Dear Members,
Here are some public policy updates to be aware of - SEVERAL efforts coming out of the federal government could have a significant effect on the status/existence of nonprofit organizations.
Official AFP-sponsored activism is limited to promoting strategies to maximize philanthropic giving under the OBBBA at this time. I’ve attached a flyer so that you can learn more about what AFP is doing and their official stance.
For those of you interested in other activism impacting the nonprofit sector, I have compiled this information mostly from the National Council for Nonprofits.
THESE MEASURES WOULD IMPACT ALL NONPROFITS NATIONALLY.
URGENT….
Take Action! Administration Proposes Changes to Federal Grantees, Harming Nonprofits and Communities
The General Services Administration has proposed significant changes to the System for Award Management (SAM), the online portal nonprofits, state, local, and tribal governments, and other entities use to do business with the federal government. Organizations have until March 30 to submit public comments in opposition to the proposed changes.
If implemented, the changes proposed by the Trump Administration would directly impact nonprofits and other entities that apply for or receive federal financial assistance, including grants, cooperative agreements, loans, insurance, and direct appropriations. The proposed changes would require all applicants and recipients of federal financial assistance to sign new certifications under penalty of criminal and civil law. The certifications align with President Trump’s executive order and the U.S. Department of Justice guidance, misrepresenting “illegal” diversity, equity, and inclusion (DEI). The proposal also requires new certifications related to undocumented immigration and terrorism. For more information, read the proposed changes and supporting materials.
You can take action by March 30:
· Sign a national letter led by the National Council of Nonprofits (NCN) and Legal Defense Fund.
· Submit a comment letter using NCN’s comment guide, which includes talking points, instructions, and more information.
· Email your members of Congress and urge them to help protect nonprofit grantees and the communities they serve.
FUNDRAISING RELATED - Administration Threatens Combined Federal Campaign
The National Council of Nonprofits (NCN) sent a letter to the U.S. Office of Personnel Management (OPM), opposing its decision to decommission the Combined Federal Campaign (CFC) Charity Portal. The CFC provides federal employees, contractors, and retirees with an opportunity to make charitable donations to nonprofits through payroll deductions. Since it was created in the 1960s, the CFC has helped raise nearly $9 billion for nonprofits, and last year alone, the CFC raised $66 million. NCN also sent a letter to OPM in fall 2025, when the agency previously attempted to eliminate the program, but was forced to reverse its decision.
Federal Court Could Rule Soon on Nonprofit Nonpartisanship
Nonprofit nonpartisanship is at risk in the U.S. District Court for the Eastern District of Texas, where a federal judge may soon issue a decision in National Religious Broadcasters v. Werfel. The issue rests on whether the court will approve a legal settlement that would bar the Internal Revenue Service (IRS) from enforcing federal law, known as the Johnson Amendment, that has protected nonprofits from partisan politics for 70 years. While the legal settlement only applies to the two churches involved in the case, the court’s decision risks expanding the possibility of any church, synagogue, mosque, temple, or other house of worship to endorse candidates for public office without jeopardizing their tax-exempt status, and it could create a slippery slope to do the same for all nonprofits. The IRS may issue revised guidance to apply the legal settlement more broadly to all houses of worship, or even to all charitable nonprofits. NCN is closely monitoring the pending court ruling and any accompanying administration actions.
Federal Investigations and Inquiries into Nonprofits
A coalition of 19 Republican state Attorneys General (AGs) urged the U.S. Department of Justice (DOJ) to investigate over 150 U.S.-based nonprofits that work on environmental and other issues, accusing them of "taking money from foreign entities to influence energy policy in the United States." Without evidence, the state AGs allege that the nonprofits may be in violation of the Foreign Agents Registration Act (FARA) because they received grants from foundations with headquarters outside the United States. FARA requires individuals or entities to register with the DOJ with they are acting at the "order, request, or under the direction or control" of “foreign principals,” such as governments, parties, or companies.
The House Ways and Means Committee held a hearing on February 10 to discuss “Foreign Influence in American Non-profits: Unmasking Threats from Beijing and Beyond.” As follow up, Rep. Smucker (R-PA) announced that the committee is working on legislation to ensure greater oversight of tax-exempt organizations by the Internal Revenue Service (IRS). The legislation could require nonprofits to report to the IRS if they receive funding from international sources or donor-advised funds, and if the organization acts as a fiscal sponsor. Other proposals raised in the hearing include barring nonprofits from receiving donations from entities with headquarters outside the United States to support ballot measures, voter engagement, or issue advocacy, and revoking tax-exempt status – without due process – if the Treasury Secretary alleges the nonprofit has connections to the Chinese Community Party or terrorist organizations, engages in "disruptive" or violent protests, or promotes anti-Semitism or "illegal" diversity, equity, and inclusion (DEI) programs or practices.
Please let us know if there is specific information you would like to hear more about in the future.
With gratitude,
Jennifer M. Tersigni, CFRE
Government Relations Lead for AFP Southern Az & Member of AFP Greater AZ