2024 General Assembly Roundup: What Illinois Non Profits Need to Know

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ENACTED: IL Gives Tax Credit Act (SB172 / HB1241)

A long-term priority for the Alliance of Illinois Community Foundations and Forefront, the Illinois Gives Tax Credit (nee “Endow Illinois”), gained traction in early 2022, undergoing heavy negotiations over the ensuing years.

Illinois Gives received six subject matter hearings in House and Senate Revenue Committees between 2022-2024, at which hundreds of supportive witness slips were submitted.

On 6/7/24, Illinois Gives became law when Governor Pritzker signed HB4951, the FY25 revenue omnibus bill, which contains its provisions (now Public Act 103-0592, Article 170).

Prior to enactment, IL Gives achieved strong bicameral, bipartisan support from 62 total sponsors, including over half of the Illinois Senate and almost a third of the Illinois House.

As a result, beginning 1/1/25, any Illinois taxpayer, including individuals, corporations, trusts, and estates, may receive a 25% state income tax credit up to $100,000 when they make an eligible donation to a non-DAF permanent endowment at a qualified community foundation in Illinois.

ENACTED: Workforce Development Through Charitable Loan Repayment (SB3273 / HB4736)

When a higher education student receives a traditional scholarship, it is not taxed as income. However, as soon as they graduate, if they receive a “post-graduation scholarship” for the same type of expenses (i.e., tuition and other fees) in the form of loan repayment, such support is taxable as income. With the enactment of the Workforce Development Through Charitable Loan Repayment Act on 6/7/24 via HB4951 (Article 10), eligible workers will no longer pay state income tax on charitable loan repayment in Illinois. The program, which will be overseen by the Illinois Student Assistance Commission, will help communities around Illinois lure and retain talent while leveraging private funds to help tackle our student debt problem.

NOT ENACTED: Small 501c3 Lobbyist Registration Fee Waiver (SB1349 / HB4266)

This bill, which would protect civic engagement and improve compliance with the Lobbyist Registration Act, was supported by a large coalition and received a subject matter hearing for the first time on 4/10/24, with over 170 witness slips. Forefront testified at this hearing with support from Illinois Partners for Human Service and the Illinois Coalition Against Sexual Assault. However, the General Assembly did not move an ethics package this spring, which is the likely vehicle for this proposal to become law. Forefront will continue to work on Lobbyist Registration rules and fees until we improve the regulatory conditions for the nonprofit sector. Read fact sheet and learn more about Lobbying Rules in Illinois.

NOT ENACTED: Community Partner Fair Contracting Act (SB3457 / HB5064)

After conducting related research in 2023, Forefront, in conjunction with the Illinois Health and Human Services Coalition, introduced a sweeping government contracting reform omnibus bill known as the Community Partner Fair Contracting Act. Subsequently, a steering committee led by Forefront engaged in negotiations with state constitutional offices (Governor’s Office, Comptroller, Secretary of State, Attorney General, Treasurer) and state grantmaking agencies (Illinois Department of Human Services, Department of Commerce and Economic Opportunity, Illinois Department of Public Health). As a result of these negotiations, the bill was heavily amended. Additionally, just before the end of the spring session, Forefront established a limited agreement with the Governor’s Office to make substantial updates to the Government Accountability and Transparency Act (GATA) and prepared a draft bill reflecting this agreement. However, legislative leaders did not provide a hearing or a legislative vehicle to enact the agreed provisions. Forefront will continue fight inertia in government related to government contracting. We remain committed to advocating for the Community Partner Fair Contracting Act and we will continue related negotiations with state officials. In the meantime, read more about Forefront’s efforts to support government contractors in practical ways.

FY25 State Budget

Senate Bill 251 contains FY25 appropriations; House Bill 4951 is the revenue omnibus; and, House Bill 4959 is the budget implementation plan (BIMP). Forefront’s key budget priorities were fully funded, including the Charitable Trust Grant Program and state-funded Nonprofit Security Grants. The Nonprofit Security Grant Program had a successful first round of grant awards in FY24, thanks to the advocacy of the Safeguard Illinois Communities Coalition, of which Forefront is a member. The FY25 budget builds upon this success; combined with the new FY25 appropriation remaining funding from previous years, we expect another full round of grants to be awarded in FY25 ($19.2 million total; advanced payments permitted). See more in-depth budget analysis from our partners below.

Other New Laws Impacting Nonprofit Sector

While the following bills were not introduced by Forefront, our policy team engaged on them in various ways since they impact the nonprofit sector directly.

ENACTED: Office of Economic Equity and Empowerment (SB859 / formerly HB5606)

Forefront requested and successfully obtained an amendment to the original bill to specifically make not-for-profit organizations that primarily serve minorities, women, veterans, or  persons with a disability eligible for assistance under the newly codified Office of Economic Equity and Empowerment. Forefront will work to educate stakeholders about how to tap the OEEE’s resources in the future. Read Forefront’s testimony.

ENACTED: Nonprofit Board of Directors’ Demographics Reporting Mandate for Grantmaking Nonprofits (SB2930)

Forefront heavily negotiated the provisions in this bill, which was promulgated by Equality Illinois and first introduced under SB1501/HB3139 in early 2023. As originally introduced, SB 1501/HB 3139 would have required every nonprofit (not just grant makers) include in their annual filing with the Secretary of State’s Office information about the aggregated demographics of its directors and officers. It would have also required nonprofits to post the aggregated demographic information on its website. There were no exemptions, ways to opt-out, or decline to disclose information. The bill was later refiled as HB4595/SB2930, which addresses most of our concerns.

In the final version, the requirement to collect aggregated demographic data for boards of directors and officers is only applied to organizations that make grants totaling more than $1,000,000. Senate Amendment 2 also deleted the Secretary of State’s enforcement role, limiting the mandate to a self-report by foundations. Finally, SA2 added an individual decline-to-disclose. Recommendations that we made that were not accepted in final version included 1) excluding donor advised funds from the calculation of the $1M grant threshold; 2) setting a minimum board size to preserve individual safety/privacy for small boards, especially in small towns and 3) raising the $1 million grant threshold up to $10M. Forefront’s Policy Committee advised our policy team on this bill multiple times; Forefront also sought feedback by sending an alert through our policy listserv and in multiple statewide email newsletters. Lacking consensus in the responses we received, we remained neutral on the bill, while simultaneously achieving improvements through negotiations. Read Forefront’s most recent testimony.

As enacted, beginning 1/1/25, SB2930 requires foundations that distribute more that $1 million in grants annually to publish aggregated demographic information about their board of directors on their website every year, and leave each year’s data on the website for three years. Forefront will provide more information in the coming months to stakeholders about how to comply with this new law.

Click here for the full article on myforefront.org

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