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How might the election results impact federal funding for local nonprofits?

Lansie Sylvia. November 23, 2016 Category: ColumnFeaturedFundingMedium

How to Give is a biweekly column by local philanthropy wizard Lansie Sylvia. In it, Lansie answers readers’ questions about millennials, philanthropy and engaging the next generation of givers. To ask her a question, tweet @FancyLansie.


How might the election results impact federal funding for local nonprofits?

I’ve spent a lot of time pondering and researching this question, and the simple answer is that it’s too complex to answer with any degree of confidence. While this may seem like a cop-out, I would hope that in this time of platitudinal pomp, my admission of humility will be seen as honesty, and not ignorance.

Nonprofits receive funding from a variety of hyperlocal, regional, statewide and federal sources. As such, they need to navigate multiples tiers of legislatures, plus all three branches of government because judges, legislative bodies, corporate executives, lobbyists and administrative agencies all have varying levels of judgment and power over what happens to specific nonprofits, and the charitable sector as a whole.

Here’s what we do know: Nonprofits most often work on the issues that no one else has the conviction or compassion to tackle. Nonprofits feed the hungry and shelter the homeless. Like so many Mothers of Exiles, nonprofits across America tell us to give them our tired and our poor, and in exchange, they ask that we give them our donations so that they can continue this often-thankless work.

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It’s hard to know what the president-elect will actually do in his first hundred days, or in the 1,360 after that, but based on what he’s said he will do, here are some possible philanthropic impacts:

  1. Widespread despondence will increase year-end giving. With widespread moral panic afflicting over half the voting population, many people are wondering, “What do we do now?” Edutainers such as Jon Oliver have suggested donating to pro-women, minority, immigrant and LGBTQ organizations such as Planned Parenthood and the ACLU. We could see an increase in monthly giving as well as higher year-end giving for nonprofits working within these specific cause areas.
  2. … Or the instability caused by the election could shoot short-term giving in the foot. We know that donors give more when they feel a sense of belonging, and many people are feeling disconnected from their neighbors, communities and nation right now. This could mean less year-end giving and an overarching depression of generosity in the coming year.
  3. … And then his tax plans could shoot medium-term giving in the other foot, ankle and knee. The president-elect’s proposed tax plan calls for repealing the estate tax and capping itemized deductions at $100,000 for individuals and $200,000 for couples. According to one analysis, this could result in a decrease in charitable giving by between 4.5 percent and 9 percent, or as much as $26.1 billion per year. Woof. 
  4. … But then again, maybe his tax plan will increase charitable giving? The possible elimination of the estate tax could push the wealthiest individuals to increase their charitable giving related to business sales and acquisitions in a more advantageous tax environment. But most mega-gifts are given to universities, so that might not help your average American in need of a hand-up all that much.
  5. Cuts in government spending could leave nonprofits picking up the slack. A newly conservative Congress could slash funding to government programs, leaving America with two choices: Turn to nonprofits to support education, arts and culture, health initiatives and more … or no longer have those things in our lives. This is especially true if the president-elect increases defense spending because that money will likely come out of the budgets for social service programs.
  6. Nonprofits that support abortion rights, immigration, environmental issues, rights for transgender individuals and other “liberal” causes could have their work cut out for them and might need all the philanthropic help they can get. Two words: Supreme Court.

See what I mean? There are so many factors to consider, it’s hard to prognosticate with any degree of certainty. And that’s without even touching the World’s Largest Can of Worms that is the possible repeal and replacement of the Affordable Care Act.

But can I be honest for a second? I’m scared, and I know a lot of you are, too. For many of us, the country feels broken in an irreparable way. My own personal life buoy has always been giving.

Donating to causes that matter to you is a way to give yourself agency during the darkest of days. Use your dollars, your time and your voice to ally with the nonprofits that are working day in and day out to support the causes that matter most to you.

And stay strong.


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