and Gerrit Smith, along with many small donors mobilized by an army of religious female fundraisers. Within two years the society had 200 local chapters, and there were 1,350 by 1838, mobilizing an estimated 250,000 members. Given the controversial cause, historian Kathleen McCarthy calls this “a stunning level of recruitment, accounting for almost 2 percent of the national population within the scant space of five years in an era of primitive communications.” As a fraction of the national population, the society was larger than today’s Boy Scouts, or National Rifle Association, or National Wildlife Federation, or Chamber of Commerce.

In the process, abolitionism became a national crusade. Advocates presented the following arguments for reform: No one has the right to buy and sell other human beings. Husbands and wives should be legally married and protected from involuntary separation. Parents should maintain control of their children. It is wrong for slaveowners to be able to severely punish a slave without trial. Laws prohibiting the education of slaves must be repealed. Planters should pay wages to field hands instead of buying slaves.

In the summer of 1834, slavery apologists reacted violently to this new opposition. During a riot in New York City, leading AAS donor Arthur Tappan escaped with his life only by barricading himself and his friends in one of the family stores well supplied with guns. The home of his brother Lewis Tappan was sacked that same evening, with all of his family possessions pulled into the street and burned while some leading citizens looked on passively.

Despite their narrow escapes, the Tappan brothers were undeterred. Lewis left his house unrepaired, to serve, he said, as a “silent anti-slavery preacher to the crowds who will flock to see it.” More substantively, the Tappan brothers decided to flood the U.S. with anti-slavery mailings over the next year. They had founded and subsidized several important magazines to popularize anti-slavery arguments, including the high-circulation Emancipator, the children’s magazine the Slave’s Friend, the Record illustrated with woodcuts, William Lloyd Garrison’s the Liberator, and the journal Human Rights.

These publications and other abolitionist tracts and papers were now flurried across the country by the American Anti-Slavery Society. The campaign was powered by $30,000 of donations. It targeted ministers, local legislators, businessmen, and judges, using moral suasion to make the case against enslavement. The society’s publications committee, headed by Lewis Tappan, mailed over a million pieces in the course of ten months, harnessing new technologies like steam-powered presses plus the religious enthusiasms of thousands of volunteers to mobilize public opinion.

As McCarthy notes, defenders of slavery had “kept the leavening potential of civil society in check…watchfully curbing any trend which might contribute to the development of alternative, independent power bases.” So the enemies of abolition struck back against this civil information campaign. In his 1835 message to Congress, President Andrew Jackson called for a national censorship law to shut down mailing of these politically “incendiary” writings. He encouraged his postmaster general to suppress the deliveries or at least look the other way while local postmasters did, and in many places abolitionist tracts were pulled out of the mail and subscribers were exposed and threatened.

Arthur and Lewis Tappan and other philanthropists subsidizing the effort were subject to additional violence. Lewis was mailed a slave’s ear, a hangman’s rope, and many written threats. An offer of $50,000 was made for delivery of his head to New Orleans. A Virginia grand jury indicted him and other members of the American Anti-Slavery Society. As his only weapon, Lewis carried a copy of the New Testament in his breast pocket.

These thuggish reactions helped turn public opinion against slavery, especially among Northern churchgoers, and fueled the rapid spread of AAS chapters described above. The Tappans, meanwhile, continued their dogged efforts to change national policy on this issue. See their contributions, for instance, in the nearby 1841 entry on the Amistad decision, and the 1846 entry on the American Missionary Association. Combining abundant generosity with personal passion and a genius for organizing and public relations, the Tappan brothers made giant contributions to the most consequential public-policy reform in the history of the United States.

Upcoming ACR Webinar: The Politics of Tax Reform in 2015

You are invited to join us on May 5 at 2:30 p.m. EST for the next presentation in the ACR webinar series: The Politics of Tax Reform in 2015.

