COVID-19: 5/12/20 NAO Update

by | May 14, 2020 | Event

Subject: NAO’s COVID-19 Update: May 12, 2020

May 12, 2020
Dear Nonprofit Colleagues and Supporters:
As the Oregon Health Authority’s daily update stated yesterday: “As Governor Brown starts slowly lifting restrictions on activities and businesses, it’s important to remember that health and hygiene advice that slows the spread of COVID-19 still applies. Actions such as frequent handwashing, staying six feet apart, and wearing face coverings will continue to be a part of our daily lives.”
Here in Oregon
Oregon agencies asked to plan 17% budget cuts
With projected drop-off in revenue from lost wages and corporate taxes due to the COVID-19 pandemic, the state has preliminary estimates of a $3 billion shortfall for the current two-year budget cycle. Yesterday, at the direction of Governor Brown, state agencies began planning to reduce their respective budgets by 17% for the upcoming fiscal year that starts July 1.
Governor Brown is calling it a planning exercise in preparation for the next state revenue forecast, which will be released on May 20. She intends to call a special session of the Legislature, possibly in early June, to implement spending cuts.
Governor Brown said in a news release. “We know a potential cut of this magnitude would be extremely drastic.”
Despite certain declines in revenues, the state has so far held off any systematic spending reductions, though a few agencies have implemented targeted cuts, layoffs and furloughs depending on the severity of their revenue declines.
The state has some $2.5 billion in a rainy-day fund and agency reserves, a fund that can be used, within parameters, to support the emergency and the recovery. The Oregon reserves did not exist during either the 2001 or 2008 recessions, which led to deep, and in the case of the 2008 recession, persistent cuts for successive state budget cycles.
The impact on nonprofits is not yet known, but the Oregon Department of Human Services has already reached out to its partners to invite them to a briefing today to discuss the budget reduction planning they are engaging in.
If your nonprofit currently receives funding for programming from state agencies, you should reach out to them to ask for guidance and attend their briefings to get the most updated information.
At the Federal Level
In Congress:
Not yet. That’s the word on the House $1 trillion+ CARES 2.0 bill that was supposed to be introduced by now. The latest word is that the bill may be ready by today (Tuesday, May 12) and the House will not return until Friday at the earliest to vote on it. While the details are in flux, some details are slipping out (although our colleagues in Washington D.C. can’t say if these are “scoop or idle rumor” until we see the actual legislative text). The bill is expected to pass the House, but Senate Republicans and the White House are putting out the word that they aren’t in a hurry to pass another economic stimulus bill until they see how the economy responds to re-openings in various states. Here is what we are hearing so far:
  1. Paycheck Protection Program: It is believed that the House CARES 2.0 bill will carve out a track of funding just for nonprofits, half of which would go to those with 500 or fewer employers and half to nonprofits of all sizes and types. If true, this means that, for the first time, large charitable nonprofits as well as social welfare nonprofits, unions, and trade associations would have access to PPP funds.
  2. Mid-Size Loans: The House CARES 2.0 reportedly will include a nonprofit mid-size loan program to extend relief to employers with up to 10,000 employees, but that will not include loan forgiveness. As reported previously, House Financial Services Committee Chair Waters (D-CA) supposedly nixed forgiveness out of concern that for-profit businesses would demand the same treatment.
Rep. Joyce Beatty (D-OH) announced yesterday that she is introducing the Help Charities Help Communities Act this week. The bill would require Treasury Secretary Steven Mnuchin to provide loans and loan guarantees to larger nonprofits and create a mechanism for loan forgiveness similar to the Paycheck Protection Program. Her legislation would set aside $60 billion from the $454 billion allocated to the Exchange Stabilization Fund (CARES Act) for these purposes.
