State Legislation & Issues
Nonprofit Property Tax Exemption - SB 960
Michigan Senate Bill 960 will address the rise in the number of cases of local tax assessors challenging the property tax exemptions of charitable nonprofit organizations. The nonprofits involved are located all over the state and represent a wide variety of charitable organizations such as child development centers, nursing homes, and homeless shelters.
Specifically, the bill intends to do the following:
- Codify and modify the Michigan Supreme Court’s holding in Wexford Medical Group v. City of Cadillac (the “Wexford decision”).
- Strengthen and bring clarity and consistency to the process, not expand or restrict the eligibility for exemption.
- Define what it means to be a charitable institution.
- Require the State Tax Commission to work with the Michigan Nonprofit Association to educate assessors about the changes contained in the legislation.
To see a list of organizations in support of the bill, click here. If you would like to add your organization's support, please contact Terry Streetman, Communications & Public Policy Manager, at email@example.com.
From the Michigan League for Public Policy
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Federal Legislation & Issues
Federal Judge Blocks Overtime Rule
Late on Tuesday, November 22, 2016, a federal district judge in Texas issued a preliminary injunction blocking implementation of the Overtime Final Rule, ruling that the U.S. Department of Labor exceeded its authority. Barring a last-minute appeal, the overtime rule will not go into effect as scheduled on December 1 because of this decision.
At issue is the question of which employees qualify for an exemption from the requirement under the federal Fair Labor Standards Act (FLSA) that most employees are entitled to time and a half overtime pay for work in excess of 40 hours in a week. The FLSA exempts from the overtime requirement “any employee employed in a bona fide executive, administrative, or professional capacity,” often called the EAP or “white collar” employees. Current regulations require that employees must possess the duties of executives, administrative workers, or professionals and be paid more than a minimum salary. The overtime rule published by the Labor Department in May, and set to go into effect on December 1, would have more than doubled the existing “salary level test” for exempt white collar employees from $455 per week ($23,660 per year) to $913 per week ($47,476 per year).
Twenty-one Governors and Attorneys General filed suit in federal court challenging the overtime rule on several grounds. Siding with the states, Federal Judge Amos Mazzant held that the white collar exemption is clearly based on the duties that individual employees perform, and that the Labor Department did not have the authority to create a different or higher standard. Specifically, he ruled: “Congress gave the Department the authority to define what type of duties qualify [for the overtime exemption] — it did not give the Department the authority to supplant the duties test and establish a salary test that causes bona fide EAP’s to suddenly lose their exemption ‘irrespective of their job duties and responsibilities.’”
The judge issued a nationwide preliminary injunction. The Department of Labor is expected to appeal the decision, meaning the injunction could be lifted and the overtime rule put in place in a matter of weeks or months.
Charities Helping Americans Regularly Throughout the Year Act (CHARITY Act S.2750)
Senators John Thune (R-SD) and Ron Wyden (D-OR) today introduced the "Charities Helping Americans Regularly Throughout the Year Act" (CHARITY Act), S.2750.
If enacted, the legislation would:
- Express the sense of the senate that "encouraging charitable giving should be a goal of tax reform," and that Congress should ensure that the value and scope of the federal charitable deduction "is not diminished
- Permit IRA rollovers into donor advised funds and add pay-out and other disclosures for DAFs
- Streamline the foundation excise tax by setting a fixed rate of one percent (unenacted portion of the America Gives More Act)
- Mandate electronic filing of IRS Form 990s, with a delayed effective date for smaller nonprofits with revenues of between $200,000 and $500,000
- Establish an adjustable Volunteer Mileage Rate pegged to rate for medical/moving purposes (currently 19 cents)
- Make a limited exception to the private foundation excess business holding tax for enterprises that donate all profits to charity.
Nonprofit Advocacy Matters
The National Council of Nonprofits provides MNA's members access to public policy, training, and education resources at the national level. Nonprofit Advocacy Matters is a bi-weekly newsletter on policy issues affecting the nonprofit sector.Click here to access the most recent issue of Nonprofit Advocacy Matters.