Our policy experts will outline how the political landscape of 2015 could shape the progress of tax reform and what that means for the sector. We will also recap highlights from the 2015 ACR Summit and our recent meetings with lawmakers to discuss how you and your allies can continue to urge lawmakers to protect philanthropic freedom and private giving. Presenters at the webinar will include:

  • Alexander Reid, of counsel to Morgan Lewis, former staff to the Joint Committee on Taxation
  • Anne Urban, co-founder, Urban Swirski & Associates
  • Sandra Swirski, co-founder, Urban Swirski & Associates
  • Joanne Florino, senior vice president for public policy, The Philanthropy Roundtable

If you are unfamiliar with ACR webinars, we have previous webinars on donor-advised funds and the economic impact of the nonprofit sector available to view on our website.

To RSVP for this webinar, please click the button below.

Good Giving | Success Stories

Houston Philanthropist David Weekley to Receive William E. Simon Prize

WASHINGTON, D.C.— Houston-area homebuilder and philanthropist David Weekley has been named the recipient of the 2015 William E. Simon Prize for Philanthropic Leadership, an annual award administered by The Philanthropy Roundtable that highlights the power of philanthropy to promote positive change and to inspire others to support charities that achieve genuine results. The prize is intended to honor living philanthropists who have shown exemplary leadership through their own charitable giving, either directly or through foundations they have created.

“This is a prestigious award that I am honored to accept. I consistently strive to do something positive with everything that I have been blessed with, and to be recognized for that effort is truly a privilege. I am humbled to be mentioned among the recipients of this award,” Weekley said.

“My father took very seriously the responsibility of being a good steward. David Weekley fulfills that ideal by taking great care in his charitable giving and setting a standard of excellence for other philanthropists to follow. I know my father would be proud to have him receive this award,” said William E. Simon, Jr., co-chairman of the William E. Simon Foundation.

Weekley is a passionate supporter of programs that develop character, from the Boy Scouts to the Positive Coaching Alliance to Young Life. An active player in education reform, Weekley supports KIPP, YES Prep, and Cristo Rey schools. He is a community leader, serving on the boards of professional and nonprofit organizations throughout the Houston area. Weekley gives not only of his wealth but also of himself.

“David Weekley is the consummate example of selfless giving. For more than two decades, he has lived by the principle of donating 50 percent of both his money and his time to charitable service. His commitment to strengthening our free society is the personification of the ideals the Simon Prize is meant to honor,” added Adam Meyerson, president of The Philanthropy Roundtable.

Weekley founded a homebuilding company at the age of 23, with a capital investment from his brother, Dick. Since 1976, Weekley Homes has grown to become the largest privately held homebuilder in America, expanding to 20 metropolitan areas and closing over $1.3 billion worth of new homes in 2014. As president of the David Weekley Family Foundation, he practices a venture-philanthropy model of investing treasure, time, and talent to grow nonprofits and social enterprises serving the poor and disadvantaged. The foundation’s international portfolio concentrates on improving education, health, and economic opportunity, with a focus on helping young, innovative organizations expand their proven models to reduce global poverty.

Weekley will be honored on Thursday, October 15, at the Four Seasons Resort and Club Dallas in Las Colinas, Texas during a special lunch at the 2015 Annual Meeting of The Philanthropy Roundtable. The prize includes a $250,000 award, payable to a charity designated by the winner.

The William E. Simon Foundation created the William E. Simon Prize for Philanthropic Leadership to further Bill Simon Sr.’s ideals and principles of personal responsibility, resourcefulness, volunteerism, scholarship, individual freedom, faith in God, and helping people to help themselves. Previous winners of the William E. Simon Prize for Philanthropic Leadership include Jon Huntsman Sr., Eli and Edythe Broad, Bernie Marcus, Charles Koch, Roger Hertog, Phil and Nancy Anschutz, Dr. Ben Carson, David Robinson, the late Sir John Templeton, and the late John Walton.

ACR News 04.17.15 -  ACR Submits Recommendations to Finance Committee

>> Federal: Washington Roundup
>> Federal: ACR Submits Recommendations to Senate Finance Working Groups
>> Federal: Tax Reform Momentum Shifts
>> Federal: 2016 Presidential Candidates Emerge
>> Federal: ACR Webinar
>> Consider This: Wait and See
>> Top Reads: On Tax Day, Sen. Wyden Issues Call for Reforms

Washington Roundup

Members of Congress returned to Washington on Monday after a two week Easter recess and wasted no time getting back to work. Late Tuesday night the Senate passed a long term “Doc fix” bill, repealing the automatic cuts to doctors’ payments when treating Medicare patients. Members continue negotiating a final budget resolution, as well as an agreement on the Administration’s nuclear arms deal with Iran. Finally, according to a memo from House Majority Leader Kevin McCarthy (R-CA), the House will also focus on a range of other issues this month, and already held votes this week on multiple tax bills affecting IRS regulation and repealing the estate tax.

