TAX REFORM AND CHARITABLE CONTRIBUTIONS 


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TAX REFORM AND CHARITABLE CONTRIBUTIONS 

HEARING 

BEFORE THE

COMMITTEE ON WAYS AND MEANS 

U.S. HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

FEBRUARY 14, 2013 

Serial No. 113–FC02 

Printed for the use of the Committee on Ways and Means 

( 


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Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001

21–128 2017

TAX REFORM AND CHARITABLE CONTRIBUTIONS 

HEARING 

BEFORE THE

COMMITTEE ON WAYS AND MEANS 

U.S. HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

FEBRUARY 14, 2013 

Serial No. 113–FC02 

Printed for the use of the Committee on Ways and Means 

( 


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COMMITTEE ON WAYS AND MEANS 

DAVE CAMP, Michigan, Chairman 

SAM JOHNSON, Texas 

KEVIN BRADY, Texas 

PAUL RYAN, Wisconsin 

DEVIN NUNES, California 

PATRICK J. TIBERI, Ohio 

DAVID G. REICHERT, Washington 

CHARLES W. BOUSTANY, JR., Louisiana 

PETER J. ROSKAM, Illinois 

JIM GERLACH, Pennsylvania 

TOM PRICE, Georgia 

VERN BUCHANAN, Florida 

ADRIAN SMITH, Nebraska 

AARON SCHOCK, Illinois 

LYNN JENKINS, Kansas 

ERIK PAULSEN, Minnesota 

KENNY MARCHANT, Texas 

DIANE BLACK, Tennessee 

TOM REED, New York 

TODD YOUNG, Indiana 

MIKE KELLY, Pennsylvania 

TIM GRIFFIN, Arkansas 

JIM RENACCI, Ohio 

SANDER M. LEVIN, Michigan 

CHARLES B. RANGEL, New York 

JIM MCDERMOTT, Washington 

JOHN LEWIS, Georgia 

RICHARD E. NEAL, Massachusetts 

XAVIER BECERRA, California 

LLOYD DOGGETT, Texas 

MIKE THOMPSON, California 

JOHN B. LARSON, Connecticut 

EARL BLUMENAUER, Oregon 

RON KIND, Wisconsin 

BILL PASCRELL, JR., New Jersey 

JOSEPH CROWLEY, New York 

ALLYSON SCHWARTZ, Pennsylvania 

DANNY DAVIS, Illinois 

LINDA SA ́ NCHEZ, California 

JENNIFER M. SAFAVIAN, Staff Director and General Counsel 

JANICE MAYS, Minority Chief Counsel 


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C O N T E N T S 

Page 

Advisory of February 14, 2013 announcing the hearing ...................................... 2 

WITNESSES 

Naomi L. Adler, Esq., President and CEO, United Way of Westchester and 

Putnam, White Plains, NY .................................................................................. 292 

John Ashmen, President, Association of Gospel Rescue Missions, Colorado 

Springs, CO .......................................................................................................... 207 

Diana Aviv, President and CEO, Independent Sector, Washington, DC ............ 115 

John A. Berry, CEO and Executive Director, Society of St. Vincent de Paul 

Georgia, Atlanta, GA ........................................................................................... 213 

LaKisha Bryant, President and CEO, United Way of Southwest Georgia, 

Albany, GA ........................................................................................................... 231 

Nicole Lamoureux Busby, Executive Director, National Association of Free 

and Charitable Clinics, Alexandria, VA ............................................................. 154 

Brent E. Christopher, President and CEO, Communities Foundation of Texas, 

Dallas, TX ............................................................................................................. 178 

Roger Colinvaux, Associate Professor, Columbus School of Law, The Catholic 

University of America, Washington, DC ............................................................ 36 

William C. Daroff, Vice President for Public Policy and Director of the Washington Office, The Jewish Federations of North America, Washington, DC ... 193 

Tim Delaney, President and CEO, National Council of Nonprofits, Washington, DC ............................................................................................................. 260 

Vinsen Faris, CFRE, Executive Director, Meals-on-Wheels of Johnson and 

Ellis Counties, and Chairman of the Board of Directors, Meals On Wheels 

Association of America, Washington, DC ........................................................... 126 

Scott D. Ferguson, President and CEO, United Way of the Chattahoochee 

Valley, Columbus, GA .......................................................................................... 226 

Brian A. Gallagher, President and CEO, United Way Worldwide, Alexandria, 

VA .......................................................................................................................... 31

Cynthia Gordineer, President and CEO, United Way of Forsyth County, Winston-Salem, NC ..................................................................................................... 296 

Mark W. Huddleston, President, University of New Hampshire, Durham, 

NH, on behalf of the American Council on Education, the Association of 

American Universities, and the Association of Public and Land-Grant Universities ................................................................................................................. 93 

Lisa Ireland, Executive Director, United Way of Orleans County, Medina, 

NY ......................................................................................................................... 341

Tory Irgang, Executive Director, United Way of Southern Chautauqua County, Jamestown, NY ............................................................................................... 345 

Mike King, President and CEO, Volunteers of America, Alexandria, VA .......... 242 

Bill Kitson, President and CEO, United Way of Greater Cleveland, Cleveland, 

OH ......................................................................................................................... 287

Earle I. Mack, Chairman Emeritus, New York State Council on the Arts, 

Manhattan, NY .................................................................................................... 314 

Jan Masaoka, CEO, California Association of Nonprofits, Sacramento, CA ...... 54 

Terry Mazany, President and CEO, The Chicago Community Trust, Chicago, 

IL ........................................................................................................................... 172 

Jill Michal, President and CEO, United Way of Greater Philadelphia and 

Southern New Jersey, Philadelphia, PA ............................................................ 139 

Larry Minnix, President and CEO, Leading Age, Washington, DC .................... 221 

Kimberly Morgan, CEO, United Way of Western Connecticut, Danbury, CT .... 167 

Kevin K. Murphy, President, Berks County Community Foundation, and 

Chairman of the Board, Council on Foundations, Arlington, VA .................... 17 

Leslie Osche, Executive Director, United Way of Butler County, Butler, PA .... 183 

John M. Palatiello, President, Business Coalition for Fair Competition, Reston, VA .................................................................................................................. 325 


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Karen Rathke, President and CPO, Heartland United Way, Grand Island, 

NE ......................................................................................................................... 302

William N. Rieth II, President and CEO, United Way of Elkhart County, 

Elkhart, IN ........................................................................................................... 135 

Anthony L. Ross, President, United Way of Pennsylvania, Harrisburg, PA ...... 336 

Pamela King Sams, Executive Vice President for Development, Children’s 

National Medical Center, Washington, DC ........................................................ 149 

Jake B. Schrum, President, Southwestern University, Georgetown, TX, on 

behalf of the Council for Advancement and Support of Education .................. 110 

C. Eugene Steuerle, Fellow and Richard B. Fisher Chair, The Urban Institute, Washington, DC .......................................................................................... 6 

Conrad Teitell, Chairman, Charitable Planning Group, Stanford, CT, on behalf of the American Council on Gift Annuities ................................................ 100 

Eugene R. Tempel, Ed.D., Founding Dean, Indiana University School of Philanthropy, Indianapolis, IN ................................................................................. 48 

Ruth S. Thomas, Vice President of Finance and Administration, SAT–7, Easton, MD ................................................................................................................. 201 

Jimalita Tillman, Executive Director, Harold Washington Cultural Center, 

Chicago, IL ............................................................................................................ 250 

Andrew Watt, President and CEO, Association of Fundraising Professionals, 

Arlington, VA ........................................................................................................ 320 

Rand Wentworth, President, Land Trust Alliance, Washington, DC .................. 159 

David Wills, President, National Christian Foundation, Alpharetta, GA .......... 24 

SUBMISSIONS FOR THE RECORD 

A Mother’s Wish Foundation .................................................................................. 356 

Alexander Reid ......................................................................................................... 358 

American Academy of Pain Medicine Foundation ................................................ 361 

American Alliance of Museums .............................................................................. 363 

American Camp Association ................................................................................... 366 

American Health Care Association ........................................................................ 368 

American Lung Association .................................................................................... 369 

American Red Cross ................................................................................................ 372 

Americans for Fair Taxation ................................................................................... 373 

Amy Fitterer ............................................................................................................ 383 

Association for Healthcare Philanthropy ............................................................... 386 

Association of Art Museum Directors .................................................................... 391 

Association of Baltimore Grantmakers .................................................................. 398 

Association of Christian Schools International ..................................................... 400 

Association of Fundraising Professionals .............................................................. 401 

Audrey Meyers ......................................................................................................... 410 

Barbara Bilton ......................................................................................................... 412 

Barbara J. King ....................................................................................................... 413 

Bentz Whaley Flessner ............................................................................................ 415 

Canine Comfort, INC ............................................................................................... 419 

Casa Esperanza ....................................................................................................... 420 

Center for Fiscal Equity .......................................................................................... 422 

Colorado Nonprofit Association .............................................................................. 425 

Convoy of Hope ........................................................................................................ 428 

Council of Michigan Foundations ........................................................................... 432 

Council of New Jersey Grantmakers ..................................................................... 434 

Cynthia Pellegrini .................................................................................................... 436 

Dan P. Hagler .......................................................................................................... 438 

Dance USA ............................................................................................................... 439 

Deborah J. Kuzdal ................................................................................................... 442 

Dr. Judson Shaver ................................................................................................... 443 

Easter Seals statement ........................................................................................... 445 

Eligius G. Walker .................................................................................................... 446 

Ellen Foell ................................................................................................................ 447

Eric R. Bridges ......................................................................................................... 450 

Evangelical Council for Financial Accountability ................................................. 452 

Feeding America ...................................................................................................... 459 

Florida Philanthropic Network ............................................................................... 463 

Food Donation Connection ...................................................................................... 466 

Ford Bell ................................................................................................................... 473 

Forgotten Harvest .................................................................................................... 476 

Girl Scouts of the USA ............................................................................................ 480 

Glen E. Leirer .......................................................................................................... 482 


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Goodwill Industries International .......................................................................... 483 

Goodwill Industries of the Columbia Willamette .................................................. 486 

Grant Oliphant ........................................................................................................ 489 

Great Kansas City Community Foundation .......................................................... 492 

Habitat for Humanity International ...................................................................... 493 

Hope Community Resources ................................................................................... 495 

Illinois Council of the Blind .................................................................................... 496 

Indiana Association of United Ways ...................................................................... 498 

Indiana Grantmakers Alliance ............................................................................... 499 

James Ledoux .......................................................................................................... 500 

James M. Bennett .................................................................................................... 501 

Jesse Rosen .............................................................................................................. 504 

John W. Vettel Jr., LtCol, USAF (Ret) .................................................................. 512 

Junior Achievement of Western Massachusetts .................................................... 513 

Kelly Kuhn ............................................................................................................... 515 

Ken Engle ................................................................................................................. 518 

Larry Minnix ............................................................................................................ 520 

Laurie Baskin .......................................................................................................... 528 

League of American Orchestras ............................................................................. 532 

Leo Linbeck .............................................................................................................. 540 

Lorie A. Slutsky ....................................................................................................... 550 

Lutheran Family and Children’s Services of Missouri ......................................... 557 

Lutheran Services in America ................................................................................ 558 

Mary’s Shelter .......................................................................................................... 561 

Matt Scorca .............................................................................................................. 562 

Matthew Smith ........................................................................................................ 566 

Matthew W. Hessler ................................................................................................ 573 

Mental Health America ........................................................................................... 574 

Mercy Medical Airlift ............................................................................................... 575 

Michael Alvarez ....................................................................................................... 577 

Michael E. Rountree ................................................................................................ 582 

Michigan Nonprofit Association ............................................................................. 583 

Mike Maloney ........................................................................................................... 586 

Mountain State Council of the Blind ..................................................................... 587 

NAEIR ...................................................................................................................... 589

National Council of Nonprofits ............................................................................... 595 

National Kidney Foundation .................................................................................. 605 

National Religious Broadcasters ............................................................................ 607 

National Restaurant Association ............................................................................ 609 

Neal Denton ............................................................................................................. 613 

New Jersey Conservation Foundation ................................................................... 616 

Nicole Lamoureux Busby ........................................................................................ 618 

Northern Arizona University Foundation ............................................................. 621 

OPERA America ...................................................................................................... 625 

Oregon Food Bank ................................................................................................... 629 

Partnership for Philanthropic Planning ................................................................ 632 

Patrick Burkett M.D. ............................................................................................... 637 

Pediatric Palliative Care Coalition ......................................................................... 638 

Peter Roberts ........................................................................................................... 639 

Philanthropy Northwest .......................................................................................... 643 

Robert Aiken ............................................................................................................ 650 

Robert Collier ........................................................................................................... 654 

Robert F. Sharpe, Jr. ............................................................................................... 656 

Silicon Valley Community Foundation .................................................................. 663 

Sophia Siskel ............................................................................................................ 665 

Southeastern Council of Foundations .................................................................... 666 

The Beacon Hill Institute ........................................................................................ 668 

The Community Foundation ................................................................................... 698 

The EHL Consulting Group .................................................................................... 700 

The Evangelical Lutheran Good Samaritan Society ............................................. 702 

The FairTax and Charitable Giving ....................................................................... 703 

The Giving Institute and Giving USA Foundation ............................................... 706 

The Leukemia and Lymphoma Society .................................................................. 711 

The Nature Conservancy ........................................................................................ 715 

The Nonprofit Association of Oregon ..................................................................... 719 

The Restoration Foundation ................................................................................... 722 

The Samuel Roberts Noble Foundation ................................................................. 723 

Theatre Communications Group ............................................................................ 734 


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Thomas P. McCabe .................................................................................................. 738 

University of South Carolina .................................................................................. 739 

Valerie S. Lies .......................................................................................................... 742 

Vikki Spruill ............................................................................................................. 745 

Volunteers of America ............................................................................................. 755 


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TAX REFORM AND CHARITABLE 

CONTRIBUTIONS 

THURSDAY, FEBRUARY 14, 2013 

U.S. HOUSE OF REPRESENTATIVES, 

COMMITTEE ON WAYS AND MEANS, 

Washington, DC. 

