Governor Proposes Changes that Affect Nonprofits

Governor Rick Snyder unveiled a bold and politically charged budget proposal last week. The proposal calls for a flat income or profit tax on businesses (in place of the MBT), taxing of pensions, elimination of the homestead provisions, and a myriad of cuts to social services and education programs and institutions. Governor Snyder’s budget also included the rolling back of decades work to make Michigan one of the nation’s most Nonprofit Friendly States. Michigan has a proud tradition of giving and volunteering:

• nearly half of all citizens volunteer,
• 85% donate financially to nonprofits,
• nearly 90% see charities as important to the quality of life in Michigan,
• 93% say the need for nonprofits is greater today than in the past, and
• nine out of ten believe that charities should retain their tax exemptions.

Over the past three years as our state’s manufacturing, retail, and government sectors have struggled and declined, only one sector was hiring and growing–the nonprofit sector.

• One in ten workers in Michigan is employed by a nonprofit.
• During the recession, employment in the nonprofit sector grew by 14%.
• Wages increased among workers in the nonprofit sector by 2.7%.

While growing, the sector has not been able to meet the overwhelming demand for services brought on by persistently high unemployment, record levels of foreclosures, stalled business investment, and tight money markets. Individual giving is especially challenging to maintain in a climate of constrained discretionary income levels. Nonprofits are also working to deal with the challenges of government where payments are late and fail to cover the full costs of services provided.

Given this growth, our state’s long tradition of public/private partnerships, the tools we’ve developed to encourage growth in individual philanthropy, and the challenges of government grants and contracts, it is difficult to understand the rationale behind the Governor’s budget choices.

In addition to the tax changes for seniors and businesses, the Governor proposed 15%+ cuts to the 15 public 4-yr. higher education institutions, over $400 per pupil cuts in K-12 funding, the budget calls for the all out elimination of the majority of the charitable incentive tools Michigan nonprofits use to support vital services to Michigan residents. They include:

• Earned income tax credit (a Michigan companion to the national credit) – $353.8 million
• Gifts: public art, radio, colleges, universities, archives, museums, libraries credit – $24.8 million
• Community foundations, $3.4 million
• Food banks and homeless shelters credit – $21 million
• College tuition and fees credit – $4.8 million
• Automobile donation credit – $100,000
• Energy efficient home improvement credit – (figures not available)
• Historic preservation credit – (figures not available)

In just the areas we can calculate right now, the nonprofit sector will be taxed a total of $54.1 millionin this budget year alone. This excludes the energy credit, preservation credit, both of which go to support areas in which nonprofits are essentially the only service providers, and also leaves out the Earned Income Tax Credit ($353.8 m) which goes to the individuals only nonprofits, in partnership with government, serve – the working poor. It also omits any local government financial challenges that will be thrust upon nonprofits as revenue sharing is cut nearly in half in the Governor’s budget. And, of course this calculation omits the loss of leveraging power nonprofits will suffer when Michigan donors realize our state tax credits as incentives to give are gone (with the exception of a few targeted for veterans and special needs children).

The Governor and members of the legislature have difficult choices to make. Michigan’s structural deficit has long been the can kicked down the road and the end of the road is here. Michigan’s nonprofit sector will be called upon to make sacrifices for our future financial security. No one should operate under the illusion that they will be spared the budget axe during this important time in our state. As a sector, we need to decide if Governor Synder’s proposal properly defines the sacrifices we want to make or if there are more sustainable and ultimately healthier choices we can make to help in Michigan’s economic recovery.

Submitted by Kyle Caldwell, president and CEO, for the Michigan Nonprofit Association.

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MCC AmeriCorps*VISTA Recruitment – Be a Part of the History

AmeriCorps*VISTA (Volunteers in Service to America) is a full-time national service program for individuals who are interested in developing lasting solutions to the problems of poverty in America. VISTA members address poverty in communities by mobilizing community resources and increasing the capacity of the low-income communities. Members have been striving to create positive, long-term, sustainable change since 1965. VISTA is part of the AmeriCorps national network of service programs within the Corporation for National and Community Service.

The Michigan Campus Compact (MCC) AmeriCorps*VISTA program places members on Michigan campuses to act as transformative agents between higher education institutions and their surrounding communities. VISTA members create service opportunities and engage students in the community, in order to gain a richer and more valuable experience outside the classroom. They build mutually beneficial relationships, which lead to long‐term partnerships between community‐based organizations and colleges, enhance the quality of campus community service and service-learning programs, improve student leadership in service, increase the number of students coordinating programs, and increase the number of students in direct service within their campus communities. Through this indirect, capacity building work, MCC*VISTA members fight poverty in Michigan, and they do so with a lot of passion!

