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Can Charities Survive Trump? For Some, It’s Life and Death

This post was originally published here (NY Times).

Tom Sheridan opened his lobbying firm in 1991 with the motto “Helping the good do better,” and these days he could use all the help he can get.

As a left-leaning lobbyist for the nonprofit sector, his job is getting the voices of groups like the American Cancer Society, Save the Children Action Network and the ONE Campaign (which fights poverty and disease) heard in Washington. Over the years he has gotten support from both political parties for a variety of causes with the help of celebrities like the Irish rock star Bono and the actresses Elizabeth Taylor and Jennifer Garner.

When administrations change, there is a normal ebb and flow of political appointees and an inevitable shift in focus for power brokers. Everyone adjusts to a new normal, identifies where opportunities are and finds point-people in the White House and on Capitol Hill who can advance their agendas.

But everything changed in January, with the new administration determined to slash budgets and minimizing priorities for anything not related to the military and Homeland Security.

Domestic and international development groups face proposed deep cuts in federal funds, and so do social programs that include meals for older adults, work-study programs for college students, programs to help homeless veterans and support for the arts and public broadcasting. Conservatives have come to power before, but Mr. Sheridan says the tone is different this time.

Whereas in prior handovers nonprofits faced a fight for keeping or increasing their share of federal support, this time they face extinction. “This isn’t a political threat, it’s life and death,” Mr. Sheridan said by phone in March. “We’re not fighting ideology. It’s raw politics and a culture that is extremely new. Many are not equipped to handle it.”

Federal funding to support nonprofits has been a Republican bugaboo since the Reagan era, when policy priorities focused on cutting taxes and giving states more of a say in allocating the funds directed to them by Washington. Mr. Reagan shifted to a system of block grants to states for services related to aging, children and mental health. And those grants have been a favorite target for elimination by Republican lawmakers in recent years.

Still, there have been opportunities for widespread support for some causes. Mr. Sheridan, a social worker by training, began his lobbying career in the late 1980s, representing AIDS activists pushing for a federal response to the growing health crisis. Their work led to two early achievements: the Americans With Disabilities Act and the Ryan White Care Act, which funded H.I.V. and AIDS research and treatment, both signed into law by George H.W. Bush.

The Clinton administration created the national volunteer organization AmeriCorps in 1993 under the Corporation for National and Community Service, the new name for a federal agency established during the George H.W. Bush administration to help advance his “1,000 points of light” vision of national service.

AmeriCorps would become a big vehicle steering how the federal government finances community programs such as local disaster services, youth education, financial literacy programs and affordable housing through Habitat for Humanity.

In 2001, George W. Bush came to office promising his own brand of “compassionate conservatism,” an opportunity Mr. Sheridan seized upon. Senator Edward Kennedy introduced him to Bobby Shriver, a Kennedy nephew, and along with Bono, they helped push through the bipartisan emergency AIDS relief program for Africa. The program devoted $1.1 billion last year to medicine and prevention programs through government and development agencies.

In 2009, again with bipartisan support, President Barack Obama authorized the expansion of AmeriCorps and created the Social Innovation Fund, designed to match government grants with private sector investments to finance programs on chronic homelessness, unemployment, mental health and early childhood education. In eight years it has invested more than $1 billion (about $300 million of government money) in 469 nonprofit organizations.

Financing such programs in a way that appeals to Republicans and Democrats has been a major effort, says Mark Shriver, the president of the Save the Children Action Network, an advocacy arm of the nonprofit group, which focuses on early childhood education and maternal and child health care. He has been talking to both parties, attending political conventions last summer and having conversations with the administration and lawmakers at the state level.

“You need to have solutions that are palatable to both sides,” said Mr. Shriver, who is Bobby Shriver’s brother.

Social impact bonds are one of those ideas. Essentially, they are loans from the investors who buy the bonds to social services programs. If the programs are successful, the private investors get paid back. Eight projects financed by them emerged in the last years of the Obama administration with mixed results. But they have the backing of big banks like Goldman Sachs and wealthy investors like Chicago’s Pritzker family foundation, which teamed up on a bond to support a Utah preschool program.

Nonprofits are bracing for what’s next. President Trump’s proposed budget eliminates the Corporation for National and Community Service, and with it would go AmeriCorps, a related program called Senior Corps for older volunteers and the Social Innovation Fund.

A mini-version of this played out in 2013 when Congress failed to make required budget cuts, triggering an immediate reduction in funds to a wide range of defense and civilian programs. As Mr. Sheridan wrote in The Huffington Post at the time, millions of older adults received fewer meals, tens of thousands of children lost access to early education in Head Start, and research on cancer and AIDS was halted.

“Rarely in our nation’s modern history have the differences of our political parties put our nation at such risk,” he wrote. “Walking the halls of Congress, veteran lawmakers and their staff are asking themselves, ‘Has it ever been this bad?’ The standard answer among most is, ‘No, it really hasn’t.’”

What does he think of the current climate? “This is going to be a fight unlike one we’ve ever had before,” he said.

They are merely proposals for now. If the health care legislation in Congress is any indicator, Mr. Trump’s ability to push through his whole budget may be limited.

“There is a ramped-up harsh tone that’s generating fear that I haven’t seen before,” said Tim Delaney, the chief executive of the National Council of Nonprofits, who says he and his staff have pulled a lot of all-nighters recently because of the significant increase in activity. “Hyperpartisanship is ripping our country apart. We have to bridge the divide and bring people together.”

He is fighting to protect the tax deduction on charitable donations and make it universally available, because reductions in giving would have devastating consequences for food banks, art groups and other community-based charities.

At the state level, Republicans have shown a willingness to play ball, Mark Shriver said. Governor Chris Sununu of New Hampshire, a Republican whom the Save the Children Action Network spent $1 million trying to defeat in last year’s election, recently proposed a $9 million program for all-day kindergarten in some of the state’s neediest communities. The Save the Children Action Network has been running media spots in the state praising the proposal.

Tax policy could be an opportunity for nonprofits, Mr. Sheridan said. Along with immigration, trade and health care reform, Mr. Trump came to office on the promise of a tax overhaul. The Save the Children Action Network has proposed expanding tax credits and deductions for supporting early childhood education, in just one example.

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Image: Lexey Swall for The New York Times

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