The Committee met, pursuant to notice, at 9:41 a.m., in Room 

1100, Longworth House Office Building, Hon. Dave Camp [Chairman of the Committee] presiding. 

[The advisory announcing the hearing follows:] 


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ADVISORY 

FROM THE COMMITTEE ON WAYS AND MEANS 

FOR IMMEDIATE RELEASE CONTACT: (202) 225–3625 

Tuesday, February 5, 2013 

No. FC–02 

Camp Announces Hearing on 

Tax Reform and Charitable Contributions 

Congressman Dave Camp (R–MI), Chairman of the Committee on Ways and 

Means, today announced that the Committee will hold a hearing to examine the 

itemized deduction for charitable contributions as part of the Committee’s work on 

comprehensive tax reform. The hearing will take place on Thursday, February 

14, 2013, in Room 1100 of the Longworth House Office Building, beginning 

at 9:30 a.m. 

Any individual or organization interested in providing oral testimony at this hearing with respect to the charitable contribution deduction should contact the Committee’s tax office to discuss the possibility of receiving an invitation, pursuant to the 

procedures set forth below. (See ‘‘Details for Submission of Request to Be Heard.’’) 

In addition, anyone not scheduled to give oral testimony may submit a written 

statement for consideration by the Committee and for inclusion in the printed 

record of the hearing. 

BACKGROUND: 

Section 170 of the Internal Revenue Code provides a deduction to the roughly onethird of taxpayers who itemize their deductions for charitable contributions. Taxpayers may contribute on a deductible basis to institutions such as churches, universities, hospitals, museums, and certain other tax-exempt organizations. Certain 

limits apply to the deduction, such as percentage-of-income limits and purposes for 

which contributions may be made, and the recently reinstated overall limitation on 

itemized deductions for taxpayers above certain income thresholds. 

Proposals to limit the deduction for charitable contributions have appeared in recent years, in some cases as part of broader tax reform proposals that lower rates 

and in other cases for the purpose of raising taxes to fund specified levels of government spending. Examples of some of these restrictions include: Limiting the tax rate 

against which contributions may be deducted; a dollar cap on total itemized deductions; a floor below which contributions may not be deducted; and the replacement 

of the deduction with a tax credit available regardless of whether the taxpayer 

itemizes. Different types of limitations could have varying effects on giving. 

As part of the Committee’s ongoing commitment to pursue comprehensive tax reform in an open and transparent manner, the Committee is holding this hearing to 

allow stakeholders and members of the public the opportunity to share their perspectives on the deduction and on various proposals to modify it. 

In announcing this hearing, Chairman Camp said, ‘‘Public charities and private foundations perform invaluable services for our society, especially 

during this time of economic slowdown and high unemployment. These organizations depend upon the goodwill of the American people—the most 

giving and charitable people in the world. Because of the critical role that 

charities play, the Committee must hear directly from the charitable community before considering any proposals as part of comprehensive tax reform that might impact their ability to obtain the resources they need to 

fulfill their missions.’’ 


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FOCUS OF THE HEARING: 

The hearing will examine the itemized deduction for charitable contributions as 

part of the Committee’s work on comprehensive tax reform. It also will receive testimony from witnesses on previous proposals to modify the deduction and its value. 

DETAILS FOR SUBMISSION OF REQUEST TO BE HEARD: 

Requests to be heard at the hearing must be made to the Committee on Ways 

and Means either by telephone at (202) 225–5522 or by e-mail at tax.reform@ 

mail.house.gov. Please include the phrase ‘‘charitable deduction’’ in the subject line 

of the message and submit the request no later than the close of business, Thursday, February 7, 2013. The request should include a brief summary or outline of 

the proposed testimony. 

In view of the limited time available to hear witnesses, the Committee may not 

be able to accommodate all requests to be heard. Those persons and organizations 

not scheduled to give oral testimony are encouraged to submit written statements 

for the record of the hearing. All persons requesting to be heard, whether they are 

scheduled for oral testimony or not, will be notified as soon as possible after the 

deadline for submitting requests. 

DETAILS FOR SUBMISSION OF WRITTEN COMMENTS: 

Please Note: Any person(s) and/or organization(s) wishing to submit written comments for the hearing record must follow the appropriate link on the hearing page 

of the Committee website and complete the informational forms. From the Committee homepage, http://waysandmeans.house.gov, select ‘‘Hearings.’’ Select the hearing for which you would like to submit, and click on the link entitled, ‘‘Click here 

to provide a submission for the record.’’ Once you have followed the online instructions, submit all requested information. ATTACH your submission as a Word document, in compliance with the formatting requirements listed below, by the close 

of business on Thursday, February 28, 2013. Finally, please note that due to 

the change in House mail policy, the U.S. Capitol Police will refuse sealed-package 

deliveries to all House Office Buildings. For questions, or if you encounter technical 

problems, please call (202) 225–3625 or (202) 225–2610. 

FORMATTING REQUIREMENTS: 

The Committee relies on electronic submissions for printing the official hearing record. As always, submissions will be included in the record according to the discretion of the Committee. 

The Committee will not alter the content of your submission, but we reserve the right to format 

it according to our guidelines. Any submission provided to the Committee by a witness, any supplementary materials submitted for the printed record, and any written comments in response 

to a request for written comments must conform to the guidelines listed below. Any submission 

or supplementary item not in compliance with these guidelines will not be printed, but will be 

maintained in the Committee files for review and use by the Committee. 

1. All submissions and supplementary materials must be provided in Word format and MUST 

NOT exceed a total of 10 pages, including attachments. Witnesses and submitters are advised 

that the Committee relies on electronic submissions for printing the official hearing record. 

2. Copies of whole documents submitted as exhibit material will not be accepted for printing. 

Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit material 

not meeting these specifications will be maintained in the Committee files for review and use 

by the Committee. 

3. All submissions must include a list of all clients, persons and/or organizations on whose 

behalf the witness appears. A supplemental sheet must accompany each submission listing the 

name, company, address, telephone, and fax numbers of each witness. 

The Committee seeks to make its facilities accessible to persons with disabilities. 

If you are in need of special accommodations, please call 202–225–1721 or 202–226– 

3411 TDD/TTY in advance of the event (four business days notice is requested). 

Questions with regard to special accommodation needs in general (including availability of Committee materials in alternative formats) may be directed to the Committee as noted above. 


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Note: All Committee advisories and news releases are available on the World 

Wide Web at http://www.waysandmeans.house.gov

f 

/. 

Chairman CAMP. Good morning, and thank you for joining us 

today. As part of the Committee’s ongoing commitment to pursue 

comprehensive tax reform in an open and transparent manner, the 

Committee is holding today’s hearing to allow stakeholders and 

members of the public the opportunity to share their perspectives 

on the deduction for charitable contributions. 

For today’s hearing, we granted all timely requests to testify in 

person, so that national and local leaders in the charitable community could educate us about the work they do each day, and what 

Congress should consider as we explore comprehensive tax reform. 

I realize that this open-door approach is a bit different than the 

way we typically structure hearings. But looking back to the 1986 

Tax Reform Act, the last comprehensive tax reform endeavor, it 

turns out that this is a Ways and Means tradition. Then-Chairman 

Dan Rostenkowski, a Democrat from Illinois, employed the same 

method for gathering stakeholder input. Much like he did, I believe 

that including the voices of the stakeholders who are working every 

day in our communities is critical to understanding how the policy 

decisions we make in Washington will affect people back home. 

We want to ensure that whichever policies we ultimately decide 

to pursue are crafted in a way that makes the Tax Code simpler, 

fairer, and easier to comply with. In the case of the charitable community, we also want to make sure that tax reform allows you to 

continue to meet and fulfill the mission of each of your organizations. 

Our Nation’s public charities and private foundations perform invaluable services for our society at home, nationally, and, in some 

cases, across the globe. This is especially true during times of economic slowdown and high unemployment, challenges we have 

struggled with mightily over the past years. These are also the 

same organizations that step up and respond to individual moments of crisis: Hurricanes, floods, earthquakes, fires, acts of terrorism, and community-specific tragedies as well. 

It is in those moments that these organizations come face-to-face 

with humanity and the generosity of men and women who answer 

the call for help. Oftentimes that means lending a hand to their 

own families, friends, and fellow church-goers. These organizations 

depend upon the goodwill of the American people, the most giving 

and charitable people in the world. And our response, along with 

their service, underscores the truth that charity begins at home. 

Over the last several months, we’ve heard a lot about the different ways that the Tax Code might be changed that could affect 

the charitable community and the valuable services it provides. Examples of some of these changes include limiting the tax rate 

against which contributions may be deducted; a dollar cap on 

itemized deductions, as the President has repeatedly proposed; a 

floor below which contributions may not be deducted; and the replacement of the deduction with a tax credit available regardless 

of whether the taxpayer itemizes. 


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Different types of limitations could have varying effects on giving. Because of the critical role that charities play, the Committee 

needs to hear directly from the charitable community before considering any proposals as part of comprehensive tax reform. And let 

me be clear on this point: We want to hear from this community 

before considering proposals. This hearing is not about your responding to what we have already done. Instead, it is about gathering your input so that any policies that might be considered will 

be crafted with you and the communities you serve in mind. 

So, I would like to thank all of you for being here today. We’ve 

assembled six panels of witnesses who have indicated a strong desire to share their perspectives. All of you have a unique story to 

tell, and we look forward to your testimony. Thank you again for 

being here today, and thank you in advance for your patience. I 

know it will be a long day. 

I will now recognize Mr. Levin for his opening statement. 

Mr. LEVIN. Thank you very much. And welcome. And welcome 

to all of you who will be testifying. 

We are holding this hearing on an important but not very immediate topic. What is not being done is to address the sequester that 

looms immediately. There are 5 legislative days, only 5 legislative 

days, remaining before the sequester kicks in and begins to do severe damage to our economy. 

Just last week the nonpartisan Congressional Budget Office 

warned about the prospects of inaction, noting that it would slash 

GDP growth by 30 percent this year. This Committee should be focused on reviewing the economic consequences of inaction, and 

finding a bipartisan solution. 

Again, that is not to say that the topic for today’s hearing is unimportant. Quite the contrary. In their last two budgets, House Republicans have proposed cutting the top marginal rate to 25 percent, creating a $5 trillion revenue loss. Some of the proponents 

have suggested one way, one major way, to fill that hole is by cutting loopholes and acting on the largest deductions and credits, 

which includes the charitable deduction. Such action needs to be 

looked at carefully, as I have long suggested. Carefully. 

The charitable deduction is among the 10 largest tax expenditures in the Code, benefitting almost 1.1 million charities, and 

more than 70—37 million Americans who contribute to section 

501(c)(3) organizations every year. In 2010 it is estimated that individuals donated $2.10 billion—$210 billion to charitable organizations, of which they claimed $170 billion on their tax returns. As 

we know, there are already deduction limitations in place for the 

very wealthiest Americans through the so-called Pease Provision 

that was reinstated during the action that Congress took on New 

Year’s Day to avoid the fiscal cliff. 

I would be interested in knowing from our witnesses today how 

further limitations would affect their organizations. Yesterday, in 

announcing the working groups that we have set up on a bipartisan basis, I said that the process helps us undertake in-depth 

fact-finding on a variety of important issues related to tax reform, 

including the charitable deduction. The testimony we hear today 

may help us, Mr. Chairman, kick off that effort. Thank you. 


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Chairman CAMP. Thank you, Mr. Levin. Now it’s my pleasure 

to welcome our first panel of the day, whose experience and insights will be extraordinarily helpful as the Committee considers 

this important issue. 

Two of the witnesses on our first panel are constituents of Committee Members, and I will ask those Members to formally introduce them when it’s their turn to testify. So I will begin by introducing Mr. Steuerle. And then, after Mr. Steuerle’s testimony, I 

will recognize Mr. Gerlach to introduce his constituent, Mr. Murphy. I will then proceed to introduce and recognize our next three 

witnesses before recognizing Mr. Young to introduce his constituent, Mr. Tempel. And after Mr. Tempel’s testimony we will 

hear from Ms. Masaoka. 

