Author archives: Connor Semelsberger, MPP

Families and Charitable Organizations: The Foundation of American Society

by Connor Semelsberger, MPP

June 17, 2020

This piece was originally published at NRB.org.

Churches and other charitable organizations have been on the front lines of the coronavirus response. A few examples are Samaritan’s Purse building a field hospital in New York City’s Central Park and churches hosting food drives and conducting coronavirus testing. One Alabama church tested 1,000 people in two days! Despite the active role these nonprofits have taken in meeting the health and economic needs of our country, they still rely on donations—at a time when many Americans face financial hardship due to job loss, limited working hours, or increased medical costs. Such hardships may lead to a decline in charitable donations. Thankfully, some leaders on Capitol Hill are championing the important role churches and charitable organizations play in helping local communities.

One way the tax code helps charitable organizations is through the charitable deduction. However when the 2017 Tax Cuts and Jobs Act simplified and raised the standard deduction to $12,000, it caused many tax filers to take the standard deduction instead of itemizing their charitable contributions. Realizing this problem in the tax code, Congress recently passed the CARES Act, which allows charitable contributions up to $300 to be deducted above and beyond the standard deduction on annual tax returns. This new policy is a great first step in promoting charitable giving during the pandemic. But congressional leaders believe there is much more to be done.

Senator James Lankford (R-Okla.) has been the most vocal voice advocating for direct changes to the tax law to support both families and nonprofits. He summed this need up perfectly in a Joint Economic Committee hearing on charitable giving. “We have three safety nets in America. The family is the first safety net. Nonprofits are our second safety net and government is our third…The first two are essential and if the family collapses, nonprofits struggle to keep up and governments struggle to keep up.”

In May, Senator Lankford and Senator Angus King (I-Maine) co-authored a letter to Senate leaders, advocating for nonprofits, charities, and houses of worship in any future coronavirus relief bills. One of the specific proposals Lankford and King offered is raising the $300 charitable deduction limit in the CARES Act to one-third of the standard deduction. This would equate to $4,000 for individuals and $8,000 for married couples. Representative Mark Walker (R-N.C.) has taken a similar approach in the House of Representatives. His bill, the Coronavirus Help and Response Initiative Through the Year 2022 (CHARITY) Act, would expand the charitable deduction to one-third of the standard deduction until 2022.

Families and churches are the foundation of our society. They are, therefore, the societal institutions best-equipped to provide stability when America faces many health and safety challenges. When families and churches struggle, so does the rest of America. That is why the government needs to recognize and support these institutions and charitable organizations. As Sen. Lankford said, “it’s beneficial for us in our official policy and what we choose to do in the tax code to be able to create a tax code that is encouraging to families and that is encouraging to nonprofits.

Speaker Pelosi’s Partisan Coronavirus Relief Bill Attacks Life and Family

by Connor Semelsberger, MPP , Mary Beth Waddell, J.D.

May 19, 2020

Partisan politics are at play again. Last week, House Democrats passed the Heroes Act (H.R. 6800), a coronavirus relief bill that purports to help the people risking their lives on the front lines of the coronavirus, but in reality disregards vulnerable lives by funding abortion providers and deconstructs the idea of family.

The bill passed by a margin of 208-199 with one Republican supporting and 14 Democrats opposing. While it is unlikely to move in the Republican-controlled Senate, it is important to highlight how congressional Democrats are seeking to work against human life and the family during this pandemic.

In summary, the Heroes Act:

Attacks Longstanding Pro-life Policies

  • It creates a new “Heroes Fund” to provide an additional $13 per hour for essential workers in addition to their regular wages. Helping frontline workers who have put their lives at risk to battle the coronavirus is a good idea in principle; however, the bill’s definition of essential work includes any work conducted at outpatient clinics without any restrictions on those working at abortion clinics. It is disheartening enough that some liberal states have deemed abortion as an essential service, but pro-abortion members of Congress providing bonus pay for abortion clinic workers—while millions of Americans remain unemployed—takes abortion extremism to a whole new level.
  • Appropriates nearly $1 trillion in funds to state and local governments so they can continue conducting tests, providing essential equipment, and treating patients suffering from coronavirus. There is bipartisan support for such funding. However, the funding proposed in the Heroes Act has very limited restrictions on usage. This means liberal states like California and New York can use the federal funds to cover budget shortfalls they created by funding Planned Parenthood and other abortion providers. Just a few months before the coronavirus pandemic hit the U.S, the Illinois legislature appropriated millions of dollars for abortion facilities that provide family planning services.
  • Provides several tax subsidies for employers that can be used to pay for health plans that cover abortion. In particular, it would provide a full subsidy for COBRA health premiums, a current program which allows the recently unemployed to remain on an employer health care plan. This subsidy would violate the principles of the Hyde Amendment by directly subsidizing employer health care plans that cover abortion. 
  • Makes substantive changes to the Paycheck Protection Program (PPP). The PPP was designed to help small businesses and nonprofits seek immediate financial relief, and many churches and religious nonprofits have been able to access the program. Large nonprofits that perform abortions are currently ineligible for the PPP because of the 500-employee limit. Instead of expanding the program to include larger charitable organizations, House Democrats prioritized making an exception for abortion providers.

Undermines Marriage and Family

  • The bill deconstructs the idea of family with the same language that some had attempted to insert into the paid family and sick leave program in the Phase 2 coronavirus relief bill. While the language in this bill doesn’t include “domestic partnership” in a definition of “spouse,” it uses multiple definitions to try and achieve the same effect. The bill amends paid leave requirements to include paid sick leave for family members including “domestic partners.” This greatly waters down the significance of the family structure and renders the word “family” virtually meaningless.
  • Redefines “sex” in the context of sex discrimination to include sexual orientation, gender identity, and medical conditions related to pregnancy. This is the same language that appeared in the infamous Equality Act the House passed last year, which would have redefined civil rights laws in a manner inconsistent with biological realities and forced organizations to provide abortions. The language would apply to this bill and the other relief bills that have already become law, such as the Cares Act.
  • Establish diversity and outreach programs that specifically prioritize gender and sexual minorities. Further, the bill would create a designated suicide hotline that politicizes the meaning of sex. An excessive focus on sexual minority status is misplaced, given the existence of other high-risk groups and risk factors such as underlying mental illness.

