Policy & Legislative Update

Impacts on Charitable Donations A WIN: After considerable opposition from a variety of interests, the IRS has withdrawn their proposed rule allowing nonprofits to ask for donor's Social Security numbers (here's our overview from December). Besides the unease of donors with giving this information, nonprofits themselves would've had to invest in secure systems to store this data.   TAKE ACTION! With a similar obligation/cost on nonprofit operations, legislation in New York (A03394) has been reintroduced that would require that nonprofits provide a receipt for donations to determine and disclose how that donation would be allocated internally.  For instance, "administrative expenses"  would have to be differentiated from funds "directly...helping with the...charitable work." This bill would require nonprofits to make a near-immediate internal commitment of donated funds, and maintain an internal accounting system tracking donations of all sizes.The publicly available Federal 990 tax return already provides a pretty clear picture of internal resource allocations. For these, and a variety of other reasons, we encourage NYCON members to contact your representatives and/or bill co-sponsors to share their perspective on the merits of this legislation. Ongoing $15 Minimum Wage Discussions On January 7th, 2016, the NY Senate Standing Committee on Labor invited a diverse cross-section of employers and economists to testify on their view of Governor Cuomo's proposal for a state-wide $15 wage by 2021. To be sure, there was some divergence in the viewpoints on feasibility and net impacts.Only 3 of the official 16 members of the Committee attended. An archived video of the (4.5 hour) hearing is available here NYCON prepared a brief synopsis of the comments offered by the respective parties. Click to Read. Other news Minimum Wage Updates: There are at least a dozen bills pending in the Legislature with bearing on NY's minimum wage. They range from simply tying the existing wage to inflation, to allowing counties to recommend a Living Wage. As NYCON has already said, it will be difficult for NY nonprofits to cope with the proposed increase, even if NY attempted to substantially offset an increased minimum wage, as most nonprofits are funded without NY State participation.  Now, it appears that the Governor's budget proposal leaves even the State's commitment in doubt. As a general reminder, the minimum wage in NY is $9 in 2016, with increases (for those only subject to NY, not Federal, law) in the overtime exempt salary levels of "Administrative" and "Executive" positions from $34,125 to $35,100. On that overtime exempt issue, the latest update on the proposed US Dept. of Labor regulations increasing the overtime exempt salary level (as long as the 'duties' test is also met)...is a midsummer 2016 publishing...with a 60 day implementation period. Again, most nonprofits in NY have activities that keep them outside of the Federal rules...whereby they are covered by NY only. NYCON will keep you updated on any developments. Ongoing Litigation on NY Executive Order 38 Leaves Ambiguity for Many Nonprofits  For those of you not subject to (or familiar with) NY's EO 38, it requires nonprofits that annually receive funding from New York State (or passed through the State) of over $500,000, when that exceeds 30% of their total annual revenues, to be known as "Covered Providers," with limits on administrative expenses and executive compensation. The best guidance we can give is to act as though the entirety of EO 38 is still in effect. Here is an excellent synopsis (from the law firm of Greenberg Traurig) of the litigation and the aspects challenged.