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Last Thursday was the crossover deadline in the NC General Assembly – the date by which most bills must pass either the House or the Senate to be considered during the 2021-22 legislative session. Legislators can still consider bills that affect taxes or spending, the state constitution, election laws, or redistricting, even if they haven’t yet been approved by the House or Senate. To mark the unofficial mid-point of this year’s legislative session, the Center has prepared a “halftime report” on the status of dozens of bills affecting the work of charitable nonprofits.

Yesterday, both the NC House of Representatives and NC Senate approved a bill (S.172) that would formally create a State Fiscal Recovery Fund to spend the state’s $5.3 billion in aid from the American Rescue Plan Act (ARP), as well as create a Local Fiscal Recovery Fund for $3.8 billion in ARP funding for local government in North Carolina. The bill, which also formally appropriates other pass-through funding from ARP, is the first step in appropriating the state’s ARP funding. It now goes to Governor Roy Cooper for his consideration.

The Center is advocating for legislators to include a nonprofit recovery fund in the next state COVID-19 response package. Your input is essential in coming up with a plan to provide meaningful relief for nonprofits. Specifically, it would be helpful to know what type of economic hardships your nonprofit has experienced due to COVID-19 so we can advocate for a grant program with appropriate eligibility criteria. Examples of possible criteria could include:

Let us know what type of eligibility criteria for a nonprofit relief fund would make the most sense for your nonprofit and other organizations in your community. Thank you if your nonprofit has already provided input. The Center has included input we have received in the information sheet on the need for a nonprofit recovery fund that we have shared with legislators.

On Wednesday, Governor Cooper released his recommendations for spending the state’s ARP funding. While Governor Cooper’s proposal does not include a nonprofit relief fund, it does include funding for certain types of nonprofits. Highlights of the proposal for nonprofits include:

Ultimately, the NC General Assembly is responsible for appropriating the state’s ARP funds. It is unclear how closely the General Assembly will follow Governor Cooper’s recommendations in developing its next COVID-19 relief plan.

On Monday, the Internal Revenue Service announced that most families with children will begin receiving automatic Child Tax Credit payments on July 15. Under the ARP, the maximum Child Tax Credit was increased to $3,000 per child (up from $2,000 per child) and to $3,600 for children under the age of six. To help working families access this support sooner, the ARP authorized the IRS to issue the Child Tax Credit in advance monthly payments rather than having taxpayers wait to claim the credit on their tax returns. The IRS anticipates that about 88% of families with children will receive the advance payments automatically. The IRS will be working with community-based nonprofits (see the next item for more details) to help other families with children access these advance payments.

On Wednesday, the IRS encouraged community-based nonprofits to spread the word about stimulus payments and the Child Tax Credit to people experiencing homelessness and individuals in their communities without bank accounts. The ARP included stimulus payments of $1,400 for most Americans and increased the amount of the Child Tax Credit (see the item above) and Earned Income Tax Credit for 2021. The IRS is automatically making stimulus payments and issuing advance Child Tax Credit payments to most eligible taxpayers through direct deposits, checks, and debit cards. However, the IRS needs help ensuring that people without permanent addresses or bank accounts have access to this important financial assistance. The IRS notice includes additional information about the ways that community-based nonprofits can help people they serve receive their stimulus payments and tax credits.

Last Friday, Governor Cooper issued Executive Order No. 215, which lifts many COVID restrictions across the state. The executive order, which follows updated guidance from the Centers for Disease Control and Prevention, ends the mask mandate in most settings. Under the executive order, masks are still required in schools, child care facilities, camps, hospitals, outpatient healthcare settings, long-term care facilities, skilled nursing facilities, intermediate care facilities for individuals with intellectual disabilities, correctional facilities, public transportation, and facilities providing services to people experiencing homelessness. Under the executive order, nonprofits may continue to require masks at their facilities and other places where they provide programs and services.

The ARP includes a provision that helps employers – including nonprofits – that have to lay off staff due to COVID provide health insurance premiums under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA). The new law provides a refundable tax credit for employers that will subsidize the full cost of COBRA health plans from April 1, 2021 through September 30, 2021. On Tuesday, the IRS issued guidance on this temporary COBRA subsidy. The guidance, which is in the form of answers to 86 common questions, includes information about the calculation of the credit, eligibility of individuals, the premium assistance period, and other issues.

Last Monday, Governor Cooper issued Executive Order No. 212, which extends through June 1 a previous executive order (Executive Order No. 136) allowing nonprofits with members to hold membership meetings remotely during the COVID-19 crisis. The order gives boards the flexibility to allow membership meetings to take place by remote communication and through remote voting, even if these types of remote meetings are not expressly authorized in the nonprofit’s articles of incorporation or bylaws. The Center advocated for Governor Cooper to issue the original executive order and to extend it. We are appreciative that Governor Cooper has provided this relief to nonprofits since it helps some organizations continue to take actions that require membership approval during the COVID-19 crisis.

Both the NC Senate (S.410) and NC House of Representatives (H.B 320) have unanimously approved legislation that would codify and expand Governor Cooper’s executive orders. Both bills would make it easier for nonprofits with members to conduct meetings remotely and for nonprofit board members to use email to take action by unanimous written consent. The Center is working with legislators to ensure that one of these bills becomes law this year.