As the 2023 NC legislative session gets underway next week, the Center is interested in finding out how well nonprofit leaders know the people who represent them in the NC General Assembly - and how well you'd like to know them. This information helps us better understand which state legislators are already familiar with nonprofits serving their communities. It also helps us develop resources to help you strengthen (or initiate) your relationship with your local state legislators so you can be a strong(er) advocate for policy solutions related to your organization’s mission. Please fill out this quick survey to let us know! Thank you if you have already completed the short survey.

With the NC General Assembly starting its 2023 session this month and many county boards of commissioners and city and town councils holding their first meetings of the year, now is a great time for nonprofit leaders to build relationships with newly-elected state and local officials. To help make it easy for your nonprofit to reach out to elected officials, friend of the Center Lisa Hazirjian shared some basic tips and sample emails that you can send to your newly-elected (or newly-re-elected) lawmakers and local officials. 

You may be wondering whether it is worth reaching out to an elected official in your community who isn’t likely to be a supporter of your nonprofit’s mission and advocacy – and who may have even run on a platform that directly opposes your organization’s position on certain public policy issues. To help you think through whether – and how – to engage with elected officials who may not be likely allies for your organization, Lisa has shared some additional insights and sample messaging.

As a reader of these weekly Nonprofit Policy Updates, you are probably aware that the Center takes positions on – and lobbies on – state and federal public policy issues that affect most or all 501(c)(3) nonprofits in North Carolina. Last month, the Center’s Board of Directors approved the 2023 Public Policy Agenda for North Carolina’s Nonprofit Sector’s Nonprofit Sector, which describes the Center’s current positions on state and federal public policy issues affecting nonprofits. Many of the public policy solutions and challenges identified on the Center’s 2023 public policy agenda are included because of your input and the input of other nonprofits.

Now that the NC General Assembly has officially started its 2023-24 session, the Center is starting to talk with legislators about filing bills to help nonprofits operate more effectively in achieving their missions. As we have these conversations, the Center needs your input so that:

1. We can make the strongest possible case to legislators about the need for these nonprofit policy solutions; 
2. We can prioritize potential legislation that would be of the greatest benefit to nonprofits; and
3. We don’t overlook nonprofit policy solutions that are important to your nonprofit but aren’t (yet) part of the Center’s 2023 public policy agenda.

To help the Center be the strongest possible advocate for policy solutions that could help your nonprofit in 2023, please take five minutes to complete a brief survey about potential 2023 nonprofit sector legislation. Thank you if you have already provided input; the responses we received over the past two week are already helping shape our initial conversations with legislators!

Over the next few months, the Center is hosting a series of Nonprofit Policy Conversations around the state to bring together nonprofit leaders and local elected officials (mostly state legislators) to discuss public policy issues that are important to charitable nonprofits and the people and communities they serve. At each of these Nonprofit Policy Conversations, the Center will provide a briefing on state legislative priorities for 2023, trends in the nonprofit sector, and potential public policy solutions and challenges for nonprofits in 2023 and beyond. The Nonprofit Policy Conversations also will include discussions about state and federal public policy issues of particular interest to local nonprofits. The Center is working with local partners to host upcoming events in Burlington (January 30), Wilmington (February 10), Concord (February 24), Raleigh (March 6), and Fayetteville (TBD), . Registration is open for the Burlington, Wilmington, Concord, and Raleigh events; we’ll keep you updated as other dates are finalized.

Yesterday, the U.S. Treasury Department notified Congress that the United States has reached its debt limit, so the Treasury Department is taking “extraordinary measures” through June 5 to ensure that the U.S. does not default on its debts over the next few months. Only Congress has the authority to increase the nation’s debt ceiling, so the U.S. Senate and U.S. House of Representatives now have a little more than four months to negotiate legislation to raise the debt ceiling. Failure to raise the debt ceiling could have dire financial consequences for the global economy, which in turn, could create significant challenges for nonprofits. 

Typically, when the U.S. reaches its debt limit, Congress agrees on bipartisan legislation to raise the debt ceiling. However, this year, several members of the U.S. House of Representatives – potentially enough to block a deal with the Senate – have indicated that they will only support legislation to raise the debt ceiling if it also includes significant cuts to federal spending. Potentially, this could mean cuts to federal funding for many nonprofits and to a variety of social safety net programs that complement the work of nonprofits.

