The American Rescue Plan has Highlights and Holes for Nonprofits

President Biden’s $1.9 trillion American Rescue Plan continues to weave its way through the complex budget reconciliation process on Capitol Hill, but it took a major step forward on February 19 with the release of compiled legislative text by the House Committee on the Budget. House leadership has indicated that they will pass the legislation by the end of this week and have issued their customary threat that action could slip into the weekend.

The package measures in at a relatively svelte 591 pages – roughly one-tenth of December’s relief, tax, and spending law. If even a mere 600 pages is more than you care to read, Independent Sector has released a summary of provisions relevant to the nonprofit sector. From this summary, a few key things stand out:

  • Expanded Paycheck Protection Program eligibility is not yet at what our sector requested, but still a significant and hard-earned victory for nonprofits that operate more than one physical location.
  • Substantial funding for state and local governments – a top Democratic priority for months – reflects the partisan nature of this process, but is also a victory for nonprofits. This funding will either flow through to nonprofit partners, alleviate some of the need for government funding cuts, or both.
  • This legislation is compiled from the work of nine separate committees over the past couple weeks. Committee consideration yielded few substantive changes overall, but it did lead to a prospective increase in the reimbursement percentage from 50% to 75% for nonprofits that self-insure for the purposes of unemployment insurance. This is yet another sign that legislators are hearing our sector’s message and trying to find ways to help.
  • The package makes major investments in civic and community infrastructure, echoing in some form many Nonprofit Infrastructure Investment Advocacy Group (NIIAG) policy priorities. NIIAG – started by Independent Sector and IS member, KABOOM! – is a national coalition that began in 2020. It is made up of more than 35 national, regional, and local nonprofits and foundations.

Once this legislation clears the House of Representatives this week, it will move to the Senate, where the strict requirements of the budget reconciliation process only get more arcane. Democrats will need to navigate those procedural hurdles and maintain unanimous support in their caucus, and time is growing short to meet their stated March 14 deadline. Nonprofit advocates will be watching closely and advocating furiously as we try to further shape the American Rescue Plan to our sector’s needs.

Types: Blog
Global Topics: Congress, COVID-19 Public Policy, COVID-19 Response, Infrastructure, NIIAG, Public Policy
Policy Issues: Civil Society Infrastructure, Nonprofit Operations