National Council of Nonprofits

Nonprofit Advocacy Updates | June 14, 2021

Serving Notice

Congress, Don’t Claw Back State and Local Fiscal Recovery Funds | They are Vital to Nonprofit Recovery

An article by the National Council of Nonprofits shares: “Today, the National Council of Nonprofits sent a letter to congressional leaders and all Members of Congress opposing any proposal to claw back or reclaim funds already allocated to governments from the American Rescue Plan Act. That law promised $350 billion in State and Local Fiscal Recovery Funds to all levels of government and expressly declared that governments can use the money to support nonprofits recovering from the pandemic and providing needed aid in their communities. In recent days (see next article), some Senators have called for blocking those funds from going out to state and local governments and instead using the money to pay for other spending plans, namely, infrastructure programs. Seeing this approach as shortsighted, the National Council of Nonprofits points out that the “recovery is not assured; many people, communities, and the organizations that support them continue to suffer from the pandemic’s aftermath.”

In sending the letter, the National Council of Nonprofits is standing with the National Association of Counties, National League of Cities, and U.S. Conference of Mayors, which recently sent their own letter to congressional leaders expressing opposition to reclaiming or “clawing back” American Rescue Plan funds. However, the concerns from the nonprofit perspective go further because the federal support for charitable organizations has been less robust compared to other segments of the economy. The State and Local Fiscal Recovery Funds are seen by nonprofits as “their best and likely last chance to achieve any degree of parity and fairness.” Regarding the proposed taking of already allocated funds to pay for other purposes, the letter explains, “None of the ‘hard’ infrastructure proposals currently under discussion address the unmet needs of charitable nonprofits and the people they serve; only the State and Local Fiscal Recovery Funds provide the potential for that relief.” It concludes, “Therefore, it is imperative that you reject any attempt to claw back or reclaim ARPA funds at the devastating expense of charitable nonprofits serving your constituents and all Americans, every day.””

More Inside this Issue:

Federal Issues

  • Infrastructure Bills and Nonprofits
  • Federal FastView
  • Nonprofit Jobs Update
  • Unemployment Data and Policy
  • H1B Work Visas
  • Form 990 E-Filing
  • In Focus: Donor Advised Funds

State and Local Issues

  • State Revenues: AZ, CA, CO, FL, ID, MD, MO, NJ, OK, TX, UT, WA
  • Charitable Giving Incentive: CO
  • Legislative Studies: MA, NE, NH
  • Government-Nonprofit Grants Reforms Update: CO, MD, MA

Advocacy in Action

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