Executive Branch
PPP Interim Final Rule: Last evening, our colleagues at the National Council of Nonprofits submitted public comments on the Interim Final Rule published by the U.S. Treasury and Small Business Administration on the Paycheck Protection Program. In summary, here is what they commented on the interim rule:
  • Eligibility: Expand nonprofit access to “alternative size standards” on equal basis as for-profit businesses and agricultural concerns.
  • Calculating Maximum Loan Amounts: Appreciation for recognizing the unique nature of nonprofit accounting and documentation.
  • Maturity Date: Reject decision to impose a two-year maturity date as based on an unrealistic expectation of economic recovery and replace it with a longer maturity date.
  • “First-Come, First Served” Promise: Delete Question M and the answer (“yes”) as false given the extensive reports of smaller nonprofits and businesses being forced to the back of the line as lenders gave priority to preferred customers in violation of the Interim Final Rule.
  • Need for Nonprofit PPP Data: Immediately publish state-by-state and national data on nonprofit applications, loans granted, loan amounts and averages, and more.
  • Payment of Principal and Interest: Extend due date for first payments of principal and interest to one year, recognizing that the proposed start date of six months will occur for most borrowers at a time when scientists expect a second wave of COVID-19 cases and disruptions.
  • Loan Forgiveness: Reject the “75%/25%” payout rule as arbitrary, capricious, and contrary to the will of Congress.
  • Certifications: Alter the good-faith certification of “necessity,” delete reference to the “75%/25%” payout rule, and clarify that payments on pre-existing debt are forgivable.
  • Need for Nonprofit-Specific Guidance: Issue guidance providing clarity on unique questions related to charitable nonprofit operations, such as “ownership,” applicability of “alternative size standards,” and impact of government grants and contracts.
  1. Go here to submit your own comments. You are welcome to copy and paste any of the text that the National Council of Nonprofits developed, incorporate their comments by reference, or draft a whole new set of comments. Comments are due Friday, May 15. Please share with NAO what you submit.
  2. Be sure to attend NAO’s Oregon Nonprofit Town Hall tomorrow morning, May 13 from 8:30 – 9:30 a.m. with Oregon’s U.S. Senator Wyden and Senator Merkley. This is your opportunity to hear directly from them and express your concerns regarding federal aid packages and the future. Register here.
Upcoming Online Sessions for Nonprofits
Ask the Experts – Maximizing Forgiveness Under the Paycheck Protection Program: Tips, Techniques, and a Planning Toolkit for Nonprofits, Tuesday, May 12, Noon – 1 p.m. PT: Kathy Swift, Senior Vice President and Nonprofit Development Officer at Heritage Bank, Laura Caldera, Practice Group Leader at Bullivant Houser, and Bill Holmes, CPA of Holmes & Company will provide a comprehensive analysis of how to maximize the loan forgiveness of the Small Business Administration’s Paycheck Protection Program. In addition to the tips and techniques, they will provide a PPP loan forgiveness calculator that can be used weekly to manage the payback under this eight-week program. Nonprofits who have received a loan under the PPP program definitely won’t want to miss this important session. There’ll be a Q&A session for participants to ask questions and offer comments. Register for the session here.
Oregon Nonprofit Virtual Town Hall with U.S. Senators Ron Wyden and Jeff Merkley, Wednesday, May 13, 8:30 – 9:30 a.m.: Join NAO for a virtual town hall with U.S. Senators Ron Wyden and Jeff Merkley addressing Oregon’s nonprofit community. We will have the opportunity to hear from our Oregon senators about the CARES Act and plans for future congressional action, as well as discuss specific issues and needs facing Oregon’s nonprofits. This session will be moderated by Raziah Roushan, NAO Board Member and Chair, NAO Public Policy Committee and Jim White, NAO Executive Director. Register for the session here.
