Public Policy Agenda Issues

If you’re looking for more information about the public policy issues the Minnesota Council of Nonprofits (MCN) is working on, you’re in the right place. On this page you will find explanations of *some* (this is not comprehensive!) of the issues in MCN's 2021 public policy agenda

We also carry out policy work through the Minnesota Budget Project, a nonpartisan research and advocacy initiative of MCN that promotes policy solutions — particularly in the areas of tax, budget, and the economy — so that all Minnesotans have access to opportunity and economic well-being.

If you have any questions or feedback regarding the issues below, or other issues you would like MCN to pay attention to, please connect with MCN's public policy team below. 

2021 MCN Public Policy Agenda Issues

Uphold and Advance the Role of the Nonprofit Sector

In mid-2020, the state was facing a revenue shortfall of $4.6B in the FY 2022-23 two-year budget cycle. That number was decreased to a $1.3B projected shortfall just before the start of the legislative session, and in the February forecast the state’s projections show a small budget surplus. 

These budget developments are very good news for the state. However, when legislators thought the state was facing a large deficit, there was talk of cuts. When we have had large state budget shortfalls in the past, there has been huge pressure on legislators to implement damaging budget cuts.

Even with the projected budget surplus, nonprofits face the prospect of the state cutting funding for their services and services important to the communities they serve. Facing similar circumstances in the 2000s, some policymakers made the incorrect assumption that nonprofits can make up that lost revenue somewhere else, and we know that greater uncertainty about funding makes it hard for nonprofits to plan and manage services.   

In the past, the nonprofit community has put up a united front against large budget cuts. MCN will work with the sector to use our collective voice to educate policymakers and others about the contributions of the sector, and about COVID’s harm to the sector, and why nonprofits can’t just make up for lost state funds somewhere else.   

Please see related Robust and fair state revenue increases section below. 

As noted above, the state of Minnesota is facing large revenue shortfalls as a result of the pandemic. At the same time, policymakers must take action to tackle the pandemic and economic downturn, and build for a more equitable recovery. Resources are needed to support those actions as well as protect other public services. These resources should come from drawing on the state budget reserve, maximizing federal dollars to the state, and a robust and fair state revenue increases.

In coordination with our friends at the Minnesota Budget Project, we have launched the Together We Rise Minnesota campaign, under which we will work with nonprofits and partners in organized labor to make the case for a progressive revenue package, with a particular focus on raising revenues from those who continue to do well despite the economic downturn: higher-income people and profitable businesses. Likely specific areas of focus include: Increasing income taxes on high-income individuals, strengthening the estate tax, and addressing current law provisions that allow business profits to go untaxed. These policies push back against income inequality and racial disparities in income and wealth.

MCN is an active part of the Volunteer Driver Coalition, which will again seek to eliminate barriers for volunteer drivers and to ease the financial burden imposed by current tax requirements on mileage reimbursement received by volunteers.

Currently volunteers must pay federal and state income tax on mileage reimbursement received over the IRS-set rate of 14 cents per mile when the total reimbursement exceeds $600 a year. The coalition supports legislation to create a state income tax subtraction for volunteer drivers to reduce their tax liability in Minnesota. 

Volunteer drivers are a foundational element in rural Minnesota transportation and have supplemented rural public transit programs for decades. Nonprofits utilize volunteer drivers in many ways, most notably to take individuals to and from medical or other appointments. This is the best solution currently available for transit systems in small Minnesota towns that are often located 30 miles or more from regional hubs, and in particular, specialized medical care. We are hearing from nonprofits that they are finding it increasingly difficult to recruit and retain volunteer drivers. 

Under federal law, private foundations must disclose which organizations they grant to, including amount and purpose. They report this to the IRS and the Minnesota attorney general's office on Form 990PF. Many private foundations have restrictions on how funds can be used, such as only within Minnesota.

Many private foundations grant money to Donor Advised Funds for efficiency and impact. They are the fastest growing way to give to charity, reaching $121 billion in assets nationally. Private foundations in Minnesota granted over $34 million into DAFs from 2010-2018, and that amount is growing. 

There is a significant lack of transparency around money in DAFs. One problem is that DAFs are not subject the same reporting requirements as private foundations. When private foundations grant money to DAFs, ensuing transfers of those dollars occur with no opportunity for attorney general supervision over whether the transfers are in compliance with any trust restrictions on their funding.

