Note: This story has been updated to reflect that the AARP does not have a Political Action Committee (PAC).
William Daroff campaigned door-to-door for a candidate running for local council when he was just 7 years old. Fast forward 40 years. Daroff continues to work impacting the democratic process, this time as senior vice president for public policy at The Jewish Federations of North America (JFNA).
As director of JFNA’s office in Washington , D.C., Daroff oversees a staff of 17 — including six registered lobbyists — who work on issues ranging from poverty, Medicaid, social services and charitable giving to anti-terrorism funding, Israel-U.S. relations and the nuclear ambitions of Iran. This summer’s flare-up of violence in Gaza became the top priority for the office.
“During the current war in Israel, the vast majority of my time is focused on that component as it relates to interactions with the president and Congress as well as communicating with constituencies, local federations, news media and the like,” said Daroff. “We’re very engaged and work closely with AIPAC [The American Israel Public Affairs Committee] and other Jewish groups,” he said, as well as on issues relating to Medicaid policy, Jewish social service agencies, hospitals, and nursing agencies. For instance, JFNA is working with both Democrats and Republicans to try to get $5 million into the appropriations bill for Holocaust survivors living below the poverty line.
The Center for Responsive Politics (CRP) in Washington, D.C., home of OpenSecrets.org, estimates the nonprofit industry last year spent $44 million on lobbying, which pales in comparison to the likes of the pharmaceutical industry, which spent $226 million or even the automotive industry at $58 million, not including hospitals.
Contrary to what sometimes is misunderstood about nonprofits, charities can lobby, with some restrictions. Many have been involved during the past few years in trying to repel caps on the charitable tax deduction and others have their hands in a variety of issues, fighting poverty or securing funding for disease research.
“Much of our ability to advocate on the Hill comes from relationships that federation leaders have locally, where they’ve known their senator since he or she was a city councilman or an aide. They’ve grown up with them politically and actually,” Daroff said. On charitable giving-related legislation, several lobbyists pointed to JFNA’s senior tax policy counsel, Steven Woolfe, as their go-to person.
As nonprofits such as JFNA have their hands in a variety of pots, one piece of legislation seems to unite charities working across assorted subsectors of the industry. The America Gives More Act (H.R. 4719) passed the House in July by a 277-130 vote and headed to the Senate. President Barack Obama has threatened to veto the bill for not offsetting deductions with more revenue and previously has proposed limiting various deductions, including the charitable deduction.
The measure would make permanent several charitable giving provisions that expired in December, including the Individual Retirement Account (IRA) Charitable Rollover as well as a tax deduction for donating food inventory and charitable land easements and increasing donation limits for both. The bill also would allow taxpayers to take a deduction on charitable gifts until April 15 of the following year, similar to making IRA contributions, and reduce the excise tax rate on private foundations to 1 percent.
Among the things that must be done by Congress is approval of spending for the new federal fiscal year that begins Oct. 1, be it through a continuing resolution (CR), omnibus appropriations bill or a single bill.
Much also will depend on who holds leadership positions of key committees after November’s midterm elections. If Republicans take control of the Senate — which Democrats currently hold by just six seats — there’s speculation that they might push legislation on matters such as tax reform into the next session, he said.
Ron Wyden (D-Oregon) succeeded Max Baucus as chairman of the Senate Finance Committee earlier this year. U.S. Rep. Dave Camp (R-Mich.) will not seek re-election and it’s expected that Paul Ryan (R-Wisc.) could take over as chairman of the House Ways and Means Committee.
This is a unique opportunity and an important time to try to win, according to Russell Shay, vice president of public policy for the Land Trust Alliance, which represents 1,200 organizational members.
“Next year, we’re going to start the commotion all over again about tax reform,” he said. “Everyone seems to support reduced tax rates but it can only be done in a revenue-neutral way by taking away tax breaks, and the charitable deduction is among those potentially on the block. As long as tax reform is talked about, it’s a threat, and will be talked about until it’s accomplished. It’s an important time for the charitable community to be aware of what Congress is doing and to assert itself,” Shay said.
A Senate Finance Committee report on the bill would extend the measure one year, which Shay said would “leave us where we were before,” as of Jan. 1, 2015.
Comprehensive tax reform is likely to come up in the next Congressional session, but it could be a matter of when and how long that might take.
Elections are very good at covering up where people agree because everyone is emphasizing the differences of their opponents, Shay said. “Democrats and Republicans have a tough time agreeing on whether it’s day or night, let alone on tax reform. Complicated things tend to take a long time,” he said.
Daroff expects some tax extenders to be approved if the America Gives More Act isn’t the vehicle for those giving incentives in the short term, perhaps before the end of the year, after midterm elections. For the most part, members of Congress understand how important the charitable sector is and how vital these incentives are to ensure the nation continues to be philanthropic, he said.
