2023 Legislation to Strengthen the Nonprofit Sector
The charitable sector plays a vital role in addressing some of our society’s most pressing challenges and providing a wide range of services and support to communities across the country. As the third largest private sector employer and an integral partner in addressing social and economic issues, our sector supports a strong American economy and civil society. Yet, nonprofits are not at the table when federal policy is developed.
Independent Sector has been working with Congress and sector partners to address this omission. We are thrilled that Representatives Nancy Mace (R-SC) and Betty McCollum (D-MN) introduced in May the Nonprofit Stakeholders Engaging and Advancing Together Act, also known as The Nonprofit SEAT Act. This bipartisan legislation will strengthen the nonprofit sector and promote collaboration between the sector and the federal government.
Representative Structure
The Nonprofit SEAT Act will establish a structure that ensures the federal government is thinking about and engaging with the nonprofit sector. A White House office on the nonprofit sector and an Interagency Council will coordinate within the federal government to ensure that policies are designed with an understanding of the nonprofit sector to maximize benefit to our sector and the communities we serve. The Advisory Board, made up of community-based and national nonprofit and philanthropic leaders, will consult with federal government officials to provide insight into community and sector needs.
While the structure helps create a formal seat for nonprofits, the legislation also addresses many critical gaps in policy for our sector.
Regular Economic Data for Nonprofits
The charitable sector, which contributes 5.6% of GDP and has over 12 million employees, deserves to be treated as a major economic contributor. However, we are not given comparable workforce data that is given to other industries on a regular basis. When goat farmers know more about the state of their industry’s workforce than nonprofits, we have a problem. The Nonprofit SEAT Act directs the Bureau of Labor Statistics to report existing nonprofit economic data on a quarterly basis, as they do for other industries. Nonprofits leaders can use this data to inform the decisions they make for their organizations within the larger trends for the nonprofit sector.
Volunteerism, National Service, and Charitable Giving
National service is an entry into the nonprofit sector for many young Americans. Unfortunately, some nonprofits and prospective volunteers experience challenges accessing the current AmeriCorps program. This bill calls for reforms to improve access to the program for small organizations and organizations representing underserved communities. The legislation also encourages more research, data, and federal recommendations to expand volunteerism and charitable giving to help our sector thrive.
Easier for Nonprofits to Raise Money and Access Federal Grants
Many nonprofits secure their funding through a complex and confusing federal grant process. The Nonprofit SEAT Act would create a commission on federal grant reform — with strong
representation from the sector — to simplify and streamline formal partnerships with nonprofits to enable them to put more resources toward their missions.
To raise money across states, nonprofits must register and meet regulations in each individual state. This costs time and resources, both in short supply with even the largest organizations, much less small, community-led nonprofits. The Nonprofit SEAT Act would support the creation of a single online portal where organizations can fulfill existing state registration and reporting requirements in one place. This will make it easier and faster for nonprofits of all sizes to raise money.
We Need Your Support
Independent Sector is asking you to sign your organization onto a letter to be shared with Congress. You can also show your support by mobilizing your networks, posting on social media, and asking your elected representatives to support the bill. You can learn more about the bill on the IS resource page.
The Nonprofit SEAT Act represents an important step toward advancing and strengthening the nonprofit sector. This legislation enables nonprofits to contribute their expertise to shape the policies that impact them and their communities.
Nancy Barry is Manager, Special Initiatives, Public Policy at Independent Sector.