The best solution to the lack of transparency is to amend Minnesota's charitable trust statute (Minn. Stat. 501B.38) to require that private foundations report to the Attorney General where money granted into a DAF ultimately goes. This would shine light on funds have not been subject to charitable trust oversight. This reporting requirement would not be burdensome to private foundations/DAFs to comply with, and would provide information identical to what is currently required for private foundation direct grant reporting to the IRS.

Such a change to law would ensure that the Office of the Attorney General is able to exercise its oversight over charitable assets transferred to Donor Advised Funds, thereby increasing transparency of some funds held in DAFs. 

We are an active participant in the Paid Family and Medical Leave (PFML) coalition. The coalition is advancing legislation that would establish a paid family leave insurance program modeled on Minnesota’s unemployment insurance program and funded by a payroll tax paid by employers and employees. The current PFML legislation would provide up to 12 weeks per year in partial wage replacement for leave of at least seven days associated with a worker’s serious health condition (including pregnancy and pregnancy complications), and up to 12 weeks per year for leave associated with care of a family member (including a new child, foreign deployment, violence, or a serious health condition).

Differential access to paid leave contributes to Minnesota’s significant racial disparities in health, income, and wealth. Access to adequate paid time off to manage during these often unplanned events is not evenly distributed, with significant variation based on geography, race, income, and employer size. BIPOC (Black, Indigenous, and people of color) and lower-income Minnesotans are more likely to lack access to these benefits and have fewer resources to get through times of illness and caregiving needs.

Premiums collected would be paid to an account administered by a new division within the Department of Employment and Economic Development, which would then pay out benefits to employees taking leave for qualifying family and medical situations.

MCN supports this legislation because it would allow nonprofits to be more competitive employers, allow all Minnesotans to take time off to care for themselves and their families, boost the economy, and help to close racial disparities in Minnesota.

MCN will work to ensure that policymakers are informed about, and take into consideration, the unique circumstances of nonprofit employers in the establishment of paid family medical leave. 

Many nonprofits, along with governmental and tribal organizations, self-insure for unemployment claims. Self-insured employers (also called reimbursing employers) reimburse the state dollar-for-dollar when a former or furloughed employee is approved for unemployment benefits. This is a sensible, cost-saving approach for the nonprofit employer and is intended for the individual circumstances of resignation, termination, or layoff. 

The advent of COVID-19 has changed our normal. In response, the federal CARES Act includes a reimbursement for self-insured nonprofits for half (50 percent) of the costs of the benefits provided to their laid off or furloughed employees.

Without additional relief, nonprofits that have elected to self-insure for unemployment costs – including health care providers, food banks, housing providers, and senior care facilities – may have to close their doors or significantly reduce services at a time when access to health care, food, housing, and other basic needs are more essential than ever. 

For many months, MCN has been leading both national and state advocacy efforts for full reimbursement of unemployment benefits for reimbursing employers. We created a state-based coalition of advocates, and pushed our national partners to take action. We expect a new coronavirus relief package in the new year, and will advocate strongly that it includes full relief for reimbursing employers.

There is also potential relief at the state level, though it is very specific and application is unclear. Minn. Stat. § 268.047 Subd. 2(5), which states that unemployment benefits paid will not be charged to the reimbursable account of a base period nonprofit when the applicant’s unemployment from this employer was a direct result of an “act of nature,” where 25 percent or more of the employees employed at the affected location, including the applicant, became employed as a result. (Governor Walz clearly stated that the coronavirus pandemic is an “act of nature” in Executive Order 20-01.) 

The Minnesota Department of Employment and Economic Development (DEED) has not provided any information on how they will determine that 25 percent, how they will treat “base period” employers, or a plethora of other determinants.

As of early March 2021, DEED is still working to apply the 50 percent federal relief and applicable statutory relief to reimbursing employers’ accounts. We have advocated for a liberal reading of the state statute, and are waiting to see whether reimbursing employers are treated appropriately. If not, we will consider legislative or other action. 

We will continue our work to focus the public debate on the key challenges facing our state and nation. This will include ongoing advocacy for strong federal responses including expanded and inclusive economic supports such as Unemployment Insurance and food assistance; and additional aid for states and local governments through both flexible aid and an increase in the federal government’s share of Medicaid funding. 

