May 8, 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...
Take 1 minute today to help NC nonprofits get more COVID-19 relief
Governor Cooper signs COVID-19 response legislation into law
State COVID-19 bill covers self-insured nonprofits’ unemployment costs
Senators Burr and Tillis ask Senate leadership for more relief for nonprofits
ICANN rejects transfer of .org registry 
North Carolina begins easing COVID-19 restrictions
Reminder: IRS has extended filing date for 990s through July 15
New resource provides pro bono assistance to nonprofits on COVID-19 issues
Census tip of the week: There are three ways to self-respond to the Census 
It’s not too early to become a National Voter Registration Day partner
Take 1 Minute Today to Help NC Nonprofits Get More COVID-19 Relief
The Center is working to ensure that state lawmakers listen to the voices of nonprofit leaders and include provisions to address the nonprofit sector's needs in the second round of COVID-19 recovery legislation expected later this month. 

You can help right now by joining more than 400 other nonprofits in adding your signature to the North Carolina Nonprofit Letter to State Legislators, which spells out six concrete steps state legislators can take to help charitable organizations and the communities they serve:

  1. Protect Self-Insured Nonprofits from Unemployment Liability. Many 501(c)(3) nonprofits elect to reimburse the state for the cost of their employees’ unemployment claims rather than pay state unemployment tax. The CARES Act provides funding to cover half of the costs of these nonprofits’ COVID-19 related unemployment claims, but still leaves these organizations with significant financial liability. Without assistance in covering the costs of these unemployment claims, many nonprofits that provide health care, food assistance, affordable housing, childcare, and other critical services will have to end or curtail services later this year. State legislators can prevent further economic harm to these nonprofits either by covering the other half of the costs of their COVID-19 related unemployment claims or by giving them more time to reimburse the state. 
  2. Exempt Charitable Nonprofits from Paying Sales Tax in 2020. The COVID-19 crisis has forced many nonprofits to exhaust their financial reserves. A temporary provision allowing for point-of-sale exemption from sales tax would help improve nonprofits’ immediate cash flow. 
  3. 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. 
  4. Bolster Charitable Giving Incentives. The CARES Act created a temporary above-the-line charitable deduction for 2020, capped at $300. While nonprofits appreciate this measure, the $300 cap is unlikely to generate nearly enough new or increased donations to help nonprofits weather this crisis. A temporary non-itemizer state tax credit for charitable contributions would help increase private giving this year.
  5. Facilitate Remote Meetings of Nonprofit Boards. Some nonprofits are unable to conduct board meetings remotely and therefore are unable to take essential actions to ensure that their organizations can continue to provide programs and services. Legislators can solve this problem by temporarily amending the NC Nonprofit Corporation Act to allow all nonprofit boards to take action by email by unanimous written consent and to conduct meetings by remote communications such as conference calls. 
  6. Seek Input from Nonprofits. Charitable nonprofits work directly with a wide range of people in all 100 counties of the state. As legislators consider additional state policy changes and funding to address the COVID-19 crisis, it is essential that they consult with nonprofits to fully understand the current needs of communities throughout North Carolina.

Please take one minute to sign on to the North Carolina Nonprofit Letter to State Legislators to show your organization's support for this additional relief for nonprofits. We will list each nonprofit’s name and county (but not contact information) on the letter. Thank you if your organization has already signed on to the letter!
Governor Cooper Signs COVID-19 Response Legislation into Law
On Monday, Governor Roy Cooper signed into law two COVID-19 response bills that unanimously passed the NC Senate and NC House of Representatives last Saturday. One bill ( H.B. 1043) appropriates $1.5 billion in funding for immediate state needs related to the COVID-19 crisis. The other bill ( S.704) makes a variety of policy changes to help North Carolina respond to and recover from the pandemic. Many provisions in this COVID-19 legislation are important to nonprofits, including:

  • Appropriations. The CARES Act provided about $3.5 billion in federal funding to help North Carolina respond to the COVID-19 crisis in 2020. The COVID-19 relief legislation appropriates about $1.5 billion of this funding. Legislators are holding off on spending the remainder of the federal funding immediately in hope that Congress will provide states flexibility to use some of the CARES Act money to make up for revenue shortfalls in the FY2020-21 budget.

