COVID-19: August 4 NAO Update

by | Aug 5, 2020 | Event

August 04, 2020
Hello Nonprofit Leaders and Supporters,
The summer is in full swing and in the scorching heat, many of us continue to work hard to keep our organizations running in the depths of the COVID-19 pandemic and the massive economic downturn. Most of you would have seen by now the second quarter posting for historic GDP losses. The U.S. economy suffered its worst period ever in the second quarter with GDP falling 32.9%. Neither the Great Depression, the Great Recession, nor any other slump over the past two centuries have ever caused such a sharp drain on the economy.
Already, nonprofits are showing signs of over stress. Communities need more and more at this critical time, but resources are indeed at a premium. NAO worked with a group of organizations to get feedback and quantify the needs of our sector. Nearly 500 nonprofits from across Oregon responded. If you haven’t had a chance, please download and read the Impact of COVID-19 on Oregon Charitable Nonprofits – Preliminary Report – Key Findings Summary that we released last week.
Many of us are looking for creative ways to manage costs while maintaining or even expanding services. (Check out one way for larger nonprofits to manage healthcare costs here.) As the pandemic doesn’t seem to be easing any time soon further inhibiting Oregon’s economy, the state is also considering their costs and getting ready to make big cuts due to anemic tax revenue projections. (When people don’t have jobs and businesses are closed, they can’t pay taxes.)
Governor Brown announced last Friday that Oregon lawmakers will reconvene at the state Capitol Aug. 10 for a special session focused on cutting more than $1 billion in budget shortfall. The Governor’s decision to call lawmakers into session could be a concession that the state is unlikely to receive any significant budget assistance from Congress in the latest round of COVID-19 aid packages.
Legislators and executive branch officials have known since earlier this year that they had to return to Salem for a second special session to create an achievable budget. This after the Governor decided their first special session would focus largely on police accountability laws in the wake of the murder of George Floyd and sweeping protests for police reforms.
Meanwhile in Washington D.C., Senate Republicans introduced the Health, Economic Assistance, Liability, and Schools Act (HEALS Act) on July 27. This set the stage to begin negotiations with House Democrats over the substantive terms of a COVID relief bill. The $1 trillion HEALS Act has significant differences from the $3 trillion Health and Economic Recovery Omnibus Emergency Solutions Act (HEROES Act) the House passed on May 15. Neither bill is expected to be enacted in its original form. T National Council of Nonprofits’ chart compares the competing proposals in the House-passed HEROES Act and the Senate HEALS Act. After several false starts, it appears that the lead negotiators – Treasury Secretary Mnuchin, White House Chief of Staff Meadows, House Speaker Pelosi, and Senate Democratic Leader Schumer – started making some progress over the weekend.
The big issues remain the greatest obstacles to agreement, albeit even more critical with the expiration of extended unemployment benefits and the eviction moratorium. Democrats remain committed to maintenance of the extended unemployment benefits and eviction protection, as well as considerable funding for state and local governments, support for childcare programs, and increased money for food programs. Republicans seek extending unemployment benefits at a lower level and duration, and want inclusion of liability protections for employers that reopen for business. Both parties reportedly are willing to include hazard pay for essential workers but differ on who would be eligible.
The long struggle to influence the next, probably last, COVID relief legislation before the November elections is nearly over. Conventional wisdom has it that a deal will be struck by the end of this week or a few days later. To make the bill better, nonprofits must take action today, August 3, and in the coming days to ensure the COVID relief bill is made better – for the people we serve, for the sustainability of our organizations, and for our communities.
The Broad Nonprofit Community Asks
The Nonprofit Community Letter, signed by more than 4,000 organizations, including NAO and many in Oregon, provides updated legislative priorities in four key issue areas:
  • Continue Emergency Funding Programs: (1) Extend and expand the Paycheck Protection Program (“PPP”) by enabling a second round of funding for all nonprofits and modifying the eligibility criteria pertaining to 500 employees; (2) Enact and expand grant and funding programs, such as the proposed WORK NOW Act or the Employee Retention Tax Credit, to help nonprofits retain employees, scale service delivery, and create new jobs; and (3) Appropriate funds for federal grant programs that enable nonprofits to advance their missions of serving communities.
  • Provide Low-Cost Loans to Mid-Size and Larger Nonprofits: (1) Authorize and require the Federal Reserve to quickly finalize a nonprofit lending facility under MSLP that is tailored to accommodate mid-size nonprofits including language similar to H.R. 6800 that offers a loan forgiveness option; and (2) Extend eligibility of PPP to all nonprofits of all sizes similar to H.R. 6800 and lift the loan cap to appropriately reflect the operational needs of these nonprofits.
  • Strengthen Charitable Giving Incentives: (1) Expand the above-the-line or universal charitable deduction in the CARES Act by enacting the provisions in S. 4032/H.R. 7324 increasing the amount to one-third of the standard deduction; and (2) Extend this and the giving incentives enacted in the CARES Act through 2021.
  • Provide Full Unemployment Benefit Reimbursement: Increase the federal unemployment insurance reimbursement for self-insured (reimbursing) nonprofits to 100% of costs. The nonprofit employees that have been furloughed need support through unemployment and the nonprofit organizations needs these funds for survival.