ACR Submits Recommendations to Senate Finance Working Groups

ACR submitted recommendations to both the individual and business working groups urging Senators “to protect philanthropic freedom and expand charitable giving in the United States.” Specifically, ACR called for preserving the full value of the current charitable deduction, carving out charitable donations from the Pease limitation, streamlining the private foundation excise tax to a flat one percent, and opposing restrictions on donor-advised funds.

As you may recall, Chairman Orrin Hatch (R-UT) formed the bipartisan groups to analyze current tax law, examine policy trade-offs, and identify available reform options within the group’s designated topic areas. Staff expects the working group process to finish by the end of May, and their final reports will likely be made public. After the working groups conclude, Chairman Hatch will lead the process and may call for an additional round of hearings and legislative text.

Tax Reform Momentum Shifts

On Tuesday, Senate Finance Committee Chairman Orrin Hatch (R-UT) and House Ways and Means Chairman Paul Ryan (R-WI) wrote a letter to small business organizations, asking for their input on business tax reform. The letter outlines growing sentiment that comprehensive reform might not be possible this year, but there could be just enough momentum to reform the corporate side. The chairmen said, “If President Obama is willing to help us achieve a first phase of tax reform focused in part on business income, we owe it to American workers and their families to see if we can find common ground.” The groups were asked to respond by May 31, coinciding with the Finance Committee working group timeline mentioned above.

Additionally, Hatch told reporters on Tuesday that he would like President Obama to more fully outline his business tax reform plan and “let us see what we can do with it.” As of this writing, the Administration has not responded.

2016 Presidential Candidates Emerge

Three Presidential hopefuls officially announced their candidacies for the White House this week: Republican Senators Marco Rubio (R-FL) and Rand Paul (R-KY), and former Secretary of State Hillary Clinton.

As we reported in early March, Senator Rubio released a tax reform plan with Senator Mike Lee (R-UT), which preserves the charitable deduction while eliminating almost all other credits and deductions. Senator Paul and Hillary Clinton have not released detailed tax proposals.

ACR Webinar

You are invited to join us on May 5 at 2:30 p.m. EST for the next presentation in the ACR webinar series: The Politics of Tax Reform in 2015.

Our policy experts will outline how the political landscape of 2015 could shape the progress of tax reform and what that means for the sector. We will also recap highlights from the 2015 ACR Summit and our recent meetings with lawmakers to discuss how you and your allies can continue to urge lawmakers to protect philanthropic freedom and private giving. If you are unfamiliar with ACR webinars, we have previous webinars on donor-advised funds and the economic impact of the nonprofit sector available to view on our website.

To RSVP for this webinar, please click the button below.

Consider This: Wait and See

We would have expected more activity surrounding taxes in DC this week, given the April 15 deadline that has come and gone. We’ve actually heard more about a small helicopter landing on the grounds of the Capitol than we have about reforming the tax code.

Sure the House voted to repeal the estate tax this week but is that ever really going to go anywhere?  Not anytime soon. While the tax-writing Chairmen are soliciting input and forming working groups and holding roundtables, not a lot of concrete, visible progress has been made toward tax reform (except perhaps in the international area).

While we grant that work is being done behind the scenes, we think the real reason things have slowed down is that we are in a wait and see mode. What will the Supreme Court do in the Obamacare case it has taken?  What will Congress do when the highway bill expires at the end of May?  Will Congress pass a budget that will make it a whole lot easier to get tax reform passed?

By the time we get to Memorial Day we should know the answers to these questions and the real outlook for tax reform this year should be much clearer. As always, we will keep you posted.