Additional Progressive Priorities

Partisan policies have no place in legislation intended to address a pandemic. In addition to the aforementioned provisions that seek to undermine the sanctity of human life and the family, the Heroes Act includes:

  • Provisions propping up the notion of hate crimes, which FRC has consistently opposed because they undercut freedom of expression. Hate crimes are essentially “thought” crimes, and hate crime laws punish the accused for a perceived prejudice against the victim. This is reinforced by the bill’s addition of “alternate sentencing” to existing hate crimes law, which will allow courts to order “educational classes” to correct the defendant’s alleged prejudice. Thoughts are not criminal; only actions are, and the First Amendment protects all expression, even that with which we disagree. Existing criminal law categories are sufficient to address the interests of justice without straying into the dangerous territory of trying to eradicate the thoughts of our citizens. 
  • Language taken straight out of the SAFE Banking Act, a policy that would legitimize the marijuana industry by granting them access to capital and other banking services. As Senate Majority Leader Mitch McConnell said in a statement, “The word ‘cannabis’ appears in this bill 68 times. More times than the word ‘job’ and four times as many as the word ‘hire.’” Reducing current federal restrictions on marijuana would, among other things, give money laundering access to international drug cartels who are already using marijuana legalization as a cover, and would radically increase investment in the marijuana industry.
  • A second round of stimulus checks with a change to allow illegal immigrants without a social security number to be eligible. Republicans led an effort to amend this policy, but came up just short of amending this language before final passage.
  • An extension of the $600 per week unemployment insurance increase through January 2021, allowing some individuals to continue collecting more money on unemployment than they would working. This perverse incentive to work was raised by Senate Republicans during the debate of the CARES Act, and now as the economy starts to open could have even more lasting impacts on the value and dignity of work.
  • Long-term changes that reshape the way elections are conducted in a way that favors Democrat candidates. This bill would require 15 days of early voting for federal elections and absentee vote by mail ballots for all voters. It would also mandate that all voters can register the same day, both in-person and online. Not long ago, many Democrats were highly concerned about fraud and interference in the 2016 election. Now, they are seeking to mandate mail-in ballots and online registration, policies that can put election security at risk.

Unfortunately, the present national health emergency has not united Congress to help our country. Congressional Democrats have shown time and time again that they would rather score political points than help our country through this pandemic. As Congress continues to consider what steps may be necessary to provide additional relief to the health care system and economy, FRC will remain vigilant in protecting faith, family, and freedom.

Congressional Support for Communities of Faith Pays off for Churches

by Connor Semelsberger, MPP

May 12, 2020

Congressional programs designed to help the faith community rarely work as intended. But the Paycheck Protection Program (PPP), one of the signature policies in the CARES Act, appears to be one of those rare successes.

The PPP was created to provide financial relief to small businesses and nonprofit organizations (with fewer than 500 employees) whose finances have been strained by the economic fallout of the coronavirus. With most in-person church services temporarily suspended due to social distancing requirements, 40 percent of pastors report decreased giving, and 18 percent say donations have been cut in half. But now, thanks to the PPP, many churches—as well as small businesses and other nonprofit organizations—are able to keep the lights on and employees paid.

Initially, there was some concern that existing small business loan regulations (which excluded religious-based organizations) would render churches ineligible for the PPP. Thankfully, a bipartisan group of members of Congress led by Senator James Lankford (R-Okla.), Senator Jim Inhofe (R-Okla.), House Minority Whip Steve Scalise (R-La.), and Representative Mike Johnson (R-La.) sent a letter to the Departments of Treasury and Labor and the Small Business Administration (SBA), clarifying that Congress intended to allow churches and religious nonprofits access to these loans. Subsequently, SBA issued guidance to ensure that lenders would not discriminate against the loan applications of faith-based organizations. The guidance also clarifies that churches would not be sacrificing their autonomy or First Amendment-protected religious freedom by accepting government funds.

Shortly after the PPP’s second round of funding commenced, it was discovered that thousands of churches had applied for and received these loans. Out of the roughly 12,000 Catholic parishes that applied for the PPP loans, an estimated 9,000 received funds. In a recent LifeWay survey, two in five Protestant pastors said they applied for loans, and approximately 59 percent of them were approved. Additionally, the Jewish Federations of America announced that 573 Jewish organizations, including 219 synagogues, received loans.

The efforts by members of Congress and the Trump administration to ensure churches have access to essential financial assistance—thereby saving some of them from laying off employees or closing altogether—should not be overlooked. When crafting the largest economic relief package in American history, instead of forgetting about churches or actively trying to exclude them from economic relief, these political leaders prioritized faith-based organizations. They realized that churches, in addition to running religious services, often employ staff to operate schools, food banks, and other services that play a vital role in American society, especially during a crisis like the current coronavirus pandemic.

This is one more item on the ever-growing list of actions the Trump administration has taken to promote religious freedom.

Coronavirus Relief: What Churches and Nonprofits Need to Know About Accessing SBA Loans

by Travis Weber, J.D., LL.M. , Connor Semelsberger, MPP

April 4, 2020

On April 3rd, lenders began processing Paycheck Protection Program (“PPP”) relief loans around the country. As authorized by the “Phase 3” coronavirus relief legislation known as the CARES Act, the $349 billion PPP program will grant forgivable Small Business Administration (“SBA”) loans to small businesses and nonprofits for hardship they have suffered under the coronavirus-inflicted economic shutdown. These loans will cover eight weeks of necessary expenses during the coronavirus crisis.

In conjunction with the launch of the program, the SBA published an interim final rule, effective immediately, with further guidelines for lenders and borrowers—including guidance on religious freedom. SBA also issued an interim final rule on affiliation clarifying that faith-based organizations are exempt from SBA affiliation rules if those rules burden religious exercise. Finally, the SBA published a list of Frequently Asked Questions (“FAQs”) regarding the ability of faith-based organizations to access these loans—and Economic Injury Disaster Loans (“EIDL”). These FAQs bring significant clarity to many of the issues discussed below.

What follows are some key considerations for churches to understand and think through when applying for these loans.