Oregon Senators’ Actions
Thirty Senators signed the Lankford/King bipartisan letter to Senate leaders stating that Congress must include nonprofit provisions in the COVID relief bill to “ensure that charitable nonprofits are fully supported in their service on the front lines of responding to the COVID-19 crisis.” Senator Merkley signed the letter and we know that Senator Wyden is in support through the bills and actions he has taken to include nonprofit provisions.
Partial Unemployment Insurance Fix Enacted
Congress passed and the President signed the Protecting Nonprofits from Catastrophic Cash Flow Strain Act (S.4209), the bill to override the Labor Department requirement that self-insured nonprofits must pay 100 percent of benefits costs upfront and get reimbursed by their states later.
Working with many of you and our colleague state associations across America, we collectively identified the problem and shared knowledge across state lines. The information we all helped to provide and the national survey many of you filled out demonstrated the case that was presented to the Senate Finance Committee and others.
This still only covers 75% of the costs. Representative Boyle (D-PA) and Pennsylvania State Senator Tartaglione (D-Philadelphia), Democratic Chair of the Labor & Industry Committee in the Pennsylvania State Senate, sent a letter to U.S. House Leadership requesting that the next COVID-19 response package should include language providing 100% reimbursement by the federal government of the costs of unemployment benefits.
ACTION ITEM: If you are a self-insured/reimbursing nonprofit in Oregon you are not on the hook for the full 100% of the unemployment benefits paid to your employees laid off or furloughed due to COVID-19. MORE IMPORTANTLY, please be sure to communicate that understanding to the Oregon state unemployment office. NAO will be making sure that they know the bill has been signed, but if all of us communicate that message, it will be sure to get through.
Universal Charitable Deduction
Last week, a bipartisan group of 16 Representatives sent a letter to House and Senate leaders urging them “to include an expanded universal charitable giving deduction for tax year 2021, as a means to aid non-profit (sic) organizations that have always been, and will continue to be, at the forefront of assistance in any disaster.” The letter was led by Representatives Smith (R-NJ) and Cuellar (D-TX), sponsors of H.R. 651, the Charitable Giving Tax Deduction Act.
Upcoming Online Sessions for Nonprofits
Ask the Experts: Maximizing Loan Forgiveness Under the Paycheck Protection Program, Wednesday, August 12, Noon – 1 p.m. PT: Many nonprofits who received loans under the Small Business Administration’s Paycheck Protection Program are now dealing with how to best navigate the complexities of maximizing their loan forgiveness. In this session, Lisa Fajardo Faust – Senior Vice President and Relationship Banking Team Leader at Pacific West Bank, Robert Countryman – Market President for Portland/Seattle at First Interstate Bank, and Lesley Bennett – Senior Financial Consultant at CFO Selections will discuss practical steps, processes, and documentation that nonprofits should follow to ensure the best outcomes for their organizations. They will provide guidance on the approach, processes, and procedures that nonprofits should implement as they see it from their vantage points as a professional at a lending institution that transacted the PPP loans and a finance practitioner. Register for the session here.
The Ultimate Grant Proposal Blueprint Course: Your Step-by-Step Roadmap and Built-It-Yourself Toolkit for Crafting an A+ Grant Proposal, an eight-week online course scheduled from August 24-October 26: In this comprehensive, on-your-own-schedule video-based, course from GrantsMagic U, veteran grant writer, grant consultant, and grantmaker Maryn Boess pulls back the curtain on what it really takes to be successful in the grants world. She will share hundreds of tried-and-tested tools, strategies, how-to’s and “insider’s tips” to take you to your next level of grants success no matter where you’re starting out.. More details here.
Strategic Health Benefits Planning for Your Upcoming Renewal: A Conversation you Can’t Afford to Miss: Thursday, August 20, 10 – 11 a.m. PT: Health benefits renewal is coming, ready or not! Nonprofit leadership have a tremendous responsibility to strategically plan for a potentially challenging upcoming health benefits renewal season. The earlier risk can be identified, assessed, managed, and integrated into strategic planning, the better. Lead your nonprofit out of the hazardous cycle of skyrocketing premiums and diminishing health benefits. Join Lesley Brown Albright, Senior Marketing Manager of Nonstop Administration & Insurance Services, Inc.; Libra Forde, COO at Self-Enhancement, Inc.; and Todd Kimball, Partner at CFO Selections to learn how your nonprofit can strategically approach health plan design to control costs and improve health benefits for your employees. There’ll also be time for questions and answers. Register for the session here.
The Rapid Redesign Project – a two-part cohort on Wednesdays, September 9, and September 23, 9 a.m. – 3 p.m. PT: Steve Patty, Founder of Dialogues in Action, along with DIA colleagues Jessamyn Luiz and Landen Zernickow invite your organization to participate in a two-day facilitated cohort around redesigning your program strategy due to impacts of the COVID-19 crisis. This cohort will help you design solutions for the immediate challenges of your program; fix some of your chronic and pre-existing issues of your program; and grow the leadership for your program. Let’s reframe our thinking! Registration allows up to five staff members. To participate, fill out this registration form by Friday, September 4. Learn more.
I hope that you all 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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