Obama’s jobs plan may provide nonprofits relief

From the Alliance of Arizona Nonprofits

The current debate in Washington centers on President Obama’s Sept. 8 call for passage of the American Jobs Act. The purpose of the proposal is to spur economic development and provide relief to struggling employers, especially small businesses. How would the proposed law affect nonprofits?

According to analysis by the National Council of Nonprofits, the proposed law would:

• Reduce the payroll taxes that nonprofits pay
• Eliminate these payroll taxes if your nonprofit adds new staff or increases wages
• Reduce your staff’s payroll taxes through 2012
• Give tax credits to businesses that hire veterans and long-term unemployed workers. (It’s unclear whether these would apply to nonprofits.)
• Provide federal support for state budgets to prevent teacher and public safety worker layoffs
• Create new building and infrastructure projects which might involve some nonprofits

Some of these provisions may provide some financial relief for organizations beleaguered by the weak economy. However, the Administration must still propose measures to finance the measures, so they do not increase the federal deficit – any proposal that would increase the deficit is presumed to be “dead on arrival” in Congress.