Charitable Crowdfunding: An Alert for "Recipient Charities"
10.29.2024 | Linda J. Rosenthal, JD
In Nonprofit Volunteer-Mileage Rate Parity – Again (May 8, 2023), we wrote about the “national shortage of volunteers for nonprofit organizations and activities” that “has been – and continues to be – at a crisis level.”
Among those loudly raising the alarm has been Jan Masaoka: Volunteers are the Bees of Our Sector – And They’re in Trouble (April 2022, updated April 2023) California Association of Nonprofits. In that article, she lauded the try-again spirit of a pair of bipartisan legislators from Minnesota. They have reintroduced in the House of Representatives a proposal that failed last year: raising the volunteer-mileage tax-deduction rate to achieve parity with the much more generous amount Congress has allowed to business drivers. Of course, it’s a pittance of a benefit in relation to the size of the entire U.S. budget, but … help is help.
Separately, there is a piece of federal legislation in the news that includes a provision of particular interest to the nonprofit sector: “mandatory volunteerism.” At first blush, it seems a great idea to help out with the nonprofit staffing (paid and volunteer) shortage. It is not. It’s a truly insidious proposal that rears its ugly head from time to time. And the National Council of Nonprofits (NCN) has issued a warning about it (and two other provisions) in the most recent issue of its biweekly news bulletin, the Nonprofit Champion (May 1, 2023): See DOA, But Still Dangerous to Nonprofits.
On April 26, 2023, House Republicans passed (by a razor-thin margin: 217-215) a bill called the Limit, Save, Grow Act of 2023: H.R. 2811. In exchange for raising the debt-limit ceiling, the GOP included deep slashing of programs and other tweaks to the federal budget.
There is zero chance that the Senate will pass this bill, or that President Biden will sign H.R. 2811. Nevertheless, NCN took this opportunity to caution the nonprofit community about three provisions – “dangerous to nonprofits – that merit close watching as they could pop up in other legislation in the coming weeks or months. They are: (1) “Clawing Back Unspent Covid Funds”; (2) “Requiring Work – and Volunteering – in Support Programs”; and (3) “Repealing Green Tax Credits.”
The House bill (Sections 311, 312, and 321) would “expand the work requirements to more people under the Supplemental Nutrition Assistance Program (SNAP) and Medicaid, and include a ‘community service’ component that could result in individuals turning to charitable nonprofits to ‘work off’ their public assistance benefits. Charitable organizations generally oppose any such Mandatory Volunteerism condition because it shames and coerces individuals while also imposing increased costs, burdens, and liabilities on nonprofits by an influx of coerced individuals.”
This particular application of mandatory volunteerism was the subject of a flurry of activity in recent years. The prior Administration imposed the requirement on states as they administered these joint federal-state programs. The move was blocked in court and then abolished entirely when the current Administration came into office.
See our string of posts on this debacle:
Note, though, that this bad idea continues to be popular in a number of distinct contexts beyond the Medicaid/SNAP scenario. It pops up as a requirement (proposed or enacted) in many state and local benefit programs including general “welfare” programs. It is also popular as a graduation prerequisite in high schools and colleges.
There are many reasons why “mandatory volunteerism” is not just unnecessary (as well as cruel, oppressive, and degrading to the recipients of the benefits) but is also counterproductive. It’s not surprising that the term “voluntolds” has crept into the vocabulary surrounding this controversial concept.
For a sampling of these objections, see:
Of course, the nonprofit community’s key objections should be more than enough reason to permanently discard this policy in any and all of its forms. “Few if any of the mandatory volunteerism bill sponsors ever ask whether nonprofits in their communities can handle an onslaught of hundreds or thousands of individuals showing up on nonprofit doorsteps for the purpose of doing time rather than doing good….”
– Linda J. Rosenthal, J.D., FPLG Information & Research Director