MNN Urges Senate to Vote Against Tax Cuts and Jobs Act

Today, the Massachusetts Nonprofit Network (MNN) sent letters to Senator Edward J. Markey and Senator Elizabeth Warren of Massachusetts, thanking them for their ongoing support of the nonprofit sector and urging them to vote against the Tax Cuts and Jobs Act scheduled for a vote in the Senate today.

“The tax legislation to be considered by the Senate includes significant changes to long-standing tax policies that will have a drastic effect on the Commonwealth’s nonprofit sector. These effects include reducing charitable giving by billions and imposing new and unfair taxes on the nonprofit sector,” said Jim Klocke, CEO of MNN.

Although the Senate bill does not contain a repeal of the Johnson Amendment like the House bill included, Klocke noted concerns held by many in the nonprofit sector that a repeal could be offered as an amendment, or could survive should the House and Senate tax bills end up in conference.

In opposing the Tax Cuts and Jobs Act, MNN joins opposition from both their member nonprofit organizations across the Commonwealth and from national groups including the National Council of Nonprofits, Independent Sector, and the Council on Foundations.

The full text of the letter can be found here.

Nonprofit 411: Driving Diverse, Desired Target-Audience Actions with Online Advertising

306ae18By Gail Snow Moraski, Principal and Digital Marketer, Results Communications and Research

Anyone who’s held a discussion with me about marketing and development activities knows I’m a huge fan of online advertising. Because search engine networks, such as Google AdWords, and social media platforms, such as Facebook, allow advertisers to execute campaigns where they only pay when a target-audience member clicks on a “pay-per-click” ad, advertising on the aforementioned networks/platforms can be quite cost-effective, particularly since you still get valuable, awareness-generating “impressions” for free!

Because many nonprofit organizations aren’t looking to receive compensation for their services, individuals charged with marketing and development activities may assume online advertising doesn’t make sense for them. It’s very reasonable to think that our “featured” marketing vehicle only makes sense for for-profit businesses looking to generate product and service sales. With the ideas shared below, I hope to shake up those preconceived notions and shed light on why I believe there is a role for online advertising in a nonprofit’s marketing and development toolbox.

Fundraising Application

As I’ve shared with nonprofit contacts, while the individuals who comprise their target audience may not be directly searching for the contact’s upcoming fundraising event(s), those individuals may still be searching on terms that have some relevancy to the  fundraising activity. For example, let’s say an organization holds an annual holiday high tea to support development goals. The organization would likely benefit from running search engine (“paid search”) ads targeted to women, aged 25+ and residing in relevant geographies, who are entering terms in a search engine which indicate they are trying to identify local, charitable, holiday events to attend with their girlfriends, sisters, moms, etc.

In addition to running paid search advertising to create event awareness and ticket sales among “searchers”, the organization should consider running display/image ads on a variety of social media platforms and/or search engine “display” networks, like Google AdWords Display. In lieu of presenting ads to individuals based on their “search” behavior, social media and display networks offer the option to have ads presented to individuals who have certain interests, read about certain topics, or who visit certain Web sites (“placements”).

The type of targeting selected to promote an event may be very closely or very loosely tied to its nature. For example, if an organization is selling tickets to a cooking class “fundraiser”, it would make great sense to target individuals who have an interest in or read articles about cooking, or who visit cooking Web sites. But, in the case of our high-tea fundraiser, there may not be an obvious “interest” or “topic” target to pursue, and targeting may simply consist of having ads presented to women who meet an organization’s geography requirements and who visit Web sites known to have large female readerships.

The above scenario should apply as well to causing individuals to make donations. Presenting ads to audiences whose demographics and interests make them good donation targets should serve to create awareness or reminders of your organization, and therefore, support donation-making.

Driving Non-Monetary Actions

Online advertising can also be used to cause target audiences to take important non-monetary actions. For example, display/image ads presented to appropriate individuals can cause a note-worthy percentage to click to “sign up for a weekly e-blast,” “learn more about volunteering” or “complete our survey to help us serve our constituents better.”

When putting together your marketing and communications plan for a campaign – whether its purpose be to grow funds, volunteers, e-communication sign-ups, or awareness – be sure to give ample thought to what campaign objectives might be achieved if you included online advertising as a tactic, and the opportunities that might be lost if you forego this cost-effective tactic.