Earlier this month, President Joe Biden signed into law a $1.7 trillion omnibus spending bill (H.R. 2617) to fund the federal government through the remainder of the fiscal year (through September 30). In addition to funding the federal government, the 4,155-page omnibus bill makes a variety of other changes to federal laws. Two of these changes could affect retirement benefits and fundraising opportunities for some nonprofits:

1. Retirement Benefit Changes. The omnibus bill makes two changes to federal retirement laws that will enable more nonprofits to join together to offer retirement benefits for their employees. Specifically, the new law allows 403(b) retirement plans, which many nonprofits offer, to be part of multiple employer plans (MEPs), and it enables nonprofits to participate in pooled employer plans (PEPs). It also requires most employers to automatically enroll their employees in new 401(k) and 403(b) retirement plans (employees can opt out if they choose not to participate in retirement benefit plans), which should mean that more nonprofit workers will be saving for retirement.
2. Changes to Charitable Giving Laws. The omnibus bill also improves the IRA charitable rollover, the federal law that enables individuals aged 70½ and older to make tax-free distributions to charitable nonprofits from their individual retirement accounts (IRAs) by increasing the maximum amount that retirees can contribute to nonprofits, most notably indexing the $100,000 maximum contribution amount for inflation starting in 2024. 

To help your nonprofit better understand these changes (and to provide more details on them), the National Council of Nonprofits has posted an analysis of the retirement and charitable giving provisions in the omnibus bill of interest to nonprofits.

The NC Department of Health and Human Services (DHHS) announced this week that February 2023 will be the final month when families enrolled in Food and Nutrition Services (FNS) receive extra weekly benefits due to the COVID-19 pandemic. Families that receive FNS food assistance will see their food assistance reduced by at least $95 per month starting in March because of a recent change in federal rules. This reduction in food assistance will likely mean that many families will rely more on nonprofits for food security and other basic needs that they may be unable to afford because of higher food costs.

Nonprofits that were registered as lobbyist principals in 2022 (and their staff or contractors who were registered as lobbyists) must file their final quarterly reports with the Secretary of State Lobbying Compliance Division by January 24. Lobbyist principals need to use the special fourth quarter expense reports (available online) that include the cumulative total payments to lobbyists for the year. To help you understand the basics of state lobbying laws affecting nonprofits, check out the Center's summary of NC lobbying laws for nonprofits. 

Also, the NC Secretary of State has opened lobbying registration for 2023. Lobbyist principals (i.e. nonprofits that lobby) and lobbyists (i.e. nonprofit employees and contractors who lobby on behalf of nonprofits) must register annually with the Secretary of State. Lobbyists and lobbyist principals must register within a day after they begin lobbying.

Earlier this week, the Internal Revenue Service (IRS) reminded nonprofits and other employers that they must file 2022 Form W-2 and other wage statements by January 31, 2023. Employers must file their copies of Form W-2, Wage and Tax Statement and Form W-3, Transmittal of Wage and Tax Statements with the Social Security Administration by January 31. The IRS website has additional information on how to file. The January 31 deadline also applies to Forms 1099-NEC filed with the IRS to report non-employee compensation to independent contractors.

A new bill (H.R. 31) filed in the U.S. House of Representatives this week would allow counties and cities to opt into Medicaid expansion even if their states have declined to expand Medicaid under the Affordable Care Act. North Carolina remains one of 10 states that has not opted into Medicaid expansion, which would provide health coverage for adults with incomes up to 133% of the federal poverty level. The new U.S. House bill, known as the Cover Outstanding Vulnerable Expansion-Eligible Residents Now Act, or COVER Now Act, would give local governments in North Carolina the option of approving Medicaid expansion for residents in their areas.

The COVER Now Act is extremely unlikely to pass since it has only Democratic sponsors in the Republican-controlled House. All seven congressional Democrats from North Carolina are cosponsors of the bill.

As we explained in a Care4Carolina blog post, the Center strongly supports Medicaid expansion because it would support the work of charitable nonprofits by:

1. Complementing the work of many nonprofits that provide services to North Carolinians who don’t currently have adequate health coverage;
2. Providing 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; and
3. Providing payment for some types of Medicaid-eligible services that nonprofits currently provide to clients for free.

It remains possible that Medicaid expansion could come to North Carolina this year. Both the NC Senate and NC House of Representatives overwhelmingly approved of legislation to enact Medicaid expansion in North Carolina last year, but they were not able to come to agreement on details about other health care provisions that could be included in the bill. Legislative leaders have indicated that Medicaid expansion remains a priority for the NC General Assembly this year. 

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. Become a member to ensure you continue receiving these updates along with many other valuable benefits.