June 19, 2020
Note: The North Carolina Center for Nonprofits typically provides Nonprofit Policy Matters each week as a benefit to its nonprofit members . However, to help all North Carolina nonprofits respond to the COVID-19 crisis, we're temporarily providing this newsletter to non-member nonprofits.
In this issue...
NC Senate includes nonprofits in proposed new COVID-19 grant program
NC Senate approves bill that would limit nonprofits’ liability for COVID-19 claims
Take action: Let Federal Reserve know nonprofits need improvements to lending program
Census tip of the week: Celebrate Juneteenth with a My Black Counts action
SBA releases new PPP loan forgiveness applications as nonprofits seek greater clarity
Take 12 minutes to let funders and state government know your nonprofit needs
NC Senate approves using more CARES Act funding to reduce state budget shortfall  
NC Senate approves bill to delay Medicaid transformation and fund other DHHS priorities
U.S. House bill would improve UI process for self-insured nonprofits
Governor signs 2020 absentee voting changes into law 
Let us know: Is your nonprofit facing county or city funding cuts?
OMB provides more flexibility for nonprofits with federal grants and contracts
Center offers re-engagement guide for nonprofits
NC Senate Includes Nonprofits in Proposed New COVID-19 Grant Program
On Wednesday, the NC Senate Appropriations Committee amended a bill ( S.848) to enable nonprofits to be eligible for a proposed new state COVID-19 grant program. The program would provide $50 million in grant funds for businesses or nonprofits that maintained at least 90% of their employees from March 1, 2020 through May 31, 2020 if they have not received financial assistance through the Paycheck Protection Program (PPP) or the Main Street Lending Program.

The Center worked with the bill sponsors and other state senators to revise the bill to make nonprofits eligible for these grants. Including nonprofits in this grant program is consistent with one of the six requests in last month’s letter to state legislators from 460 nonprofit organizations: “ Include nonprofits in small business relief. Like small businesses, many nonprofits need immediate financial support to continue to operate and provide services. As the General Assembly develops or expands loan programs, grants, or other measures to help small businesses, it is essential that nonprofits have full access to these programs.” Thanks to Senator Mike Woodard (D-Durham) and Senator Paul Newton (R-Cabarrus) for taking the lead in adding nonprofits to this program.

The full Senate is expected to vote on the bill later today, and the House will likely take it up next week.
NC Senate Approves Bill That Would Limit Nonprofits’ Liability for COVID-19 Claims
Yesterday, the NC Senate approved a bill ( H.B. 118) that would provide immunity for nonprofits, businesses, and individuals from liability for alleged transmission of COVID-19. By extending the immunity to individuals, nonprofit board members and volunteers also would be protected from liability under this legislation. The limited immunity would not apply if alleged contraction of COVID-19 were due to the gross negligence, willful or wanton conduct, or intentional wrongdoing of the nonprofit, business, or individual. The bill, which was released in a committee on Tuesday, would not limit the ability of workers to file workers’ compensation claims if they contracted COVID-19 in the course of their employment. The limitation on liability would be applicable for claims up to 180 days after the end of the COVID-19 state of emergency in North Carolina ( Executive Order No. 116).

The bill also would require nonprofits, businesses, and governmental agencies to provide reasonable notice to people entering their facilities of actions they are taking to reduce the risk of COVID-19 transmission. Many nonprofits are already doing this by posting signs about their policies for social distancing, mask wearing, and sanitizing. Thanks to Senator Paul Newton (R-Cabarrus) for including nonprofits in this bill.
Take Action: Let the Federal Reserve Know Nonprofits Need Improvements to Lending Program
On Monday, the Federal Reserve announced its plan to expand the Main Street Lending Program to provide access to credit for nonprofit organizations. These loans – which are not forgivable – would be available to 501(c)(3) nonprofits with between 50 and 15,000 employees if: (a) their endowments are less than $3 billion; and (b) less than 30% of their total 2019 revenue came from donations. Eligible nonprofits could take loans in the amount of $250,000 to $300 million with interest rates of 4% or lower. The National Council of Nonprofits and Independent Sector released a statement explaining that the new program is appreciated but not enough relief for nonprofits since these arbitrary terms will disqualify many nonprofits and because the loans are not forgivable. 

