Get Ready, Here It Comes… Increasing the Minimum Wage

On September 1, 2014, Michigan’s Workforce Opportunity Wage Act, Public Act 138 of 2014, will go into effect. The new Act will increase the minimum wage for workers in the state from $7.40 to $8.15 per hour.

In Michigan, one out of 11 workers are employed by nonprofit organizations. Many employees of Michigan Nonprofit Association member organizations are paid at the minimum wage. We also know that nonprofit organizations in Michigan and across the country provide many valuable services and support to Americans who are living in poverty, including the “working poor.”

Nonprofits in the state directly employed 438,000 individuals in 2013. Together the nonprofits in Michigan pay their employees over $4.9 billion per quarter. Our members have weighed in on both sides of the debate around raising the minimum wage.

The minimum wage increase is a policy that will have significant impact for our member agencies and for the state. While our nonprofits provide valuable services, many operate as lean small businesses. And just like small businesses across the country are grappling with the impacts of a minimum wage increase, so will our nonprofits in the coming weeks and months. The key thing to remember is that the debate is over.  Starting in September, nonprofits, along with small businesses and large corporations will be expected to raise the minimum wage payments for their hourly workers.

Wherever you personally weigh in on the issue of an increased minimum wage, as a nonprofit with employees, this increase will initially impact your bottom line. And it will require lots of planning and reviewing as a part of the sustainability for many of your organizations.

Many of you have already begun your strategic planning to address the financial implications that this increase may have on your budgets, staffing and reimbursement levels for direct services. There is no question that the increase in wages will require an increase in revenues and donations, much in the same way that small businesses will have to think strategically about creating more revenue to support the wage increase. We will continue to revisit this subject and share with you some of the strategies that your colleagues are implementing in the field to make this a seamless win-win.

For information and questions on compliance, contact Michigan’s Department of Licensing and Regulatory Affairs (LARA) at http://www.michigan.gov/lara/0,4601,7-154-61256_11407_32352-140972–,00.html. Organizations seeking professional assistance can search MNA’s Consultant & Resource Directory for companies that specialize in accounting & auditing or human resources for nonprofits. The Consultant & Resource Directory is available at http://mnaonline.org/consultantsearch.aspx.

 Submitted by Donna Murray-Brown, President & CEO, Michigan Nonprofit Association

MNA President & CEO Donna Murray-Brown on the Impact of the Government Shutdown on Nonprofits

Shutdown Image

When the federal government shut down last Tuesday, no one ever thought it would be shut down for more than a couple of days.  As we go into the second week of the shutdown, there has been great impact to the nonprofit sector’s ability to do their work.  Nonprofits are experiencing increased demand for services, stalled payments on government contracts, inability to conduct routine data inquiries, uncertainty of how to engage with their AmeriCorps members, and difficulty in their continued ability to employ staff.

With nearly 30% of nonprofits receiving revenues from government contracts, stalled payments from government contracts are placing a huge strain on nonprofits to meet the needs of their communities while keeping their doors open.  Additionally, the impact of sequestration, a fragile economy, and now thousands of government employees suddenly without income, nonprofits are becoming further strained in fulfilling their missions.

Simple daily activities such as internet searches for data and information on government websites are now impossible due to the shutdown rendering the websites inoperable. The U.S. Census Bureau, one of the “go to” websites, is no longer available to assist a nonprofit in gathering key demographic information to make decisions on every day work, future planning, and creating strategy.

Many nonprofits leverage national service programs to build capacity or provide direct service to those they serve.  Just last week, the Corporation for National and Community Service informed AmeriCorps members across the country they are required to serve during the shutdown, but without any compensation.  AmeriCorps members already receive a modest stipend for their service and, as a condition of their service commitment, are not able to hold a second job while serving.  This has become problematic for national service members because they find it increasingly difficult with each day of the shutdown to feed themselves and pay for housing.

As the days and weeks of the government shutdown continue, the aforementioned challenges will only become greater.  Nonprofits must brace themselves for additional trials and the reality of making painful decisions that may compromise the quality of their programs and services.  Decisions such as whether to buy much needed supplies and equipment, whether to forego important training and professional development, and ultimately, making decisions pertaining to staffing.

Making a decision regarding staff may become a reality for some nonprofits heavily reliant on government funding.  Understanding your legal options is key to making the best decision during this time of uncertainty.  Nonprofit HR, an organization providing guidance to nonprofits on Human Resources related topics and issues, is a great source for nonprofits faced with making decisions regarding staffing. Visit their website at http://www.nonprofithr.com/wp-content/uploads/2013/09/Legal-Considerations-in-Layoffs_final_2013.pdf.

If you are experiencing challenges linked to the government shutdown either similar or dissimilar to that I have highlighted, I want to hear from you.  Please email me directly at dmurray-brown@mnaonline.org.

Donna Murray-Brown Submitted by Donna Murray-Brown, President & CEO, Michigan Nonprofit Association

A note from MNA President & CEO Donna Murray-Brown

Charitable giving incentives have been a strong vehicle to support the work of nonprofits serving communities across the country.  While we were not successful in retaining the charitable deduction in Michigan, we know there has been an adverse impact to the level of giving received since its elimination.  It is imperative we advocate protecting charitable giving incentives at the federal level. 

Congress has taken a “blank slate” approach to tax reform, and will analyze everything to arrive at a comprehensive set of reforms including consideration of reducing or eliminating incentives for charitable giving.

