State Nonprofit Policy Updates

Posted By: Ann Timberlake Advocacy ,

 

Public Policy Agenda for the Spring 2020 Legislative Session 
Adopted by the Together SC Board Jan. 28, 2020

Together SC is South Carolina’s network for thousands of charitable nonprofit and philanthropic organizations, and as such takes positions and advocates on state and federal public policy issues that affect the ability of our state’s charitable nonprofits to function effectively and efficiently.

Policy priorities for Together SC are identified by its Advocacy Committee and approved by the Board of Directors.  Together SC does not typically take positions on local issues, unless the issue has statewide relevance and it has been invited by a member organization to do so.

STATE POLICIES

Tax Policy:

Charitable nonprofit organizations provide services and social good for all South Carolinians, and in recognition, are exempted from income and other taxes.

Nonprofit tax exemption

  • SUPPORT: full exemptions from state and local taxes and licensing fees in lieu of taxes (also known as PILOTs).
  • OPPOSE: attempts by local governments to circumvent tax exemptions through creative relabeling of taxes, or charging fees to nonprofits that are not charged to for-profit companies.
  • SUPPORT: maintenance of state property tax exemption for charitable nonprofit organizations.

Sales tax on services

South Carolina has a myriad of sales tax exemptions for certain organizations and even named organizations. Yet, there is no general exemption from sales tax for charitable nonprofits as exists in least 30 states.

  • SUPPORT: state sales tax reform that includes an exemption for charitable organizations similar to those in most other states.

Nonprofit Operations:

Government regulations and contracts for goods and services awarded to nonprofits should be reasonable and treated the same as for private for-profit companies.

Freedom of Information Act

  • SUPPORT: reforms of the state FOIA law that do not impose burdensome requirements or treat charitable nonprofit organizations differently from other companies. The agency that grants or contracts with charitable nonprofits should be responsible for appropriate disclosure under FOIA.

Raffle Reauthorization

  • SUPPORT: S719 and H.4937 to eliminate the sunset clause set for 2020, increase the value of prizes and allow unified reporting by organizations with multiple chapters. Nonprofit organizations have raised over $13 million in the five years since charitable raffles were legalized in South Carolina.

The State Budget:

Governments often contract with charitable nonprofit organizations because nonprofits have proven to be efficient and effective in delivering public services but nonprofits are often not paid the full cost of providing public services and are underpaid for their documented indirect costs.

Nonprofit Contracting: The General Assembly should:

  • Require state agencies to sign contracts with nonprofits before nonprofits are asked to begin delivering public services.
  • Ensure that the state budget includes enforcement mechanisms for prompt contracting and payment.
  • Ask the Legislative Audit Council to study problems with nonprofit-government contracting, including late contracting, late payments, and underpayment for indirect costs.
  • Adopt the OMB Uniform Guidance to guarantee full and fair implementation of cost principles and other grants reforms.
  • Provide adequate state support for public services provided by nonprofits - and where appropriate, expand funding for nonprofits that are expected to provide services instead of state or local governments.

Transparency & Accountability for state funds

  • MONITOR: legislation to ensure transparency and accountability for state funds directed to nonprofit organizations through state agencies as "member requests" or earmarks.

Major Issues That Affect the Nonprofit Sector

2020 Census

  • SUPPORT: a fair, accurate, and complete count in the 2020 Census because an accurate account is vital to ensuring that South Carolina receives its fair share of resources and funding. Solid data is essential for nonprofits and funders to plan and evaluate programs and services.

 

FEDERAL POLICY