The Center is starting to plan a series of local nonprofit policy briefings for Spring 2022. Traditionally, we have offered policy briefings and town halls as in-person gatherings held in communities throughout the state. To help us plan for next year, take five seconds to answer the poll below. If you have additional thoughts on the format or content for 2022 nonprofit policy briefings, feel free to share those with us.

Beginning on January 1, 2022, a new state law will require local government elected officials who serve on nonprofit boards to recuse themselves from decisions to provide government funding to those organizations. Essentially, the law means that most local officials who serve on nonprofit boards won’t be allowed to vote on local government budgets that include funding for the nonprofits on whose boards they serve. The nonprofit funding provision in the bill only applies to cities, towns, or villages with more than 15,000 residents and to counties that have municipalities with 15,000 or more residents. This means that it will only apply in about 60 of the 100 counties in North Carolina. 

Over the past seven months, the Center has worked with the bill sponsor and other legislators to improve the bill by minimizing unintended consequences that could jeopardize nonprofit funding and/or board recruitment and retention. The final version that Governor Cooper signed into law is a significant improvement over the original bill. However, the Center remains concerned that the bill could create challenges that would make it difficult for some local governments to pass budgets with nonprofit funding if a majority of the members of a city council or county board of commissioners serve on boards of nonprofits that would likely receive local government funding. In those instances, so many local elected officials may have to recuse themselves that there would not be a quorum to vote on a budget without eliminating funding for some nonprofits. The Center continues to work with lawmakers, state officials, and local government advocates for a solution to this potential issue.

To help us better understand the impact of the new law on conflicts of interest between nonprofits and local elected officials, we are seeking input from nonprofits on their experiences with local government elected officials serving as board members. Please take two minutes to send us an email answering these questions:

Your answers will help us and our partners advocate for changes to this new law in 2022.

Charitable nonprofits from across the country have reported experiencing significant difficulties in retaining staff and filling vacancies, resulting in challenges delivering services. On Monday, the National Council of Nonprofits released its report on the national survey on nonprofit workforce shortages. Among other things, the report identifies salary competition and inability to find adequate child care as the two biggest sources of staffing challenges for nonprofits. The report recommends a variety of ways that policymakers and funders (both public and private) can develop solutions to help mitigate the impact of the nonprofit workforce crisis.

The future of three federal rules requiring certain workers – including many nonprofit employees – to be vaccinated for COVID-19 remains uncertain as a variety of federal courts weigh in on their constitutionality. Here is the latest on each rule:

Regardless of the ultimate fate of the OSHA and CMS rules and the federal contractor executive order, individual nonprofits can still require their employees to be vaccinated for COVID-19. To help your nonprofit answer questions about vaccination policies, the Center has published an analysis of vaccination considerations for nonprofits, including tips to help your organization develop a COVID-19 vaccination policy for your employees.

This week, both the U.S. Senate and U.S. House of Representatives passed legislation to raise the nation’s debt limit by $2.5 trillion. The increased debt limit should prevent the federal government from defaulting on its financial obligations through some time in 2023. A federal government default would have dire economic consequences for the country. 

If Congress had not raised the debt limit, nonprofits could have felt both short-term and long-term impacts of the resulting economic challenges. Most immediately, nonprofits would have been expected to provide a wide variety of basic services if government programs were shut down. If the United States had defaulted on its financial obligations and gone into a recession, nonprofits would likely have experienced several years of reduced contributions from individuals, businesses, and foundations with declining incomes and investments.

State legislators included an unprecedented $849 million in new funding for nonprofits in the recently enacted state budget for FY2021-23 (S.105). To help you digest the more than 1,400 pages of budget documents, the Center has developed an 11-page synopsis of nonprofit provisions and appropriations in the budget.

State agencies are likely to begin making payments to newly funded nonprofits in late winter or early spring of 2022. Many nonprofits will be receiving state funding for the first time, so they will need to comply with a variety of reporting requirements. The Center is working with the NC Office of State Budget and Management (OSBM) on a webinar for early next year to help nonprofits receiving state grants or appropriations understand the process for disbursement of these grants and the reporting requirements that accompany state funding. Look for more details in the coming weeks.

Two temporary federal tax provisions may help some nonprofits with year-end fundraising campaigns this month:

Your nonprofit may want to consider reminding potential donors of these tax provisions in any year-end fundraising appeals you are sending.

The Center 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. Don’t miss out – become a member to ensure you continue receiving these updates along with many other valuable benefits.