The following blog titled “The Lab Results Are in on Tax Reform,” is an opinion piece written in support of the charitable giving incentive that was published in a recent The Hill e-communication, a publication widely read by congressional and White House staffers. The blog gives an inside look at the work of key states advocating for charitable giving incentives and strongly suggests the impact of these incentives on the nonprofit sector and the services they provide in communities.

Please take some time to read, share and educate our law makers, media and networks about this very important topic.

ImageStatement by Donna Murray-Brown, President & CEO, Michigan Nonprofit Association

Statement from MNA President & CEO Donna Murray-Brown on the impact of Detroit’s bankruptcy filing on the nonprofit sector.

Below is a statement from MNA President & CEO Donna Murray-Brown on the impact of Detroit’s bankruptcy filing on the nonprofit sector. A longer statement will be forthcoming.

Donna Murray-Brown, president and CEO of the Michigan Nonprofit Association,  sees the bankruptcy as an opportunity “for not just nonprofit organizations but residents to really create the next Detroit” , Although Murray-Brown acknowledged that the demand for services will probably continue to rise, she’s optimistic. “Nobody wanted to be here, it’s a scary thing to be in a city that just filed for bankruptcy, but it’s also an opportunity,” she said. “Kevyn Orr wants to maintain services to residents. This is a time not to acquiesce but to be proactive and figure out the best role for nonprofits.”

Donna Murray-Brown

Statement by Donna Murray-Brown, President & CEO, Michigan Nonprofit Association

Mackinac Policy Conference Review

Last week, the Detroit Chamber of Commerce held its annual Mackinac Policy Conference at the Grand Hotel on Mackinac Island. Donna Murray-Brown and I were fortunate enough to attend the conference this year on behalf of MNA. One difference in the conference this year, was the lack of lawmakers. Michigan legislators stayed behind in Lansing to put the finishing touches on the FY’12-13 state budget.

This year’s theme was on making Michigan and Detroit a place for global competitiveness. To help attendees think about Michigan in a global setting, the Detroit Chamber had two very high-profile foreign affairs experts, Fareed Zakaria and Thomas Friedman. Both had very similar messages, Michigan and the United States can no longer think of itself as the sole “super power” on the global stage – both in foreign policy and economic progress. Both Zakaria and Friedman came to the same recommendations, improve US infrastructure (including wireless deployment), open up immigration policy, and invest in K-16 education. Detroit Public Television has both sessions on their website, you can view each of them here.

Fareed Zakaria and Thomas Friedman were not the only ones touting the need for Michigan to invest in the future. Numerous keynote speakers and panelists also reiterated the point: if Michigan is going to succeed, it must invest in the future.

One slightly low point of the conference was the “Fab Five” panel, where the leaders of Macomb, Oakland, Wayne, and Washtenaw counties, and Detroit Mayor, David Bing discussed regional collaboration. There was much more of the usual bickering around turf and who should pay for what, instead of broader discussion of a vision of what regionalism looks like for the Detroit area, which would have built upon what the other keynote speakers proposed. There is always next year…

 

Submitted by Christina Kuo, Senior Director of Public Policy and Public Affairs, Michigan Nonprofit Association

Despite differences, education is central to both State and Federal Budgets

These past few weeks have demonstrated the challenges of creating sound, effective budgets at the state and national level. The Michigan and federal budgets, however, paint two very different pictures of the health of their constituents.

The recession over the past four years has not been kind, but there seems to be a glimmer of hope in Michigan. After several consecutive years of painful cuts, it appears the financial outlook is more optimistic with 2012’s budget surplus. Education funding increased by 0.2%, public safety funding is also set to increase, and the “Rainy Day” fund will grow by an additional $130 million, according to the State Budget Office. At the Federal level, by contrast, the deficit still weighs heavily on programs most Americans take for granted, but rely on – the President offered a 52% decrease in Education, a 35% decrease in Labor, and slight increases for Health and Human Services (3.7%) and the Corporation of National and Community Service (1.3%).

Still, there are some common commitments between the two budgets, such as improving performance and affordability of education. President Obama promotes a ‘Race to the Top’ and links financial aid to universities that keep their tuition under control. Governor Rick Snyder also wants to link increased spending in education to improved performance, best practices, and college tuition restraint. And they are politicians from two different parties.

Despite the other differing priorities of the two budgets, it is clear that superior education for future generations must be a priority for education beyond high school. Whether it is community college, traditional four-year, or vocational – higher education has become increasingly important to achieve personal financial security.

Submitted by Michelle Eichhorst, Public Policy Fellow for Michigan Nonprofit Association

Nonprofits Ready to Partner

Wednesday night, Governor Snyder gave his second State of the State address. As he talked about how far Michigan has moved forward in 2011, and his Administration’s priorities for 2012, he continually came back to two key ideas: collaboration and innovation. Collaboration brings with it a sense of community, inclusion, and hope for the future. With innovation, Michigan can creatively improve upon what is already great or throw out the bad. These are indeed keys to a successful future in Michigan and keystones to the good governance Gov. Snyder also advocates.

But you can’t talk about collaboration with just these two sectors (business and government) while ignoring the impact of nonprofits on many of the metrics on the MiDashboard. By including nonprofits at the table of this discussion from the beginning, alongside elected officials and businesses, Gov. Snyder would not only see a broader, more complete view of the impacts of his proposals, but also a better solution to the problems he has identified.

While Snyder’s agenda was positive and avoided controversy, he can no longer ignore the growing importance of nonprofits that are integral to achieving many of his goals for 2012. By championing his own values of collaboration and innovation, the state, nonprofits, and other key players can work together to achieve the desired results of a healthy and prosperous Michigan.

Submitted by Michelle Eichhorst, Public Policy Fellow for Michigan Nonprofit Association

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