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By: Andrew Shafer, SD Solutions
The final weeks of December are always a good time to reflect on the year that is leaving us. As I write this, we are rapidly approaching 2017 – and 2016 was without a doubt one for the record books. The world and domestic landscapes certainly left us all challenged and constantly wondering what would be at the next bend in the road. As with most years, and in most sectors, the only guarantee that we have to lean on is change. In 2017, change we will! A new presidential administration will force the nonprofit sector to remain vigilant and responsive to proposed and adopted legislation that impacts each of the organizations that we are fortunate enough to work with.
The December 2016 issue of The Chronicle of Philanthropy featured an article titled “A New Landscape: What his views on taxes, spending, race, immigration, and more could mean for nonprofits.” Now most presidential transitions do include changes to many sectors in our society. However, it is predicted by most that many of the Trump Administration’s new policies and procedures will impact various part of our sector and we need to be prepared.
According to the Chronicle and many other experts, the most notable and wide-reaching policy that will impact the nonprofit sector involves the charitable tax deduction. No changes have been made as of this writing, however, advocacy efforts have already begun on Capitol Hill and those will likely continue long into 2017 and beyond. As most in the philanthropy space know, major and principal gifts are generally not very impacted by the need for tax benefits, but annual gifts and some planned giving decisions are incredible impacted. The Chronicle article states “…leaders…[need to] ratchet-up advocacy….to protect the charitable giving incentive….”
The other key point to consider as we enter the new administration’s move into the White House involves federal spending. Most leaders in philanthropy have already heard from foundation program officers in particular who have notified them of the decision to hold on further grant decisions. Until more is known about congressional and presidential decisions regarding rules for allocating funds, these foundations are causing angst for agencies dependent on these resources. In particular, anyone with government contracts should no be considering their “plan B.” For many, this will mean brushing off their latest wealth screening, or scheduling a new one, and focusing more on individual gifts.
Truth be told, all of the transition concerns may be exacerbated among organizations that have less diversified funding models. Just like personal finances, diversifying as a nonprofit means not relying on any one gift or fund for a majority percentage of their operating revenues. Of course, the best-case scenario would be if the economy thrives: President-Elect Trump has indeed pledged to “double economic growth” and Adam Myerson of the Presidential Roundtable, says “that will be great for charitable giving [if it happens].”
As consultants to nonprofits, we all have an obligation in times of transition and uncertainty to be the voice of reason to clients. Clients look to us as “experts” in our respect niche areas. If we are calm and confident, so too will they be calm and confident. If we are angry, nervous, and negative, clients will feel that. In fact, I would encourage all of us to challenge clients to think of the 2017 landscape as the “time to shine.” Let’s think more innovatively, get out of the office more, meet with one more potential investment partner (time, money, or other resources) each week. The time is now to effect positive and lasting change on the sector. We must ride the waves of the new administration while also keeping focus on our critical missions at hand.
Andrew Shafer is the Chief Advancement Officer for the Paulist Fathers - headquartered in New York City. He is also a consultant for nonprofit organizations; consulting on executive leadership and strategy development with a goal of creating "strategy leading to funding solutions." More at www.advancementplan.com. Andrew also instructs in an adjunct faculty capacity at a number of universities throughout the US. For more information, you can e-mail firstname.lastname@example.org or call 615.866.7037.
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