| For Immediate Release 7/8/2003 |
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| SECOND NCRP REPORT ON SEC. 105 OF H.R. 7 REAFFIRMS PROVISION WOULD HELP CHARITIES, PRESERVE FOUNDATIONS AND ENCOURAGE EFFICIENCY | |||
| Findings Reveal Measure Could Free $3.2 Billion Annually for Grants to Nonprofits; Analysis Also Shows Foundation Trustee Fees, Staff Salaries and Benefits Make Up Nearly Half of Overhead Costs That Foundations Count as Charitable Spending | |||
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WASHINGTON - The National Committee for Responsive Philanthropy (NCRP) today released the second of two reports on a proposal in Congress to end foundations' widespread practice of counting many of their own overhead costs toward their annual 5 percent charitable spending requirement. The new report - A Billion Here, a Billion There: The Empirical Data Add Up - is available from www.ncrp.org in pdf format. Among NCRP's findings based on an analysis of commonly accepted IRS data: Private, non-operating foundations will be counting up to $3.2 billion of their overhead costs in 2003 toward their charitable spending requirement - money that could otherwise generate 26,000 average-sized grants for America's nonprofits. NCRP also found that IRS data for 1989-1999 reveal that on average, nearly half of the overhead costs foundations counted as charitable spending each year went toward their own trustee fees, staff salaries and benefits. "Our second research report on this subject reaffirms that the modest changes proposed by Sec. 105 of H.R. 7 represent a balanced and reasonable tax reform that would help our nation's charities with billions of dollars in new grants while allowing foundations to sustain themselves for the future and improve their efficiency," noted NCRP Research Director Jeff Krehely. "In the wake of feedback we received following last month's release of our Helping Charities, Sustaining Foundations analysis of the reform proposal, we have been able to refine and build upon our findings. If light triumphs over heat in this debate, the measure should pass." The bipartisan proposal - contained in Sec. 105 of H.R. 7, the Charitable Giving Act of 2003 - is awaiting markup this summer in the House Ways and Means Committee. It is being opposed by the Council on Foundations, the foundation trade association, despite research showing that it would free up billions of dollars annually for America's charities while only marginally increasing foundation expenses by an annual average of no more than 0.4 percent of assets. |
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