March 12, 2021
Note: The North Carolina Center for Nonprofits typically provides Nonprofit Policy Update each week as a benefit to its nonprofit members. However, to help all North Carolina nonprofits respond to the COVID-19 pandemic, we're temporarily providing this newsletter to non-member nonprofits.
In this issue...
American Rescue Plan Act provides significant relief to nonprofits and communities
New bills in Congress would improve tax incentives for charitable giving
Register for policy briefings for latest on legislation affecting nonprofits
Congress and nonprofits seek extension and improvements to PPP loan application process
New U.S. Senate bill would provide $50 billion in grants for new nonprofit jobs
Take action: Help eligible community members get vaccinated
NC Senate unanimously approves bill that would prevent UI cost increases for nonprofits
New NC Senate bill would allow employers to offer exclusive provider benefit plans
NC House bill would increase state tax benefits for charitable contributions in 2021
Free webinar on transition to Medicaid managed care
Remind your community: Don’t miss out on federal stimulus payments
Federal executive order would begin to improve access to voting
American Rescue Plan Act Provides Significant Relief to Nonprofits and Communities
Yesterday, President Joe Biden signed the American Rescue Plan Act of 2021 (H.R. 1319) into law. The U.S. Senate passed the $1.9 trillion COVID relief package last Saturday, and the U.S. House of Representatives gave it final approval on Wednesday. Some highlights of the American Rescue Plan Act for nonprofits include:
  • Improvements to the Paycheck Protection Program (PPP) Loan Programs. The American Rescue Plan Act allows many larger nonprofits to apply for PPP loans for the first time by extending eligibility to nonprofits with more than 500 employees that operate at multiple locations as long as no more than 500 employees work at any one location. It also allows performing arts nonprofits to apply for both the Shuttered Venue Operators Grant (SVOG) and the PPP with limits on the total amounts they can receive from the two programs.
  • Extension and Improvement of Federal Unemployment Coverage. The COVID relief package extends various federal benefits for unemployed workers – including coverage for self-employed workers and staff of religious and very small nonprofits and $300 per week supplemental federal payments – through September 6, 2021. These benefits had been scheduled to expire on March 14. Notably for nonprofits, the federal government will cover 75% of the unemployment costs of reimbursing nonprofits from April 1 through September 6; currently, the federal government is only covering 50% of these costs, and the state of North Carolina is covering the other 50%. 
  • Tax Relief for Individuals and Employers. The American Rescue Plan Act provides $1,400 stimulus checks for most taxpayers. It also helps working families by increasing the child tax credit and earned income tax credit. The new law extends the tax credit for nonprofits and other employers that offer paid sick leave and paid family and medical leave through September 30, 2021 (it was set to expire on March 31).
  • Increased Federal Funding for Various Programs Important to the Work of Nonprofits. The American Rescue Plan Act provides additional funding for child care providers, the Corporation for National and Community Service, arts and humanities organizations, food assistance, housing and homelessness prevention, and nonprofits providing services to survivors of domestic violence and sexual assault.
  • $340 Billion in Additional Funding for State and Local Governments. This support could help ease financial pressures on cities and counties throughout North Carolina and provide additional support to state legislators to invest in nonprofits providing COVID relief. 
  • Funding for COVID-19 Vaccines, Treatment, and Testing As Well As Other Public Health Programs. The added investment in these public health measures should significantly reduce the spread of COVID-19.

Many of these important provisions are included in the American Rescue Plan Act because of the persistent advocacy of nonprofits. To learn more about the ways the American Rescue Plan Act will help nonprofits and the communities they serve – and additional relief that nonprofit organizations are seeking from Congress and state legislators – join the Center for a nonprofit policy briefing next Monday, March 15 at 11 a.m. Register today.
New Bills in Congress Would Improve Tax Incentives for Charitable Giving
On Tuesday, a bipartisan group of members of Congress introduced the Universal Giving Pandemic Response and Recovery Act in the U.S. Senate (S.618) and U.S. House of Representatives (H.R. 1704). Under current law, taxpayers who use the standard deduction are eligible for the universal charitable deduction, which applies to the first $300 in cash donations for individual taxpayers and the first $600 for married couples filing jointly for 2021 (last year, the deduction was capped at $300 for both individual taxpayers and for married couples filing jointly). The Universal Giving Pandemic Response and Recovery Act would expand and extend the current deduction for charitable giving by allowing taxpayers who use the standard deduction to also take a deduction for their charitable giving up to one-third of the standard deduction level (around $4,000 for individuals and $8,000 for married couples filing jointly) in 2021 and 2022. It is possible that Congress could take up the bill on its own or include it in a larger piece of tax legislation later this year.

