This week, Center staff met with several members of our state’s congressional delegation and their staff to give them updates on the state of North Carolina's nonprofit sector and to ask them to support several federal policy solutions that could help charitable nonprofits.

Our members of Congress were receptive to these nonprofit priorities. Most of North Carolina’s U.S. Representatives have signed on as co-sponsors to legislation to restore the ERTC and several expressed interest in the other four nonprofit priorities that we discussed. The Center will let you know when there is a need to take action on any of these federal policy priorities.

Earlier this month, the NC Senate passed a bill (H.B. 149) that would expand Medicaid coverage to adults with incomes up to 133% of the federal poverty level. Medicaid expansion would provide health coverage for about 600,000 North Carolinians whose incomes are too much to qualify for Medicaid currently but not enough to receive health care subsidies in the Affordable Care Act health marketplace. The bill, which passed the Senate with broad bipartisan support, also includes several other major policy provisions aimed at expanding access to healthcare in North Carolina.

The Center strongly supports Medicaid expansion for two reasons. First, it would complement the work of many nonprofits that provide services to North Carolinians who don’t currently have adequate health coverage. Second, it would provide health coverage for some employees of nonprofits that don’t offer group health plans and whose salaries leave them in the health care coverage gap.

While it is good news that the Senate has approved Medicaid expansion with broad bipartisan support, it won’t become law unless it also passes the House, either through the bill the Senate recently passed or as part of the state budget. To help encourage the House to pass Medicaid expansion this summer, please take two minutes to contact your House member and ask them to close the health coverage gap by passing Medicaid expansion. The Care4Carolina coalition, of which the Center is a member, has made it easy for you to take action and send a message to your House member.

With rising gas prices, nonprofits are finding it more challenging for volunteers to drive their vehicles to help provide programs and services. One reason for this challenge is that a federal tax law, which has been in place since 1997, only allows volunteers to claim a tax deduction valued at 14 cents per mile. This is far below the actual cost that volunteers incur when they drive to help nonprofits provide programs and services. 

Unlike the business mileage rate, which the Internal Revenue Service regularly adjusts based on gas prices and inflation, the volunteer mileage rate is set in statute at 14 cents per mile, so it would take an act of Congress to change it. Last week, the IRS increased the standard business mileage rate to 62.5 cents per mile for the second half of 2022 (up from 58.5 cents per mile for the first six months of the year). Because the volunteer mileage rate is so much lower, volunteers who are reimbursed by nonprofits at the standard business mileage rate will have to pay federal income tax on the additional 48.5 cents per mile when they drive their vehicles to help nonprofits deliver programs and services. 

The Center has been advocating for more than a decade for Congress to increase the volunteer mileage rate and eliminate this tax on volunteering. In our congressional meetings this week, several members of Congress and their staff expressed interest in raising the volunteer mileage rate and asked for examples of nonprofits that have been affected by the current law. To help us respond to our members of Congress, let us know if your nonprofit is having trouble recruiting or retaining volunteers because of (or at least partly because of) high gas prices.

Over the past several years, many nonprofits, along with accountants and attorneys who represent tax-exempt organizations, have told the Center about challenges their organizations have experienced with the state charitable solicitation licensing process. As a result of your input, the Center recommended legislation (H.B. 695) last year that would make a variety of improvements to the North Carolina charitable solicitation statute, including:

The NC House of Representatives unanimously passed this bill last May, but the NC Senate has not taken it up. Over the past month, the Center has been advocating for lawmakers to include these charitable solicitation licensing reforms in one of the bills they will pass during the 2022 legislative session. Legislators are planning to conclude the session in the next couple of weeks, and we remain hopeful that they will pass charitable solicitation licensing reforms this month. We’ll let you know if there is a need for your nonprofit to take action.

National Voter Registration Day (September 20) is a great opportunity for nonprofits to ensure that their staff, volunteers, and community members are registered to vote. Sign up to join the nationwide effort to register hundreds of thousands of voters on September 20. As an official partner, your nonprofit will receive a free voter registration kit and access to opportunities and resources to support your nonpartisan voter registration work.

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.