Nonprofits hail anti-poverty aspects of COVID relief measure

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President Joe Biden signs the American Rescue Plan, a coronavirus relief package, in the Oval Office of the White House, Thursday, March 11, 2021, in Washington. (AP Photo/Andrew Harnik)

Nonprofit advocates have hailed Congress’ passage of a $1.9 trillion pandemic relief measure that has the potential to lift millions of people out of poverty at a scale not seen since the New Deal.

The legislation, signed by President Joe Biden on Thursday, expands a key loan program for nonprofits, boosts AmeriCorps funding and enacts or expands several programs aimed at providing direct relief to individuals.

Independent Sector, an advocacy coalition of foundations and nonprofits, said the legislation “contains important and hard-fought victories for the nonprofit sector and the people we serve during Covid-19 and these challenging economic times.”

However, the statement also complained that lawmakers omitted an expansion of the charitable deduction and said the Paycheck Protection Program is still far too restrictive.

Following is a summary of the key provisions of the measure that nonprofit advocates have been watching.

AMERICORPS

The legislation includes nearly $1 billion in funding over three years for AmeriCorps to expand national-service programs to respond to the pandemic. That’s a big boost: AmeriCorps budgets in recent years have hovered around $1 billion a year.

The funding will be primarily directed to existing programs to increase the living allowances paid to AmeriCorps members and expand their ranks, though AmeriCorps officials are still sorting out the details.

Samantha Warfield, a spokeswoman for AmeriCorps, said the measure will provide “bold, targeted investments we need in order to support the administration’s top priority of providing immediate relief for the pandemic.” She added that AmeriCorps can expand quickly.

AnnMaura Connolly, head of Voices for National Service, a group that lobbies in support of national-service programs, said the legislation’s provisions that increase the stipend paid to AmeriCorps members — which currently ranges from about $1,120 to $2,230 a month for AmeriCorps Vista members — will be crucial to expanding the economic appeal of national-service positions.

“While the language in the bill is not particularly directive, they do identify some priorities, and an important one is to increase the living allowance of those that serve, because it’s very hard to serve if you don’t have additional support,” said Connolly. “That’s very important from a diversity and equity perspective, and it will allow the corporation to put more boots on the ground and to fill gaps as they are needed.”

Jesse Colvin, CEO of Service Year Alliance, said the national-service provisions were a “monumental” first step for the Biden administration’s national service plans.

“It will provide new, and previously out of reach, opportunities to young Americans who are eager to serve and sets the stage for President Biden, who has the opportunity to make service a cornerstone issue of his administration,” said Colvin in a statement.

The additional funding includes:

— $620 million for AmeriCorps’ state and national programs, which provide grants to local nonprofits to hire AmeriCorps members for designated projects.

— $148 million for the National Service Trust, a program that pays off some student loans for AmeriCorps alumni.

— $80 million boost for AmeriCorps Vista, which works with local nonprofits and governments on anti-poverty programs.

EXPANDED LOANS FOR NONPROFITS

Under a stimulus bill enacted in March 2020, nonprofits with 500 or fewer employees were eligible for forgivable Paycheck Protection Program loans of up to $10 million. The new stimulus measure expands that eligibility to nonprofits that operate at multiple locations as long as no more than 500 employees work at any single location, according to the National Council of Nonprofits.

HELP FOR NONPROFITS THAT SELF-INSURE UNEMPLOYMENT BENEFITS

The measure extends and expands help for nonprofits that self-insure unemployment benefits. Under previous stimulus legislation, the federal government covered half the costs of benefits provided to their laid-off employees. The new legislation would expand the reimbursement rate to 75 percent from April 1 through Sept. 6.

HELP FOR STATE AND LOCAL GOVERNMENTS

The legislation will provide $350 billion for state, local and tribal governments. Nonprofit advocates say the money will prevent states and local governments from delaying or cutting payments to charities that have service contracts with them.

HELP FOR PEOPLE IN POVERTY

The Center on Poverty and Social Policy at Columbia University estimates that the stimulus measure will reduce child poverty by nearly half, and nonprofit advocates say that will reduce demand on overburdened charities.

It provides $1,400 in direct payments to most Americans in addition to the $600 in aid provided in the December stimulus bill.

The legislation also extends emergency unemployment benefits beyond their March expiration date to September 6 and increases the child tax credit.

It provides $20 billion in rental assistance plus $510 million for the FEMA Emergency Food and Shelter Program to support organizations that provide services to homeless people.

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This article was provided to The Associated Press by the Chronicle of Philanthropy. Michael Theis is a staff writer at the Chronicle. Email: michael.theis@philanthropy.com. Dan Parks is a senior editor at the Chronicle. Email: dan.parks@philanthropy.com. The AP and the Chronicle receive support from the Lilly Endowment for coverage of philanthropy and nonprofits. The AP and the Chronicle are solely responsible for all content.

Copyright 2021 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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