The Center strongly supports the Universal Giving Pandemic Response and Relief Act, and we are encouraging North Carolina’s members of Congress to support it. We are also asking state legislators to consider establishing a state tax credit for charitable donations by non-itemizers to encourage all North Carolinians to give generously to support the work of nonprofits. We will let you know when it is the right time to take action to support either federal or state legislation to enhance incentives for charitable giving.
Register for Policy Briefings for Latest on Legislation Affecting Nonprofits
To help your nonprofit’s staff and board better understand how recent and upcoming public policy changes may affect your organization’s operations, the Center is offering two online nonprofit policy briefings in the next couple of weeks. The first policy briefing on Monday, March 15 from 11:00 a.m.-12:00 p.m. will provide an overview of the latest federal and state COVID-19 relief plans and the potential policy solutions that could help nonprofits during the 2021 NC legislative session. The second policy briefing on Friday, March 26 (note the change in date) from 9:30-11:00 a.m. will feature a bipartisan panel of state legislators sharing insights on state policy priorities in 2021, the budget process, and how nonprofits can effectively engage with elected officials as the pandemic continues. Register for one or both of these policy briefings.
Congress and Nonprofits Seek Extension and Improvements to PPP Loan Application Process
The deadline for nonprofits and businesses to apply for PPP loans is currently set for March 31. Yesterday, a bipartisan group of members of the U.S. House of Representatives introduced a bill to extend this deadline through May 31 and to allow the Small Business Administration (SBA) to continue to process loan applications through June 30. Also yesterday, the National Council of Nonprofits and several other national organizations sent a letter to the SBA seeking help in fixing several challenges that nonprofits have faced in the PPP loan application process.
New U.S. Senate Bill Would Provide $50 Billion in Grants for New Nonprofit Jobs
Yesterday, Senator Amy Klobuchar (D-MN) introduced the WORK NOW Act, which would provide $50 billion in grants to charitable nonprofits to expand staff and hire unemployed individuals. This bill is welcome news in light of the challenges nonprofits have faced with increased demand for services and loss of employees and volunteers over the past year. A recent report from the Center for Civil Society Studies at Johns Hopkins University found that nonprofit employment has declined by 7.7% since February 2020 and estimates that it will take nearly two years for nonprofit employment to return to pre-pandemic levels.
Take Action: Help Eligible Community Members Get Vaccinated
Nonprofits are trusted messengers, and many North Carolinians are more likely to take important public health actions if the message comes from a familiar nonprofit organization rather than a government official. Your nonprofit can make a big difference in fighting the COVID-19 pandemic by sharing information about the availability, safety, and importance of vaccines and about the continuing importance of wearing masks and social distancing when in public. 

Yesterday, Governor Roy Cooper announced that North Carolinians with high-risk medical conditions (includes a list of the many eligible conditions) can begin receiving vaccinations next Wednesday, March 17. Vaccinations will also be available next Wednesday for individuals living in group settings, including people experiencing homelessness and people living in correctional facilities. As of last week, frontline essential workers – including social workers, public health workers, clergy, homeless shelter staff, veterinarians, college and university instructors and support staff, and workers in stores that sell groceries and medicine – are eligible to receive vaccines. North Carolina is also currently vaccinating educators, school personnel, child care workers, health care workers, long-term care staff and residents, and people 65 and older.