Church Eligibility

The final text of the CARES Act and subsequent guidance make clear that a tax-exempt nonprofit organization—described in section 501(c)(3) of the Internal Revenue Code (IRC)—is eligible to apply for relief. Under IRS guidance, the 501(c)(3) definition generally includes churches—even if they have not registered with the IRS—as long as they meet 501(c)(3) requirements. Members of Congress wanted to ensure the program included all churches and houses of worship, even those unregistered churches without a letter of determination from the IRS. To make this clear, a bipartisan group of members headed by Republican Whip Steve Scalise (R-La.) and Representative Mike Johnson (R-La.) sent a letter to key agencies to clarify that these churches are included within the program. Based on the most recent guidance, we can now say they are included.

Some questions have come up about church eligibility for different types of loans under the CARES Act. The PPP created a new SBA loan program based on existing Section 7(a) small business loans, which changed eligibility to include all 501(c)(3) nonprofits, including churches, which previously were not eligible for these small business loans. It had appeared that EIDL loans, which provide working capital for organizations during a time of declared disaster, were only available for small businesses and private nonprofits, which does not include public charities like churches.

However, the FAQs make clear that faith-based entities can receive both EIDL and PPP loans, and do not need a determination letter from the IRS to do so.

The bottom line: All churches, even unregistered ones, can qualify for both EIDL and PPP loans.

Religious Liberty Concerns for Churches and Religious Nonprofits

Based on the most recent guidance in the interim final rules and FAQs, virtually all religious liberty issues in this loan program have been addressed.

One of the concerns had been requirements reflected on the SBA loan application: “All businesses receiving SBA financial assistance must agree not to discriminate in any business practice, including employment practices and services to the public on the basis of categories cited in 13 C.F.R., Parts 112, 113, and 117 of SBA Regulations. All borrowers must display the ‘Equal Employment Opportunity Poster’ prescribed by SBA.” Certain of these religious and sex nondiscrimination provisions in the SBA code, based on the way courts have interpreted such provisions, could run counter to church statements of faith and hiring practices and violate their faith.

The interim final rule addresses these concerns in part by reiterating religious liberty protections, stating that “all loans guaranteed by the SBA pursuant to the CARES Act will be made consistent with constitutional, statutory, and regulatory protections for religious liberty, including the First Amendment to the Constitution, and the Religious Freedom Restoration Act.” The rule also provides for the application of 13 C.F.R. 113.3-1h, an SBA regulation which states that “[n]othing in [SBA nondiscrimination regulations] shall apply to a religious corporation, association, educational institution or society with respect to the membership or the employment of individuals of a particular religion to perform work connected with the carrying on by such corporation, association, educational institution or society of its religious activities.”

The problem was that while 113.3-1h is helpful, it does not cover all relevant religious liberty concerns. As attorney Ian Speir, whose practice at Nussbaum Speir Gleason PLLC specializes in churches and religious nonprofits, points out: 13 C.F.R. 113.3-1h mirrors the Section 702 exemption in Title VII. That exemption has largely been interpreted to permit religious preferences in hiring, but not tolerate practices deemed to be other forms of “discrimination.” And “sex discrimination” may include firing an employee for out-of-wedlock pregnancy or for sex-related lifestyle choices contrary to the employer’s faith. Further, if a ministry has fewer than 15 employees, it’s not currently subject to Title VII; but if it takes SBA funds, it will be subject to the SBA’s regulations—so this ministry may find itself subject to new mandates as a result of accepting aid.

In the final analysis, however, any such outstanding concerns remain minimal.

The FAQs make expressly clear that:

  • Faith-based organizations can receive the loans regardless of whether they provide “secular social services.” (As the FAQs say, “no otherwise eligible organization will be disqualified from receiving a loan because of the religious nature, religious identity, or religious speech of the organization.”);
  • The religious instruction limitation referenced in 13 CFR 120.110 will not be applied, and will thus not inhibit religious organizations in how they use these loans;
  • Faith-based organizations can use the loans for anything that a secular organization can (no “additional restrictions on how faith-based organizations may use the loan proceeds”);
  • Churches are “not required to apply to the IRS to receive tax-exempt status” in order to access the loans; and
  • Faith-based organizations will not be required to sacrifice their “independence, autonomy, right of expression, religious character, and authority over [their] governance” in order to access these loans.

The FAQs also make clear that religious liberty protections are to be comprehensively applied throughout the loan program:

Consistent with certain federal nondiscrimination laws, SBA regulations provide that the recipient may not discriminate on the basis of race, color, religion, sex, handicap, age, or national origin with regard to goods, services, or accommodations offered. 13 C.F.R.§113.3(a). But SBA regulations also make clear that these nondiscrimination requirements do not limit a faith-based entity’s autonomy with respect to membership or employment decisions connected to its religious exercise. 13 CFR §113.3-1(h). And as discussed in Question 4, SBA recognizes the various protections for religious freedom enshrined in the Constitution and federal law that are not altered or waived by receipt of Federal financial assistance. SBA therefore clarifies that its regulations apply with respect to goods, services, or accommodations offered generally to the public by recipients of these loans, but not to a faith-based organization’s ministry activities within its own faith community. For example, SBA’s regulations will require a faith-based organization that operates a restaurant or thrift store open to the public to serve the public without regard to the protected traits listed above. But SBA’s regulations do not apply to limit a faith-based organization’s ability to distribute food or clothing exclusively to its own members or co-religionists. Indeed, SBA will not apply its nondiscrimination regulations in a way that imposes substantial burdens on the religious exercise of faith-based loan recipients, such as by applying those regulations to the performance of church ordinances, sacraments, or religious practices, unless such application is the least restrictive means of furthering a compelling governmental interest.”

A few remaining concerns: It should be noted that these loans do constitute “federal financial assistance” and thus obligate the borrower to comply with any attendant requirements. However, as explained above, the religious liberty concerns regarding those requirements are almost all addressed, and the FAQs make clear that such requirements do not extend beyond the life of the loan in any event.

However, churches may be obligated by state and local nondiscrimination requirements due to taking these loans, a point also observed by attorney Ian Speir. This is likely something that churches will have to consider based on consultations with their attorney or other professionals familiar with the legal landscape in their state.

The bottom line: While a few, smaller concerns remain, churches and other faith-based entities can be generally confident their religious freedom will be protected in this loan program.

What to Know When Applying for These Loans

After weighing all these considerations, churches and nonprofits with fewer than 500 employees (or those who qualify under the interim final rule on affiliation) that want to apply for PPP loans can find information on the SBA website. To begin, interested organizations must find a local bank or credit union that is eligible to administer these loans. The SBA is working on adding many new lenders to expand the reach of the program. To apply with the lender, the organization must fill out this application form and provide payroll documentation. If approved, the lender will work to administer the funds promptly, with the goal of them being available the same day.