Michigan Campus Compact recruits college graduates who are committed to performing a voluntary year of national service. They are recruited, selected, and receive ongoing training by MCC staff, and they have varying backgrounds and professional goals. MCC*VISTAs are not necessarily experts in a specific field, but have typically had significant experience in college-level community service and/or service-learning programs. Having amazing VISTA members behind the work has been a key factor in running a successful VISTA program, and we are recruiting for those individuals right now!

We are looking for motivated, graduating college seniors, who are interested in (but not limited to) organizing campus and community-wide service projects, fighting poverty, working with faculty and staff to coordinate service-learning programs, recruiting and training student volunteers, gaining invaluable work experience, and receiving an education award to pay off loans/put toward further education. To further view what it means to be a VISTA in this program, please check out the video from our 2009-2010 MCC*VISTA cohort.

If you or someone you know are interested, please visit our website or contact Melissa Strapec at 517.492.2436 or

Submitted by Melissa Strapec, AmeriCorps*VISTA Leader for Michigan Campus Compact

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AmeriCorps Week: Michigan Campus Compact VISTAs Connect Campus to Community

The Michigan Campus Compact AmeriCorps Volunteers in Service to America (VISTA) cohort consists of 18 dedicated VISTA members and one VISTA Leader. These VISTAs serve on college and university campuses across the state of Michigan, as well as in the Michigan Campus Compact office in Lansing. The goal of the Michigan Campus Compact AmeriCorps*VISTA program is to fight poverty with passion, focusing specifically on the needs of children and youth in low-income communities. MCC VISTAs believe that poverty can be alleviated through the connection of campuses to their communities, and each works to build the capacity of campuses to empower their student leaders to become engaged in their communities.

MCC VISTAs are often placed in campus academic service learning or student activities offices. Here, they build programs to engage students in volunteerism and service. By building sustainable initiatives, students will continue to have opportunities to become leaders in their communities after the VISTA has completed their year of service. In the 2008-2009 academic year, Michigan Campus Compact AmeriCorps*VISTAs generated on campus involvement of 10,539 college students performing community service or service learning, and a total of 9,785 active community volunteers. These volunteers performed 43,309 hours of service. At $20.85/hour (a figure developed by Independent Sector for 2009), this service equates to a value of more than $900,000.

To highlight some of the outstanding impact that MCC VISTAs are having in their communities, MCC has created a monthly VISTA feature that is posted on the organization’s website. This feature demonstrates the accomplishments of several VISTA members on their campuses and in their communities. May’s VISTA feature highlighted the work of Gordon Beedle, MCC VISTA serving at Delta College, Sierra Demski, MCC VISTA serving at Davenport University, and Tiffany Sims, MCC VISTA serving at Oakland University. To view the work of these individuals and their fellow VISTAs, check out the monthly VISTA feature and the previous VISTA features archived at

Submitted by Melissa Strapec, Michigan Campus Compact Strategic Initiatives AmeriCorps*VISTA, and Amber Toth, Michigan Campus Compact AmeriCorps*VISTA Leader.

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As Poverty Rates Rise, Michigan Campus Compact AmeriCorps*VISTAs Work to Get Things Done

One could argue that there has never been a more important time to become an AmeriCorps *VISTA (Volunteers in Service to America). VISTAs are individuals who dedicate a year of their life to eradicating poverty—these volunteers pledge to “get things done for America.” As poverty and unemployment rates have climbed sky-high nationwide, VISTAs have worked diligently to create effective, sustainable programming to stem these crises and strengthen communities. As Michigan Campus Compact AmeriCorps*VISTAs, our work is particularly vital to a state with the nation’s largest joblessness rate. MCC *VISTAs are placed on college and university campuses across the state of Michigan in order to provide indirect service by building the capacity of the campus to connect to the community in which it belongs. This is an enormous need for Michigan—post-secondary training will be essential for Michiganders to return to the work force. Allying higher education institutions with their communities helps individuals to see college as a possibility and view these campuses as important members of their neighborhoods.