Free Webinar on Mon., 11/27: What Tax Reform Will Mean for Nonprofits

The House and Senate are racing to enact comprehensive tax reform in time to place a bill on the President’s desk by Christmas. The House passed its own bill on November 16 and the Senate plans to pass its version by December 1, giving them time to work out the many differences and enact the first comprehensive reform of the tax code since 1986. The Senate will likely start deliberations on this bill as early as the Monday after  Thanksgiving.

MNN is joining with its colleague organizations across the country, including the National Council of Nonprofits, in promoting a free national webinar on Monday, November 27, 2017, from 4:00 to 5:15pm.

On the webinar, participants will hear from nationally prominent speakers who are involved in the intricate details of the tax policy proposals, are directly engaged in the policy debates, and can speak to effective advocacy strategies. They will also hear from nonprofit leaders active in the states at the grassroots level who will provide real-world examples of the impact of the proposals. Most importantly, they will get their questions answered and learn what they can do to help improve the legislation on behalf of the people nonprofits serve.

Click here to register for the webinar.

MNN Urges House Members to Vote Against Tax Cuts and Jobs Act

Today, MNN sent letters to the entire Massachusetts congressional delegation urging them to vote against the Tax Cuts and Jobs Act (H.R. 1).

“As drafted, this bill will reduce charitable giving, eliminate a long-standing law prohibiting charities from engaging in partisan politics, and will impose new taxes on the sector,” said Jim Klocke, CEO of MNN. “This bill will have a devastating impact on the Commonwealth’s nonprofit community and the people and causes they serve.”

In calling for the Massachusetts congressional delegation to oppose H.R. 1, MNN joins a growing chorus of opposition to the House bill, including the National Council of Nonprofits, Independent Sector, and the Council on Foundations.

The full text of the letter can be found here.

New MNN Report Features Fundraising Advice “From the Experts” to Aid Nonprofits

Today the Massachusetts Nonprofit Network (MNN) released the latest edition of its Commonwealth Insights report series. The report, entitled “From the Experts: Advice to Inform Your Organization’s Fundraising,” features advice from interviews with four successful Massachusetts nonprofit fundraisers in an effort to inform and support year-end fundraising efforts of nonprofit organizations.

CI-November2017-thumbnail

Click on the image to read the full report.

In an early 2017 survey of its membership, nearly 60% of MNN member nonprofits cited fundraising as the largest challenge facing their organization. With many nonprofits currently accelerating their fundraising operations to coincide with the end of the calendar year, MNN believes this report will be useful to its over 700 nonprofit members representing every region of the state, as well as members of the state’s nonprofit sector at large.

“Fundraising is an ever-present challenge-and opportunity-for all types of nonprofits. This edition of Commonwealth Insights focuses on ideas that can help nonprofits take their fundraising to new heights.” said Jim Klocke, CEO of the Massachusetts Nonprofit Network.

The report is centered on general strategies for fundraisers to consider in their efforts and is supplemented with actionable advice. In a fast-paced and changing fundraising landscape, all four experts agreed that the need to consistently engage donors and provide them with new, creative ways to be involved with a nonprofit organization is critical to building and retaining support.

The report also touches upon a concern of those working in fundraising, particularly at smaller organizations, that current events and overwhelming needs from across the country and world could further heighten the competition for donors’ support. The interviewed experts agreed that while this concern is understandable, donors of all ages are looking for even more ways to support causes they care about.

“I think that many people are looking for more ways to make a difference, and I think that is what we need right now,” says Margaret Keller, Executive Director of Community Access to the Arts in Great Barrington, MA, one of the experts featured in the report. “Donors are more engaged and more committed than ever.”

This is the third edition of Commonwealth Insights MNN has published in 2017. Earlier editions focused on federal tax reform and the Earned Income Tax Credit. The Commonwealth Insights series is made possible by support from the Barr Foundation. Past editions of Commonwealth Insights can be found at www.massnonprofitnet.org/commonwealthinsights.

