Nonprofits may benefit from proposed legislation

REAL ECONOMY BLOG | May 18, 2023

Authored by RSM US LLP

A new bill in Congress could strengthen the relationship between the nonprofit sector and the federal government, providing nonprofits a seat at the table of federal policymaking.

Federal legislation specifically applicable to the nonprofit industry doesn’t come around that often, so it’s notable when it does. This is particularly true of the Nonprofit Stakeholders Engaging and Advancing Together (SEAT) Act.

Representatives Betty McCollum (D-MN) and Nancy Mace (R-SC) introduced the bill, H.R. 3245, on May 11. The bill was championed by Independent Sector, a national association of nonprofits, and has over 450 nonprofit organizations signed on as supporters.

The Nonprofit SEAT Act would create many new mechanisms for collaboration and communication, and provide funding for research and training.

Some of the key components of the Nonprofit SEAT Act include the following:

• Create the White House Office on Nonprofit Sector Partnership. Independent Sector’s summary says this office would make “recommendations on federal policies that would strengthen the nonprofit sector and its partnership with government” and coordinate “an annual release of existing data about nonprofits collected by federal agencies.” The office would also work to improve federal grant processes for nonprofits.
• Create the Interagency Council on Nonprofit Sector Partnership and the Advisory Board on the Nonprofit Sector, which would liaise with various parts of the federal government.
• Direct agencies such as the Treasury Department and the Bureau of Labor Statistics to provide and enhance data availability on volunteerism, donating and economic data. This would encourage more robust analysis and forecasting for the nonprofit industry, and in a similar format as for-profit organizations.
• Enhance processes related to federal grants, service opportunities and tax returns. This would create more simplified, streamlined processes and provide better clarity and data.

“The bipartisan Nonprofit SEAT Act recognizes the valuable role nonprofits play in shaping public policy at the federal level,” Congresswoman Mace said. “By giving the nonprofit sector a seat at the table, we can ensure their unique perspectives and expertise are considered in federal decision-making, while also ensuring they have access to the resources they need.”

The nonprofit community has applauded the bill and looks forward to its progress through the legislative process. The full text of the bill is available here, and the bill’s progress can be tracked at Congress.gov.