State action will also be needed to respond to Minnesotans’ health, safety, and economic security needs, and potentially to fill in the gaps where Minnesotans (such as immigrants) are left out of federal efforts, The Minnesota Budget Project’s work on covid response especially focuses on health care, child care, and economic supports. In addition, this work includes supporting continued adaptions in public program delivery so that Minnesotans can continue to access needed services during the pandemic, and to ensure that access is not cut off abruptly when various state and federal emergency orders end. 

Attention is needed particularly that policy solutions are inclusive of and meet the needs of BIPOC communities, who have been hardest hit by the pandemic and economic downturn.

We support these specific nonprofit priorities at the federal level: 

  • an increase to the universal charitable deduction and extend through at least 2021,
  • a new round of Paycheck Protection Program (PPP) loans to nonprofits of all sizes,
  • expansion of refundable payroll tax credits,
  • forgivable loans for mid-size and large nonprofits that have thus far been unable to access this necessary aid,
  • full unemployment benefit reimbursement for reimbursing employers,
  • continue emergency funding programs to provide nonprofits with financial support to continue serving their missions.

Build a Strong Democracy and Encourage Civic Participation

Elections: There will undoubtedly be legislation introduced in 2021 to both create and reduce barriers to voting. MCN supports a democracy in which every eligible adult can easily cast their ballot, and we work to remove barriers to voting.  

  • Voter Photo ID is an issue that MCN continues to oppose. Currently, Minnesotans with current and active registration do not need to bring identification to vote on Election Day. Proposed Voter Photo ID legislation would require voters to present a photo ID at the polls to be able to vote. Current law is the most inclusive for all of the communities in Minnesota. Communities such as the elderly, people with disabilities, veterans, students, highly mobile populations, and others, face barriers to obtaining a current photo ID. Passing Voter Photo ID would exclude many communities from civic duty participation. We believe that Minnesota’s nation leading voter turnout supports our robust civic sector, and should be celebrated and expanded rather than restricted.
  • Voter privacy in Presidential primaries. MCN led the charge on this issue in 2020, and was steps away from the finish line when COVID hit. We will hold off on bringing the issue up this year, as it is a budget year and we have three years until the next Presidential primary. In a nutshell, when Minnesota moved to having a Presidential Primary, the enacting legislation also allowed each of the major parties in Minnesota access to the lists of which partisan primary each voter chose to participate in. There are no limits as to what the parties could do with such information, and MCN is concerned for nonprofit staff whose partisan leanings could be made public. The legislation we worked on would simply put commonsense boundaries into place around what parties could do with the information.  

Redistricting: In 2021 and 2022, Minnesota and municipalities are required by the U.S. Constitution to redraw their districts based on the results of the census to achieve “one person one vote.”

Because redistricting has a significant impact on politics and the political futures of candidates and parties, MCN has an important role to play as part of a nonprofit, civic coalition that is working for transparency and a solution that serves all people, not partisan preferences. This work fits well with MCN’s other democracy work, such as promoting engagement in the census and elections.  

For the last four redistricting events, the Legislature has not been able to agree on fair maps, and the job has gone to the courts. MCN supports a parallel commission and community of interest (COI) mapping to ensure fairness and equal representation for all residents.

MCN is an active member of the Our Maps MN coalition and MCN’s role will be reaching out to nonprofits across Minnesota to share important redistricting information with them. Working on redistricting and involving our members in understanding what is at stake and how they can help to make the process open and provides equal representation has important implications for how well people will be represented. Along with other nonprofits, MCN will focus on:

  • Engaging historically under-represented BIPOC (Black, Indigenous, and people of color) communities and other stakeholders
  • Promoting reforms to the redistricting process that increase community ownership over the process
  • Achieving fair Congressional and state legislative district maps that reflect input from communities of interest, particularly Black, Indigenous, and people of color communities

In addition, the characteristics of an equitable and comprehensive plan should include the following, in no particular order: equal population, contiguity, compactness, political and geographic boundaries, communities of interest, and competitiveness. 

The 2021 Legislative Session will be largely or fully conducted virtually. Advocates’ experience in the 2020 Session was that it was harder to connect with legislators and staff when not in person, and there were barriers to mobilizing and engaging our constituencies. That environment will exacerbate inequities in access to legislators, as lobbyists have been working with legislators longer, and who attend candidate fundraisers are more likely to have legislators’ cell phone numbers. Nonprofit advocates and constituents are much less likely to attend partisan events or have significant tenure at the Capitol.