Update on Federal Tax Reform – November 14, 2017

On November 9th, the House tax bill was approved on a party-line basis by the Ways and Means Committee. On the last day of the House Ways and Means Committee markup,  Chairman Brady offered a “manager’s amendment” that dramatically expanded the anti-Johnson Amendment provision. As amended, the new harmful Johnson Amendment language, Section 5201, will politicize the 501(c)(3) community by allowing charitable nonprofits, houses of worship, and foundations to engage in partisan electioneering for or against candidates, as long as doing so occurs “in the ordinary course of the organization’s regular and customary activities in carrying out its exempt purpose,” and the organization incurs no more than “de minimis” incremental expenses. The provision would be effective from 2019 through 2023, and is estimated to cost. In addition, the nonpartisan Joint Committee on Taxation (JCT) estimates that the provision would cost the federal government $2.1 billion over just six years because donors would divert their currently nondeductible political campaign donations to political churches and charitable nonprofits in order to claim charitable tax deductions. This legislation is expected to come to the House floor by Thursday with a “closed rule,” meaning that no amendments will be allowed and Representatives will only be able to vote for or against the Committee version of the bill. 

Also on November 9th, the Senate released its tax bill with the Finance Committee’s deliberation set to begin today. Similar to the House Ways and Means bill, significant changes to the bill in the Finance Committee are not likely. Committee members were informed late last week that amendments would be rejected unless they were cost neutral or contained offsetting revenue raisers, and were accompanied by a cost estimate from the Joint Committee on Taxation. Those restrictions have no dissuaded Senators from drafting more than 300 amendments. Senator Stabenow (D-MI) and Ranking Member Wyden (D-OR) have prepared an amendment for Committee consideration that would create a universal deduction that would allow all Americans who take the standard deduction to also claim a deduction of up to 60 percent of their adjusted gross income (AGI).

Other filed amendments to the Senate tax bill include one to incorporate the CHARITY Act, several to make the work and economic development tax credits permanent, and a proposal to permit charitable deductions from estates for donations to non-charitable nonprofits, including 501(c)(4) social welfare organizations, (c)(5) labor unions, and (c)(6) trade associations. Once the Committee completes its work this week, the Senate version will go to the Senate floor under an expedited procedure known as “reconciliation”. This will limit debate and permit passage by a simple majority rather than the usual 60 votes needed to overcome a filibuster. It is expected that the full Senate will vote on the bill after the Thanksgiving holiday.

With a few notable exceptions, both the House and Senate tax bills are closely aligned to the Tax Reform Framework negotiated by Republican congressional leaders and White House officials. Each bill adds to the federal deficit by $1.5 trillion over 10 years by lowering individual and corporate tax rates, and nearly doubling the standard deduction while repealing most deductions and exemptions. Neither bill includes a universal deduction. Both bills would immediately double the exemptions under the estate tax to exclude estates valued at less than $11 million for an individual and $22 million for couples; the House bill goes farther and repeals the estate tax after 2024. The drafts in the House and Senate both turn to the nonprofit community for new revenue, proposing to impose excise taxes on some nonprofit college and university endowments as well as on salaries of higher-paid employees of nonprofits.

Unlike the House version, the Senate bill does not currently include language weakening the Johnson Amendment, streamlining the private foundation excise tax, nor a provision eliminating private activity bonds upon which many nonprofits rely for capital financing. The Senate bill does include several new provisions that could be problematic for charitable nonprofits, including new unrelated business income taxes (UBIT) and rules on intermediate sanctions. Thanks to the diligent work of our colleagues at the National Council of Nonprofits, click here for a detailed and helpful comparison of the House and Senate tax bills.

MNN Testifies on Employer Health Care Assistance Contributions

On November 13, 2017, MNN’s CEO Jim Klocke testified to the Division of Unemployment Assistance (DUA) on the Employer Medical Assistance Contribution supplement (EMAC supplement) draft regulations. The testimony raised our key concerns and included three recommendations:

  • The EMAC supplement draft regulations should only apply to employees who have been employed with an employer for at least two quarters.  In essence, this would create a waiting period before the assessment is applied, recognizing that many employers have high turnover rates. It would also keep the EMAC supplement from being overly complicated to administer.
  • The employer liability for the EMAC supplement draft regulations, which is currently set at 14 days, should be extended to 8 weeks. By only applying the assessment to employees who are on MassHealth or ConnectorCare for at least 8 weeks, this will avoid employers being unfairly assessed for very short-term stays on those programs
  • Third, many employers in the nonprofit sector employ very part-time employees to run various programs, assist elderly clients, and work as non-medical home health care aids, just to name a few. Many times these employees have multiple employers and their typical weekly hours per employer can be as low as 2 to 4 hours per week. Employer liability for the EMAC supplement for these particular employment situations should be given special consideration

Click here to view the testimony and here for additional information about this new employer assessment.