This program is administered as a loan, but if the funds are used on essential payroll expenses, it will essentially act as a grant, and the loan amount will be forgiven in full. Churches considering applying for the PPP loan should keep these key facts in mind:

In order to get forgiveness, the organization must use the loan for:

  • Payroll costs, including benefits;
  • Interest on mortgage obligations, incurred before February 15, 2020;
  • Rent, under lease agreements in force before February 15, 2020; and
  • Utilities, for which service began before February 15, 2020.

Payroll costs include:

  • Salary, wages, commissions, or tips (capped at $100,000 on an annualized basis for each employee);
  • Employee benefits including costs for vacation, parental, family, medical, or sick leave; allowance for separation or dismissal; payments required for the provisions of group health care benefits including insurance premiums; and payment of any retirement benefit;
  • State and local taxes assessed on compensation.

Requests for loan forgiveness will be submitted to the lender. They will include documents that verify the number of full-time equivalent employees and pay rates, as well as the payments on eligible mortgage, lease, and utility obligations. An organization will owe money on the loan if it is used for anything other than payroll costs, mortgage interest, rent, and utility payments over the eight weeks after getting the loan. No more than 25% of the forgiven amount may be for non-payroll costs.

There are also requirements to maintain payroll and staff:

  • Number of Staff: Loan forgiveness will be reduced if the number of full-time employees is reduced.
  • Level of Payroll: Loan forgiveness will be reduced if salaries and wages are reduced by more than 25 percent for any employee that made less than $100,000 annualized in 2019.
  • Re-Hiring: Employers have until June 30, 2020, to restore full-time employees and salary levels for any changes made between February 15, 2020, and April 26, 2020.

If the organization must pay back any loan amount, it will be paid back with 1 percent interest. All payments are deferred for six months; however, interest will continue to accrue over this period. The loan will be due in two years.

EIDL loans are another option for nonprofit organizations to consider if they have been met with financial hardship. This program provides eligible organizations with working capital loans of up to $2 million that can provide necessary economic support. Eligible organizations that need immediate help replacing lost revenues, can receive an advance of up to $10,000 that will not have to be repaid. Those interested in applying for EIDL loans can do so here.

It can be challenging to determine whether it is in your organization’s best interest to apply for federal financial programs like the Paycheck Protection Program. The coronavirus crisis has brought the American economy to a standstill, and many nonprofit organizations are struggling with financial instability. However, government aid programs that may help organizations financially may also come with some unintended consequences. Fortunately, Congress has intended to make the PPP open to religious organizations in the same way small businesses are—without additional government stipulations that dramatically change how religious organizations operate. The FRC team will continue to work alongside allied organizations to ensure that the congressional intent of the CARES Act (to not discriminate against religious organizations for financial aid) is carried out when implementing programs like the PPP.

To help the church navigate these and other challenges we are confronted with due to the coronavirus, we have created a resource page at FRC.org/church. Please visit us there and let us know how else we can be of help.

How Federal Coronavirus Legislation Will Impact Your Family (Part 3)

by Connor Semelsberger, MPP

April 1, 2020

Read Part 1 and Part 2

Despite many speedbumps, and several self-inflicted roadblocks—including House Democrat attempts to pass their ideological wish list—members of Congress from both sides of the aisle eventually came together to pass the most recent coronavirus relief bill. On Friday, March 27, President Donald Trump signed into law H.R. 748, the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which is the third phase of coronavirus response legislation. This $2 trillion law is the largest relief package ever passed by Congress, demonstrating the powerful forces unleashed by the coronavirus and drastic congressional response—including from some typically fiscally conservative members. Indeed, we are facing a public health and economic emergency of the likes most of us have never seen. Here is a look at how this legislation will impact you and your family.

Direct Payments

The signature policy in the CARES Act, first proposed by the Trump administration, is a tax rebate that will be sent directly to families to help cover essential costs during this crisis. As a result of this bill, all Americans with an annual income of $75,000 or less will receive a direct payment of $1,200. For married couples with an income of $150,000 or less, this payment will double to $2,400. Families with dependent children will also receive an additional $500 per child. This policy was also adapted from a previous draft, to provide the full $1,200 rebate to those with little or no income. If you are someone who makes over the $75,000 threshold, you will still be eligible for a partial rebate. This rebate will be reduced by $5 for every $100 over the cap and will be completely phased out at incomes of $99,000 and above.

The great news is, if you have filed a previous tax return, there is no action required to receive the rebate. For Americans who have already filed their 2019 tax returns, the IRS will rely on those returns to determine eligibility. If you have not filed for 2019, they will use 2018 returns. Even though the president signed the bill on Friday, the earliest families can expect to see these rebates is in three or four weeks, according to some estimates. The rebate will be sent via direct deposit if the IRS has that information from a tax return. If the IRS does not have direct deposit information, it will mail a physical check, which may take a few weeks longer to arrive.

Sending tax rebates directly to Americans is not something unique to the current situation. During the 2008 recession, President George W. Bush issued tax rebates of $600 for individuals and $1,200 for married couples to help stimulate the economy. The tax rebates in the CARES Act are not only higher than in 2008 but will be sent out much sooner due to the IRS’s ability to work through logistics faster. This policy cements and incentivizes family structure, as there is no penalty on married couples, giving them double the individual amounts. It also functions as an additional child tax credit, giving more money for each child a family has. For the average family of four, this tax rebate will equate to a $3,400 check providing immediate financial help.

For those with a greater financial strain, who may need to draw from their retirement funds, there is additional help. As done in previous emergencies, if someone withdraws no more than $100,000 from their retirement account for coronavirus-related reasons, the 10 percent early withdrawal penalty is waived. The taxes that would otherwise be collected on that withdrawal can be paid out over the next three years.

Unemployment Insurance

In addition to the rebate checks, the CARES Act provides $250 billion to expand unemployment insurance to help those who are without work because of the coronavirus outbreak. This bill creates a temporary Pandemic Unemployment Program that will run through the end of the year. This program will provide extended financial assistance, enabling those without work to make monthly payments for food, rent, and other necessities. The program provides unemployment benefits for those who do not usually qualify, including religious workers, the self-employed, independent contractors, and those with limited work history. It also covers the first week of lost wages in states that do not cover the first week a person is unemployed and provides an additional 13 weeks of unemployment for those who remain unemployed beyond the weeks provided by the state.