So, with that, let’s get started. Gene Steuerle is a Richard B. 

Fisher Chair and Fellow at The Urban Institute, and is a familiar 

face here at the Committee. Mr. Steuerle served as Deputy Assistant Secretary of Treasury for Tax Policy, and was an Economic Coordinator of the 1984 Treasury study that led to the 1986 Tax Reform Act. 

So, Mr. Steuerle, you and all of today’s witnesses will be recognized for 5 minutes for your oral remarks. And everyone’s full 

written statement will be made part of the official hearing record. 

Mr. Steuerle, welcome back to the Committee, and you may proceed when you are ready to testify. 

And, as you know, as you get near the end of your remarks, 

a yellow light will appear. You have just about 30 seconds to 

conclude your remarks, and it will be a hard-timed stop. So, 

Mr. Steuerle, welcome. 

STATEMENT OF C. EUGENE STEUERLE, FELLOW AND RICHARD B. FISHER CHAIR, THE URBAN INSTITUTE, WASHINGTON, DC 

Mr. STEUERLE. Thank you, Chairman Camp, Mr. Levin, and 

Members of the Committee. It’s my honor once again to testify to 

you—before you today on the relationship between tax reform and 

charitable contributions. My testimony centers largely on one simple point, that a tax subsidy like that for charitable contributions 

should be treated like any other government program, examined 

regularly and reformed on occasion to make it more effective. 

The good news is that the charitable deduction can be designed 

both to strengthen the charitable sector and increase charitable 

giving without costing revenues. In fact, revenues can be raised 

and charitable contributions raised at the same time. 

So, what’s the trick? Simply put, take the revenues that are 

spent with little or no effect on charitable giving, and reallocate 

those revenues toward measures that would encourage giving more 

effectively. For example, to increase giving, Congress can allow people to make contributions up until the time they file their tax returns, or April 15th. I believe that this would save at least $3 in 

charitable giving for every dollar of revenue loss. 

Congress could also create a charitable contribution for all taxpayers, not just itemizers. It could remove or reduce the dysfunctional excise tax on foundations. 


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Congress can more than pay for these changes with little or no 

reduction in giving if it would put a floor into deductions which 

would have little effect on giving, and reform subsidies that tend 

to be highly ineffective and invite abuse, such as the deduction for 

household goods and clothing. I provide a somewhat longer list in 

my testimony, with further details. 

Now, certainly, reform must take into account the extent to 

which IRS already does not and cannot properly enforce the rules 

for many charitable contributions. A chart in my testimony attempts to clarify my point by demonstrating the effect of three 

changes to the charitable tax law standardized to produce approximately $10 billion in revenues. In one example I show that this 

would have almost no cut-back at all in the amount of giving that 

is done. 

Now, it would be much easier for Congress to reform the charitable deduction if the Committee were to request the assistance of 

the Joint Committee and the Treasury to provide estimates not just 

of the revenue effect of proposals, but their effect on the amount 

of giving that would take place. 

It would also help if the IRS would develop better methods for 

informing Congress through audits and related follow-through of 

the extent to which deductions for certain types of gifts were legitimate, not legitimate, and actually, most importantly, unable to be 

verified or enforced one way or the other. This approach to tax reform and charities is very different from one that derives from 

across-the-board cuts or caps. These tend to operate very much like 

sequestration, in the sense of their arbitrary effect across items. 

Now, certainly, some subsidies should be kept. Examples include subsidies for home ownership or health insurance, where we 

mainly want to subsidize the first dollars of spending, rather than 

for second homes or for expensive health insurance. But just the 

opposite applies to charitable contributions, where it’s the last, not 

the first dollars of giving that are the ones that we want to subsidize. 

Now, although I focus here on the formal measures of revenues 

and giving that a charitable incentive might entail, it also affects— 

this incentive also affects society in other immeasurable ways. It 

sends a positive signal about the type of society we seek, and our 

duties to one another. It promotes a general spirit of giving, and 

the development of mediating institutions. It reduces tensions that 

arise from the unequal distribution of power and wealth. And it 

promotes a more altruistic society, providing benefits beyond just 

what is transferred to ultimate donees. 

Finally, note that the cost of reduced charitable deductions is 

born, to no small extent, by those who would have benefited from 

the deductions: The museum visitor, the student, the recipient of 

food from the food bank, rather than the taxpayer, who can adjust 

to any additional tax burden simply by reducing his or her own 

contributions. Thank you. 

[The prepared statement of Mr. Steuerle follows:] 


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Chairman CAMP. Thank you. Mr. Gerlach. 

Mr. GERLACH. Thank you, Mr. Chairman. Mr. Chairman, thank 

you for your recognition and for your leadership in initiating a comprehensive review of the Tax Code, and today specifically for looking at charitable deductions. 

In addition, I appreciate the Chairman giving Kevin Murphy, 

with the Berks County Community Foundation, the opportunity to 

discuss the good work he does in the sixth congressional district of 

Pennsylvania. Kevin serves as President of the Berks County Community Foundation in Reading, Pennsylvania. In addition, he currently serves as the Chairman of the Board of Directors of the 

Council on Foundations, a national association of nonprofit foundations. 

The Berks County Community Foundation was founded in 1994 

to promote philanthropy and improve the quality of life for over 

400,000 residents of our county. Additionally, the Council on Foundations represents over 2,000 grant-making foundations and corporations with assets over $300 billion. 

Kevin is a graduate of Penn State University, and he also holds 

a master’s degree in community leadership from Duquesne University. His experience as president of a medium-sized community 

foundation has given him valuable insight on how to assess the importance on charitable provisions in the Tax Code, and how the 

proposed changes to it would affect my constituents in Pennsylvania, and all of us across the country. 

I look forward to his testimony today. And again, I want to thank 

the Chairman for allowing his opportunity to provide testimony to 

the panel. 

Chairman CAMP. Thank you, Mr. Gerlach. Welcome, Mr. Murphy. You are recognized for 5 minutes. 

STATEMENT OF KEVIN K. MURPHY, PRESIDENT, BERKS 

COUNTY COMMUNITY FOUNDATION, AND CHAIRMAN OF THE 

BOARD, COUNCIL ON FOUNDATIONS, ARLINGTON, VA 

Mr. MURPHY. Good morning and—Mr. Chairman, Ranking 

Member Levin, Members of the Committee. Congressman Gerlach, 

thank you for that kind introduction and for your friendship and 

partnership in the work we do in the community. 

In my role at Berks County Community Foundation I’ve worked 

every day for the last 19 years with local donors who are interested 

in designing and implementing charitable gifts that do the most 

good for our community with the resources they have. I have to say 

that, doing that work on the ground, I’ve become concerned that 

the conversation here within the beltway about the charitable deduction has become remarkably unglued from the reality of the 

community that Congressman Gerlach and I work in. 

The discussion reached a high point—or perhaps a low point— 

when the Washington Post recently editorialized that the charitable 

deduction overwhelmingly benefits the wealthy. Ladies and gentlemen of the Committee, I submit to you that the charitable deduction, and its encouragement of charitable giving, is hardly a loophole or a benefit for the rich, and, in fact, forms the final safety 

net in our Nation. 


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I’d like to share with you what the charitable deduction means 

in our community. This is a backpack. It’s one of about 400 

backpacks that are sent home every Friday with elementary school 

children in Berks County by the Greater Reading Foodbank. And 

it’s filled with as much food as we can get an elementary school 

student to carry home. And, for most of the students who take it 

home, it’s the only food they’ll have for the whole weekend. We 

even had to get backpacks with wheels on them, because some of 

the children were too small to carry this. 

I think we should all take a moment some time today to imagine 

what it’s like to be a 6-year-old child, and for that backpack and 

this food to be the only thing that stands between you and hunger 

for the weekend. Before we sent these backpacks home, many of 

these children showed up sick on Monday mornings, having not 

eaten. 

What’s important for the Members of the Committee to understand about these backpacks is that there are no Federal, State, or 

local government dollars invested in this program. These backpacks 

are funded entirely through charitable contributions from our community. And, yes, some of the people who made those contributions 

deduct that contribution from their income tax. But we cannot 

allow ourselves to lose sight of the fact that the person who benefits from those charitable gifts isn’t the donors; it’s those hungry 

children. 

Seventy-five years ago, President Roosevelt established the 

March of Dimes to raise money from Americans to fight polio. Millions of donors have given to that cause. And today, the Bill and 

Melinda Gates Foundation projects there will be no cases of polio 

in the world by the close of this decade. And there hasn’t been a 

case of polio in the United States since 1979. You see, it’s the people who don’t get polio who are the beneficiaries of the charitable 

deduction. 

In my home town of Reading we consider ourselves fortunate 

that Terry McGlinn, who founded the Colonial Oaks Foundation, 

and his family were able to donate the money to build a cancer center at our local hospital. 

Mr. Chairman, I have 17-year-old twin boys. They are great 

young men and I am very proud of them. But any of you who know 

17-year-old boys know that some days you think they forgot to turn 

their brains on in the morning. But Carver and McQuillin, on their 

spaciest days, know that they are the beneficiaries of the McGlinn’s 

generosity in establishing the cancer center because their mother, 

my wife, is still alive 7 years after having been diagnosed with cancer and treated at the McGlinn Regional Cancer Center. Cancer 

survivors and their families are the beneficiaries of the charitable 

deduction. 

Feeding hungry children, eradicating disease, building cancer 

centers, these aren’t loopholes for the rich. These are solutions for 

our community. The charitable deduction stands alone among provisions in the Tax Code and encouraging behavior that benefits society, not the taxpayer. It’s a simple statement of economic truth 

that any charitable contribution one of my donors makes leaves 

them with less money than they had before they made the gift. 


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Now, the value of the tax deduction may be an interesting debate 

for tax economists here in the beltway. President Reagan once said, 

‘‘An economist is someone who sees something that works in practice and wonders if it will work in theory.’’ I assure you that the 

charitable deduction works in practice for our communities. Let’s 

do nothing that threatens the ability of the food bank to send this 

backpack home. 

Thank you, Mr. Chairman, Mr. Levin. 

[The prepared statement of Mr. Murphy follows:] 


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Chairman CAMP. Thank you, Mr. Murphy. We will now hear 

from David Wills, who is President of the National Christian Foundation. Mr. Wills has practiced in charitable giving, planning, and 

tax-exempt organizations for the last 22 years, and is testifying on 

behalf of the Alliance for Charitable Reform. 

Mr. Wills, welcome. You are recognized for 5 minutes. 

STATEMENT OF DAVID WILLS, PRESIDENT, 

NATIONAL CHRISTIAN FOUNDATION, ALPHARETTA, GA 

Mr. WILLS. Thank you. Good morning, Chairman Camp, Ranking Member Levin, Members of the Committee. My name is David 

Wills, and I serve as the President of the National Christian Foundation. Thank you for the opportunity to testify before you today. 

Chairman CAMP. Is your microphone on? 

Mr. WILLS. Yes, it is. 

Chairman CAMP. Oh, okay. You may want to pull it just a little 

bit closer. Thank you. 

Mr. WILLS. The National Christian Foundation serves the giving 

needs of almost 10,000 families across our country. In 2012, these 

families contributed over $870 million and made grants of over 

$600 million to over 14,000 charities across our country. I have 

been privileged to serve families that give from $10,000 a year to 

$10 million a year, from those that give from their income and 

those that give from their wealth, from people that tithe to people 

that reverse tithe—living on 10 percent and giving away 90 percent. One thing that they have in common is that they take advantage of the charitable income tax deduction. 

It is the generosity of these people that in many ways makes 

America great. De Tocqueville once said, ‘‘America is great because 

she is good. If America ceases to be good, America will cease to be 

great.’’ 

Today I am testifying on behalf of the Alliance for Charitable Reform, a project of the Philanthropy Roundtable, which represents 

over 600 private charitable donors and foundations across the U.S. 

And I want to make three quick points: First, the charitable deduction is distinctive from any other credit or deduction; second, any 

cut, cap, or limit to the deduction will dramatically decrease giving; 

and finally, if the charitable deduction is limited, those who will be 

harmed most are people served by charities, not donors. 

The charitable deduction is unique and should be considered separately. It’s the only incentive that encourages people to give away 

their wealth. All others involve consuming more or acquiring more. 

Yet policymakers and the President have proposed limits on the deduction as one solution to our Nation’s fiscal crisis. Their proposals 

would decrease giving by billions per year. 

While any limit on the charitable deduction is ill-advised, so are 

back-door tax increases aimed at the deduction, and I would encourage you to carve out the charitable deduction from the Pease 

limitation, as well. One of our donors in central Florida saw the 

Pease Provision as a major factor when planning his giving. He 

originally hoped to give his business to charity over time. Last year 

it became clear to him that the rates could go up and the deduction 

could go down, and so he gave his business in 2012, over $2 million 

worth of giving. He now knows, because of the Pease rule that’s 


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been implemented, that he made the right decision. It would have 

dramatically cut his giving. 

