In the excitement of the budget negotiations between the House GOP, Senate Democrats, and the White House, a nonprofit organization was again thrust into the national spotlight. When negotiations went into Thursday last week, both Republicans and Democrats were showing that they were close on meeting their budget numbers, but a few issues were holding up the process, mainly the “policy rider” attached to the budget that would take away government funding for Planned Parenthood. The issue exploded in the public arena. Liberal groups decried the defunding effort as a deliberate action against women; conservatives vowed to advance the pro-life movement. More than anything, I felt agitated as a nonprofit practitioner: The federal government was once again misusing the sector. The latest actions against Planned Parenthood are part of an increased effort by political parties—primarily Republicans—to use the nonprofit sector to advance partisan interests.
You can look at how Congress uses its powers to regulate, interfere, or oversee the actions of the nonprofit sector in a number of ways, but I focused specifically on its work through committee meetings (Ways and Means, Committee on Taxation, Senate Finance, etc.), and through the reports it requests from the General Accounting Office or the Congressional Research Service. These actions—committee meetings and report requests—are one way that Congress gets involved in nonprofit sector work, and they are often indicators of future legislation or regulation. For example, in 1972, the House Ways and Means Committee was looking to amend the Internal Revenue code so that tax-exempt religious and charitable organizations could devote 20% of expenditures to lobbying. The Congress at the time was Democratic and had been for many years. Over the next eight years, not including the 1976 Tax Code revisions, the number of requests for reports or committee hearings by Congress, specifically on the nonprofit sector, ranged from zero to two.
The number of Congressional actions increased drastically after Republicans gained control of the Senate in 1980 (the first time a section of Congress had been controlled by the GOP since 1954). In 1982, the number of actions jumped to seven, and then in1986, that number jumped to 13—at that time, the most on record. Senate Finance Committee meetings about the nonprofit sector constituted most of these and led to Government Accountability Office (GAO) report requests. From 1988 to 1994, Democrats regained control of both sections of Congress, and the average number of these types of actions dropped to just two a year.
As the Newt Gingrich-led movement began, Republicans obtained control of both sides of Congress for the first time since 1946. In the last term of the Clinton administration, looking specifically at 1997 to 2000, the average number of actions jumped to five specific actions a year, having seen an average of just two during his first term.
As the Bush administration began in 2000, we started to see levels of involvement from Congress that we had never seen before. In 2001, Congress tied the record number of actions at 13, and so began the “Grassley-era” of Congressional involvement in the nonprofit sector. Senator Grassley became the leader of the Senate Finance Committee in 2001 and, just months after taking on the role, announced hearings on charitable giving. This led to investigations of misleading charities, including a 2002 GAO report on the subject. Since then, regulatory involvement has only increased. The IRS has significantly changed the way it monitors the nonprofit sector (990 forms, more staffing, etc.) compared to just ten years ago, and situations around nonprofits such as Planned Parenthood (not to mention ACORN and NPR) have become a regular part of the nonprofit-government dialogue.
Questions that come to mind include how do we protect nonprofits from partisan efforts, Democratic or Republican? Would passing the Nonprofit Community Solutions Act (H.R. 5533) help balance government-nonprofit relationships? Do we need a louder national movement on behalf of our great sector—something like the national Chamber of Commerce’s advocacy efforts during recent healthcare debates? Somewhere, someplace the sector needs to discuss these matters and—more importantly—devise action. For the moment, I hear crickets….
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