At the time of this writing, DUA has scheduled four additional listening sessions in Springfield, Worcester, Lawrence, and West Barnstable. In addition, DUA will be collecting comments electronically at EMACSupplement@massmail.state.ma.us. We encourage all nonprofits who will be impacted by the new EMAC supplement to submit comments to DUA or attend one of the listening sessions. If you have questions, contact Director of Government Affairs Tonja Mettlach anytime.

Nonprofit 411: Workplace Conflict – Is It Always Just About the People?

by Janet Grogan, The Mediation GroupJanet Grogan

The times we live in seem to be exacerbating tensions in the workplace. Hostilities seem to be more overt; they are certainly often more public. Diagnosing the real nature of a conflict when it arises and ensuring that the right intervention is applied is crucial to preventing a continuing burn that could explode in the future. But this is easier said than done for a number of reasons:

  • The web of laws and regulations that govern many workplace processes can be difficult to untangle and apply to any given situation. They overlap, sometimes contradict, and often confuse.
  • Our nonprofit cultures are complex. We are proudly mission-driven, motivated by what ought to be but frustrated by what is.  We often make assumptions about shared values and feel betrayed when we learn that sometimes they are not.
  • We have limited resources and less latitude to use resources to help with things that are not direct program delivery.
  • Making any kind of change is hard. It is hard for us as individual human beings to alter behaviors and beliefs acquired over time.  It is just as hard for an organization to make changes in the way it operates.

Because finding the right solution is hard, what often happens when tensions or conflicts arise is that either it is ignored in the hope that it will resolve and go away, or, the solution applied is based on the symptoms presented rather than the underlying issue.

For example, Brian, a supervisor at a community-based organization, is upset with his employee, Mayra.  He had given her a directive NOT to do X, and she did it anyway. From his perspective, she has been blatantly insubordinate, and he issues a formal written warning. An upset Mayra files a complaint about Brian. Issuing a warning is not an illogical response to an act of insubordination – but, what was that “insubordination” about?

In an in-house meeting, a neutral probed Mayra’s understanding of the directive and her thought process that led her to do X. It turned out that, while Mayra’s thought process was different from Brian’s, it was not without its own merit, and resulted, in part from Brian’s way of communicating his directive, as well as from some confusion and overlap in their respective authority and mandate to carry out certain aspects of their department’s job. Brian realized that Mayra didn’t simply “defy” him, Mayra realized that she needed to ask more questions, and they both realized that they needed to do some work to clarify roles and responsibilities.

The organization learned a few crucial lessons about handling workplace conflict:

  • It’s not always “just” interpersonal. There are almost always ways in which the organization’s history, structure, systems and culture contribute (as in the lack of clarity around roles and responsibilities in the example).
  • Good listeners and problem solvers need to take the time to delve thoroughly into the issue, to listen to everyone involved and understand their perspectives, and to analyze the organizational contribution.
  • Once solutions are proposed, they need to be monitored to see how and if they are working – and adjusted as needed.
  • Solutions need to match the organization’s resources. If a manager would benefit from professional coaching, but the organization can’t afford it, other options must be developed to help that manager.

And, of course, there are times when a conflict really may be just about the people and should be dealt with as such. Just be sure to look beneath the surface before you decide!

***

Janet Grogan is a senior consultant with The Mediation Group. Previously the head of HR for the Massachusetts Port Authority, Janet has developed HR policy, conducted training, facilitated and implemented strategic planning and has a track record of mediating disputes and creating effective solutions for internal resolution. Contact her at jgrogan@themediationgroup.org.

MNN Statement on the House Tax Reform Bill

The following is a statement from Jim Klocke, CEO of the Massachusetts Nonprofit Network:

“The Tax Cuts and Jobs Act released yesterday by the US House of Representatives Ways and Means Committee is a step backwards in many important ways. It will harm the Commonwealth’s nonprofits and the people they serve.

Federal tax policy should continue to support the work of the nonprofit sector—and it should encourage all Americans, regardless of income, to give back to their communities.

This bill does neither. It reduces charitable giving incentives in ways that will have a severely negative effect. It introduces partisan politics into the nonprofit sector in new and dangerous ways, jeopardizing the sector’s integrity. It imposes new and unfair taxes on the nonprofit sector, undercutting its tax exempt status. And it does not include any provisions to make giving easier for the 70% today, and 95% of Americans tomorrow, who do not itemize their federal tax deductions.

