Note: This article has been updated to reflect passage of the bill in the Senate and President Trump’s signing of the bill.
Nonprofits that depend on federal aid were deeply worried 16 months ago that the election of Donald Trump could spell disaster for their budgets — and for the people they serve. With a Republican-led Congress in place to back up Trump’s budget promises, the stars seemed aligned for deep cuts in domestic spending, billions of dollars of which flows through nonprofits in the form of federal grants.
Trump’s first budget, released a few months after his election, ratcheted up the anxiety level. He proposed slashing the Health and Human Services budget by 18 percent and housing programs by 13 percent, for example, with some anti-poverty programs zeroed out entirely. Also on the chopping block were programs that finance the arts, AmeriCorps, and college-loan subsidies to people who work at nonprofits.
It may be time for nonprofits to let out a big sigh of relief. None of Trump’s proposals for deep spending cuts have come to pass.
“We are pleased that agencies and programs critical to our communities were not significantly cut and, in some cases, were actually improved by this bill,” said Dan Cardinali, CEO of Independent Sector. “For example, programs like the National Endowments for the Arts and Humanities, the Corporation for National and Community Service, and the Public Service Loan Forgiveness Program received level or increased funding, a departure from the administration’s proposals.”
Politicking Ban Remains
Many nonprofits were especially pleased that the $1.3 trillion spending bill didn’t include a rollback of the ban on nonprofit politicking, something Trump and many House Republicans have been pushing for in recent months.
Nonprofit advocacy groups like Independent Sector say the ban on politicking helps preserve the integrity of nonprofits and maintain public support for their tax-exempt status.
Many religious leaders want to repeal the ban, saying it infringes on free speech.
Nonprofits that advocate for immigrants were disappointed the bill doesn’t include language to extend the legal residency status of “Dreamers” — people brought into the country illegally when they were children.
The bill includes $1.6 billion for border fencing and other security measures, far less than the president requested, according to the Wall Street Journal.
Much-Needed Victory
If the spending bill can be counted over all as a win for nonprofits, the victory comes at a good time. The recently enacted tax bill was widely seen as a lobbying disaster for nonprofits, who fear it will reduce charitable giving.
The House and Senate passed the measure ahead of the Friday night deadline to prevent a government shutdown, and President Trump signed it on Friday.
The bill would provide about $4.65 billion to help states and local governments fight opioid addiction, a $3 billion increase, according to the Washington Post.
According to the National Council on Nonprofits, the spending bill would also:
- Increase domestic spending by $63 billion.
- Provide $153 million each for the National Endowment for the Arts and the National Endowment for the Humanities, a $3 million increase.
- Boost funding for the Corporation for National and Community Service, which oversees AmeriCorps, by about 5 percent. Funding for the Corporation for Public Broadcasting would remain flat. Trump wanted to end spending on both.
- Provide $350 million for the Public Service Loan Forgiveness Program, which benefits employees of nonprofits and governments. Trump has proposed ending the program.
- Cut $175 million in funding for the Women, Infants, and Children program, bringing the total to $6.2 billion. It would provide an additional $1.5 billion for child nutrition programs, including $564 million for the Summer Food Service Program. The legislation would provide $74 billion for the Supplemental Nutrition Assistance Program, a $4.5 billion cut.
- Provide $37 billion for medical research at the National Institutes of Health, a $3 billion increase.
- Provide $28 billion for the Administration for Children and Families, a $4 billion increase. Early-childhood programs would get an increase of nearly $3 billion. Head Start would see a boost of $610 million, and the Child Care and Development Block Grant would get a $2.4 billion increase, to $5.2 billion.
Democrats also won a boost in a tax subsidy for affordable housing.
Doing It All Over Again
President Trump has signaled his support for the measure.
The spending bill, which is long overdue, would keep the government operating only through the end of the September, when fiscal 2018 ends.
More spending fights and a renewed push to overturn the nonprofit politicking ban are likely to ensue in the upcoming debate over the fiscal 2019 budget.
Tim Delaney, president of the National Council of Nonprofits, said in an email that while the current spending bill was “cause for cautionary celebration,” nonprofits must remain vigilant.
“The forces that pushed for deep cuts this time will continue to do so,” he said. “Nonprofits and foundations alike need to prepare for ongoing advocacy for their missions.”