  • Unemployment Relief. The recovery bills codify (and provide more details for) various COVID-19 unemployment insurance (UI) law changes that Governor Roy Cooper made through executive orders.

  • Regulatory Flexibility. The bills provide regulatory flexibility for state agencies during the COVID-19 crisis, allowing them to extend filing deadlines and waive late filing fees, penalties, and interest. Notably for nonprofits, this will enable the Secretary of State to extend charitable solicitation licensing deadlines beyond the typical 60-day automatic extension period.

  • Health Care Assistance. Among other health provisions, the bills increase access to medical supplies needed for COVID-19 prevention and treatment and provide funding for nonprofit hospitals, food banks, community health centers, and free and charitable clinics.

  • Small Business Loans. The bills appropriate $125 million to the Golden LEAF Foundation to expand the COVID-19 small business bridge loan program. Nonprofits are not eligible for these loans.

  • Immunity for Essential Businesses. The bills provide limited immunity for essential businesses for COVID-19 related illness or death of customers or employees incurred during the provision of products or services.

For more details on nonprofit provisions in the state COVID-19 recovery bills, see the Center’s summary of the legislation.
State COVID-19 Bill Covers Self-Insured Nonprofits’ Unemployment Costs
One of the provisions in the COVID-19 Response Act ( S.704) would ensure that unemployment insurance (UI) related to COVID-19 would not be charged to the UI accounts of recipients’ “base period employers.” This provision codifies language from Executive Order No. 118, which Governor Roy Cooper issued in March. Based on the Center’s analysis of the provision and conversations with state officials, this means that self-insured nonprofits in North Carolina will not be liable for the cost of UI claims by employees that they have had to lay off or furlough due to COVID-19. 

This provision could help prevent thousands of North Carolina nonprofits from incurring significant new costs stemming from their unexpected, unavoidable, and unwanted decision to lay off or furlough staff due to COVID-19. Since the beginning of the COVID-19 crisis, the Center has been advocating for the federal and/or state government to hold harmless these self-insured nonprofits for these UI costs.  

Last week, the Center posted an analysis of the recent DOL guidance on the implementation of a provision in the CARES Act that provides federal funding to cover half of the cost of self-insured nonprofits’ COVID-19 related UI claims. We remain concerned that this DOL guidance may require the state to take further action to avoid unintended expenses for self-insured nonprofits and the state Unemployment Insurance Trust Fund. The Center will continue to advocate for all necessary federal and state policy changes.
Senators Burr and Tillis Ask Senate Leadership for More Relief for Nonprofits
Yesterday, 30 U.S. Senators, including Senator Richard Burr (R-NC) and Senator Thom Tillis (R-NC), sent a letter to Senate leadership urging them to make three improvements to the CARES Act to provide relief for nonprofits:

  1. Expand Access to Credit. Helping nonprofits get more immediate financial assistance by expanding nonprofit eligibility for the Paycheck Protection Program (PPP) and prioritizing nonprofit applications for PPP loans.
  2. Protect Self-Insured Nonprofits. Holding harmless self-insured nonprofits by providing funding to cover 100% of the costs of these organizations’ unemployment claims.
  3. Bolster Charitable Giving Incentives. Strengthening the temporary above-the-line charitable deduction from the CARES Act by allowing taxpayers to use it on their 2019 taxes and significantly increasing the $300 cap.