Some see the gridlock in the nation’s capital as being worse than ever. It’s the “single most dysfunctional stretch in the city,” said Neal Denton. “I keep waiting for one of these elections to break the logjam and it’s not,” said the senior vice president and chief government affairs officer for YMCA of the USA. And Denton’s been around the Hill awhile, having held a similar post at the American Red Cross after almost 20 years as executive director of the Alliance of Nonprofit Mailers.
David Thompson, vice president of public policy for the National Council of Nonprofits, recalls running into Grover Norquist of Americans for Tax Reform earlier this year who agreed that the action is in the states. “Nothing’s going to happen here for three years,” he said, in a reference to Congress not acting until after the next presidential election in 2016. “Things just aren’t moving,” Thompson said.
“All you can do is to be ready as each train leaves a station, whether that’s a committee or one body of the House or Senate,” said Jim Clarke, senior vice president, public policy, ASAE: The Center for Association Leadership.
Clarke, who joined ASAE in 1997 after being staff director for former Rep. William Clinger, Jr. (R-Pa.), said some fear the lame duck session following this fall’s midterm elections could have the potential to be long and contentious. “There are things that will have to be contemplated in a lame duck. That’s going to be a very contentious period,” he said.
Despite what others might say, for a lot of issues, the nation’s capital continues to be the place where concerns need to be addressed, according to Daroff. Divided government off and on for the past 14 years has made both parties believe that they’ll have a better deal after the next election, he said, believing “the longer they can push pause, the better their deal will be.”
Few nonprofits are bigger on the lobbying front than AARP. The behemoth representing Americans 50 and older is armed with a 501(c)(4). “We obviously have advantages over small nonprofit shops just built in to being a large organization,” with the ability to focus on issues that some small shops can’t specialize as much, said David Certner, AARP’s legislative policy director and counsel.
Thanks to its vast membership, AARP enjoys a big presence in every congressional district and state so it’s visible both in Washington, D.C., and back home. The latter is something that Certner said small organizations can do, too: build a presence in their home district — but not just when faced with funding cuts or a bad bill. “If you’re ramping up just in times of crisis, it’s harder to see people. You can’t always get that meeting you need, it’s not as high a priority. Being visible throughout the year, talking about issues that you can project, they know you’re a resource, available and understand your position early on,” he said.
Thompson recalls a breakfast meeting years ago where Sen. Lindsay Graham (R-S.C.) proclaimed himself a proponent of big ideas. “I just need some, so come see me,” he said. That’s why Thompson stressed that elected officials need input. “Every nonprofit person knows their job better than a politician does. Everyone in nonprofits is an expert about their policy,” he said.
“There are key moments for any bill…but a lot of the work that leads up to that is building support for the policies,” said Michael Markarian, chief program and policy officer at Humane Society of the United States (HSUS) and president of the Humane Society Legislative Fund (HSLF). “We’ve been working on some issues that have been introduced year after year in numerous Congressional sessions, sometimes it takes a long time for an issue or a bill to get traction or critical mass of support,” he said.
If nonprofits have any advantage when it comes to lobbying, it’s their grassroots support and organizing. “I think something that really impacts the effectiveness — and it’s one of our strengths — is our grassroots are real. It’s big and it’s real and we make a big priority out of building them, educating them and activating them,” said Chris Hansen, president of the American Cancer Society Cancer Action Network (ACS CAN). “You can’t just go out to people cold, send them one message and hope to do something effective. You really have to feed it, you really have to train it,” he said.
The more that elected officials hear from nonprofits and the communities they represent, Shay said the more likely something will get done. “Sometimes it’s the most basic, old-fashioned politics that work: people keep asking for something, maybe they get it,” he said.
Given the gridlock, it might be an opportune time for organizations to show their face around Washington, D.C. “You have to find the right advocates, and the right stories, the right storytellers,” said Denton. “There’s a member of Congress whose family has been affected by the very thing you’re advocating to protect or the medical condition you’re trying to raise awareness about. There are folks on the Hill who could tell that story as effectively. That requires research and a little legwork.”
At its Lobby Day on Capitol Hill this month, ACS CAN – a 501(c)(4) offshoot of American Cancer Society – planned to focus on three issues: funding for cancer research through the National Cancer Institute; increasing the federal tobacco tax; and, quality of life legislation focused on palliative care. While ACS CAN routinely bumps up against tobacco companies regarding increasing taxes on its product, there’s really no opposition to pushing for more palliative care training of doctors, according to Hansen.
Hansen calls palliative care an issue that’s time has come. “It’s not just for cancer patients. Palliative care is for anyone with a serious illness,” he said. But anything in the healthcare space is a little more difficult to move at the federal level right now because of debate surrounding the Affordable Care Act. “Larger issues around the Affordable Care Act (ACA) have made some people reticent to get involved in any issue other than its repeal,” he said.
