April 2024 Philanthropic Freedom Newsletter

Status of the States: Four Wins to Date

State legislatures are wrapping up nationwide. While election years are notoriously tough to enact legislation, the team has surpassed our goal of securing three wins for philanthropic freedom. Here is a rundown of the four wins to date:

  1. In Nebraska, where legislation was carried over from last year, the governor signed a bill package with both the Charity Protection Act and the Personal Privacy Protection Act. The Roundtable led the three-plus year charge on our bill to prevent the overregulation of charities. In tandem with our donor privacy coalition we pushed donor privacy protections over the finish line as well.
  1. In Kentucky, the Roundtable’s Donor Intent Protection Act was signed by Gov. Andy Beshear, a Democrat who had allowed our prior bills to go into law without his signature. His approval sets a positive precedent for moving this bill forward in other purple states in coming sessions. The success of this model bill in its sophomore year is thanks to the participation of one of our working group members, Mason Rummel. In a tough environment with pushback from several in-state voices, Rummel’s support was instrumental in this victory.
  1. We also have our first win to report in Alaska. After more than a year working with the state attorney general, legislators and the governor’s office, the governor issued an Administrative Order earlier this month, calling for a review of donor privacy protections and weaknesses in state law. This seeds the ground for legislative efforts down the line, but more importantly, it is the first state to issue such an order. We are working with several other states that may now also take similar action.
  1. Finally, Georgia’s Gov. Brian Kemp has signed the Donor Intent Protection Act into law this month. Georgia is the second state this year and third state overall to enact the Donor Intent Protection Act.

While our goal has been met, we have a donor privacy bill on the governor’s desk in Georgia, and pending legislation in Mississippi and Vermont, where there is a slim chance of a win as well. The team has also run social media campaigns this year in North Dakota and Rhode Island to lay the groundwork for future efforts.

As of now, the Charity Protection Act is in place in 17 states, Personal Privacy Protection Act is enacted in 18 states and the Donor Intent Protection Act has passed in three states.

We would love your feedback on these efforts as we look ahead to next year!

Questions? Contact Megan at [email protected]

DAF Rulemaking Testimony

In the last newsletter and our February meeting, we discussed the Roundtable’s response to DAF rules proposed by the Treasury Department and IRS, which implement provisions of the 2006 Pension Protection Act. Following our February comment letter, we have requested the opportunity to testify in early May at the agency hearing on the rules. Our testimony will focus on the value of DAFs as a vehicle for robust giving and will urge the regulators to reconsider three aspects of the proposed rule:

  1. the short implementation timeline,
  2. the restrictions on how investment advisors may assist clients with their DAFs, and
  3. overly broad definitions of distributions that appear to penalize necessary expenses such as legal counsel or accounting related to a DAF’s operation.

Our testimony is also an opportunity to stress  our concerns with the future potential rulemaking related to the 2017 Treasury/IRS letter. Future regulations  may impose significant restraints on DAFs, making it harder for charities to meet the public support test.

The federal team is hard at work educating members of Congress on what these rules and future proposals mean for DAFs as giving vehicles. We are proud to be part of a coalition that spurred a new letter from a bipartisan group of 33 Ways and Means members to the Treasury Secretary.  

Heard on the Hill

Since we last met, the team continued educating members on the value of philanthropic freedom in their communities. This is crucial given the revenue fights we expect in 2025. As the Roundtable builds its presence on the Hill, the team is frequently called on for input on bill language and is positioning the Roundtable as a resource. In a challenging landscape, our goal is to move the needle for philanthropic freedom. That may take the form of a donor privacy provision in the higher education bill targeting foreign donors, or helping narrow Ways and Means focus from “there are too many nonprofits” to “enforce existing law.”

Beyond this ongoing education effort, the Roundtable is closely monitoring chatter about a new iteration of the so-called Accelerating Charitable Efforts Act. The team met with Sen. Charles Grassley’s (R-IA) office recently and is hearing that the next version may be tucked into a tax vehicle rather than be introduced as a standalone bill. We know the advocates are still pushing for a bill and the Roundtable will be monitoring any movement on the issue.

Other legislative updates: The Roundtable is working with Sen. Todd Young (R-IN) to gain support for our donor privacy legislation as he gears up to introduce the bill.

Questions? Thoughts on emerging efforts to stop earmarks for nonprofits? Contact Courtney: [email protected] 

Research Resources

With the expiration of the 2017 Tax Cuts and Jobs Act in 2025, the Roundtable is releasing resources to highlight the impact of tax code changes on philanthropy. The first of these is a policy primer about the Tax Cuts and Jobs Act. The primer details key issues to monitor as the tax discussions get underway. If you are interested in the impact of the expiring provisions and an analysis of other philanthropic policies at stake while members seek revenue offsets, this is a must-read report.

On the tax front, we will also be hosting a Roundtable Briefing Series webinar on the TCJA implications on April 30.

Donor privacy remains a priority for the team with a new David Primo paper on the costs and benefits of donor disclosure regimes (spoiler alert, the costs outweigh the “benefits”). Additionally. we released a three-part interview with DAF researcher Dan Heist on his groundbreaking research about how DAFs are used as powerful giving tools.

Gearing up for more legislative work on protecting giving intent, our 50-state analysis of donor intent laws is online here. We are also using this research to fuel media coverage of philanthropic freedom issues nationwide.

In case you missed it, we again highlighted the problems with President Joe Biden’s budget proposals related to philanthropy. The budget proposed restricting how private foundations can give through DAFs and limiting family member expenses at family foundations. Backed by our recent report on how private foundations use DAFs to meet their giving goals, the Roundtable has a unique voice on this issue on the Hill.

Questions? Contact Jack at [email protected]

Outreach Opportunities

Our Free to Give campaign is a key tool to demonstrating the value of philanthropic freedom to a wide range of causes and communities. See the full campaign at freetogive.org, or click here for our latest interviews with the Phoenix Center and the Victims of Communism Memorial Foundation.

Thanks to those of you who have participated in interviews with this campaign so far.

We are always looking for donors and nonprofits to spotlight! If you are interested or have an idea for an interview, please contact Patterson Sheehan at [email protected].