Michigan Campus Compact AmeriCorps*VISTAs 2009-10

Michigan Campus Compact AmeriCorps*VISTAs 2009-10

As large of a task as this seems, this year’s Michigan Campus Compact AmeriCorps*VISTAs are up to the challenge. On July 26, our group of 21 VISTAs flew to Boston, MA to participate in a Pre-Service Orientation on the campus of Northeastern University. Alongside the Rhode Island, Massachusetts and Connecticut Campus Compact VISTAs, the 09-10 MCC *VISTA cohort learned the principles and foundations of service-learning, explored the assets of Boston’s many diverse communities, participated in civic reflection, honed their leadership skills and gained knowledge that will prepare them for the year ahead. This Pre-Service Orientation was very valuable for all of us. We gained Campus Compact-specific skills that will aid us all in the year ahead as we strive to create and expand programming to end poverty in the communities where we live and serve. We also grew to know, respect, and like each other–integral aspects of succeeding in the critical and often challenging work that we do across the state.
2009-10 VISTAs swearing in ceremony

2009-10 VISTAs swearing in ceremony

This is my second year as a Michigan Campus Compact AmeriCorps*VISTA, and my first as *VISTA Leader. I am thrilled to resource, train, and support the 09-10 cohort of MCC *VISTAs. Our group is passionate, intelligent and deeply dedicated to both the mission of the VISTA program, eradicating poverty, as well as the mission of Michigan Campus Compact. MCC VISTAs are placed on 18 diverse campuses across Michigan; they serve at both public and private, and 2 year and 4 year institutions. On these campuses, our VISTAs serve as the on-the-ground presence of Michigan Campus Compact: doing the daily work of building civic and community engagement into campus and academic life through college access initiatives, alternative breaks, service learning courses and programs, days of service and countless other projects and programs. We are taking up the task of rebuilding Michigan, and not a moment too soon—Michigan Campus Compact AmeriCorps*VISTAs are “getting things done.”

Amber TothSubmitted by Amber Toth. Amber is a 2008 graduate of Michigan State University. She is serving as the Michigan Campus Compact AmeriCorps*VISTA leader, coordinating MCC VISTAs in their work with students and community partners on Michigan college campuses. Prior to becoming VISTA leader, Amber served as an MCC VISTA on the campus of the University of Michigan-Dearborn connecting campus to community through service-learning.

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As Individuals are Priced Out of Insurance Coverage, So Are Employers

New U.S. Census data released Tuesday shows that Michigan has more than 1 million residents who lack health insurance. That’s about one in every nine people in the state. This gives new urgency to the national debate on health care reform. It’s of huge importance to the nonprofit world – both as advocates for the uninsured and underinsured and as nonprofit employers – who employ 1 in 10 Michigan workers – struggling with high costs of providing health insurance to dedicated staffs.

The majority of health care coverage is tied to employment. With unemployment rising, and more employers dropping or reducing the benefits they offer due to cost, millions of Americans are at risk of losing the health care coverage they have or finding it inadequate when they need it. According to the Kaiser Commission, while employers continue to cover a similar percentage of employee premium costs, the increases each year in the premiums results in higher and higher costs for both the employer and the employee. As individuals are priced out of insurance coverage, so also are employers as their costs have also skyrocketed.

It’s imperative that we create a wellness system that offers widespread preventive care – not a system that offers wellness care for some and expensive treatment for the others in the state’s emergency rooms. At its worst, our system allows the loss of life from treatable conditions. We also need a system that is affordable to all employers. Nonprofit employers do not benefit from small business tax credits.

The new national reform plan by Senate Finance Committee Chair Max Baucus, unveiled last week, would begin to slow the growth of health care spending and it would extend coverage to many uninsured in Michigan and improve insurance for others who already have coverage. However, it contains three troubling components that need to be addressed. Those are inadequate subsidies for low- and moderate-income folks to pay for coverage and a “free rider” provision that would that create a disincentive for employers to hire workers from low-income families, especially those with children. And a recent mark up by Chairman Baucus would extend some relief to nonprofits as employers, though at a potentially lower level than the relief provided to small businesses. Charitable organizations will be eligible to apply the tax credit against the organization’s liability as an employer for payroll taxes for the taxable year to the extent of the amount of income tax withheld from its employees; however, the charitable organizations will not be eligible for a credit in excess of the amount of these payroll taxes.

As you follow the health care reform debate, I encourage you to read our Case for National Health Reform.