Here are four things your nonprofit can do to help ensure that people you serve get vaccinated once they are eligible:
  • Share the NC Department of Health and Human Services’ (DHHS’s) online Find My Group tool to help North Carolinians know when they will be eligible to get their vaccine. 
  • Share the DHHS Find My Spot search tool to help North Carolinians locate vaccine providers near where they live and work. 
  • Help the people you serve and others in your community get appointments for vaccinations. Many North Carolinians are struggling with the technology required to get an appointment to receive a vaccine. Nonprofit staff and volunteers can help people navigate the online appointment systems to ensure that technology is not a barrier to vaccinations.
  • Share highlights of the new Centers for Disease Control and Prevention (CDC) guidelines for fully vaccinated individuals as incentive for people to get a vaccine when they are eligible. Notably, the CDC recommends that it is safe for fully vaccinated people to get together with other fully vaccinated people indoors without masks or social distancing.
NC Senate Unanimously Approves Bill that Would Prevent UI Cost Increases for Nonprofits
On Wednesday, the NC Senate unanimously approved a bill (S.114) that would prevent increases in unemployment insurance (UI) costs for virtually all North Carolina nonprofits this year. Two parts of the bill are particularly noteworthy for nonprofits:
  1. It would keep the base rate for state unemployment tax (SUTA) at 1.9% for 2021. Without this change, the tax rate would increase to 2.4% this year. Businesses and many nonprofits pay SUTA quarterly. Their tax rate is a combination of the base rate and their experience rating, which is based on the history of UI claims by their employees.
  2. It would extend the period when employers’ accounts will not be charged for COVID-related UI claims through December 31, 2021 (or the expiration of Governor Roy Cooper’s emergency declaration, if that occurs before the end of this year). This non-charging period expired on December 31, 2020. This provision is significant for nonprofits that elect to reimburse the state for UI claims rather than pay SUTA since it means they are not liable for the 50% of the cost of these claims that is not covered by federal payments. For reimbursing nonprofits that have laid off or furloughed staff, this provision is a significant costs savings. Since the start of the pandemic, the Center has successfully advocated that it is essential that state policymakers hold harmless reimbursing nonprofits for their COVID-related UI claims, and this bill would continue this important policy into 2021.

The NC House of Representatives could take up the bill as soon as next week.
New NC Senate Bill Would Allow Employers to Offer Exclusive Provider Benefit Plans
A new bill (S.228) introduced in the NC Senate on Wednesday would allow many North Carolina employers to offer exclusive provider benefit (EPO benefit) plans for their employees. EPO benefit plans are typically less expensive than other health insurance plans and allow participants to use a limited network of local health care providers while paying the full cost for any out-of-network health services other than emergency care. The Center regularly hears from nonprofits seeking ways to provide more affordable health coverage for their employees. The Center is continuing to research whether this legislation would provide a meaningful and affordable health coverage option for some nonprofits.
NC House Bill Would Increase State Tax Benefits for Charitable Contributions in 2021
A bill (H.B. 279) filed in the NC House of Representatives yesterday would make a variety of changes to state tax laws. Most notably for nonprofits, the proposal would allow North Carolinians who use the universal charitable deduction – and those who itemize their deductions and contribute more than 60% of their adjusted gross income to charitable nonprofits – to get the full benefit of these tax deductions on their state taxes in 2021. Last year, North Carolina “decoupled” from these two federal tax incentives for charitable giving, meaning that North Carolinians who gave generously didn’t get breaks on their state tax liability.
Free Webinar on Transition to Medicaid Managed Care
Starting on July 1, 2021, more than 1 million North Carolinians on NC Medicaid and NC Health Choice will begin having their coverage managed by one of five private health insurance plans. With enrollment in Medicaid managed care starting soon, it is important for nonprofit service providers to understand the basics of how this transition in Medicaid will work. The National Health Law Program, Charlotte Center for Legal Advocacy, North Carolina Justice Center, Disability Rights NC, and Pisgah Legal Services are offering a free webinar on Friday, March 19 from 12:00-1:30 p.m. to share information to help service providers and advocates better understand Medicaid transformation.
Remind Your Community: Don’t Miss Out on Federal Stimulus Payments
As part of the COVID relief package that was approved in December, most Americans were eligible for Economic Impact Payments – or stimulus payments – in the amount of $600 for each person in their household. The IRS has made direct deposits or issued checks for these stimulus payments, but many North Carolinians – particularly those with low incomes who don't typically file federal income tax returns and those with children – may not have received these payments or may not have received the full amount they are due. The IRS has a tool for individuals to check the status of their stimulus payments.

Individuals and families that did not receive their stimulus payments are eligible for a Recovery Rebate Credit, which they can claim by filing IRS Form 1040 and using line 30. The Center strongly encourages nonprofits – particularly those serving North Carolinians with low incomes and those serving children – to help spread the word to ensure that those who did not receive their full Economic Impact Payments file a Form 1040 and use line 30 to request their stimulus payments.
Federal Executive Order Would Begin to Improve Access to Voting
On Sunday, President Biden issued an executive order on promoting access to voting. Among other things, the executive order would analyze barriers to voting for individuals with disabilities, provide federal assistance to states under the National Voter Registration Act, and improve and modernize the Vote.org website. This executive order should be helpful to the many nonprofits that work to ensure the people they serve are registered to vote and actually vote in elections.
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Nonprofit Policy Update is a weekly newsletter 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.