Senate-Passed Stimulus Bill Does Not Include Philanthropy Measures

By Suzanne Perry and Grant Williams

Feb. 11, 2009, Washington, The Chronicle of Philanthropy — The economic-stimulus package passed by the Senate today does not include a number of measures that nonprofit and foundation leaders had proposed to help ease the impact of the recession on the philanthropic world.

As these provisions were also left out of the House bill, the chances that they will be included in the final stimulus package are slim.

They include:

* A $15-billion bridge-loan fund that was proposed by Independent Sector, a coalition of charities and foundations. The coalition says the money is needed to help charities that receive late payments from cash-strapped state governments while also facing a tight credit market.

* A “flat” excise tax for private foundations, instead of one that varies between 1 percent and 2 percent, pushed by both Independent Sector and the Council of Foundations. The groups say the current system penalizes foundations that substantially increase their distributions in a given year, thus affecting the five-year average used to determine their tax rate.

* A measure proposed by the Council on Foundations to allow people who qualify to transfer money from their individual retirement accounts to charity tax-free to give it to donor-advised funds. Under current law, charities can receive such gifts — but not donor-advised funds, which allow people to put money into account and distribute it over time.

* An increase in the tax deduction for people who use their vehicles to volunteer, which is much lower than the business mileage deduction. Sen. Charles E. Grassley, Republican of Iowa, had worked to include that provision in the stimulus package, but he did not succeed.

The Senate and House must now reconcile differences in their versions of the stimulus package. The Council on Foundations will continue pushing to get the measures on the excise tax and individual retirement account into the final package, says Rodney Emory, vice president of government relations.