Rethinking Your Strategy: Planning for Your Nonprofit’s Recovery – a three-part series on Thursday, May 14, Thursday, May 21, and Thursday, May 28, Noon – 1 p.m. PT: Steve Patty, Founder of Dialogues in Action will guide nonprofits on how to rethink our pre-COVID strategies and plan for recovery in this three-part series. The COVID-19 pandemic has disrupted the way nonprofits deliver services and programming and continuing to pursue our pre-COVID-19 strategies is not an option. Steve will discuss how nonprofits can make it through this crisis, emerge better, and be even more valuable to our communities for greater impact. The series consist of: Session 1 – The Opportunity of a Crisis (May 14); Session 2 – How to Adapt Your Strategy (May 21); and Session 3 – Create a New Future for a New Normal (May 28).  Register for the three-part series here.
Ask the Experts: Building Your Plan for More Meaningful Donor Engagement, May 19, Noon – 1 p.m. PT: Laurel McCombs, Consultant of The Osborne Group will discuss how and why building even stronger relationships with your donors is more critical than ever before. Relationship building has always been the core of fundraising efforts; however, the past couple of months have brought these even more clearly into focus. Many organizations have seized the opportunity and built even stronger relationships, while others continue to struggle to connect. Laurel will discuss how to engage your donors no matter where you are today and how to plan for the transition that is here and now. Register for the session here.
Nonstop Presents: Workplace Strategies to Support Mental Health, Thursday, May 28, 10 – 11 a.m. PT: Nonstop Administration and Insurances Services, an NAO partner, will be hosting Laura Green, SHRM-CP of Nonprofit HR, who will share how employers can best support their employees during these uncertain times. She’ll discuss tangible, simple solutions to help employees feel connected to the organization, as well as provide resources to assist with finding personal peace of mind. Register for the session on Nonstop’s site here.
QuickBooks Desktop Edition Made Easy for Nonprofits, June 16, 17 & 18, 11 a.m. – 1 p.m. PT: Gregg S. Bossen, CPA of QuickBooks Made Easy, is partnering with NAO to offer an updated three-part QuickBooks® training webinar for nonprofits. This webinar is for the Desktop edition of Quickbooks. Gregg will cover the basics of setting up and entering transactions specifically for nonprofits, an overview of the software updates included in the QuickBooks® 2018 Desktop Edition, as well as advanced topics covering a host of specific processes that will help you do more helpful and amazing things! Register for the three-part webinar here.
QuickBooks Online Edition Made Easy for Nonprofits, June 23, 24 & 25, 11 a.m. – 1 pm. PT: Gregg S. Bossen, CPA of QuickBooks Made Easy, is partnering with NAO to offer an updated three-part QuickBooks® training webinar for nonprofits. This webinar is for the Online edition of Quickbooks. Gregg will cover the basics of setting up and entering transactions specifically for nonprofits, an overview of the software updates included in the QuickBooks® 2018 Online Edition, as well as advanced topics covering a host of specific processes that will help you do more helpful and amazing things! Register for the three-part webinar here.
Other Updates
Oregon Business’ 100 Best Nonprofits to Work for in Oregon survey launched: Oregon Business has launched its 100 Best Nonprofits to Work For in Oregon survey for 2020. The coronavirus pandemic has created a lot of uncertainties for organizations across all sectors of the economy, including Oregon’s nonprofits. It is more important than ever to keep communication flowing with employees as many are working remotely. Register for Oregon Business’ 2020 100 Best Nonprofits to Work For in Oregon survey to find out how satisfied your employees are and what their concerns are in these uncertain times. Taking time to listen to your employees will set you up to be an even stronger organization. Join our effort to support strong workplace culture and celebrate successful employers by participating in the 100 Best Nonprofits to Work For in Oregon survey. The survey must be completed by mid-July. Click here for survey information; to register for the survey, click here.
Stay safe and healthy!
Jim White
Executive Director
Thank you to the following SUPPORTERS and SPONSORS who are supporting NAO’s online COVID-19 events and communications during these challenging times. Their support is vital in helping NAO to bring much-needed resources and information to Oregon’s nonprofits – thank you.
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