Top Reads

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ACR Outlines Critical Provisions to Finance Committee Working Groups

Submits Letter Recommending Specific Policies That Will Preserve Private Charitable Giving

WASHINGTON, D.C.— The Alliance for Charitable Reform (ACR) submitted a letter today to two tax reform working groups of the Senate Finance Committee urging support for four charity-related provisions that will protect charitable giving.

“We strongly encourage the Senate to protect philanthropic freedom and expand charitable giving in the United States. As tax reform moves forward, we are hopeful that Congress will consider policies that will lead to more giving while carefully guarding against policies that could unintentionally thwart giving,” wrote Sandra Swirski, executive director of ACR.

ACR made four specific recommendations:

Senate Finance Committee Chairman Orrin Hatch (R-UT) formed five bipartisan working groups to identify key issues in tax reform in January. The groups have begun roundtable discussions and are accepting public comment until today. ACR has been an active participant in the working group process offering key insight to policymakers on how certain proposals may encourage or curtail private charitable giving. The letter from ACR was submitted to both the individual income tax working group and the business income tax working group.

“Every day our charities, and the generous individuals, foundations, and corporations who support them, are offering creative solutions to meet the diverse needs of our communities. We urge you and your colleagues to do everything you can to protect, promote, and expand charitable giving,” wrote Swirski in the letter.

The letter sent to the individual income tax working group and be viewed here, and the letter to the business income tax working group can be viewed here.

Philanthropic Achievement of the Week

1993: Saving the Joffrey Ballet

When philanthropist Patricia Kennedy invited rock artist Prince to join her at the Joffrey Ballet in 1991, she didn’t think the shy star would say yes.

Prince was renting a mansion from her at the time, and had a reputation as a recluse. He surprised her by agreeing, and after seeing his first ballet, went home in excitement to write dance music. The Joffrey had been founded in 1956, and moved from New York to Los Angeles in 1982, with $1 million in debt and in danger of going under. Kennedy had long been one of its biggest supporters, and she gave extensively to keep the wolf from its door. This introduction of popular artist to formal art, however, may have been the biggest gift she ever gave the company.

As the company’s finances continued to spiral downward, Kennedy suggested that the company use Prince’s music in a ballet. A few months and a few conversations later, Prince had offered the company unprecedented access to his music, which allowed the Joffrey in 1993 to produce the first-ever rock ballet, entitled Billboard. In seemingly no time, the ballet caught fire, winning a vast, new, younger audience that would fill its seats for a generation. By 1995 the company had made a permanent home in Chicago, and today bills itself as the “mavericks of American dance.”

Thanks in large part to the visibility generated by Kennedy’s tenant, the Joffrey is also known as America’s company of firsts: the first ballet troupe to perform at the White House, the first to appear on television, the first on the cover of Time magazine, the first to have a major movie based on it (The Company, 2003), and, of course, the first to perform a rock-and-roll ballet.

Philanthropic Achievement of the Week

1999: Rose Center for Earth and Space

Sometimes the vision and management direction a philanthropist offers to a project can be as valuable as his money. Financier Richard Gilder was a longtime member of the board of directors for the American Museum of Natural History in New York, and served on its planetarium committee. By 1992, annual attendance at the venerable Hayden Planetarium had dropped by more than 20 percent in a decade, and the facility was showing its age. Museum leaders originally planned a modest upgrade that would cost $15 million. Gilder urged starting over, and called not just for a new planetarium and exhibits but also a high-powered research center (Gilder eventually convinced astrophysicist Neil deGrasse Tyson to be the first director). The grand $210 million project attracted donations, including one for $20 million from builder and philanthropist Frederick Rose. Gilder contributed significantly himself. In just a few years, the modest planetarium had become the Rose Center for Earth and Space, with multiple theaters, halls, and exhibits.



ACR News 04.03.15 - Two Senators Retire, Congress (Narrowly) Extends Charitable Deduction Deadline

>> Federal: Washington Roundup
>> Federal: Influential Senators Announce Retirement
>> Federal: Congress Passes Narrow Charitable Extension
>> Federal: Ways and Means Update
>> Federal: ACR Contributes to Finance Committee Working Group
>> Federal: House and Senate Pass Budget Resolutions
>> Federal: Come on Down!
>> Top Reads: Congress Offers One Last Chance to Lower Your Tax Bill

Washington Roundup

Congress is currently in its two-week Easter recess and is expected to be back in session on Monday, April 13.