Last week, 144 members of the U.S. House of Representative sent a similar letter to House leadership asking them for additional COVID-19 relief for nonprofits in the next federal stimulus bill. Congresswoman Alma Adams (D-NC), Congressman G.K. Butterfield (D-NC), and Congressman David Price (D-NC) were a part of the House letter. If these requests seem familiar, it’s because they are the same points that were raised in a recent letter from 461 North Carolina nonprofits (quite possibly including your own organization!) to our congressional delegation.
ICANN Rejects Transfer of .org Registry
Last week, the Internet Corporation for Assigned Names and Numbers (ICANN) rejected the transfer of the .org registry to Ethos Capital, a newly-formed for-profit company. Advocacy from many nonprofits and government officials was critical in ICANN’s decision, which will help protect the .org registry from being taken over by a private equity firm that could have significantly increased the cost of nonprofits’ web domain names.
North Carolina Begins Easing COVID-19 Restrictions
On Tuesday, Governor Cooper issued Executive Order No. 138, which eases some of the restrictions from North Carolina’s “stay at home” order and begins the first phase of re-opening the state’s economy. While the “stay at home” order remains in place, most retail businesses can open at 50% of capacity with social distancing measures in place, starting at 5 p.m. today. The order includes a few notable provisions for nonprofits:

  • Organizations with retail operations, including thrift stores, can begin to re-open these facilities. 
  • Childcare providers can provide services to any working families, not just to families of essential workers.
  • State parks and trails are encouraged to re-open, which could enable some nonprofits with programs and services based in parks to resume these activities.
  • Some nonprofits’ facilities, including performance venues, athletic facilities, and swimming pools, must remain closed.

To learn more about the changes in the “stay at home” order, you can check out Governor Cooper’s FAQs and the interim guidance from the NC Department of Health and Human Services.
Reminder: IRS Has Extended Filing Date for 990s through July 15
Last month, the IRS extended until July 15, 2020 the filing deadline for Form 990, Form 990-T, and other nonprofit tax returns and information returns typically due on May 15, 2020. The IRS took this action through a combination of a new notice related to COVID-19 and previous IRS guidance for extension of filing deadlines during federally-declared disasters. Many nonprofits with May 15 filing deadlines for their 990s already were planning to file for automatic extensions.
New Resource Provides Pro Bono Assistance to Nonprofits on COVID-19 Issues
The North Carolina Pro Bono Resource Center has launched a new remote clinic designed to help small businesses and nonprofits navigate the legal issues they are experiencing due to COVID-19. The program is available to nonprofits affected by the COVID-19 crisis that have 25 or fewer employees. 

The program offers pro bono assistance with a variety of COVID-19 related legal issues including: 
  • Federal funding opportunities under the CARES ACT including the Payroll Protection Program (PPP) and Economic Injury Disaster Loans (EIDL) program;
  • Commercial lease issues (NC eviction moratoriums, lease amendments, landlord issues);
  • Employment law issues (paid family and medical leave, unemployment, and furloughs);
  • Insurance questions; and 
  • Bankruptcy and dissolution.

Your nonprofit can schedule an appointment with an attorney by filling out a client screening form online.
Census Tip of the Week: There are Three Ways to Self-Respond to the Census
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 Tuesday, North Carolina’s response rate was 53.1%, well below the national average of 57.3% (see the U.S. Census Bureau’s map of response rates for more details).
Census Tip of the Week
Now is a great time for nonprofits to remind the people they serve that there are three ways for households to self-respond to the 2020 Census:

  • Online: The 2020 Census is the first time that households can complete the census online using any type of internet-connected device such as a smart phone, laptop, or tablet. You can complete the Census questionnaire online today.  
  • By Phone: You can complete the questionnaire by phone. The U.S. Census Bureau has a list of phone numbers for completing the questionnaire in a variety of languages.
  • By Mail: Households that haven’t yet completed the questionnaire online or by phone should have received a paper Census form. 

Census enumerators will be visiting households that have not self-responded by this summer.
It’s Not Too Early to Become a National Voter Registration Day Partner
This week, National Voter Registration Day (September 22) launched its partner sign-on for 2020. National Voter Registration Day is a great opportunity for nonprofits to ensure that their staff, volunteers, and community members are registered to vote. Sign up today to join the nationwide effort to register hundreds of thousands of voters on September 22. As an official partner, your nonprofit will receive a free voter registration kit and access to other opportunities to support your nonpartisan voter registration work.
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 .