Some argue that the deduction only financially benefits the 

wealthy. However, this simply isn’t true. The charitable deduction 

provides no financial gain to any donor. It simply reduces the cost 

of giving, which encourages more giving. Limiting the deduction 

will result in donors paying taxes on what they give away, and the 

net will be less to charity. When you give a dollar away, you have 

a dollar less, and the deduction doesn’t give that dollar back. 

In the case of NCF, our donors are varied, but there is no doubt 

that the charitable deduction affects their behavior. In December 

alone we estimate that over $50 million was given strictly because 

people were fearful that the charitable deduction would be limited. 

A donor from Detroit, Michigan, decided to make several years’ 

worth of charitable contributions and move it into 2012, over 

$300,000. He did it because he knew that if the deduction was limited, the cost to make a gift would go up and the charities he cares 

about most would be hurt. And he didn’t want his giving to decline 

to these organizations. 

Another of our donors from the Los Angeles area decided to give away the balance of his profit-sharing plan, almost $80,000. He 

moved it all into 2012, because he was concerned that the charitable deduction would be cut. In fact, he ended up giving over 50 

percent of his adjusted gross income last year to maximize the 

charitable deduction. 

Let me be clear. The deduction not only affects how much people 

give; it also affects the timing and the number of organizations 

they support. 

What we are really talking about here today are spending cuts. 

Already this year we have gone to every tax-paying American and 

asked them to decrease their spending so the government can 

spend more. If you limit the deduction, you will next be going to 

charities to ask them to decrease their spending, as well. Do we, 

as a Nation, want to knock on the door of the AIDS clinic, the 

homeless shelter, the boys and girls clubs, or your houses of worship, and ask them to decrease their spending so the government 

has more to spend? 

We have avoided making this decision since 1917, when the deduction was created. And I ask you today to avoid limiting the deduction going forward. Thank you for listening. 

[The prepared statement of Mr. Wills follows:] 


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Chairman CAMP. Thank you, Mr. Wills. 

Next we will hear from Brian Gallagher, who is President and 

Chief Executive Officer of United Way Worldwide. Mr. Gallagher 

oversees a network of 1,800 affiliates in over 40 countries, and is 

also an active member of the World Economic Forum. 

Mr. Gallagher, welcome, and you are recognized for 5 minutes. 

STATEMENT OF BRIAN A. GALLAGHER, PRESIDENT AND CEO, 

UNITED WAY WORLDWIDE, ALEXANDRIA, VA 

Mr. GALLAGHER. Thank you, Chairman Camp and Ranking 

Member Levin. Members of the Committee, thanks for the opportunity to testify today in front of the Committee. On behalf of the 

United Way network in the United States, I urge the Committee 

to preserve or even expand the charitable deduction for all donors. 

United Way is the largest privately-supported nonprofit in the 

world. Certainly largest in the United States. There are 1,200 local 

United Ways in just about every county, city, and town across 

America. We raised last year just under $4 billion; 97 percent of 

that came from private donors. We are not a publicly-supported 

nonprofit. And we work in the basic building blocks of life: Education, income, and health. 

We have 10 million donors a year, 2.5 million volunteers. We have 500 people who have given us $1 million or more. We have 

26,000 people who gave us $10,000 or more per year. We have 

55,000 women who last year gave $150 million to their local United 

Way. And yet our average gift is $290. I say that because, while 

we do studies and modeling and so forth, we know donors. We’ve 

known donors for over 100 years, high-net-worth donors, middleincome donors, white people, people of color, women, men. And this 

will affect their giving, if we were to curb the incentive to give 

charitably in the U.S. 

I am a little sheepish to say that there are 13 local United Ways 

testifying today. The fact is that when you opened up the hearing 

and asked anyone who wanted to testify, they all wanted to testify. 

And I would encourage—it’s our most important public policy 

priority. But you are going to hear the stories from different communities, from Cleveland and Philadelphia, Butler, Pennsylvania, 

Winston-Salem, North Carolina, Grand Island, Nebraska. And you 

are going to hear the same story: This will affect giving. 

Consider just what the cap at 28 percent would do to just giving 

to United Way. Our most conservative estimate is that it would reduce giving to United Way across the country by $100 million. 

That’s like wiping out the United Ways in Philadelphia and in 

Cleveland. Or take the 10 mid-sized and small United Ways that 

are going to testify here today. That wipes out all of them, that 

$100 million. So when we use terms like ‘‘modest effect,’’ it’s not 

that modest when you start looking at backpacks like that, or local 

nonprofits that are doing this kind of work. 

A mere 2.5 percent reduction in giving to United Way means 

that 1.3 million fewer times will we provide a job training service 

for an unemployed person, early childhood development for a lowincome child, mentoring or tutoring for a young person at risk. All 

the proposals that have been floated around Washington and 

around the country have two things in common: It will limit the 


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value of the deduction for at least some group of donors, and it will 

result in reduced giving. It will. 

In fact, I personally believed, having worked with these donors, 

that the estimates are very, very conservative. If you reduce the incentive, you should expect that donors will essentially make up the 

difference on the cost increase in the size of their gift. It’s really 

not a tax on the wealthy, as much as a transfer to government of 

the money that would have gone to nonprofit organizations. 

As already said, the charitable deduction is not a loophole. There 

is no personal gain. No one is getting a house, no one is getting 

a business benefit. They are just benefitting their community. By 

keeping the charitable deduction tied to the tax rate, we are simply 

not penalizing people for giving their money away. And every dollar that they give, every cent that they give, goes to their community. 

Rather than limiting the deduction, we have for years proposed 

that we make the incentive fairer, and make it open to all taxpayers, those that itemize and those that don’t itemize. We know 

that we are coming to government cuts at all levels—local, State, 

Federal—in terms of human services and social services. We know 

it. We expect it. Now is not the time, then, to take incentive away 

from the private sector to provide those services in our communities. 

The last two points I would make, that at a time when we are 

looking for new systems and for new approaches to job training 

systems, to education reform, we should be putting incentive into 

innovation in local communities. This isn’t just about charitable 

giving; this is about private citizen engagement. That’s where problems, social and economic problems, get solved in our communities. 

And finally, I find it incredibly ironic that, as the Chairman said, 

we work in over 40 countries around the world—I personally and 

we institutionally, over the last few years, have been giving counsel 

to the governments in England, in France, in China, in India, in 

terms of how to put greater incentive for charitable giving and volunteerism into their Tax Code, while we are considering rolling it 

back. 

This is what’s made America great. It’s core, it’s fabric of who we 

are. 

I would ask us and ask you to preserve the incentive for people 

to stay involved in their communities and helping one another. 

Thanks very much. 

[The prepared statement of Mr. Gallagher follows:] 


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Chairman CAMP. Thank you, Mr. Gallagher. Next we will hear 

from Roger Colinvaux, Associate Professor of the Columbus School 

of Law at The Catholic University of America. Professor Colinvaux 

has done extensive research and published numerous papers on the 

topic of charitable contributions, and he has previously appeared 

before this Committee, as well. 

Mr. Colinvaux, welcome, and you are recognized for 5 minutes. 

STATEMENT OF ROGER COLINVAUX, ASSOCIATE PROFESSOR, 

COLUMBUS SCHOOL OF LAW, THE CATHOLIC UNIVERSITY 

OF AMERICA, WASHINGTON, DC 

Mr. COLINVAUX. Thank you, Chairman Camp, Ranking Member Levin, Members of the Committee. 

My testimony focuses on two things: First, the various rationales 

for the charitable deduction; and second, on non-cash contributions. 

First, on the rationales. There is no consensus on rationale, but 

there are two broad approaches. One is that the deduction makes 

sense to measure income. In other words, the tax base is defined 

not to include charitable expenses. The other rationale is that the 

deduction is a kind of subsidy or tax expenditure. As you consider 

tax reform and the charitable deduction, thinking about the rationale can lead you to different outcomes. 

Now, the tax-based rationale offers some clarity, at least. Under 

a tax-based rationale, you would prefer to keep the tax benefit as 

a deduction and not a credit. This rationale also tends to disfavor 

putting any caps on the deduction. And it generally would not be 

consistent with a non-itemizer deduction. However, the rationale 

generally is consistent with imposing a floor under the deduction. 

Also under this rationale, the ability under current law to deduct 

the unrealized depreciation in contributions of property should be 

repealed. 

Finally, the rationale is at least agnostic and probably favors 

making the deduction more targeted to fewer groups. In other 

words, a base-broadening measure would be to narrow the scope of 

the deduction. 

A subsidy or tax expenditure rationale is much messier, because 

virtually anything can be consistent with a subsidy. But even with 

a tax expenditure approach, emphasis on the goal matters. If the 

priority is to raise revenue without impacting giving, then some 

choices clearly are better than others. Ten billion dollars could be 

raised while causing a drop in giving of about $10 billion, or you 

could raise $10 billion with little to no effect on giving. 

If the priority is to make the deduction more equitable, and 

extend the incentive to more people, then caps or a non-itemizer 

deduction or a credit are appealing. If the priority is to focus on 

activities performed by organizations—say to make the tax benefit 

less about promoting giving in the abstract, and more about promoting, say, basic needs organizations—then a credit or better targeting the incentive might make sense. 

Although there is no consensus on rationale, it’s noteworthy, in 

my view, that a floor is consistent with both rationales, and would 

have important administrative benefits, especially with respect to 

non-cash contributions. 


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Non-cash contributions, I believe, are somewhat neglected in the 

current tax reform debate, and they shouldn’t be. The charitable 

deduction is not really one deduction. It’s two. There is one for 

cash, and one for property. And the property deduction is significant. On average, it amounts to over $45 billion in contributions a 

year, which is more than 25 percent of the charitable deduction. 

I think that the deduction for property is worth a close look, as 

I am concerned that the cost of the deductions, which are considerable, may outweigh the benefits, which are uncertain. 

First, the costs are significant. Costs are not limited to revenue, 

but include many factors. One cost is that the rules are incredibly 

complex. There are at least 10 approaches to property contributions, and a detailed anti-abuse reporting regime to navigate. The 

complexity undermines the transparency of the incentive and its effectiveness. 

The rules are also largely inadministrable. Small-dollar contributions will escape scrutiny. Medium-sized amounts are probably not 

worth the effort. Large amounts depend on valuation, which is a 

resource-intensive area for the IRS. The rules also come at a cost 

of fairness. Most of the benefits go to a very small percentage of 

taxpayers. And the anti-abuse regime sometimes results in denying 

otherwise bona fide deductions. 

There are real reputational costs to the charitable sector from 

abuses associated with charitable—with property contributions. It’s 

led to a lot of legislation. And the IRS continues to list non-cash 

property as a top tax scheme. So the costs are high. 

Unfortunately, the benefits, though very real, are difficult to assess. So in trying to assess the benefits of property, valuation is a 

key problem, as the claimed value of property contributions may be 

inflated. And it’s also not the same as the benefit to the donee. So, 

even if we know what the value actually is, the actual benefit to 

the donee depends on a number of factors, including the donee’s 

need of the property that’s given, any cost to the donee from carrying the property, any amounts that are paid by the donee in 

order to secure the contribution, and the timing of when the donee 

realizes the benefit. 

In short, there are many uncertainties regarding donee benefit, 

and these uncertainties, combined with high costs, urge me to 

question whether a new approach is needed. Thank you very much. 

[The prepared statement of Mr. Colinvaux follows:] 


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Chairman CAMP. Thank you very much, Mr. Colinvaux. I will 

now yield to the gentleman from Indiana, Mr. Young, for the purpose of an introduction. 

Mr. YOUNG. Thank you, Mr. Chairman. Dr. Eugene R. Tempel 

is the Founding Dean of the School of Philanthropy at Indiana University, which is happily nestled in Indiana’s ninth congressional 

district. He is also President Emeritus of IU’s foundation. At the 

IU School of Philanthropy, Dr. Tempel is the leading—leading the 

planning and organization of the world’s first school dedicated to 

the study and teaching of philanthropy. He is a nationally-known 

expert on philanthropy in the nonprofit sector, and former Executive Director of the Center on Philanthropy at Indiana University. 

Dr. Tempel is a fellow Hoosier. And on behalf of the Committee, 

I would like to express my gratitude for your presence here today, 

and I thank you very much. 

I yield back. 

Chairman CAMP. Thank you very much, Mr. Young. 

And, Mr. Tempel, welcome. You are recognized for 5 minutes. 

STATEMENT OF EUGENE R. TEMPEL, ED.D., FOUNDING DEAN, 

INDIANA UNIVERSITY SCHOOL OF PHILANTHROPY, INDIANAPOLIS, IN 

Mr. TEMPEL. Thank you, Mr. Chairman, Mr. Levin, Members of 

the Committee. Thank you for the opportunity to testify here today. 

I am the Founding Dean of the Indiana University School of Philanthropy, formerly known as the Center on Philanthropy at Indiana University, founded in 1987. The school’s researchers are 

among the most respected sources of objective research on U.S. 

charitable giving and the factors that influence it. Their research 

is the basis for my testimony today. 

Charitable giving has been a cornerstone of American society 

since before our Nation was founded. The Massachusetts Bay Colony led one of the first formal fundraising drives in 1641. Giving 

is an important way citizens exercise democracy. Each year 65 percent of Americans give to charity, higher than the percent of people 

who vote. 