Another valuable expansion is that all recipients of unemployment insurance will get an additional $600 a week beginning in April and lasting for the next four months. This addition was not without controversy, as several Senate Republicans objected to this addition because of the potential for a perverse incentive for those who might make more on unemployment insurance than they would by working. Ultimately, given the negotiating dynamics and tight timeline, this provision was not fixed. Looking to pass this bill quickly, the Trump administration was willing to accept this provision, and the bill passed the Senate with unanimous support.

To view your state’s unemployment policy and apply for unemployment insurance, go to this helpful database provided by the Department of Labor.

Housing Assurance

In a public health crisis that requires families to remain quarantined in their homes, it is critical that current housing situations remain secure. For families who own a home and make mortgage payments, the CARES Act prohibits foreclosures on any federally-backed mortgages for 60 days. It allows borrowers affected by the coronavirus to push off any missed payments to the end of their mortgage with no added penalties or interest. To help families who make rent payments, it halts evictions for those renting from properties with federally-backed mortgages for 120 days. The Department for Housing and Urban Development (HUD) has provided guidance for how homeowners and renters can respond to financial hardships.

Dr. Ben Carson, the Secretary of Housing and Urban Development, will coordinate these federal housing policies. He has been a vocal leader throughout the coronavirus outbreak, promoting faith and families. On March 20, Secretary Carson joined President Trump and Vice President Pence on an FRC conference call to pray with 800 pastors. On the call, Secretary Carson reminded the pastors that despite the uncertainty facing our country, God’s hand is guiding us.

Education Policies

The coronavirus outbreak has affected education across the country in many ways. Many schools have been directed to close their doors, replacing in-person classes with at home and online learning. Because of these changing dynamics, the CARES Act waives the federal testing requirements that students take in a typical school year. It also provides additional funding for K-12 schools to adapt to at home-learning and gives increased flexibility for how grants can be used for technology and other actions needed to adapt to the coronavirus situation. Private schools can also access these additional funds.

Many parents today also face the challenge of balancing student loan payments with other essential payments like rent and food expenses. To ease the financial burden of making student loan payments, the CARES Act suspends federal student loan payments for the next six months, and no interest will accrue on federal loans during these six months. The Department of Education has more information on which federal loans qualify and how these policies will be implemented.

The coronavirus’s impact on the public health and the economic stability of or country is something not seen for nearly a century. President Donald Trump and his Coronavirus Task Force have taken strong actions to slow the spread of the virus and protect the health of many. However, the crisis has resulted in unintended financial burdens on many families across the country. Members of Congress and the Trump administration worked together to negotiate a strong economic response that truly puts families first—a welcome sight in the typically-rancorous partisan political environment on Capitol Hill. The FRC team continues to engage members of Congress and the administration to ensure that faith, family, and freedom will remain protected even as our country responds to the coronavirus.

For more on how the coronavirus relief legislation specifically benefits churches and nonprofits, see our blog here.

How the Coronavirus Relief Bills Benefit Churches and Other Nonprofits

by Travis Weber, J.D., LL.M. , Connor Semelsberger, MPP

March 27, 2020

There has been much discussion recently about the “Phase 3” coronavirus relief bill, H.R. 748, the “Coronavirus Aid, Relief, and Economic Security” (CARES) Act. Passed by the Senate on March 25, passed by the House on March 27, and signed into law by President Trump on the same day, the CARES Act is designed to provide broad-based economic relief and funding in the midst of the coronavirus crisis. While some of the headline-grabbing sections of this bill address health care supplies and financial assistance for large corporations, several key provisions directly assist nonprofit organizations, including churches.

Direct Loans to Small Businesses, Nonprofits, and Churches

One of the major sections of the CARES Act is the $350 billion Payment Protection Program, which creates federally-guaranteed loans (operated by the Small Business Administration (or “SBA”)) to small businesses and other entities (including nonprofit organizations) to cover eight weeks of necessary expenses. To be eligible for these loans, the entity must have fewer than 500 employees, or the number designated as “standard” for its specific field—whatever is greater. Including entities in this manner will result in many small businesses and nonprofits being covered by these loan provisions.

For purposes of these loans, the CARES Act defines an eligible nonprofit organization as “an organization that is described in section 501(c)(3) of the Internal Revenue Code of 1986 and that is exempt from taxation under section 501(a) of such Code.” Under IRS guidance, this generally includes churches—even if they have not registered with the IRS—as long as they meet 501(c)(3) requirements that:

  • They are organized and operated exclusively for religious, educational, scientific or other charitable purposes;
  • Net earnings do not inure to the benefit of any private individual or shareholder;
  • No substantial part of their activity may be attempting to influence legislation; and they do not intervene in political campaigns; and
  • Their purposes and activities may not be illegal or violate fundamental public policy.

Under the CARES Act, limitations that the SBA places on loans to religious entities (including a requirement that religious entities show they are not principally engaged in teaching, instructing, counseling, or indoctrinating religion or religious beliefs) are waived. As long as the church or nonprofit was operational and paying salaries and payroll taxes on February 15th, 2020, it is eligible for these loans.

Ian Speir, an attorney whose clients at Nussbaum Speir Gleason PLLC include numerous churches and nonprofits, agrees, telling us it would be constitutionally problematic to exclude churches in light of recent Supreme Court decisions, which clarify that generally available public benefits can’t exclude religious organizations who are otherwise eligible. Speir also noted his agreement that churches are included within the CARES Act’s definition of “nonprofit organizations.”

Under the CARES Act, the maximum loan an organization can receive is based on a calculation that will come out to 2.5 times the average monthly payroll, or $10 million, whichever amount is less.

If an organization uses the loan to cover payroll costs, health care benefits and premiums, employee salaries, mortgage or rent payments, or any other interest payments, the loan will be forgiven. There are also provisions for waiving borrower fees and other collateral and credit requirements, as well as automatic deferrals of any payments for six months.