Lobbyists aren’t always only trying to affect legislation on the Hill, but also impact what the administration is doing within the regulatory environment, Denton said. “Often times a favorable or unfavorable paragraph in the Federal Register could be the difference between success and failure in your program,” he said.
Hansen added that it’s important to build relationships with those agencies so your point of view is reflected in the rulemakings. “You’ll find yourself coming from behind often if you don’t have an eye on the regulatory process. Often times that’s where the real action is here in D.C.”
Lobbying sometimes entails working with advocates and associations of opposing views in an attempt to reach common ground. At odds with a trade association representing egg producers due to the confinement of hens, the HSUS worked with the association and came up with an achievable timetable to phase-in new, larger cages as old cages are replaced.
The unusual alliance, which also had support of consumer groups and other stakeholders, ran into opposition in Congress from the pork and cattle industry, which feared the measure could set a precedent for national standards across industries, according to Markarian.
The Land Trust Alliance works with any number of groups “interested in maintaining wildlife habitat in a fast developing world,” Shay said, including sports foundations and hunting groups like the National Rifle Association (NRA). There are 65 groups that work in Washington, D.C., specifically interested in conservation easements. “Sometimes some of our members don’t agree on everything — that’s OK — but we try to pull them together, when we recognize that they and their members benefit,” he said.
While legislation might not be getting completed on the Hill or culminating in new statutes, there’s a lot of activity on draft policies or work on the committee level, according to Heather Noonan of the League of American Orchestras (LAO). She said she finds herself at committee hearings or agencies as varied as the Federal Aviation Administration (FAA) and Division of Fish, Game and Wildlife, representing LAO and its 900 members.
In addition to the primary focus on funding for the National Endowment for the Arts, arts education, and nonprofit tax policy, LAO has addressed policy issues including immigration (securing non-immigrant work permits for visiting musicians); new rules about elephant ivory (small amounts used decades ago on the bows of some string instruments); and, issues related to traveling with instruments in the cabins of airplanes.
“Sometimes colleagues who are advocates for other areas are surprised to see orchestras in the mix,” Noonan said.
United Way has always been involved in early education efforts, around issues like preschool funding and Headstart. It’s among the organizations aiming to get the Elementary and Secondary Education Act (ESEA) reauthorized in the current Congress.
“A lot of advocacy organizations are very focused on a really narrow issue. You may have an organization that their whole mission is around some very small component of the ESEA,” said Steve Taylor, senior vice president of public policy at United Way Worldwide in Alexandria, Va. “One of the things United Way brings to the table is more of a big picture, holistic approach.”
Most nonprofit lobbyists described their approach to legislation as “very pragmatic,” understanding that for the legislative process to work compromise is necessary. “If on balance, legislation is going to help the people and communities we’re really trying to help through policy work, even if there are aspects we don’t like, we’ll be inclined to support something if it’s a priority area for us,” said Taylor.
A good example of that was the reauthorization earlier this year of the Workforce Investment Act. “That legislation was not perfect, but it largely reflects the principle we’ve been advocating for,” said Taylor, who joined United Way Worldwide in 2007 after two years as general counsel to Chuck Hagel (R-Neb.), who has since become Secretary of Defense. Passage of the measure also was a pleasant surprise that helps to restore some hope in the federal process, he said.
Taking an aggressive yet pragmatic and strategic approach, Markarian said HSUS looks at what is achievable within the political landscape, and within a particular state. Having bipartisan support and making sure an issue doesn’t get caught up in partisanship, everyone agreed, is critical. “We want to work on policies that are achievable and have an impact. It’s not just enough for us to have a position on something,” Markarian said.
Nonprofits are limited in how much lobbying they do, which is one reason why HSUS formed a 501(c)(4) social welfare organization, the Humane Society Legislative Fund (HSLF) as well as a political action committee (PAC). The social welfare group can do unlimited lobbying but contributions are not tax-deductible as they would be to a 501(c)(3), which can do limited lobbying but the majority of work must be non-lobbying.
The biggest successes over the years for ACS CAN have been related to tobacco, whether increasing taxes on tobacco products or getting legislation enacted to prohibit smoking in various places, like restaurants, parks or beaches. “We’ve picked the low-hanging fruit,” Hansen said, so policy wins are getting more difficult.
Hansen spent almost 30 years in government relations for Boeing, following by stints at AARP and the Technology Trade Association before getting a call from a recruiter about ACS CAN’s president position. From his experience on the corporate side, that’s more of “an inside game,” he said. “We build everything up with public support; they don’t have that,” Hansen said. They have to build a different kind of credibility, sometimes using other tools like campaign contributions. “We have more public support always on those things but not the financial resources they have,” he said.
Big business and industry has a lot of money that depends on government rules but the nonprofit sector is “not inconsequential but we have different tools,” Shay said. “Very few of us have PACs, very few of us are handing out checks, but we represent as much as 10 percent of the jobs in America and loads of people who depend on us for what we do.” NPT