Giving is a tremendous force in our society. An estimated $298 

billion was given to charities in 2011, according to our research. 

Seventy-three percent of that came from living individuals. Because of charitable giving’s enormous scope and impact, I urge you 

to investigate carefully the various effects tax policy could have on 

giving before deciding whether and how to change policies in ways 

that may have significant positive or negative consequences for the 

Nation’s more than 1 million charities and the people they serve. 

Federal tax policies have a significant impact. Our research 

shows that the cost of giving, the amount it actually costs taxpayers to make a gift after taxes, affects how much they contribute, 

and the timing of their contributions. Our research and research by 

colleagues elsewhere has looked at how various Federal tax policy 

changes impact charity. 

Raising marginal tax rates reduces the amount of after-tax income available for giving, but lowers the cost of giving by increasing the value of the tax deduction. Raising taxes alone without 


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other policy changes that affect giving is usually a net positive for 

giving. 

Capping or eliminating the charitable deduction negatively affects giving. It reduces households’ incentives to give to charity, or 

to give as much as they might have. If rates increase, and the charitable deduction is capped or reduced, this would produce a double 

whammy for giving, because it both reduces after-tax income, and 

increases the cost of giving. 

Reducing incentives for giving is especially likely to affect giving 

by higher-income households, which account for a disproportionate 

share of U.S. household giving. IRS data show that the top 10 percent of income earners at $100,000 or more gave almost two-thirds 

of all itemized contributions in 2009. The top 1 percent gave 37 

percent. Many charities rely on gifts of $100,000, $500,000, or $1 

million, the gifts most affected by the combination of raising taxes 

and reducing or eliminating the charitable deduction. That would 

have a detrimental impact on the services charities provide. 

Our study of gifts of $1 million or more shows that more than 

a third of the total dollar amounts of these gifts were given to foundations. Just under a third went to higher education. The next 

highest totals went to health care and the arts. In our 2012 survey, 

wealthy donors were almost evenly divided on whether or not they 

would decrease their giving if the charitable deduction were eliminated. 

The School of Philanthropy analyzed the Obama Administration’s 

2011 budget proposals to raise rates and reduce the charitable deduction of—for higher-income taxpayers. We estimated that if both 

proposals had been enacted, total itemized household giving would 

have fallen by 1 percent in total, and giving by the higher-income 

households specifically affected would have fallen by 2.4 percent. 

These decreases may not seem huge in total, but they could have 

a greater impact for individual charities, especially in the context 

of other factors impacting charitable giving. 

Our extensive research demonstrates that charitable giving is 

closely tied to the economy. Charities are still striving to recover 

from the great recession. Giving has dropped by more than 15 percent in 2008 and 2009 combined, after adjusting for inflation. Giving began to grow again in 2010 and 2011, but it is relatively slow 

in growth, reflecting the country’s slow economy. If donations were 

to continue to grow at the post-recession average pace of 1.8 percent, it could take over 5 years for charitable giving to return to 

2007 levels. 

Finally, the health of the economy—or the health of philanthropy 

depends on the health of the economy. Finding ways to address the 

Nation’s economic challenges without curbing the growth of charitable giving will ensure the continuity of services upon which our 

fellow citizens depend. 

Thank you very much for the opportunity to testify. I will be 

happy to respond to any questions you may have. 

[The prepared statement of Mr. Tempel follows:] 


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Chairman CAMP. Thank you, Mr. Tempel. And, finally, we will 

hear from Jan Masaoka, who is CEO of the California Association 

of Nonprofits. Ms. Masaoka has led several charitable organizations, and is a former Nonprofit Times Executive of the Year. 

Thank you for being with us. You are now recognized for 5 minutes. 

STATEMENT OF JAN MASAOKA, CEO, CALIFORNIA 

ASSOCIATION OF NONPROFITS, SACRAMENTO, CA 

Ms. MASAOKA. Thank you very much. Mr. Camp and Mr. Levin 

and Members of the Committee, thank you very much for inviting 

the participation of the nonprofit community into this important 

discussion. I am Jan Masaoka, and I am the CEO of the California 

Association of Nonprofits, which is a Chamber of Commerce-like organization for the nonprofit community. 

In California, as you may know, as our California representatives 

here today may know, there are 150,000 nonprofit organizations 

that employ three-quarters of a million Californians, deploy 7 million volunteers, and have $130 million—billion, excuse me—$130 

billion a year in purchasing power. 

So in order to discuss the impact of the charitable deduction on 

nonprofits, it’s worth spending just a minute or two thinking about 

the impact of nonprofits on American life. And just to illustrate, I 

recently visited my aunt in an Alzheimer’s care center that is run 

by our family church. I—my hearing aid that I have in today was 

used as technology that was developed in part in a nonprofit medical research lab. I recently watched a documentary made by nonprofits on the history of trains with my young nephew. And when 

my younger daughter was in a serious car crash, she was taken in 

a nonprofit ambulance to a nonprofit hospital where she received 

the expert care that made it possible for her, after all, to eventually 

walk again. 

Not only that, but all of us are breathing cleaner air today because of the work of nonprofit activists fighting against toxics and 

pollution. Many of us who are women and people of color went to 

universities and got jobs because of nonprofit activists who have 

fought against discrimination. Many of us are alive today because 

we weren’t killed in a car accident that was related to alcohol, 

thanks to the work of the nonprofit Mothers Against Drunk Drivers. And this morning, I looked up something on the nonprofit encyclopedia, Wikipedia, without knowing, without fearing or worrying that my personal data will be sold to companies that will 

then advertise to me. 

So all of these things are made possible, in part, because of the 

nonprofit corporate tax exemption and the charitable deduction. 

But, paradoxically, the charitable tax deduction disproportionately 

benefits people in the wealthier groups of society, with 57 percent 

of people claiming the charitable deduction actually claiming 79 

percent of the dollars that were claimed. And the benefits of the 

charitable tax deduction go disproportionately to the disadvantaged 

in our society. So, despite the importance of the charitable tax deduction to poor and other people, disadvantaged people in our society, as the other speakers here have mentioned, it’s also the case 


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that only one in four foundation grants in the United States is specifically targeted to help lower-income communities. 

So, what—we at the California Association of Nonprofits have 

two important messages. First, we support the charitable deduction 

because we know the power of nonprofits using charitable tax monies and government monies to strengthen families and communities. Second, though, we also support efforts to make our taxation 

system more fair, and to make the benefits of the tax deduction 

through the nonprofit sector more proportionately support all aspects of our society. 

If you remember the parable of the little Dutch boy who stuck 

his fingers into the dike to keep water from flooding into the town, 

the nonprofit sector could be seen that way. And if you were to be 

asking that little Dutch boy, ‘‘Would you like to take some of your 

fingers out of the dike,’’ he would quite appropriately say, ‘‘No, it’s 

important for me to keep them in.’’ 

But if we were to say, ‘‘Well, if you take your fingers out of the 

dike, we would have time to put in a wooden buttress against the 

dike that would do a better job,’’ then I think he might do that. So, 

for us just to discuss one aspect of the charitable tax deduction 

without discussing the aspects in particular of a floor for the deduction and benefits for non-itemizers, is like asking us to only consider one change without looking at comprehensive tax reform. 

So, we believe that charitable deduction should be kept as it is, 

but—when it is kept in isolation. But in looking at all these factors 

together, we support not just a charitable tax donation that 

incentivizes giving, but one that more fairly distributes both the 

benefits of that charitable tax deduction and the benefits to all segments of our society. Thank you. 

[The prepared statement of Ms. Masaoka follows:] 


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Chairman CAMP. Thank you very much. And thank you all for 

your testimony. And now we will move into a question-and-answer 

period. 

Mr. Steuerle and Professor Colinvaux, you recently co-authored 

a paper that discusses numerous aspects of the charitable deduction, including data on who gives, theories that support the deduction, and various proposals for reforms. I wanted to explore some 

of those issues that you raise in your report, and some of them reflected in your testimony with both of you. 

So, Mr. Steuerle, the report notes that in discussing reform proposals, floors, caps, and credits can all have similar revenue effects. 

But each has a different impact on charitable giving. If I asked you 

for a package of three or four provisions that would broaden the 

base without reducing the total level of giving, or even possibly 

could increase giving, what would that package look like? 

Mr. STEUERLE. Mr. Chairman, I lay out a number of options 

in my testimony at the end. The two primary ones that I would use 

on what I would call the revenue-raising side are to put a floor 

under charitable contributions that has very little effect on giving. 

Basically, people would still probably give some basic amount. The 

idea of incentives is to give incentives at the margin for the next 

dollar of giving, the giving above which you would have done if 

there were no tax break. 

And so, that concentrates the deduction at the top. It does raise 

revenues. But then I would take some of those revenues and, as I 

say, spend it on other items that I think would actually be much 

more effective in increasing giving. One that I’ve offered many 

times is to allow giving until April 15th, or the time people file 

their tax return. People would sit there, they would fill out their 

TurboTax or their H&R Block tax returns, and they would see immediately that they could save money—and they see exactly how 

much they’d save. That’s a very good marketing tool. We don’t put 

grocery store advertisements out 4 months before people go to the 

grocery. 

Another revenue-raising option—and Mr. Colinvaux got into this 

in some detail—is I believe there are substantial areas in which 

you could raise money by looking at areas of weak compliance. In 

some cases, it’s because the IRS just simply doesn’t have the resources to enforce. They simply can’t check up on most clothing donations. 

There is also the simple fact there that even if it’s not abuse, if 

it’s not non-compliance, in many cases somebody may be taking a 

$1,000 deduction for $10 or $20 that goes to a charity. An example 

would be I’ve bought designer clothes, paid $5,000, 2 years later I 

say, ‘‘Gee, that’s worth $2,500.’’ I give it to a profit-making agency 

that takes a charitable—works on behalf of a charity. That profitmaking agency runs a thrift store. It goes to the thrift store, those 

designer clothes sell for $100 in the thrift store. The thrift store 

people are paid off, the profit-making agency is paid off, and the 

charity gets $10. Now, that’s an exaggerated view, but that is actually legal under the current law. 

So, I think there are a lot of areas where you could increase revenues by cutting back on areas of very weak compliance. But again, 

then I would actually—I mentioned putting a floor under itemized 


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deductions. I would then use that to extend a deduction to nonitemizers, which I believe, by the way, would get at some of Jan’s 

comments, because that would actually increase the amount of giving by lower-income taxpayers that I think would go to areas like 

food banks. 

There are other options that I mention in my testimony. But 

those are among the principal items I would think about. 

Chairman CAMP. Thank you very much. Professor Colinvaux, 

you are the tax lawyer here. And one of the things I’ve learned 

from releasing two tax reform discussion drafts is that policy ideas 

are one thing, but turning those ideas into rules that are simple 

and easy to understand is something else. 

So, what rules would we need to make Mr. Steuerle’s proposals 

operational? And are there any other administrative issues we’d 

need to consider? 

Mr. COLINVAUX. Well, the question of rules is a difficult one 

in the absence of a specific proposal. But I think I would echo what 

Mr. Steuerle said at least on a floor. 

So, if you did impose a floor, my own belief is that it would affect 

giving on the margin. So it might not have a total bad effect on giving. And there are considerable administrative benefits to a floor. 

So this is not—the rule of a floor may not be difficult to enforce, 

and the administrative benefits are considerable. And if you think 

about those benefits in the context of non-cash contributions in particular, right now taxpayers who give up to $500 in non-cash contributions don’t have to separately report that, as they do with 

higher-value property contributions. 

We really don’t know whether the property being given that’s under $500 is anything close to the value that’s claimed by taxpayers, or whether the donee organizations are getting the benefits 

from those contributions. A floor would have the effect of virtually 

eliminating many of those contributions. So you wouldn’t need any 

specific rules to address that. 

I also want to echo something Mr. Steuerle said about trying to 

use proposals that focus on the benefit that actually goes to the 

charity. And a good example here were car donations, because with 

car donations, money was raised through the contribution of a car. 

The car would then be sold by a third party. The money raised 

from selling the car would often be much less than the claimed fair 

market value. Some of the sales proceeds—maybe the bulk—would 

go to the third-party seller, and the charity, at the end of the day, 

would get pennies. So you’d have a charitable deduction claimed in 

a high amount with a fairly small actual net benefit going to the 

charity. And Congress’ response to that was to tie the deduction to 

the actual sales proceeds from the car sale. So that is a rule that 

was used to try to make sure that the deduction is based on the 

benefit that goes to charity. That’s the type of rule you might have 

to institute. 

Chairman CAMP. Thank you. I want to give everyone else on the 

panel a chance to comment. I know that you represent tax-exempt 

organizations that do incredibly important work. And the charitable deduction helps you fulfill that mission, as you’ve testified. 

And the primary focus of this Committee for the next year is to 

produce a tax reform plan that broadens the base and lowers rates. 


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So if you would each—if you care to; you don’t have to—if you’d 

like to comment on Mr. Steuerle’s and Mr. Colinvaux’s statements, 

that there might be a mix of policy options that could help us 

broaden the base in tax reform while also preserving the level of 

giving, I will start with Mr. Murphy. And you don’t have to comment if you don’t want to, but I want to give everyone a chance 

before I go to Mr. Levin. 