For these reasons, the Massachusetts Nonprofit Network is strongly opposed to the bill in its current form. We will continue to work with our nonprofit members and organizational allies to push for solutions that enhance giving, benefit Massachusetts families, and allow nonprofits to continue to serve our communities.”

###

About the Massachusetts Nonprofit Network

MNN is the only statewide organization in the Commonwealth dedicated to uniting and strengthening the entire nonprofit sector through advocacy, public awareness, and capacity-building. MNN brings together nonprofits, funders, business leaders, and elected officials to strengthen nonprofits and raise the sector’s voice on critical issues. The network has more than 700 nonprofit member organizations and more than 100 for-profit affiliate partners. To learn more visit www.massnonprofitnet.org.

Nonprofit 411: To Build Your Fundraising Capacity, Start With a Plan

by Betsy Gonzalez, Harbor Compliance

A national study of fundraising challenges found Gonzalez head shotthat 23 percent of nonprofits, and 31 percent of nonprofits with operating budgets under $1 million, had no fundraising plan in place. Yet only 7 percent of high-performing nonprofits were without a plan.[1]

Creating a comprehensive road map for your fundraising efforts clearly pays off. And since 41 states require nonprofits to register before fundraising, and 25 states require special disclosure statements, it’s important to include state fundraising requirements in your plans. Unfortunately, the requirements are not always well understood. As Tim Delaney, president of the National Council of Nonprofits, recently noted, “Charitable solicitation laws vary widely from state to state and compliance can be confusing, costly, and time-consuming.”

The National Council of Nonprofits and Harbor Compliance created a Best Practices Partnership and published a white paper to help nonprofits understand charitable solicitation requirements. Mike Montali, CEO of Harbor Compliance, said, “The new guide and ongoing relationship with the Council of Nonprofits will make sure nonprofits nationwide have access to information that will help them advance their missions.” The white paper can be found here.

As a quick overview, let’s cover a few of the highlights.

The first step is to determine where you’re soliciting and what the requirements are in those states.

Soliciting = Asking for Donations

Soliciting means, simply, asking for donations, including traditional appeals such as mailings, fundraising events, phone solicitations, and advertising. But it also includes some activities you may not expect, such as personal requests by board members and grant applications. If you send a letter to a list of donors in ten states, you are soliciting in those states, and you may be subject to their registration requirements. In some states, the requirements only kick in after a certain dollar threshold. In others, it only counts if you actually receive donations from residents there. It is best to assume that you’re fundraising wherever your messages are reaching, and research the requirements in all of those states.

Digital Fundraising

So what does that mean in the age of digital fundraising? “Something as simple as having a ‘donate now’ link on your nonprofit’s e-newsletters that go beyond your state’s borders may equate to ‘fundraising solicitation’ that triggers a registration obligation in some states,” Tim said. Basically, if you’re fundraising on social media, through email, or through your website, you may need to meet registration requirements in all states where they apply.

To build their fundraising programs to full capacity, many nonprofits simply register nationally. Others hold back, assuming that nationwide registration must involve a lot of time and expense. In fact, state fees are small, particularly compared to the potential upside of fundraising nationally, and a compliance partner can eliminate the administrative burden. The biggest mistake you can make is to assume that nationwide registration is out of reach. Consult an expert and get hard numbers before making a decision.

Access the Complete Guide

This is just a quick overview of state charitable solicitation requirements and how they might factor into a comprehensive fundraising plan. To help nonprofits understand the requirements and maintain good standing, the National Council of Nonprofits teamed up with Harbor Compliance to publish Charitable Solicitation Compliance: an Explanation of State Charitable Registration Requirements. The guide provides valuable information you can use to design a fundraising plan that will take your nonprofit to new levels of performance.

If you have questions about fundraising compliance, get in touch and we’ll be happy to answer them.

 

About the author

Betsy Gonzalez is a copywriter and editor for Harbor Compliance, a leading provider of compliance solutions for nonprofits and businesses at all phases of development. Since 2012, we have helped more than 10,000 organizations apply for, secure, and maintain licensing and registration across all industries including other considerations such as appointing a registered agent, obtaining a certificate of authority, annual reporting, and renewals.

[1] Underdeveloped: A National Study of Challenges Facing Nonprofit Fundraising, CompassPoint and the Evelyn and Walter Haas, Jr. Fund. https://www.compasspoint.org/underdeveloped