Sharon ParksSubmitted by guest blogger, Sharon Parks. Sharon is the president and CEO of Michigan League for Human Services and member of the MNA Board of Directors. She has been with the League since 1977, starting as a policy analyst and most recently serving as Vice President for Policy.

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Mid-week Foodstamp Challenge Reflections: Kyle and Allison

To learn more about Michigan Nonprofit Association staff participation in the Michigan Food Stamp Challenge, go here.

Kyle Caldwell
It’s easy to forget the circumstances of others when you get wrapped up in your own life. I was working through how to stay under my daily Food Stamp Rations so I skipped my morning coffee (1.69 at McDonalds) and stuck to one meal today. Lunch at the conference was a sandwich. Perfect, I thought. Even if I go over a my budget a little, I can make it up later. I asked about cost of lunch for the conference…..$24.00! OK, so I’ve blown my week’s allotment. I can rationalize all I want—the cost is not that actual cost, the same meal would cost half that at restaurant. But what I should have done is skipped lunch all together as I had for breakfast and dinner at the conference. Again, I am wringing my hands about something that someone on food stamps wouldn’t. I am going on, guilt-ridden, but determined to see this through.

Allison Treppa
Its mid-week (Wednesday lunch) in the Michigan Food Stamp Challenge and I have exactly $15 left for 5 meals the rest of the week. With 4 coworkers, I’m piling into the minivan – stocked up with a few $0.25 snacks from the office breakroom and my full water bottle, as I know anything at a gas station or rest stop vending machine is too costly for my budget. How am I going to manage being out with colleagues for work? Even if I ate soup at a restaurant for every meal, I would still be over budget. The challenge has certainly heightened my awareness, not only of what people go through every day, but the cost and availability of nutritious food. The week is quickly becoming a week of cheap carbohydrates and relying on any freebies that are available, either in the hotel, at the conference, or the generosity of my colleagues. I am also thinking about peer pressure. I mean, my colleagues are aware of the challenge and they are accommodating and supportive. But what if they weren’t aware? If this were my life, they wouldn’t necessarily know and maybe I wouldn’t be comfortable sharing my situation. The need and desire to be accepted professionally often leaves me feeling like I need to attend lunches out and participate in these social activities. I wonder how much others sacrifice to be “accepted”.

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Beginning the Food Stamp Challenge: Kyle Caldwell

To learn more about Michigan Nonprofit Association staff participation in the Michigan Food Stamp Challenge, go here.

I was unclear how I would start this challenge. It’s Sunday evening and I am attending a state conference and staying overnight in a hotel. The food is free and the accommodations are more luxurious than my own home. Tomorrow I’ll participate in this challenge to live in the shoes of someone on public assistance without really living in that reality.

As I am pondering this, a short African American young man dressed in baggy jeans, sports jersey, ball cap and some serious bling got on the elevator with me at the conference hotel. We both punch different floors and as the elevator moved up, he asked me the time and if he could use my cell to make a call. I told him it’s 11:00 p.m. and I asked him the number he’s trying to reach. He gave me the number and I dialed it and handed him the phone. He said, “Mom, I’m fine and it’s more complicated….love you….no…bye.” He then asked me how much it would cost to stay in this hotel. I gave him my room rate and he said, “That’s not too much.” Then he went back on the elevator and the door closed. He’s gone.

At 7:00 a.m. the next morning, the beginning of my Food Stamp Challenge, I received a voicemail from the young man’s mother. She pleaded to let her know how I came in contact with her son who had run away from home. He must have been looking for a place to sleep. I called the mother back and let her know the details of our brief interaction.

I took this as a sign. I am not sure what it all means, but it did reinforce my resolve to live in the shoes of another. I cannot eat the conference food. It doesn’t feel right. I’ve yet to eat a thing other than two cups of coffee that I scammed from the lobby of the hotel….something any resourceful person might figure out. Tonight I’ll activate my card and see how it all works to live on less than $6.00 per day. Day one begins.

This was a strange day. I spent my day trying to NOT think about food while working through a conference with grant makers, attending a board meeting, and taking in an evening fundraiser. Free food was everywhere and I just couldn’t imagine someone without the means and access to do the same. I resolved to figure out a way to keep my promise to live within the means of the Food Stamp Program. After fasting all day, I decided to go home eat a salad ($1.99 Bag of Salad), ham sandwich (.99), and a diet Pepsi ($1.39). I made it with change to spare. But it was a long day and I can’t remember the last time I had only one meal in a day. On to day 2.

Submitted by Kyle Caldwell

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