Mr. MURPHY. Well, thank you, Mr. Chairman. As it should be 

obvious, I am not a tax economist. But the Council on Foundations 

has a long track record of supporting better enforcement of the existing laws. And it seems to me that a number of the issues that 

Mr. Steuerle and Mr. Colinvaux raise are concerns about enforcement. There is nobody on this panel representing a charity who 

does not want to weed out the bad apples and the bad actors. There 

will be strong support for any effort to try to do that, I think, from 

the nonprofit sector. 

Chairman CAMP. All right. Mr. Wills. 

Mr. WILLS. Yes, I’d like to echo that sentiment, as well. I think 

all of us are thinking that enforcement would be the wisest way to 

go, as opposed to creating a whole lot of new rules. 

In addition to that, I think that we want to look at the wisest 

way to structure whatever is going to happen. And we just want 

to make sure that whatever it is that comes out doesn’t further 

limit charitable giving. So when the net is all completed, we are 

not harming the charities and the people that they serve. That’s 

kind of the primary objective. 

Chairman CAMP. Thank you. Mr. Gallagher. 

Mr. GALLAGHER. Two quick points. One is this conversation of 

the floor that’s been circulating now for years. I think one of the 

things we ought to keep in mind is that not everybody lives in 

Washington, where a one-bedroom condo costs $350,000. There are 

people who live in central Indiana and southwest Pennsylvania and 

parts of the west that, you know, make $50,000 or $75,000 a year, 

own their own home, deduct their taxes, give away $1,500 or 

$2,000 a year, and $500 is a disincentive for them to make that 

gift. It’s—we always—I think we have this conversation in such abstract, we forget about where a lot of people live. 

The other is as we think about a fair—and I would say simple— 

approach, let’s try to keep it simple. Because I—you know, economists, I think, would say that a gift to charity is maybe the most 

elastic gift or spend anybody makes in a year. You don’t get a pair 

of shoes, you don’t get a car, you probably don’t even meet the person that benefits from your gift. And, therefore, it is incredibly discretionary. 

So, I think you will probably hear from folks today—Volunteers 

of America and others—who have benefited greatly by gifts of property. Crack down on compliance issues, but the gifts to Volunteers 

of America, Salvation Army, and others, in terms of clothing and 

so forth, dropped dramatically after we moved on that, after we 

moved on trying to crack down. So whatever we do, I think we 

have to realize these gifts are very elastic. You know, the perception of complexity or cost drives human behavior and drives giving. 

Chairman CAMP. All right. Mr. Tempel. 


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Mr. TEMPEL. I would say simply that, you know, a floor is better than a cap, because it pushes charity toward the top, and where 

the cost of giving will have an impact. I fully support the notion 

of a credit for non-itemizers, as well. 

You know, Congress did a wonderful thing in providing us with 

a 5-year experiment in the early ’80s. And that experiment can be 

examined, and you can get real data from the impact that had. 

Some economists at the time believed that some kind of a small 

floor there would have pushed giving up, as well. So, those things 

do provide an incentive. 

We have one study out at the University of Michigan’s panel 

study of income dynamics, where we have our own panel study on 

philanthropy. And in that study it’s clear that when people move 

in and out of itemizing, their giving changes dramatically. 

Chairman CAMP. Right. Just one quick question. You mentioned 

in your testimony that when rates go up, charitable giving declines. 

Historically, when rates have gone down, has charitable giving increased? Is the opposite true? 

Mr. TEMPEL. No. 

Chairman CAMP. All right. 

Mr. TEMPEL. Yes. 

Chairman CAMP. Thank you. Ms. Masaoka. 

Ms. MASAOKA. Thanks. One point that hasn’t really been mentioned is the impact of America’s volunteers on America’s communities, most of whom are mobilized through nonprofit organizations. And the charitable deduction does only a very small amount 

to incentivize and to reward volunteerism. 

One very small thing that Congress could do to further incentivize and reward volunteerism would be to change the mileage reimbursement rates for people who are using their cars for volunteer work. Right now, if one person uses her car, let’s say, for her 

own business, she can deduct the mileage that she uses her car for 

at $.77 a mile. If she—the same person later in the day does volunteer work driving her car for Meals on Wheels, she can only deduct 

$.41 for the mileage that she spends there. Just making that very 

small change, which would have a very minor impact, would send 

a really strong message about the importance of volunteerism. 

Mr. STEUERLE. Mr. Chairman, could I add just one quick footnote? 

Chairman CAMP. Yes. 

Mr. STEUERLE. When we talk about floors, the Committee 

should consider that we really have two floors we are talking 

about. One is the one we suggest such a floor under charitable contributions. But the standard deduction serves as a multiplicative 

floor—— 

Chairman CAMP. Yes. 

Mr. STEUERLE [continuing]. That excludes most taxpayers from 

getting any incentive at all. 

Chairman CAMP. Yes. 

Mr. STEUERLE. And so, when you are thinking about what a 

floor might be, whether you agree or disagree with our proposals, 

think about how the two floors interact. And I think in that way 

you can actually think about ways of actually dealing with Mr. GalVerDate Sep 11 2014 13:43 Feb 07, 2017 Jkt 021128 PO 00000 Frm 00073 Fmt 6633 Sfmt 6602 I:\WAYS\WAYSPS\21128\21128.XXX 21128

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lagher’s concern about moderate income taxpayers and whether 

they have some incentive. 

Chairman CAMP. Thank you. Mr. Levin is recognized. 

Mr. LEVIN. Thank you. I think this will be the only panel where 

we get into policy discussions, basically. At least the presentation. 

We may get into them, but I think the testimony will be less about 

policy. So let me just say a few words about the policy. 

Number one, the charitable deduction is not a loophole. And I 

think when anyone talks about widening the base, or whatever 

they say, and they say let’s get at loopholes, it’s often, I think, misleading. Because the charitable deduction is a tax policy. We have 

loopholes, lots of loopholes. These so-called tax preferences are not 

loopholes. 

Second, I think we should be careful to say that if there is any 

limitation, it’s a transfer to the government, if I might say so, because all of these tax policies, these tax preferences, if we change 

them at all you can say it’s a transfer to the government. For example, the limitations we placed on the mortgage interest deduction. You can say that’s a transfer to the government. 

But I think it isn’t a loophole, this deduction. Also, any limitation 

isn’t a transfer to the government. That conjures up it’s just sending the money to Washington. So I think we need to be careful 

about that, if I might say so. 

Also, we need to look at income distribution. And we’ve been, 

some of us, working on this for over a year-and-a-half. In July of 

2011, at our request, Joint Tax gave us income distributions on all 

of the tax preferences. And they gave us one on charitable contribution deductions. This was based on the 2009 rates and income levels. And there has been some change, but I think the distribution 

analysis was instructive. This was from Joint Tax. 

And this is a chart, Mr. Chairman, I would like to enter into the 

record. 

Chairman CAMP. Without objection. 

[The submission of The Honorable Sander Levin follows:] 


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Mr. LEVIN. And it shows, as to this deduction, 19 percent is from people with incomes below $100,000; 26 percent from people 

with incomes between $100,000 and $200,000; and 55 percent from 

people with incomes over $200,000. And this somewhat parallels 

what some of you have testified to. 

I think, again, I said in my opening statement, we need to look 

at this deduction, as well as others, with care. And I think we need 

to be careful of the labels. Also, we need to have a careful study 

of the Pease Provision, which is now back in law. And I know one 

or more of you gave some anecdotal evidence as to the impact, but 

we have several studies that indicate that the Pease amendment 

did have—in the past when it was in effect, the Pease Provision— 

a negligible impact. And the suggestion is that it will continue to 

have that. So, I think we need to look very carefully at that. 

Mr. Chairman, the working groups include one on charitable deductions—— 

Chairman CAMP. Yes. 

Mr. LEVIN [continuing]. That you and I have set up together. 

And I think this is a vivid example of the need for this Committee 

together to dig into the facts, and really bring out all of these 

issues, all of the suggestions, and see if we can come to some conclusion as to the facts. 

And so, let me just end by saying we’ll also probably ask economists to give us their views. I have great respect for President Reagan’s views on some issues, but I think we’ll talk to everybody. So 

if there are any economists listening, we’ll hear you also. Thank 

you. 

Chairman CAMP. All right. Thank you, Mr. Levin. Mr. Johnson 

is recognized for 5 minutes. 

Mr. JOHNSON. Thank you, Mr. Chairman. I appreciate you 

holding this hearing. I remember a roundtable of charitable groups 

back in Dallas, where just about everyone in the room spoke of the 

importance of charitable tax deductions. To that point, I am reminded of the quote I saw about an unnamed congressman—and 

perhaps for good reason—who said during a debate surrounding 

the creation of the Federal income tax system in 1913 that, ‘‘If a 

man wants to make a gift to charity, he ought to be encouraged to 

do so and not be discouraged. He ought to be encouraged to make 

such a gift, rather than be penalized for doing so.’’ 

So, with that, I have some questions for Mr. Steuerle, please. 

Given your role with respect to the 1986 Tax Reform Act, I would 

like to get your insights regarding the debate back then regarding 

the tax treatment of charitable giving. One, why did Congress, 

back in ’81, decide to allow non-itemizers the ability to deduct their 

charitable contributions? 

Mr. STEUERLE. I think accepting the broad tax-base argument 

that Mr. Colinvaux laid out, there is a good argument for extending 

a deduction to everyone to provide them an incentive. The concern 

we had by the time we got into ’86 was basically this was causing 

very large enforcement problems for IRS, that IRS did not basically 

deal with small contributions, and it complicated the tax return. So 

we were trying to reach a compromise between that argument 

about providing an incentive for everyone, and having something 

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It’s not dissimilar, if you want, to the argument for having a 

standard deduction under all contributions, although, as I’ve laid 

out in my testimony, I would prefer, with respect to the charitable 

contribution, to put a floor under it and put it outside the law. 

But back to ’86, it was trying to reach that compromise between 

issues of enforcement and issues of trying to provide an incentive 

to all taxpayers. 

Mr. JOHNSON. Well, my understanding is the House version 

still allowed for non-itemizers a deduction, but the Senate bill 

didn’t. How did it come to pass that the Senate ultimately prevailed in that question? Do you know? 

Mr. STEUERLE. I don’t remember. Again, I think sometimes 

when you go to—you know, to compromise committees, that they 

often take out items where there is some dispute, or where there 

is some big extra cost, or where there is, again, some extra administrative burden. But I can’t speak for the participants—— 

Mr. JOHNSON. Sometimes the Senate has different brain inserts—— 

Mr. STEUERLE [continuing]. In the conference committee. 

Mr. JOHNSON [continuing]. Than we do over here. Why did the 

Reagan Administration’s Treasury One plan propose to allow for a 

deduction for amounts over 2 percent of the taxpayer’s adjusted 

gross income? And what was the rationale behind that proposal, do 

you know? 

Mr. STEUERLE. Mr. Johnson, that rationale was very similar to 

the one that I suggest in my testimony. We were trying to put a 

floor under deductions, because we thought the first dollars of giving were not greatly influenced by the incentive. 

Mr. JOHNSON. Lastly, do you think non-itemizers should once 

again have the ability to deduct their charitable contributions? 

Mr. STEUERLE. Again, Mr. Johnson, yes, but if subject to a 

floor. That is, I have very strong concerns for IRS’ ability to administer much of this. So I don’t want to provide any—— 

Mr. JOHNSON. A floor, or a max, or both? 

Mr. STEUERLE. I would allow a non-itemizer deduction, but 

subject to a floor. So that way we are only allowing a deduction for 

everyone who gives in excess of some amount—say 1 percent of income. The average amount of giving is 2 percent. So people who 

give in excess of some average, or some amount below that average, 

like 1 percent of income, it seems to me that’s a compromise that 

deals with the issues of enforcement for IRS and administrability, 

but also deals with the concerns of the charitable sector that provide incentive for everyone. 

I do think the signal—I just want to be clear; we are getting very 

technical here—the signal of a charitable deduction, I think, is a 

powerful one and a very good one for our society. And I want to 

maintain it. 

Mr. JOHNSON. Thank you for your comments. Thank you, Mr. 

Chairman. I yield back. 

Chairman CAMP. Thank you. Mr. Lewis is recognized. 

Mr. LEWIS. Thank you, Mr. Chairman, for holding this hearing 

today. And let me join the Chairman and welcome each of you and 

thank you for being here today. 


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I have a question for each member of the panel. And if you can, 

just be very brief. I want to thank each of the experts for sharing 

your views and your thoughts. I would like to know if there is an 

option under consideration that would be better for increasing giving than others? Do you have an option better than we have? Do 

you have a suggestion or recommendation that would increase contribution, giving? 

Mr. STEUERLE. I want to give my panelists equal opportunity. 

I offered several options in my paper. Again, extending the deduction to non-itemizers, done the right way, I think could increase 

giving. I think one of the major ways of increasing giving would be 

to allow giving until April 15th. So I have a number of issues like 

that, where—that I suggest in my testimony, though those are 

probably the two principal ones. 