The Federal Reserve is accepting public comments on this proposal until Monday, June 22. Please help improve the Federal Reserve’s loan program for nonprofits by using this template language to develop and send comments. You can use the Federal Reserve’s online form to submit your comments, which must be limited to 15,000 characters. Once you’ve you sent in your comments, please share them with us to help us advocate for you and all nonprofits in North Carolina.
Census Tip of the Week: Celebrate Juneteenth with a My Black Counts Action
A complete and accurate count in the 2020 U.S. Census is important for nonprofits since it will help ensure that North Carolina has full representation in Congress and access to federal funding that supports the work of many nonprofits. Because nonprofits are trusted messengers that often serve hard-to-count communities, it is important for all nonprofit organizations to spread the word about the importance of completing the 2020 Census. Nonprofit’s engagement in Census outreach is particularly critical since North Carolina continues to lag behind other states in our Census response rate. As of Wednesday, North Carolina’s response rate was 57.8%, well below the national average of 61.5% (see the U.S. Census Bureau’s map of response rates for more details).
Census Tip of the Week
This week is My Black Counts Week of Action. Your nonprofit can celebrate Juneteenth by taking action to raise awareness of the Census in Black communities in North Carolina today. The NC Counts Coalition has prepared a My Black Counts toolkit with events and easy ways to take action on social media today.
SBA Releases New PPP Loan Forgiveness Applications as Nonprofits Seek Greater Clarity
On Wednesday, the U.S. Small Business Administration (SBA) and the U.S. Treasury Department announced a pair of revised application forms for loan forgiveness under the Paycheck Protection Program (PPP). The SBA has updated the full loan forgiveness application to incorporate the changes from the recently-enacted PPP Flexibility Act. The SBA also published a new EZ version of the forgiveness application that applies to borrowers that:
  1. Did not reduce the salaries or wages of their employees by more than 25%, and did not reduce the number or hours of their employees; or
  2. Experienced reductions in business activity as a result of health directives related to COVID-19, and did not reduce the salaries or wages of their employees by more than 25%. The EZ application requires fewer calculations and less documentation for eligible borrowers. 

Both applications give borrowers the option of using the original eight-week covered period (if their loan was made before June 5, 2020) or an extended 24-week covered period, which is allowed under the PPP Flexibility Act.

As many nonprofits are ready to seek forgiveness of their PPP loans, the guidance from the SBA and Treasury Department leaves many unanswered questions. On Wednesday, a coalition of 19 national nonprofits sent an urgent request from the nonprofit community for guidance on the Paycheck Protection Program asking that the SBA and Treasury Department “provide the guidance, answers, and actions that will enable nonprofits to continue helping the millions of people, as well as state and local governments, who rely on us daily.” The letter includes a series of eight question areas that reflect concerns and uncertainty raised by nonprofits in various subsectors.
Take 12 Minutes to Let Funders and State Government Know Your Nonprofit Needs
Last month, the Center and our state government partners launched a new survey on the impact of COVID-19 on North Carolina nonprofits. More than 1,300 nonprofits have already completed the survey, and we're hoping to have thousands more organizations reply in the coming days and weeks. Please take 12 minutes to complete the survey, which asks about your organization's operations and needs during the COVID-19 crisis and in the coming months. Your response to the survey will inform government, philanthropy, and others about what COVID-19 related needs are most pressing in North Carolina. To maximize the benefits and value of this survey, responses will be publicly available.

The survey, which is available in both English and Spanish, is a joint effort of the Center, the Office of the NC Secretary of State, and the Strategic Partnerships office at the NC Office of State Budget and Management. The Center encourages nonprofits to complete the survey even if you responded to our original COVID-19 survey in March. Thank you if your organization has already completed the survey!
NC Senate Approves Using More CARES Act Funding to Reduce State Budget Shortfall
This week, the NC Senate unanimously approved a bill ( S.805) that would allow North Carolina to use $645.4 million of the state’s CARES Act funding to fund certain parts of state government operations during the FY2020-21. This could help cover some of the estimated $4.2 billion revenue shortfall for the upcoming fiscal year, which begins on July 1, 2020. A smaller revenue shortfall is good news (or at least less bad news) for nonprofits; during past recessions, state legislators have made steep cuts to nonprofit funding to help fill budget shortfalls.

