CalNonprofits Articles

Many nonprofits suffer from government contracts with indirect rates of 3%, 9% or even 0%. After years of nonprofit advoacy, new guidelines were issues on December 26th that specify a minimum default rate of 10%.

And the most important part: this is not only for funds coming directly from the federal government, but for federal funds passing through states and counties on their way to nonprofits.

As before, if you have negotiated a federal indiect cost rate already, that rate will stay in place. But this is good news for the thousands of nonprofits that receive government funding but have not been able to obtain an official rate. Ten percent still isn't enough (after all, Stanford University's rate is 72% and most for-profit contractors with the Department of Defense have rates of more than 90%), but it's an important step forward.

Other good news in the "High Impact Low Profile" department: the threshold for A-133 audits (also called single audits) has been raised from $500,000 in federal funding to $750,000. Hopefully this means more nonprofits will not need to bear the additional expense and trouble of A-133 audits.

How did this come about? Thanks to the decades-long advocacy of nonprofits including the National Council of Nonprofits (of which CalNonprofits is a member) and others, OMB has taken a step towards fairness to nonprofits. The membership dues you contribute to CalNonprofits is part of what made this happen!

Watch for our new policy focus early in 2014 with new strategies to strengthen the nonprofit voice with Sacramento regulators and legislators on this crucial issue. In the meantime: who knew that OMB had a Santa hat in its closet?


0 # Dan Johnson 2014-01-16 10:22
Good information.
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