Mr. LEWIS. Mr. Murphy. 

Mr. MURPHY. Mr. Lewis, I would defer to the folks who are better at writing tax law than I am, and simply—— 

Mr. LEWIS. Are you the head of the Council on Foundation? 

Mr. MURPHY. Yes. 

Mr. LEWIS. So you know a great deal about the whole foundation community? 

Mr. MURPHY. Well, I work for a foundation, yes, right. I mean, 

I think there are certainly a number of proposals that have been 

suggested that would expand charitable giving. Our concern is primarily not to send a signal to donors that charitable giving is less 

important. We would be very concerned about any limitations that 

Congress would impose. 

Mr. LEWIS. Yes, Mr. Wills. 

Mr. WILLS. Mr. Lewis, I believe that there are many options 

that are available. Our key concern is that whatever option is selected doesn’t do anything to decrease charitable giving. That’s the 

key. 

So, as far as a particular option that I would have a preference 

for, I don’t have a particular preference, but would be very interested in helping the working group on tax-exempt and charitable 

efforts from this Committee to help design something that will not 

decrease the incentive for charitable giving. 

Mr. LEWIS. Well, have any of you considered or thought about 

ways to get a greater degree of giving from the larger American 

community? 

Mr. GALLAGHER. Well, Mr. Lewis, I would say—answer the 

first question and then that question. First of all, I don’t think we 

can overstate the simplicity and the compelling nature of tying the 

charitable tax deduction to an individual’s tax rate is the envy of 

the world. The fact is that it’s simple, and it’s compelling, and it 

works. And it’s amazing to me that just in the consultation we’ve 

had in the last 2 or 3 years with the French government, that the 

French are—now have the most generous tax incentive for charitable giving in Western Europe because they were benchmarking 

us. 

So, one, I would—having said that, I think extending tax deductibility for charitable giving to all taxpayers is the fairest and simplest way to improve the current environment. 


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Mr. COLINVAUX. I think I am going to echo that. But if the 

goal is to have more giving, then look to those who currently don’t 

have an incentive. And those who don’t currently have an incentive 

are those who take the standard deduction—so that would lead you 

to a non-itemizer—but with a floor. I think a floor is very important for the non-itemizer deduction, because we already know that 

non-itemizers do give already. And so we’d want to encourage additional gifts that aren’t already being made. 

Mr. LEWIS. Thank you. 

Mr. TEMPEL. Mr. Lewis, I would say that, you know, certainly 

not putting a cap on deductions would keep from dampening it. But 

anything you do to shift the cost of giving from the donor, you 

know, to the beneficiary, would be helpful. So creating special incentives among people who give would be helpful. I think the charitable tax credit for non-itemizers, or some way for non-itemizers to 

get recognized, would be helpful. 

The problem is that, you know—I mean, I believe in democratizing philanthropy, so that everyone can participate, and everyone 

should participate. But the philanthropy is skewed to the top. And 

so we need to find incentives that allow those people who care most 

about this to—and provide the largest sums of money—to do so 

easily. 

I was—I visited in the last 3 weeks with two people—— 

Chairman CAMP. Time has expired. 

Mr. TEMPEL. Okay. 

Chairman CAMP. If you want to submit anything in writing for 

the remainder of his questions, you are free to do that. 

Mr. Brady, you are recognized for 5—— 

Ms. MASAOKA. I just have one comment, quickly, that—— 

Chairman CAMP. You can submit that comment. 

Ms. MASAOKA. As two people have already commented earlier—— 

Chairman CAMP. You may submit that comment in writing. 

Ms. MASAOKA. Oh, all right. I am sorry. 

Chairman CAMP. We are going to stick to the 5-minute rule. We 

have a very long day, we have a lot of witnesses that want to testify—— 

Ms. MASAOKA. I am sorry. 

Chairman CAMP [continuing]. And a lot of Members who want 

to ask questions. 

So, Mr. Brady, you are recognized for 5 minutes. 

Mr. BRADY. Thank you, Mr. Chairman. I like charitable giving, 

especially at home. Our part of Texas is Hurricane Alley, and so 

what our churches and clubs and organizations do—United Way, 

others—during that crisis is just so critical. And what I like is that 

in local giving, you are looking at the organization that’s delivering 

that service. They’re accountable. And if they don’t perform or do 

the job, you quit giving to them. 

My worry is that when I send my taxes to Washington, I’ve noticed there is a middle man who takes a pretty big chunk out of 

that dollar and sends it who knows where. So I want to grow charitable giving. And I can’t help but think that, with a Tax Code so 

complex, it costs our Nation three times more a year to comply 

with the Tax Code than what we spend to encourage charitable givVerDate Sep 11 2014 13:43 Feb 07, 2017 Jkt 021128 PO 00000 Frm 00079 Fmt 6633 Sfmt 6602 I:\WAYS\WAYSPS\21128\21128.XXX 21128

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ing in the Tax Code. I would much rather, in a simpler code that 

lowers tax rates, I’d much rather send my money to my church or 

charity than to my accountant—I hope my accountant is not watching the hearing today, but that’s what I want to achieve. 

So I think this is helpful, to ask, after 96 years of principally the 

same charitable giving exemption, is there a smarter, is there a 

better way to encourage, reward charitable giving? And my question, though, is the reverse of that. 

In the current Tax Code, which areas are probably the least effective in encouraging charitable giving? For example, someone 

raised the issue of the clothing deduction, and sort of how that can 

be—my sense is it’s going to curl one way or the other. People, 

rather than renting the storage unit, want to do something with 

clothes and items that they have. I will ask the panel. What are 

the areas that we aren’t quite as good at rewarding giving, and is 

there a better way to do it? 

And I will open it up. Do you want to start, Ms.—— 

Ms. MASAOKA. No. 

[Laughter.] 

Mr. BRADY. That was kind of easy, you just—don’t give up that 

easy here. 

Mr. Tempel. 

Mr. TEMPEL. Well, I would say that, you know, one of the simplest things you can do to reward charitable giving is to have the 

tax credit for non-itemizers, so that you create incentive for those 

people to, you know, to give, and to give at higher levels. 

Mr. BRADY. But can you do that without risking, you know, a 

greater gaming of the system? 

Mr. TEMPEL. Well, there are—— 

Mr. BRADY. You think we could do it in a good way? 

Mr. TEMPEL. As Mr. Steuerle said, there are issues—there are 

enforcement issues that become involved when you make the credit 

available for non-itemizers, in how you would—how people would 

document that, et cetera. 

Mr. BRADY. You think it can be done? 

Mr. TEMPEL. I think it would be possible, sure. But I am not 

a tax law expert, nor am I an economist. But those—and when you 

study giving, incentives matter in terms of how much people give. 

And not whether they give, but how much people give. And so that 

would be one way to encourage more giving. 

The more—you know, the more you can reward people for making a contribution, that is to—supporting this sector of our society, 

our supporting it outside the government, to supporting it in ways 

that are meaningful to them, the more you strengthen democracy 

and, I think, increase philanthropy. So, you know, you have to look 

at—the cost of giving matters to individuals. Research shows that 

over and over again. So that anything you can do to lower their 

cost of giving is, in fact, helpful. 

Mr. BRADY. Can I ask you this? How much in that research is 

the tax break critical to their giving? How much of a motivator is 

that? 

Mr. TEMPEL. Well, it doesn’t motivate whether they will give, 

but it motivates how much they will give, and when they will make 

the gift. 


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Again, another wonderful experiment in 1986, 1987, you saw 

people move their giving from 1987 to 1986. It’s the only time in 

the Giving USA data that giving went down from one year to the 

next. 

Mr. BRADY. And when you say ‘‘moved it,’’ they limited it? 

Mr. TEMPEL. No, they moved their giving forward into 1986 to 

take advantage of the higher marginal tax rates. And then the giving dropped in 1987, in the aggregate. 

So, you know, it’s very—their giving is very price-sensitive. It’s 

not whether they give, but how much they give. 

Mr. GALLAGHER. Okay. Mr. Brady, if I could, there is a direct 

correlation to people that volunteer, and whether they give to charity and how much they give. 

Mr. BRADY. Yes, but—— 

Mr. GALLAGHER. So we could—the promotion of volunteerism 

is—has a direct connection to giving. And if you—whether you 

agree with mandatory service in high schools or not, if you watch 

that generation of kids coming, they are incredibly philanthropic, 

more than the boomers in—on aggregate. 

So, anything we can do to promote volunteerism—and I would 

say one of the things that has happened in this debate is you have 

galvanized the nonprofit sector. We ought to try to galvanize the 

nonprofit sector on volunteerism and innovation around solutions 

to some of our social problems. 

Mr. BRADY. Thank you, Chairman. I appreciate it. 

Chairman CAMP. Thank you very much. Mr. Blumenauer is recognized. 

Mr. BLUMENAUER. Thank you, Mr. Chairman. I would direct 

a question to Mr. Steuerle. I like the way that you package together your concepts here to try and streamline something to be 

revenue-neutral and get more impact out of the contributions that 

are made. And it seems very common sense to me. I have been 

deeply concerned of late watching—you were talking about the 

counter-cyclical impact on foundation giving, the pay-out requirements. 

Can you elaborate on what is going to be necessary—I mean, you 

have been through the wars on this in administrations. You have 

watched the process. What do we have to do to be able to somehow 

make progress on something like this, that seems common-sense, 

broad base of support, revenue-neutral? What is the key? 

Mr. STEUERLE. Well, some of the impact, in terms of foundations giving in a counter-cyclical way, or making—that is, they 

give—they have a tendency—although I have to say in the current 

recession they did not do it as much as might be expected—they 

have a tendency to give less in a recession because their assets go 

down, and then more when their assets go up. Some of this is just 

the natural result of the economic cycle as due to their own internal methods. 

So, for instance, if they decide to give 5 percent of asset value 

every year, they start to get caught in that trap. And better planning could help a lot, dealing with that. 

There is a particular policy issue, however, as well, in that the 

current excise tax has this very strange effect by the way it is calculated, that if you give more—for instance, those foundations that 


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said, ‘‘We will give 7 and 8 percent of our asset value this year’’ 

get penalized later on. So they have a strong incentive not to give 

more in times of recession or asset declines. And that excise tax is 

something worthy of fixing. The Council on Foundations has been 

fighting to fix it for some time. 

Now, the debate there often gets, then, narrowed down to, well, 

gee, there is a revenue aspect involved. And so, if we fix it by just, 

say, making it a flat 1 percent of assets and an excise tax, that 

might lower slightly the revenues. I have offered you other revenue 

options here. 

Quite honestly, I think the whole excise tax on foundations is 

silly. I mean, there is no excuse for it. And if you actually talk 

about bang per buck, you get rid of $1 of excise tax on foundations, 

that means at some point they are going to give a dollar more to 

charity. That is actually more than we get out of some of the charitable deduction. As far as I am concerned, I would eliminate it. But 

admittedly, I would simplify it, and that would solve part of your 

problem. 

Mr. BLUMENAUER. But what I am interested in, from your 

vantage point as somebody who is a scholar studying it, and somebody who has been on the inside administratively dealing with tax 

policy and administration, how—what is the dynamic that enables 

us to move forward on some things that would appear to be common sense, and have broad support? Is—what is the key to making 

it happen? 

Mr. STEUERLE. Well, I think one of the tricks—and this is an 

issue that goes far beyond the subject of this hearing; it goes to tax 

reform, or budget reform in general—the key is often to be able to 

make trade-offs on a broader scale. 

So, for instance, there are some things that people might feel, ‘‘I 

don’t want to change that, because it is—if we change it, it is progressive.’’ But it is very inefficient. You know, we can go into a part 

of the city and throw money off the roof to a poor part of the city 

and say, ‘‘Gee, we want to keep that, because if we get rid of it, 

we are going to—it is going to be regressive.’’ But if you are allowed to combine other elements, other packages to maintain that 

same goal, you can get at it. 

The same with this excise tax. When it is dealt with one item 

at a time, people say, ‘‘Gee, I would love to fix it, but it is going 

to cost us revenue,’’ so then we don’t get any movement on it. 

I think most people—I think even most legislators on both sides 

of the aisle—would say the current design of the excise tax on foundations—and I don’t want to over-emphasize that—but it is badly 

designed, you know. Nobody really supports its current design. 

So the question is—how to get movement is how to be able to 

offer trade-offs that allow Congress to get past whatever the impasse is. If the impasse is revenues, then you decide what is the 

total amount of revenues we want to raise, and then let’s consider 

the package as a whole. Let’s not take them one item at a time off 

of a list and decide it on the basis of its revenue impact or its progressivity, or anything else. 

Mr. BLUMENAUER. Thank you. I found your testimony very 

useful. Thank you, sir. 


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Chairman CAMP. Thank you very much. Mr. Tiberi is recognized. 

Mr. TIBERI. Thank you, Mr. Chairman, and thank you all for 

being here. Mr. Gallagher, great to see you. 

Mr. GALLAGHER. Good to see you. 

Mr. TIBERI. We miss you in Ohio. 

