LSA Public Policy Priorities
Nonprofit organizations make up 14 percent of the nation's workforce, but issues unique to nonprofits are often overlooked in the development of legislation and regulations. With over 300 member organizations which are impacted by federal legislation and regulations on many levels, LSA believes it important to be a voice for Lutheran health and human services organizations on these issues. Some key issues LSA will be focusing on this year include:
- Defined Benefit Pension Plan relief
- Extension of the IRA charitable rollover
- Volunteerism and national & community service
Defined Benefit Pension Plan Relief
Several LSA member organizations have had their defined benefit pension plans greatly impacted by the economic downturn. The impact has been a large financial burden at a time when state funding and individual giving is also down.
Independent Sector, a non-profit, non-partisan partner organization of LSA, describes the situation: "Many employers, including nonprofit organizations, that sponsor defined benefit pension plans will soon be required to make large catch-up contributions into their pension funds due to the decline in the financial markets at the end of 2008 and new pension funding rules that require the losses to be repaid within seven years. Congress is considering providing temporary relief in order to permit these employers to stretch out the cost of the unexpected losses. Without this relief, nonprofits that sponsor defined benefit plans will be forced to pay off the losses by shifting substantial financial resources away from vital community services.
A defined benefit plan requires an employer to fund pension obligations in advance and typically provides a pre-determined annuity to employees when they retire. These plans differ from defined contribution plans, such as 403(b) retirement savings plans, in which the employer makes contributions each year, but does not promise a specific retirement benefit." (Independent Sector website)
Extension of the IRA Charitable Rollover
Since August 2006, individuals aged 70 1/2 and older have been eligible to donate up to $100,000 per year from their individual retirement accounts (IRA) or Roth IRAs to charitable organizations without it counting at taxable income. This provision expired on December 31, 2009, but is included in a tax extenders package the House passed in December 2009. LSA is working with many other national, state and local nonprofit organizations to advocate for an extension of this provision to be voted on by the Senate.
Volunteerism and National Service
America is experiencing an increase in individuals looking for ways to serve and give back to their communities. People are applying for national service programs in record numbers and individuals of all ages, particularly older baby boomers, are looking for meaningful volunteer work. Despite the economic recession, people want to contribute in a meaningful way and serve their neighbors.
Several new initiatives are being undertaken in this area, including an expansion of AmeriCorps and other national service programs as a part of the Edward M. Kennedy Serve America Act in April 2009, the Social Innovation Fund, the Volunteer Generation Fund, and several other public and private ventures to recruit and train volunteers and increase organizational capacity.