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


Please feel free to email us at info@acreform.com if you have any questions, stories or topics you would like us to include in our newsletter.


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Federal

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:

  • Preserve the full value of the current charitable deduction
  • Carve out charitable donations from the Pease limitation
  • Streamline the private foundation excise tax to a flat one percent
  • Oppose restrictions on donor advised funds

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.


Top Reads

(Blog): Congress Extends Charitable Deduction Deadline for Cause of Slain New York Police Officers

Congress passed a bill last week that extends the charitable deduction deadline for 2014 returns to April 15, 2015 for those donating to organizations supporting the families of two New York police officers killed in the line of duty in December. The bill, H.R. 1527, the Slain Officer Family Support Act of 2015, is sponsored by Rep. Hakeem Jeffries (D-NY).



Continue reading…

(Blog): What’s My Line?



In the opening session of the 2015 ACR Summit for Leaders, we had a bit of fun with messaging around the charitable deduction while conveying the critical importance of communicating to Congress that this part of our tax code must be protected. In this session four speakers delivered four different messages about the charitable deduction and audience members voted for the most persuasive message. The presenters and moderator were all members of the Charitable Giving Coalition, which has provided a unique and unified voice on Capitol Hill on issues affecting the charitable deduction since 2009.

Continue reading…

Philanthropic Achievement of the Week

1921: Carnegie Enhances Legal Education

Early in the twentieth century, rising demand for legal services led to a sharp increase in the number of lawyers, and a perceived decline in the professional standards of many of these newly minted practitioners. It was clear that reform of some kind was needed, but there was no clear leadership. Into this breach stepped the Carnegie Foundation for the Advancement of Teaching (whose origins are described in our 1905 entry).

The foundation had previously sparked a dramatic upgrade of medical education by sponsoring an influential critique known as the Flexner Report. That led to years of thoroughgoing reform, including $94 million of spending at 25 medical schools by John Rockefeller’s General Education Board. (See details at the 1910 entry of our Medical Achievements list.)

Seeking to repeat this feat in legal education, the Carnegie Foundation for the Advancement of Teaching initiated two critiques of American law schools. These, along with promptings from Elihu Root, a prominent lawyer and Carnegie trustee, caused the American Bar Association to endorsed higher standards of training. The ABA also partnered with the American Association of Law Schools to form the American Law Institute, which used $2.1 million of Carnegie funding to create accessible archives of the authoritative interpretations of U.S. law. ALI became the leading curator of court decisions and assisted in the development of the U.S. Uniform Commercial Code.

ACR News 03.20.15 - Ways and Means Member Resigns, Budgets Unveiled

>> Federal: Washington Roundup
>> Federal: Budgets Silent on Tax Reform
>> Federal: Ways and Means Member Resigns
>> Federal: Public Policy Guidebook
>> Federal: ACR Summit
>> Top Reads: Nonprofit Tax Changes Are Possible This Year, Says House Official


Washington Roundup

Over the past several days, House and Senate Republicans released their respective 2016 budget resolutions. The Senate plan cuts $5.1 trillion in spending over the next ten years, whereas the House proposal reduces spending by $5.5 trillion.

While the ultimate product is not binding, from a political perspective these proposals are more meaningful than in past years as both the House and Senate are under Republican control. A new joint budget resolution – agreed upon by both the House and Senate – would only set broad goals for spending levels in each department of the federal government. Keep in mind that while budget resolutions require a simple majority to pass, the GOP majority in the Senate is slim and if the budget is too extreme, it could make some Republican senators who are up for reelection in swing states vulnerable during their 2016 campaigns. At the same time, a watered-down budget proposal may lose the support of more conservative members.

As for next steps, both the House and Senate Budget Committees marked up their budget resolutions this week. Full votes in each chamber are expected later next week and, should the resolutions pass, a conference committee would convene to reconcile differences between the two plans. This sets up a showdown between fiscal conservatives, who want to rein in spending, and pro-defense Republicans, who want to increase funding for the military.

It’s important to note that under congressional rules, budget resolutions require a simple majority to pass the House and Senate. Therefore Republicans would bear most of the responsibility if a bill fails to pass. Follow-up legislation will be required to actually implement and allocate federal spending. That is expected to take place before current federal funding expires on September 30.


Budgets Silent on Tax Reform

The House budget plan is largely silent on tax reform. It calls for “comprehensive tax reform that would include lower rates for individuals and families, as well as large corporations and small businesses who often file their tax returns through the individual side of the tax code.” This breaks from previous budgets, which focused on lowering the top individual and corporate rates specifically to 25 percent. The document does not offer any details about cutting specific tax breaks to broaden the base, except “by closing special interest loopholes that distort economic activity.” Charitable giving incentives were not mentioned.

