Policy Briefing
Catalyst Weekly Policy Briefing Issue IV: Control What We Can
Speaking with members and partners in the past few days, I was reminded that our region has the leadership and knowledge it needs, and philanthropy has the power to make funding streamlined and simple. And in times of uncertainty, one action we can take is to eliminate the stressors that are under our control. For philanthropy, that’s most of them.
Here’s a look at what happened this week. (Catch up on our previous installments of this briefing here.)
THE FACTS
Federal developments
- A judge denied a request by unions to end the federal hiring freeze and layoffs, noting that the matter should first be addressed with the Federal Labor Relations Authority, which is charged with addressing labor disputes.
- The Internal Revenue Service (IRS) will lay off more than 6,000 employees, representing around 6% of its workforce. IRS staff had increased to around 100,000 under the Biden Administration, growth aimed at stronger enforcement for corporations and wealthy tax payers.
- Separate budget resolutions continue to move through the House and Senate. The Senate resolution increases spending on border security, defense, and the Coast Guard; it does not address tax cuts. It was passed by Senate Republicans earlier this morning after more than ten hours of a “vote-a-rama“. The House budget resolution provides for $4.5 trillion in tax cuts and lifts the debt ceiling. It will be voted on next week. Ultimately, the two houses of Congress must agree on a single budget plan to pass through reconciliation.
- In climate funding, recipients nationwide have been unable to access funds awarded through a $20 billion initiative for community climate projects announced in 2023. The Environmental Protection Agency recently announced it will seek to eliminate that initiative. Locally, at least $22 million for housing, transportation, and workforce is in jeopardy. (Alarmed by this number? Connect with us about Catalyst’s Climate Funders Collaborative to be introduced to peers in the region learning about and funding climate resilience.)
City of San Diego budget
- City of San Diego Mayor Todd Gloria announced that 31 positions had been eliminated for a cost savings of approximately $5 million. All positions were vacant except the Chief Operating Officer, who was laid off. Department heads will now report directly to the mayor, with Gloria assuming the role of city manager.
- Numerous departments were reorganized and consolidated including Child and Youth Success, Race and Equity; Cultural Affairs, and Sustainability and Mobility.
- The mayor is required to present a balanced budget and so he must resolve a deficit of more than $250 million by June.
Funding impacts and opportunities
The Resourcing Resilience Report, published by Philanthropy CA and Nonprofit Finance Fund highlights ways that funders can advance public-private partnerships. The report highlights four key areas: capacity, coordination, trust, and working capital. During a February 20 webinar with State agencies and foundations, we explored barriers and recommendations.
- Capacity begets capacity so help nonprofits build capacity through insurance policies, technology upgrades, bridge loans, collaborative spaces, and more.
- Public funds are hard to get and can be unreliable so provide stability through multi-year general operating funds, by changing your own practices (like reducing reporting requirements), and by simply assuring partners you are not going anywhere.
- Fuel long-term change by funding nonprofit civic engagement so organizations can advocate for changes in how public funds are administered. 2023’s AB 509 changed the face of State dollars by allowing nonprofits to receive 25% in advance. Check out this resource from Philanthropy for Active Civic Engagement to better understand what it means to fund community voice through civic engagement.
- Don’t ask nonprofits to wait for you. Instead, be the one to take a risk and put some extra funding out while you figure out your strategy to navigate these dynamic times.
TAKEAWAYS: WHAT PHILANTHROPY CAN DO
- Connect with your grantees and let them know they can rely on you in this time of uncertainty, especially if they have lost or have concerns about losing public funds. Give them some insight into your thinking and what you can and cannot do to help.
- Make things easier on grantees (without being asked). Remove requirements on existing grants; inform partners of renewals before the first grant period is up; and replace a written report with a phone call or coffee visit.
- Register for the First 100 Days Funder Briefing to hear from colleagues across California about how they are navigating the economy, political environment, and more.
Talk to you next week,
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