Influential Senators Announce Retirement

Late last week, Senate Minority Leader Harry Reid (D-NV) announced he will not seek re-election in 2016. In a farewell video, Reid cited his eye injury in January, saying it forced him to reevaluate his life and think about his career. Reid endorsed Senator Chuck Schumer (D-NY) as his replacement. While Senator Schumer is currently the number three Democrat in the Senate, we expect Schumer to succeed Reid, given the support he has from his fellow Democrats in the Senate.

In addition, Senate Finance Committee Member Dan Coats (R-IN) announced he will not seek re-election in 2016. Coats said in an interview with IndyPolitics.Org that he chose to retire so he could focus on doing work in the Senate, rather than spending the next two years campaigning for reelection. 

Congress Passes Narrow Charitable Extension

Congress quietly passed legislation on March 26 giving taxpayers until April 15 to make tax-deductible donations to the families of two New York City police officers shot in the line of duty in December. President Obama signed the bill, which was introduced by Representative Hakeem Jeffries (D-NY), into law on April 1. 

Ways and Means Update

Last Thursday, House Ways and Means Chairman Paul Ryan (R-WI) said he is “happy to do tax reform in two phases if that’s necessary.” Ryan added, “We are working very hard at doing our research, getting our scores, and then engaging with Treasury to see if we can find a common ground on tax reform,” noting that the Committee “talks with [the Senate Finance Committee] all the time.”

Of particular note, Ryan said business tax reforms, or “phase one,” must “facilitate the second phase, which is to finish the job and lower the rates across the board for families and individuals.” Ryan also noted that small businesses that file on the individual side of the tax code, known as pass-throughs, should be included in business tax reform. Chairman Ryan did not offer more details about the Committee’s timeline for future action.

ACR Contributes to Finance Committee Working Group

Across Capitol Hill, Senate Finance Committee Chairman Orrin Hatch (R-UT) said last Tuesday that he is unsure if his panel will mark up tax reform legislation this year. “So far, we haven’t reached that decision,” Hatch told reporters. He added he hopes the Obama administration will be more involved in the process, saying that without presidential leadership, tax reform is “very likely dead in the water.”

Additionally, the Senate Finance Committee’s Individual Tax Reform Working Group invited ACR to participate at a recent roundtable discussion on charitable giving. Last Friday, ACR’s Joanne Florino joined several colleagues from the sector on the Hill with staff from the offices of Senators Chuck Grassley (R-IA), Debbie Stabenow (D-MI), Mike Enzi (R-WY), and Robert Menendez (D-NJ) as well as Finance Committee staff and staff from the Joint Committee on Taxation. The meeting was productive, and we will continue to advocate for private giving through the working group process.

House and Senate Pass Budget Resolutions

Last week, both chambers passed FY2016 budget resolutions. The House passed a final bill on March 25 by a vote of 228 to 199. The bill increased defense spending above the plan approved by the House Budget Committee earlier this month. The Senate worked into the early hours of the morning last Friday and passed its respective budget blueprint on a 52 to 46 vote, which included similar defense funding levels. 

As you may recall, these budget resolutions are not binding, but instead set broad goals for spending levels in each department of the federal government. A conference committee will now be convened to reconcile differences between the two proposals, and both chambers would need to pass the agreed-upon final plan. According to Senate aides, both chambers are hoping to begin that process by April 15 after Congress returns from its two-week Easter recess.

Follow-up legislation will be required to actually implement and allocate federal spending, which is expected to take place before current federal funding expires on September 30. For example, appropriations bills will have to be voted on by the House and Senate, and ultimately signed by the President.

Come on Down!

Many of you have asked if we recorded any of the sessions from the 2015 ACR Summit for Leaders. As a matter of fact, we did. Below is the video from our first panel, which had a bit of fun with messaging around the charitable deduction. In this session, four speakers delivered four different messages about the charitable deduction and audience members voted for the most persuasive message.

We also have the third panel from the ACR Summit available at our YouTube channel. The congressional panel, as you likely know, was off the record. If you missed that one, you will just need to make sure to join us at next year’s ACR Summit for Leaders.

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