Similar to the House proposal, the Senate resolution contains few details on tax reform. Instead of calling for specific rates, the proposal stresses the need to reform the code and “extend certain expiring tax relief provisions for innovation and high quality manufacturing jobs” and to “repeal the 2.3 percent excise tax on medical device manufacturers.” No other specific tax incentives are mentioned.


Ways and Means Member Resigns

Ways and Means Member Aaron Schock (R-IL) announced this week that he will resign from Congress in the face of scrutiny over his use of taxpayer dollars. Schock’s resignation is effective March 31. 

Schock’s retirement leaves an open seat on the Ways and Means Committee. Early reports indicate that Republican House Members are already lining up for the spot. You may recall that at the end of last year, four members were “on the bubble” to fill vacant seats: Representatives Bill Huizenga (R-MI), Reid Ribble (R-WI), Tom Rice (R-SC), and Todd Rokita (R-IN). The selection process could take weeks after Representative Schock’s resignation goes into effect.


Public Policy Guidebook

The Philanthropy Roundtable announced this week the public release of its latest guidebook, Agenda Setting: A Wise Giver’s Guide to Influencing Public Policy, which will help readers understand the growing role of donors in altering law, opinion, and public policy.

The book presents a diverse collection of human stories, case studies, and advocacy efforts from the annals of U.S. public-policy philanthropy, spanning from the pre-Civil War era to controversies in 2015. It makes clear that public-policy philanthropy is nothing new in America, and that private policy-shaping efforts have mirrored the expansion of the public sector—where government has tripled in size from 12 percent of U.S. GDP in 1930 to 36 percent today.

The guidebook profiles significant players in public-policy philanthropy like Charles and David Koch, George Soros, Betsy DeVos, Gara LaMarche, Art Pope, and many others. It compiles short histories of more than 100 major projects in U.S. public-policy philanthropy, including the anti-slavery movement, education reform, environmental activism, philanthropic funding for new media, and many other issues.

Agenda Setting: A Wise Giver’s Guide to Influencing Public Policy can be downloaded as a free PDF at The Philanthropy Roundtable’s website or purchased as an e-book at Amazon and other outlets.


ACR Summit

Finally, we would like to thank all of you who came to this week’s ACR Summit for Leaders. We had a surge in registration and higher attendance than originally anticipated. We are grateful for the active members of the charitable sector who are vigorous in their defense of protecting philanthropic freedom. We will be posting video of two of the panels from this year’s Summit on our YouTube page next week.


Top Reads

Uncovering Philanthropy’s Vital Role in Public Policy

The Philanthropy Roundtable Unveils Guidebook On Public-Policy Philanthropy

WASHINGTON, D.C.— The Philanthropy Roundtable announces the public release of its latest guidebook, Agenda Setting: A Wise Giver’s Guide to Influencing Public Policy, which will help readers understand the growing role of donors in altering law, opinion, and public policy.

“Almost every major controversial issue today, from school reform to gay marriage, from public-pension bankruptcy to marijuana legalization, has philanthropists working on all sides to bring useful facts and arguments into the discussion. Donors are now driving really robust debates, and this guidebook will be a valuable resource as philanthropy becomes an increasingly important part of governance and policy change in America,” said Adam Meyerson, president of The Philanthropy Roundtable.

The book presents a diverse collection of human stories, case studies, and advocacy efforts from the annals of U.S. public-policy philanthropy, spanning from the pre-Civil War era to controversies in 2015. It makes clear that public-policy philanthropy is nothing new in America, and that private policy-shaping efforts have mirrored the expansion of the public sector—where government has tripled in size from 12 percent of U.S. GDP in 1930 to 36 percent today.

“One often hears the argument these days that we are in the midst of some unprecedented and un-American meddling in public affairs by private donors. That’s historically inaccurate. In truth, donors have been crucial to the success of some of our nation’s most important and necessary public-policy reforms for generations,” explains Karl Zinsmeister, the book’s co-author.

The guidebook profiles significant players in public-policy philanthropy like Charles and David Koch, George Soros, Betsy DeVos, Gara LaMarche, Art Pope, and many others. It compiles short histories of more than 100 major projects in U.S. public-policy philanthropy, including the anti-slavery movement, education reform, environmental activism, philanthropic funding for new media, and many other issues.

Agenda Setting: A Wise Giver’s Guide to Influencing Public Policy can be downloaded as a free PDF at The Philanthropy Roundtable’s website, purchased as an e-book at Amazon and other outlets, or mailed as a printed book to interested parties.