Federal Policy & Funding Updates for New Mexico Nonprofits

Dec 10

Chart of Executive Orders

Chart of Executive Orders Affecting Charitable Nonprofits, National Council of Nonprofits

Administration to Decommission Combined Federal Campaign (CFC) Charity Portal

The administration is expected to decommission the charity online portal for the Combined Federal Campaign on March 4.

In 2024, in the Desert Southwest Zone, CFC raised $1.37 million for nonprofits. The Desert Southwest Zone includes New Mexico, Nevada, Arizona, and several counties in Texas. The CFC is the country's largest workplace giving program.

Proposed Changes to Federal Grant System, SAM

The General Services Administration (GSA) has proposed changes to the System for Award Management (SAM). The proposal requires all federal grantees, including nonprofits, to sign new certifications as a prerequisite to apply for or receive federal financial assistance.

If implemented, the proposed changes would directly impact nonprofits that apply for or receive federal financial assistance, including discretionary, block, and formula grants.

Under the proposed changes, applicants and recipients of federal financial assistance would be required to sign new certifications under penalty of criminal and civil law. These certifications include provisions on diversity, equity, and inclusion (DEI) and on undocumented immigration and anti-terrorism.

The new requirements would create significant legal and financial risks for nonprofits. With the new certifications, nonprofits may decide that it is not worth the risk and could forgo applying for federal funds altogether, leading to service disruptions.

Nonprofits have until March 30 to submit public comments in opposition to the proposed changes. For more information, read the proposed changes and supporting materials.

Federal Funds and Nonprofit Lobbying

On August 28, the President issued a memorandum to the U.S. Attorney General regarding the use of appropriated funds for lobbying and political activity.

Our colleagues from the North Carolina Center for Nonprofits shared the following:

"The memorandum alleges that "the possible use of Federal grants as slush funds for political and legislative advocacy raises serious legal concerns."

President Trump's memorandum appears to misinterpret the relevant federal statute. In fact, federal law does not prohibit nonprofits (or businesses) that receive federal grants, contracts, or cooperative agreements from lobbying. In 1995, a member of Congress tried to get that type of broad prohibition on lobbying enacted into law, but nonprofits were successful in advocating against it. Instead, the statute referenced in that sentence of President Trump's memorandum (often known as the Byrd Amendment) merely prohibits nonprofits and businesses that receive federal grants, contracts, or cooperative agreements from using these federal funds to influence other federal funding decisions. Nothing in federal law prohibits federally-funded nonprofits from policy advocacy at the federal level or from using other revenue sources to lobby Congress or federal agencies for appropriations or for the awarding, renewal, extension, or amendment of a federal grant, contract, or cooperative agreement.

The memorandum directs the Attorney General to report to the President on the results of investigations into lobbying activities by federal grant recipients in 180 days. It is unclear what, if any, enforcement actions federal agencies may attempt to take against nonprofits that receive federal grants and are engaged in lobbying activities."