There are also incentives for organizations to keep employees on the payroll. The total amount forgiven will be reduced if the employer lays off any employees or reduces employee pay more than 25 percent during the loan term. The program also encourages organizations to rehire any employee already laid off by not adding any penalties for those employees brought back onto the payroll. So, if the organization certifies with the lender that it used the loan for the appropriate expenses, the loan will act as a federal grant with no need to pay any amount back. If the organization does not use the loan for appropriate expenses, it must pay back outstanding funds with an interest rate of 4 percent.

To help stop the spread of the coronavirus, local and state authorities are restricting large gatherings, causing many churches and religious organizations not to meet in person, which can cause financial setbacks for them. We are also aware that churches and nonprofits are suffering operationally through no fault of their own, creating significant financial strain. If that is the case with your organization, you may benefit from this new loan program meant to help cover payroll and other essential costs for the next eight weeks.

We recognize not every entity may seek to avail themselves of these loans, but they are there for those who wish to do so. The goal is not increased dependence on the government, but rather temporary assistance that can serve as a lifeboat through unexpected shock. In all this, we want to ensure that churches and religious organizations are not discriminated against, but rather are treated fairly and allowed access to any programs that nonreligious organizations can participate in. The coronavirus has affected all of us—religious and nonreligious alike.

The SBA should soon be adding more helpful information to their website on how to access this relief, but in the meantime, Senator Rubio has a good FAQ sheet with information on how to apply for these loans, available here.

Incentivizing Giving to Churches and Nonprofits

Now more than ever, churches and other charitable organizations need donations in order to meet immediate needs related to the coronavirus outbreak. But simultaneously, many Americans face financial hardship due to job loss, limited working hours, or increased medical costs. Such hardships may lead to a decline in charitable donations. By creating additional tax incentives for charitable contributions, the Phase 3 coronavirus relief package seeks to encourage Americans to continue giving throughout the crisis.

Under the CARES Act, charitable contributions up to $300 can be deducted above and beyond the standard deduction on annual tax returns. This new policy will help offset the negative impact on charitable giving precipitated by the 2017 Tax Cuts and Jobs Act, which simplified and raised the standard deduction to $12,000. This change caused many tax filers to take the standard deduction instead of itemizing their charitable contributions. During negotiations on the CARES Act, the FRC team worked alongside allied organizations to increase the total amount of tax-deductible donations. While the $300 amount was not raised, this new level may apply to tax years 2020 and beyond, leading to more incentive for charitable giving going forward.

Finally, reducing charitable giving limits for those who itemize deductions on their tax return is another positive incentive put in place by the CARES Act. The cap limiting charitable contribution deductions to 50 percent of a person’s income has been lifted for the 2020 taxable year. This policy also raises the limit on corporate deductions from 10 percent of taxable income to 25 percent and raises limits on food inventory donations from 15 percent to 25 percent.

Unemployment Insurance Assistance for Those Working for Nonprofits

In addition to the $1,200 one-time rebate checks for many Americans, the CARES Act expands unemployment insurance to help those who are without work because of the coronavirus outbreak. This bill creates a temporary Pandemic Unemployment Program that will run through the end of the year. The program provides unemployment benefits for those who do not usually qualify, including religious workers, the self-employed, independent contractors, and those with limited work history. It also covers the first week of lost wages in states that do not cover the first week a person is unemployed.

While most churches are not subject to unemployment insurance, some nonprofits should be aware of this new policy in case they need to lay off or have already laid off employees who may claim unemployment insurance. Fortunately, there is language in this bill to help nonprofits cover some of these costs. H.R. 748 provides payments to states to reimburse nonprofits that are not a part of their state’s unemployment system, reimbursing for half of the costs the nonprofits incur to pay unemployment benefits. Unlike other employers, nonprofits have the option to pay state unemployment insurance taxes or reimburse the state only for the benefits paid to former employees who collect unemployment insurance. The U.S. Labor Department’s Office of Unemployment Insurance and individual states provide more detailed information on how unemployment insurance programs operate.

Paid Medical and Sick Leave Requirements that May Implicate Nonprofits and Churches

In addition to the Phase 3 bill being discussed here, President Donald Trump signed the Phase 2 coronavirus relief bill, H.R. 6201, on March 18th, 2020. While this bill included new paid medical and sick leave requirements designed to benefit employees but which may place requirements on nonprofits, the Phase 3 bill provides for some ways to cover these expenses. The Labor Department recently released initial guidelines for these paid medical and sick leave mandates, and will provide further regulations in April 2020.

First, H.R. 6201 expands the Family and Medical Leave Act of 1993 (FMLA) by including increased leave protection for employees who are unable to work or telework because they need to care for a child whose school or childcare facility was closed due to the coronavirus. Under this expansion, employers are not required to pay the employee during the first 10 days of leave, but the employer has to pay for remaining leave time up to $200 per day.

Separate from the FMLA change described above, the Phase 2 relief bill establishes an emergency paid sick leave program that requires employers to provide two weeks of paid sick leave for employees that cannot work or telework because of the coronavirus. Employees are only entitled to this mandatory sick leave if they are: having coronavirus symptoms, have been advised to self-quarantine, subject to a government quarantine, or caring for someone with coronavirus symptoms. The total amount of paid leave is equal to two-thirds the employee’s regular wages, whether salary or hourly work, and is capped at $511 a day. Both leave requirements will expire at the end of the year.

Providing paid leave during an uncertain financial situation can be difficult for some churches and nonprofits. The cost for the above two policy changes fall on employers, but there are ways for employers to alleviate the financial burden, as described below:

  • These mandates apply only to employers with fewer than 500 employees. H.R. 6201 also provides the Secretary of Labor with the ability to exclude organizations with fewer than 50 employees if providing the paid leave would jeopardize the viability of the organization.
  • If an organization has more than 50 employees or is not excluded from the Department of Labor’s waiver for other reasons, the Phase 3 coronavirus relief bill creates advanceable credits to help cover paid leave. These credits are a dollar for dollar reimbursement for all wages paid under these new requirements. The tax credits also apply to costs incurred to maintain health insurance coverage.
  • An organization can also apply for the Payment Protection Program loans previously mentioned that are designed to help nonprofits cover payroll costs, health care benefits during periods of paid medical and sick leave, and employee salaries.