Even if the General Assembly passes S.805, North Carolina will still have more than $1 billion in unspent CARES Act funding. Some nonprofits have identified immediate needs – such as emergency child care assistance – that could be alleviated with a portion of this funding. If the federal government provides state and local governments more flexibility, some of the remaining CARES Act money could also be used to reduce the state’s budget hole for next year.
NC Senate Approves Bill to Delay Medicaid Transformation and Fund Other DHHS Priorities
On Wednesday, the NC Senate gave final approval to a bill ( S.808) that would delay Medicaid transformation – the state's planned transition of Medicaid to a managed care network – until July 1, 2021. Last fall, the NC Department of Health and Human Services (DHHS) indefinitely suspended its Medicaid transformation plans after the General Assembly and Governor Cooper were unable to agree on a state budget that included necessary funding for this transition. The bill also would:
  • Provide funding for Medicaid transformation;
  • Provide preliminary funding for moving DHHS’s headquarters from Dorothea Dix Park to another location in Wake County;
  • Appropriate $50 million from CARES Act funding for behavioral health and crisis services related to the COVID-19 pandemic; and
  • Appropriate funds for the child welfare case management component of DHHS’s NC FAST system.
U.S. House Bill Would Improve UI Process for Self-Insured Nonprofits
A new U.S. House of Representatives bill ( H.R. 7066) would partially fix the unemployment payments challenge for reimbursing nonprofits. Specifically, the bill clarifies that self-insured nonprofits do not have to pay 100% of their unemployment bill upfront and wait for repayment from the state. This would fix problematic guidance from the U.S. Department of Labor requiring nonprofits to fully reimburse states for the costs of their COVID-19 related UI claims and then seek reimbursement of their reimbursement.
Governor Signs 2020 Absentee Voting Changes into Law
Last Friday, Governor Roy Cooper signed into law a bill ( H.B. 1169) that makes several changes to North Carolina’s absentee voting process to make it easier for North Carolinians to vote by mail in 2020. These changes include:
  1. Allowing North Carolinians to request absentee ballots online rather than by mail;
  2. Simplifying the requirements to request an absentee ballot this year by only requiring one witness (current law requires most North Carolinians to have either two witnesses or a notary attest to their signature when submitting an absentee ballot request).
  3. Providing state matching funds to ensure that North Carolina has access to federal election funding; and
  4. Requiring the NC State Board of Elections to investigate any internet protocol or virtual private network from which more than 10 absentee ballots are requested. This requirement could lead to the investigation of some nonprofits that provide computer access to clients or residents.

Prior to the enactment of these changes, North Carolina’s absentee ballot requirements, which were stricter than most other states, made it challenging for many North Carolinians – particularly homebound seniors and individuals with disabilities – to request absentee ballots. The Center supports the absentee ballot provisions in the bill, since these changes would help many North Carolinians who receive nonprofits’ services vote by mail this fall if COVID-19 remains a problem.
Let Us Know: Is Your Nonprofit Facing County or City Funding Cuts?
North Carolina’s local government leaders are in the process of planning their budgets for the upcoming year. Most counties, cities, and towns are facing significant funding shortfalls and could look to fill their budget gaps by cutting or eliminating nonprofit grants or imposing new taxes, fees, or payments in lieu of taxes (PILOTs) on charitable nonprofits.

Let us know if your nonprofit is facing funding cuts from your local governments. Also, let us know if your county, city, or town is proposing any new taxes, fees, or PILOTs on local nonprofits. As the Center learns about budget proposals in different parts of the state that could be harmful to nonprofits, we are available to help local organizations advocate for preservation of their government funding or in opposition to unreasonable new taxes, fees, or PILOTs. Thank you if you have already replied!
OMB Provides More Flexibility for Nonprofits with Federal Grants and Contracts
Yesterday, the federal Office of Management and Budget (OMB) issued a new Memo that provides administrative relief for federal grantees directly impacted by COVID-19. For nonprofits with federal grants and contracts, the new Memo extends flexibility on salaries and other project activities through September 30 and extends flexibility on Single Audit submissions through December 31.
Center Offers Re-Engagement Guide for Nonprofits
In the past few months, nonprofits have successfully adapted to the challenges of serving our missions in the face of a pandemic. Now, as North Carolina reopens and nonprofit staff begin to return to offices and reopen facilities, the Center has pulled together recommendations and considerations to help organizations plan and prepare. Going Forward: Best Practices and Considerations for Nonprofit Re-Engagement offers guidance on everything from operations, human resources and board governance to communications, donor relationships and events.
Nonprofit Policy Matters is a service for current Members of the North Carolina Center for Nonprofits. We track state and federal policy issues that affect all 501(c)(3) nonprofits. Learn about the Center's public policy priorities . For more information, contact David Heinen , Vice President for Public Policy and Advocacy.

Your Center membership allows each staff member, board member, and key volunteer in your organization to set up their own online account to access member resources, benefits and services. Encourage everyone to create an account .