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Craig Parshall, General Counsel

 

The Uncharitable Impulse

April 27, 2011

Sometimes it is easy for Christian ministries to tell their supporters from their opponents. At other times it takes a degree of discernment. The famous 19th century evangelist John Wesley described the time that he was preaching in the English town of Hull, when a large group rose up in protest and started pelting him with stones. He was only able to escape serious injury when a female supporter sheltered him safety in her horse-drawn coach. In the last few months several different government proposals – less obvious than rock throwing but equally harmful – have converged against non-profit organizations, including Christian ones. When President Obama addressed the nation in late March on the issue of the national budget, one of his proposals was to substantially reduce the ability of higher income citizens to deduct gifts to charity on their federal income tax. While that may sound innocuous, the results could be devastating to non-profit ministries. Indiana University’s Center on Philanthropy estimates that such a move could decrease charitable giving by 4.8%, or $3.87 billion. Non-profit Christian organizations are already struggling financially. The Evangelical Council for Financial Accountability (ECFA) has determined that while the very largest Christian groups have managed to stay the course in terms of revenue (realizing a slight increase in giving of 1.4% in 2009 compared to 2007), Christian ECFA-member ministries with annual revenue of less than $10 million saw their giving drop by 6.9% between those two years. More currently, the Nonprofit Research Collaborative has determined that charitable giving in 2010 has failed to “rebound” to the level of pre-2007 years.

Our government leaders need to realize the important public benefit served by Christian non-profit organizations. Earlier this month, when the Supreme Court struck down an attack against Arizona’s tax credit plan for stimulating contributions to private schools, including Christian ones, it addressed that public benefit issue. The Court said that the program at issue (specifically involving private Christian schools) “might relieve the burden placed on Arizona’s public schools. The result could be an immediate and permanent cost savings for the State.” The ECFA study showed a recent decline in gifts to Christian groups specializing in those areas that could benefit communities in clearly tangible ways: alcohol and rehabilitation facilities, counseling, primary and secondary education, and medical services. The Washington Post’s Philip Rucker, while covering the issue of President Obama’s budget proposal, noted that his approach would most likely hurt the “food banks, shelters and other [private] social service groups….” The fact is that increasing, not decreasing, incentives for private citizens to give to Christian charities just makes good policy sense: it can reduce the federal footprint in service areas better handled by the charitable impulse than through heavy-handed (and intrusive) government programs. Capitol Hill needs to get this message.

There are also proposals now pending for increased regulation of non-profit Christian organizations. Senator Charles Grassley (R-IA) suggested in January that religious non-profits may need a host of new restrictions, and appointed ECFA to construct a commission in order to study his ideas. We have reviewed Senator Grassley’s regulatory suggestions and, generally speaking, find them to be very troubling. The Senator’s initiatives supposedly began several years ago with his investigation of six Christian TV ministries (none of them NRB members). However, even before that, the IRS had already sent a recommendation to Senator Grassley urging that new “governance” standards be imposed upon non-profit organizations. In the same vein, there is also a movement afoot by a private “Uniform Law” commission to increase state regulatory control of non-profit charities across the nation. That commission is pitching its proposal, “The Protection of Charitable Assets Act,” to state legislatures. The Act would, among other things, empower state Attorney Generals to conduct broad, harassing investigations of Christian groups and other charities whenever it is determined to be “in the public interest.” Whether it is a matter of lost charitable tax deductions thereby defunding non-profits, or the stranglehold of new governance regulations, when it comes to non-profit charity groups including Christian ones, the mood of some leaders appears to be an unhappy willingness to throw stones at them rather than to help them lay bricks.