Encouraging and Aiding the Church’s Response to the Coronavirus Outbreak

The CARES Act also recognizes how important churches and local community organizations are to providing food and other needs during this crisis. To increase state grants for these types of services, this bill provides an additional $1 billion for the Community Services Block Grant (CSBG). This grant is given to the states so they can partner with local community organizations to lower poverty, address homelessness, and provide services addressing unemployment, education, nutrition, and health. This is a grant program that churches and religious organizations can access, as the law explicitly states religious organizations must be treated the same as other nongovernmental organizations when applying for these grants. Churches in several states have partnered with community organizations or received these grants themselves to operate food banks and other key services.

Churches and other nonprofit organizations have played a critical role in meeting the spiritual and physical needs of Americans affected by the coronavirus. During Senate negotiations over how best to respond to the economic hardships our country is facing, the FRC team worked to ensure that churches and other religious groups were not left behind and were instead recognized as organizations vital to the coronavirus relief effort—and we will continue to do so going forward.

How Federal Coronavirus Legislation Will Impact Your Family (Part 2)

by Connor Semelsberger, MPP

March 23, 2020

Things are moving rapidly in our nation’s capital as our government attempts to respond to the coronavirus. On March 18th, President Donald Trump signed H.R. 6201, the Families First Coronavirus Response Act, which is the second phase of coronavirus response legislation. Here is a look at how this legislation will impact you and your family.

Testing: One of the main legislative requests, both from President Trump and Congress, was to speed up testing across the country. This bill directly addresses that need by appropriating $1.2 billion to help cover the costs of coronavirus testing. With this new funding, access to coronavirus tests will increase dramatically while costs will come down to zero. If you are experiencing symptoms or have been in contact with someone who has tested positive for COVID-19, consult the CDC website to see testing protocols.

Food Assistance: The second piece to this bill is providing necessary food assistance to those affected most by this virus, mainly schoolchildren and senior citizens. This package includes an additional $500 million to the Supplemental Nutrition Program for Women, Infants, and Children (WIC), which is a critical program that helps low-income women and their children access healthy and nutritious food. The bill also sets aside funding to ensure that children from low-income families can receive a meal from the school lunch program if their school is closed longer than five days due to the coronavirus. State agencies will be responsible for administering these meals to schoolchildren.

This bill also contains $200 million for senior nutrition programs, including extra money for home delivered-meals and meals at senior centers. Since the elderly are most at risk of dying from the coronavirus, it is important that the government provides specific funding to ensure that the elderly can still access food in this difficult time.

Medical and Sick Leave Expansion: The major point of contention in H.R. 6201 was how to tackle medical and sick leave requirements.

First, H.R. 6201 expanded the Family and Medical Leave Act of 1993 to require employers with fewer than 500 employees to provide family leave for those needing time off to care for a child because their school or childcare provider closed due to the coronavirus. The legislation mandates 10 days of unpaid leave, and any remaining leave after 10 days must be paid. There are caps to limit paid leave to $200 a day, and these requirements do not apply to employers with fewer than 50 employees.

Second, this legislation requires all employers with fewer than 500 employees to provide two weeks of paid sick leave to any employee who has been advised to self-quarantine, is recovering from symptoms of the coronavirus, or is caring for a family member who has symptoms of the coronavirus. Paid leave is capped at $511 a day, and this coverage includes part-time and hourly employees. To ensure that small businesses are not disproportionately affected by this mandate, the Secretary of Labor has the authority to exempt certain small businesses if this requirement would jeopardize the viability of the business. There are also tax breaks to help employers cover the cost of this paid leave requirement.

These increased sick leave requirements are prudent measures to help workers affected by the virus. However, in the original bill and throughout negotiations, Democrats made several attempts to include controversial language that radically expands access to leave benefits in a way that alters longstanding social policy and weakens the family.

The term “domestic partnership” was inserted in several places throughout this bill, including in the definition of the word “spouse,” which should be reserved strictly for marriage. The injection of this term into federal statute in this manner takes advantage of our emergency posture and is unnecessary now that marriage has been redefined by the Supreme Court to include same-sex couples. It also further erodes marriage and family, the foundation of society, by equating a “domestic partnership” with the time-tested social building block of marriage.

Domestic partnership” is also defined here to include a “committed relationship.” While we have nothing against the idea of “committed relationships” in general, the way that term was defined here—to include those 18 years or older who “share responsibility for a significant measure of each other’s common welfare”—would expand the benefits under this bill in a way that waters down the significance of the family structure and renders it virtually meaningless. The rushed nature with which these serious changes to family structure were considered for codification into federal law was further cause for concern for us.

The FRC team identified this problematic language and worked with key negotiators to make sure it was removed from the House-passed bill. However, removing this language did not sit well with the Democrat leaders, so when the bill was considered on the Senate floor, Sen. Patty Murray (D-Wash.) offered an amendment to re-insert this dramatic expansion into the medical and sick leave provisions. Our team alerted key senators about the damaging effects of this amendment, and fortunately, it was defeated by a vote of 47-51. H.R. 6201 passed absent the anti-family provisions, and was signed into law by President Trump on March 18th.

The federal government’s response to the coronavirus outbreak has been swift, and for good reason. As these large spending packages continue to move through Congress, the FRC team will continue to remain vigilant and work to ensure they support faith, family, and freedom.

How Federal Coronavirus Legislation Will Impact Your Family (Part 1)

by Connor Semelsberger, MPP

March 20, 2020

As the coronavirus has spread across the nation, our federal government has responded in a number of ways to address the damage inflicted by it. Part of that response has been legislative. This series will examine the different coronavirus response bills coming out of Congress, and how FRC has worked to advance faith, family, and freedom in this process.

On March 6th, President Donald Trump signed H.R. 6074, the Coronavirus Preparedness and Response Supplemental Appropriations Act, the first in what has become a series of measures addressing the growing coronavirus crisis. This bill’s $8.3 billion price tag might seem steep, but it is the first major step in increasing funding for critical health care services and developing a vaccine. 

The largest pot of money, $3.1 billion, was appropriated to the Department of Health and Human Services (HHS) for testing and treatments for those affected by the virus. It also invests in vaccine development so that scientists can develop a good vaccine in a shorter amount of time. Of this funding, $100 million will be directed to Community Health Centers (CHC). CHCs are critical components of our health care system, specifically designed to care for low-income families. These centers receive federal funding that cannot go toward abortions and therefore are an excellent pro-life alternative to Planned Parenthood and other abortion facilities.

