Congressional Democrats push $50B bill for nonprofits
Congressional Democrats are pushing a federal bill that would give nonprofits $50 billion to help them retain employees, hire newly unemployed workers and expand their operations to combat the devastating effects of the coronavirus pandemic.
The bill, which was reintroduced in the U.S. Senate this week by U.S. Sen. Amy Klobuchar and three other Senate Democrats, would give individual nonprofits grants of up to $3 million. However, experts say the bill’s chances of passage this time remain unclear.
Most of the money will cover wages and benefits for existing or new employees with salaries of up to $50,000. Nonprofits can also use some of the funds to pay expenses, like rent and utilities, and program costs. The bill would also allow intermediary organizations, which help and provide expertise for nonprofits, to get grants of up to $100 million.
Klobuchar sponsored a similar bill last May, but it failed to advance. Since then, the nonprofit sector has shed nearly a million jobs, with one estimate from The Johns Hopkins Center for Civil Society Studies showing more than 926,000 nonprofit jobs were lost during the first year of the pandemic.
“As demand for their services continues to soar, many of these organizations are struggling financially,” Klobuchar said in a statement. “We need to help charitable nonprofits keep their doors open, scale their invaluable services, and provide opportunities for unemployed Americans to return to work serving their communities.”
The Minnesota senator and six other Senate Democrats also sent a letter to congressional leaders urging more nonprofit relief, like the ones in the bill, in future coronavirus aid packages.
Nonprofits with 500 or fewer employees have been able to get forgivable loans for expenses through the
government’s Payment Protection Program. The $1.9 trillion relief package that was recently signed into law by President Joe Biden expanded eligibility for those loans to include more nonprofits.
Shena Ashley, the head of the Urban Institute’s Center on Nonprofits and Philanthropy, says advocates have a stronger case to make for more funding this time around since nonprofit workforce numbers have been so dismal.
But, she suggests getting the legislation passed could be an uphill battle since many nonprofits have been able to benefit from PPP loans. Those loans are provided at a low interest rate and are fully forgivable under conditions that include spending a certain percentage on payroll costs.
“I was not surprised to see it come up again, but I’m also not super hopeful,” she said, adding, it’s “harder to know why we need to create something explicitly for nonprofit organizations.”
But supporters say more funding is critical because the needs are still large and it can help with recovery efforts.