By Hillary Evans, vice president of professional learning & public policy, Philanthropy Southwest
Reflection on Racial Justice and an Anti-Racist Movement
The series of harrowing events involving the deaths of Ahmaud Arbery, Breonna Taylor, George Floyd, and Rayshard Brooks have been a historic crossroads in confronting injustice and turning the tide for a more just and equitable future. Mass national protests have demanded the dismantling of systemic racist behaviors, policies and practices that have uprooted the fundamentals of a democracy that should value every human being. Philanthropy has been called to respond in support of racial justice advocacy and organizations on the frontlines of an anti-racist revolution. Following the murder of George Floyd, Philanthropy Southwest published a statement on June 3 speaking out against racism and offering a path forward where the Southwest grantmaking community is part of challenging inequities so that all communities can thrive.
Philanthropy Southwest will host a webinar on August 5 with philanthropic leaders from corporate, community and private foundations on leveraging resources (beyond cash) and collaborating more, particularly during this global pandemic and with the recent acts of racial injustice.
Meanwhile, the House of Representatives passed the George Floyd Justice in Policing Act on June 25, 2020, by a vote of 236-181. This legislation addresses a wide range of policies and issues regarding policing practice and law enforcement accountability. It includes measures to increase accountability for law enforcement misconduct, to enhance transparency and data collection, and to eliminate discriminatory policing practices. The Senate has yet to compromise on a police reform bill that satisfies both Republican and Democrat Senate leaders.
Senate COVID-19 Relief Package Slated for August
The Senate continues work on its fifth COVID-19 relief package expected to be released in early August before Congress goes on recess. To date, the COVID relief aid legislation has been introduced in phases, releasing nearly $3 trillion dollars of relief aid into the economy. The House passed their version of the relief package in May with the HEROES ACT, but the Senate refused to take action on it, opting instead to draft their own legislation.
On June 22, a group of Senators including James Lankford (R-OK), Chris Coons (D-DE), Mike Le (R-UT), Jeanne Shaheen (D-NH), Tim Scott (R-SC) and Amy Klobuchar (D-MN), introduced the Universal Giving Pandemic and Response Act (S. 4032). This bipartisan legislation seeks to lift the cap for charitable gift deductions from $300 to $4,000. Specifically, the bill would make available—for tax years 2019 and 2020—an above-the-line deduction for charitable giving on federal income taxes valued at up to one-third of the standard deduction (around $4,000 for an individual filer and $8,000 for married joint filers). According to research by the Independent Sector, this legislation could generate up to $17 billion in new annual giving if this provision were made permanent. The House version of the bill was introduced on June 24. Overall, this charitable deduction expansion is meant to incentivize charitable giving, especially with recent reports showing a downward trend.
Additionally last month, Senators Tim Scott (R-SC), Sherrod Brown (D-OH), Chuck Grassley (R-IA), and Ron Wyden (D-OR) introduced the Protecting Nonprofits from Catastrophic Cash Flow Strain Act (S.4001) related to unemployment insurance reimbursements for nonprofits. Nonprofits typically pay their share of unemployment taxes by reimbursing states 100 percent of unemployment costs upfront to later be reimbursed, placing another economic hardship on nonprofits already struggling. This legislation would clarify that such employers are only responsible for 50 percent of the costs upfront. These Senate bills are expected to be rolled into the broader COVID-19 relief package.
Advocacy among the charitable sector has included recommendations to Senate leaders asking for expansion of the universal charitable deduction, direct funding to nonprofits, and access to credit to nonprofits, particularly smaller nonprofits led by and serving communities of color. Additionally, Philanthropy Southwest joined several other organizations in Comments to the Federal Reserve, submitted by United Philanthropy Forum last month, on the proposal to expand its Main Street Lending Program to provide access to credit for nonprofit organizations. The Main street Lending Program was established via the CARES Act.
There have also been some advocacy efforts urging Congress to include a 10% mandatory payout for private foundations and impose new requirements on donor advised funds (DAFs). Philanthropy Southwest has been closely monitoring these developments and would oppose any mandatory payout requirement and impositions on DAFs. It does not appear, according our coalition network, that any such mandatory payout or new DAF requirements would be included in the anticipated Senate COVID-19 relief package. A group of national philanthropy serving organizations sent a letter to Capitol Hill earlier this month opposing these proposals. PSW will continue to track efforts.