H.R. 6074 also directly provides $950 million to state and local governments to help slow the spread of this virus and treat those in need. A key provision states that half of these funds must be allocated within 30 days. There can be lots of requirements that slow the use of funds transferred from the federal government to the states, so this 30-day provision is critically important. As we have seen, the ways to effectively respond to this virus change so rapidly that states and local governments must be equipped to provide the necessary health care needs to combat this virus. The more the federal government can assist and bolster local and state response, the better. Governors and mayors will have the best insight into how the coronavirus has affected their local community and how additional funding can be used to stop the spread of this virus.

Lastly, H.R. 6074 includes a provision that allows HHS Secretary Alex Azar to make any vaccine that is developed or purchased with these funds affordable for all Americans. With a coronavirus vaccine in such high demand, there is a concern that the developer could price the vaccine in such a way that it is unaffordable for the average American. This provision ensures that no matter your family’s economic situation, you will have access to this potentially life-saving treatment.

As the federal government continues to act quickly in response to the spread of the coronavirus, the FRC team will continue to track and monitor legislation related to this rapidly-shifting threat to ensure that human life and dignity are valued, the family is supported, and religious liberty is protected.

Ninth Circuit Rules in Favor of the Protect Life Rule, Again

by Patrina Mosley , Connor Semelsberger, MPP

February 25, 2020

After a months-long legal battle, the U.S. Court of Appeals for the Ninth Circuit (9th Circuit) ruled 7-4 that the Protect Life Rule, which separates federal Title X Family Planning funding from abortion facilities, can go into full effect.

In July 2019, an 11-judge panel sitting en banc in the 9th Circuit reinforced a decision that the Protect Life Rule could go into effect temporarily while the merits of the case against the rule filed by Planned Parenthood and several liberal states were argued. Since this July ruling, HHS has enforced this new rule which requires physical and financial separation between clinics that receive Title X funds for family planning services and facilities that perform abortions. It also prohibits physicians at Title X family planning clinics from referring patients for abortions.

Yesterday, the 9th Circuit finally ruled that the Protect Life Rule is constitutional and can go into full effect. This victory in the historically liberal 9th Circuit is a welcome sight and was made possible in part by the great work of President Donald Trump and the U.S. Senate to confirm 51 federal appeals court judges, including two 9th Circuit judges who took part in yesterday’s ruling. However, it would not be a surprise if Planned Parenthood and the other plaintiffs decided to appeal this ruling all the way to the Supreme Court, but even at the highest court in the land there is precedent for the Protect Life Rule to be upheld. In 1991 in Rust v. Sullivan, the Supreme Court upheld similar regulations governing Title X finalized under President Ronald Reagan. The decision in Rust was a crucial part of the opinion issued by the 9th Circuit yesterday, and suggests a similarly favorable outcome should this case reach the Supreme Court.

For far too long, the people’s tax dollars have been entangled with the abortion industry. Trump’s “gag rule” only gags the dishonesty and lack of integrity that has been taking place for decades, so ultimately the court’s decision to uphold the restrictions is a win for life and a win for women.

Under the Protect Life Rule, abortion is no longer considered to be “health care” or “family planning.” Abortion-performing entities like Planned Parenthood, who have decided not to comply with the new Title X restrictions, have by default opened up more opportunities for life-affirming health care centers like federally qualified health centers (FQHCs) and Obria, which provide even more services to women than Planned Parenthood.

To see a list of the Grantees who voluntarily withdrew from Title X grant awards, see our blog here.

As a result of restoring integrity to the Title X regulations, there will be an increased diversity of health care providers available for women to choose from in the federal family planning program, and the taking of innocent life will no longer be accepted as “family planning” in America.

Trump Administration Closes Out 2019 by Protecting Life and Religious Freedom

by Connor Semelsberger, MPP

December 20, 2019

Since taking office, President Trump has become known for his determination to protect life and religious freedom. Now, he has further strengthened his record with new regulatory actions. Today, the U.S. Department of Health and Human Services (HHS) announced a finalized regulation that protects taxpayers from paying for abortion, and yesterday, the comment period closed on HHSproposed rule revising its grants process. Family Research Council has voiced support for this proposed rule because it would protect the religious freedom of adoption and foster care providers.

Towards the end of his administration, President Obama mandated that adoption providers and other organizations working with HHS must accept same-sex marriage and an individual’s professed gender identity. This mandate’s infringement on religious freedom was so severe that South Carolina Governor Henry McMaster had to ask HHS for a special waiver from this regulation so that Miracle Hill, the state’s largest provider of foster homes, could remain open.

South Carolina was far from being the only state or locality in which adoption providers encountered religious freedom hardships on account of the Obama-era regulation. Now, President Trump is seeking to remedy the existing regulation’s problems with this newly-proposed rule. Now that the comment period on the rule has closed (FRC’s comment is available here), we hope to see protections for adoption and foster care providers finalized soon.

When Obamacare was passed in 2010, it circumvented the longstanding Hyde Amendment’s ban on federal funds paying for abortion. Obamacare allowed plans to cover elective abortions so long as payments for abortion coverage were collected “separately” from those paid for with federal subsidies. Not only was this policy an inadequate means of protecting taxpayers from funding abortion, but the Obama administration also issued a regulation skewing the word “separate.” As a result, many of the payments meant to be collected separately are instead collected together. Under the current regulations, a single notice about the abortion surcharge or an itemized surcharge on the bill would satisfy Obamacare’s requirement for separate abortion payments.

Because this implementation is so obscure, many Americans are unaware that they are paying for abortion coverage in their health plans. This is one reason why FRC has partnered with the Charlotte Lozier Institute to create Obamcareabortion.com, which provides much-needed transparency concerning which Obamacare plans cover elective abortion.

As 2019 comes to a close, we can be thankful we have an administration that seeks to enforce the law as written—not skew it. The newly-finalized regulation will force insurers to collect two distinct payments, one for elective abortion coverage and one for all other covered health services. This separate collection of payments will serve to alert consumers when their plan covers elective abortion, thereby allowing them to make an informed decision on whether to select a plan that covers abortion or not. The setup of Obamacare still subverts longstanding protections against taxpayer funding for abortion; therefore, it is essential that the administration enforce the separate payments provision the way Congress intended.

Whether on religious freedom or life, President Trump continues to deliver on the promises which got him elected.

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