Mr. GALLAGHER. Thank you. 

Mr. TIBERI. I found a statement that you made in your written 

testimony to be just fantastic: ‘‘A limitation on the deductibility of 

charitable donations isn’t really an increase in tax on the wealthy, 

so much as it is a transfer to the government of money that would 

otherwise go to charities. The real impact will be felt by the people 

we serve.’’ 

I had a conversation with a man you may remember who has 

since passed away in Ohio by the name of Richard Solove, who 

gave over $20 million to Ohio State. And the cancer hospital, the 

James Cancer Hospital, is now called the James Cancer Hospital 

and Solove Research Institute. Before he gave that money he said, 

‘‘Never let anybody tell you, Pat, that people like me don’t give 

money based upon what the Tax Code looks like. That doesn’t 

mean I still wouldn’t give, but maybe not as much.’’ 

Mr. GALLAGHER. Right. 

Mr. TIBERI. It was an unbelievable point that I will never forget. 

And so, on New Year’s Day, all of us were here. I was in the Capitol that afternoon, trying to figure out what was in the so-called 

fiscal cliff deal that was negotiated between Vice President Biden 

and Mr. McConnell that the Senate had just passed. And obviously 

included in that were provisions in the Tax Code that Members on 

this side of the aisle did not like, including what the President insisted on, the return of the Pease and PEP provisions that impact 

donations, including donations to charity, with the tax provision. 

And what was astounding to me is that day, as we were looking 

at those provisions, the President did a press conference. So the ink 

is not even dry on this proposal, and the President said he was 

coming back for more, in terms of limits on donations to charities. 

Now, as Chairman with the great American, Mr. Lewis, of the Philanthropy Caucus, I have grave concerns about what that means to 

charities. 

Can you tell us—and it has only been a little over a month, a 

month-and-a-half, what that has meant to charitable giving, and 

what it would mean further if the President gets his way? 

Mr. GALLAGHER. Well, in short, there is no question that the 

White House’s proposal to cap the charitable deduction for the 

highest income earners would reduce giving in the country. There 

is no question about it. The debate is how much. 

You know, the fact is that, at least the donors that we work with, 

are—they look at complexity, they look at cost. They are anticipating that the cost is going to go up for their charitable giving. 

They are doing one of two things. And somebody referenced it on 

the panel. They are accelerating their giving—and accelerated their 

giving at the end of last year—in anticipation of that gift costing 

more, or they are extending their gifts out. 


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So, we work directly with a very large donor from Orange 

County, California, who has made lots of gifts to cancer hospitals, 

local nonprofits, United Way. In fact, he has seeded the founding 

of United Way in Paris. And he is extending his gifts out multiple 

years. So what he is doing is he is reducing his annual giving in 

anticipation of the cost. So the giving is going to go down. 

I want to make another point. I want to use Columbus—and it 

is great to see you again—in Ohio, in terms of what gets crowded 

out here is—so there is $20 million donors. But when—I think we 

are missing the opportunity to galvanize the nonprofit community 

around social solutions, working with government and businesses 

and local nonprofits. Service-supportive housing in Columbus, in 

Ohio, and across the country started because Federal Government 

and State government started loosening the rules around Section 8 

funding and other housing funding. Local donors stepped up with 

local contributions. Local government got flexible in terms of instead of sending people to shelters, why don’t we put them in housing and force the services, public and nonprofit, to support them to 

get them into housing. Twenty percent of the people in shelters in 

all of your districts consume 80 percent of the capacity of those 

shelters. 

If, on the other hand, we can create innovative approaches to 

service-supportive housing with flexibility around government 

funding—and the way we seeded it in Columbus was with an individual $500,000 gift that allowed us to buy a building, go to the 

YMCA, manage it. The Mental Health Association put money into 

it to provide support services. There are 1,000 units of new servicesupportive housing in the city of Columbus and in Franklin County 

because of that. And you know it. 

And we should be talking about my view, how you get us galvanized around that, versus what we are galvanized around right 

now, which is trying to prevent the limitation on the incentive, 

which will reduce giving. 

Chairman CAMP. All right—— 

Mr. TIBERI. Thank you, great point. 

Chairman CAMP [continuing]. Thank you very much. 

Mr. TIBERI. I yield back. 

Chairman CAMP. Mr. Davis is recognized. 

Mr. DAVIS. Thank you very much. I was not daydreaming, but 

I wasn’t looking. 

Chairman CAMP. We are following the Gibbons Rule in this 

hearing. So it is Mr. Davis’ turn. 

Mr. DAVIS. Thank you very much. Let me thank you all for 

being here. There are many people who express the theory that the 

more control individuals have over the use of whatever they give 

or is extracted from them, the more likely they are to give more. 

Let me just ask your opinion quickly, relative to that theory, and 

we will just start with you, Mr. Steuerle. 

Mr. STEUERLE. It depends on the individual. The one thing I 

would say about the charitable deduction is that government, in 

most areas of social policy, does drive policy, that government decides what to do with its spending budget. So it decides often, you 

know, that we will put money into Medicare, we will put money 

into Medicaid, we will put money into, sometimes, subsidizing food 


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banks. What the charitable deduction does on the side is it gives 

the taxpayer some independent choice over where to allocate those 

social benefits, and it provides a tax subsidy to do it. And I think 

that is a very useful part of this broader social welfare budget, in 

the sense that we are allowing individuals to signal—it is not just 

the giving they do, it is the signal that they give. 

And so, I think the incentive for them to give sends a positive 

signal to which they respond very positively. And that is a good 

thing. 

Mr. DAVIS. Mr. Murphy. 

Mr. MURPHY. Mr. Davis, I think it may not be so much a matter of control as engagement. Donors have more than a tax motivation to give. And the more we give them an opportunity to see the 

impact of their gift, yes, the more active they become in giving. I 

think there is no question about that. But I am not sure it is as 

much about control as the ability to see results, and that they have 

made a difference. 

Mr. DAVIS. Mr. Wills. 

Mr. WILLS. Yes. If control means that they have more of an opportunity to create more wealth and have more disposable income 

to make decisions upon, certainly the more control they have over 

those things the greater their giving is going to be, as long as the 

incentive to give is still in place. 

Mr. DAVIS. Mr. Gallagher. 

Mr. GALLAGHER. Our research is pretty compelling. People 

give because they want to help other people. That is the number 

one driver. And that there is an incentive to do it. It is those two 

things. 

Mr. COLINVAUX. If control of the gift means having the ability, 

as itemizers do, to direct a portion of government money to a charity of their choice, then, yes. Again, this leads to the idea of a nonitemizer deduction. 

Mr. DAVIS. Mr. Tempel. 

Mr. TEMPEL. I think it is not so much control, unless you mean 

control as having a choice about where you give, following your 

own values, fulfilling your own values. 

But I would echo what Mr. Gallagher and several others have 

said, that it is, in fact, engagement. Organizations need to engage 

people and build trust. Research shows over and over again that 

when people trust organizations, they trust or trust highly, they 

give almost double the amount that they give when they don’t 

trust. 

Ms. MASAOKA. Well, what several people have already pointed 

out is when tax rates go up, or when tax rates threaten to go up, 

people give more and they give sooner. And so, what is clearly— 

people are clearly making a choice about control by doing that. 

They are saying, ‘‘I would rather give to a place that I care about 

and that I know, rather than to give that money to the government.’’ 

Mr. DAVIS. Mr. Steuerle, let me ask you, if I could. According 

to the Joint Committee on Tax, individuals with higher incomes 

give more, on average, to charity. Is the tax benefit higher for 

wealthier individuals than the general population who itemizes? 


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Mr. STEUERLE. If we are speaking about giving to particular 

charities, higher-income people clearly have more of an incentive to 

give than lower-income people, because the gift is subsidized at 

their tax rate. 

However, I do want to make another point in terms of neutrality. 

Think about a high-income person and a low-income person taking 

a vow of poverty. If you convert away from a deduction to a credit, 

you actually would end up in the strange situation where the highincome person would have to pay taxes, even though they took a 

vow of poverty; the low-income person wouldn’t. 

So, what I am trying to argue is that the non-neutrality is partly 

caused—for progressive reasons we want higher rates on higherincome taxpayers. But the result is they pay a much higher tax 

rate on their earnings, on their wages. So if they decide to work 

and give their wages to charity, we are sort of neutralizing that effect by giving them a charitable deduction. 

Or, if you want to, if we have a spouse that says, ‘‘I want to go 

work and give money to charity,’’ one spouse is high income, one 

is not, the deduction sort of treats them in a more neutral fashion. 

Mr. DAVIS. Thank you very much—— 

Chairman CAMP. Thank—— 

Mr. DAVIS [continuing]. And I yield back. 

Chairman CAMP. Well, thank you very much. Mr. Reichert is 

recognized. 

Mr. REICHERT. Thank you, Mr. Chairman, and thank you for 

holding this hearing today. And I also want to thank you for the 

opportunity to serve as the Chair of the Charitable and Exempt Organization tax reform working group. So we may meet again somewhere along the road here in the next few months. 

And, Mr. Chairman, as you have mentioned in your comments, 

charitable organizations perform invaluable services for our society, 

and I believe are part of what makes America great. You have all 

spoken to that eloquently. But all parts of our Tax Code need to 

be reviewed. And charitable giving and exempt organizations deserve a close look, also. I think all of you would agree with that. 

I will give an example. On one side of things you have AARP. 

In the last Congress, Dr. Boustany, former Congressman Herder, 

and I took a close look at how AARP sells for-profit insurance, and 

the implications for this nonprofit title and organization that they 

run. We need to ask if organizations like AARP have significant financial interests in a business like selling insurance, and should 

they continue to enjoy their tax-exempt status. I mean, that is the 

question that a lot of us have. 

And on the other side of things, I think, Mr. Colinvaux, you have 

mentioned the vehicle and property donations and the confusion 

around that. In pre-2005 people were allowed to deduct the fair 

market value of anything less—a vehicle less than $5,000. And 

then, if it was above $5,000 they had to have an appraisal. I am 

sure you are very familiar with the law. But post-2005, it was less 

than $500 for fair market value, and then you had to have the 

sales price of a—appraisal over $500. So what happened after 2005 

is the donation of vehicles went from 900,000 vehicles to 200,000 

vehicles. 


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So, I am in agreement with you that there needs to be a lot of 

work done. And as some have mentioned here, enforcement is one 

of the, I think, major concerns here, and people taking advantage 

of certain parts of a charitable giving Tax Code. I am an old cop, 

so I am all about enforcement. So we will be taking a look at this 

language very closely. 

But I also want to mention that Mr. Lewis is my Co-Chair on 

this charitable giving working group. And so, together, Mr. Lewis 

and I will be taking a close look and hopefully finding some solutions and looking at some reforms that increases giving, but also 

allows some fairness in the Tax Code and some enforcement, holding those people accountable that might be thinking about taking 

advantage of certain parts of the Code. 

I do have one quick question for Mr. Tempel, and it has been 

touched on, but I want to sort of get at it from a different—in a 

different way. You mentioned in your testimony, and you pointed 

out, that the economy and consumer confidence is more important 

to charitable giving than tax incentives. 

So, if we enact tax reform that grows the economy, do you believe 

that, even if we limit the subsidy for the charitable deduction, giving to charities will rise? So the economy grows, not just the tax 

brackets are changed and go from 6 to 2 to 10 and 25 percent, but 

the economy, as a result of tax reform, grows? 

Mr. TEMPEL. Well, the answer to that would be that there will 

be a lag if you do something to limit charitable gift deductions. But 

as the economy grows, you know, the—you know, philanthropy 

would grow with it. And you would eventually overcome the downturn that is caused by negative incentives. 

I mean, there is just no—there are no two ways about it. We 

have looked at research going back now to 1960, analyzed the 

core—you know, the drivers of increases in giving year to year. And 

the two single biggest predictors of increases in giving are the—are 

a rise in household income and the rise of the S&P. 

Mr. REICHERT. And you see that happening, even if we limit 

subsidies? 

Mr. TEMPEL. Yes. You know, that correlation has existed 

through various tax schemes. But you can see where shifts take 

place inside the sector. I do not have it with me, but I can get for 

you the research that shows what happened after 1986. Because 

there was a redistribution of philanthropy from the very top of the 

economy distributed out throughout the middle class. And the top 

marginal tax rate folks decreased their giving, but they recovered 

about 10 years later. So that is what happens. You see a depression, but it will recover if you can really grow the economy. 

Mr. REICHERT. Thank you, Mr. Chairman. 

Chairman CAMP. Thank you very much. Ms. Sanchez is recognized. 

Ms. SANCHEZ. Thank you, Mr. Chairman. I want to take a moment to thank each of our panelists for appearing before the Committee today. I know that your organizations do remarkable work 

in our communities, often encountering many challenges, and 

sometimes very limited funding. And I also wanted to thank the 

Chairman and the Ranking Member for holding this hearing, because it is an important step, as the Committee starts to think 


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about the long-overdue tax of comprehensive tax reform. Our Tax 

Code needs to be fair to working families and businesses, alike. 

And in an effort to simplify our Tax Code, we hope that we can encourage American innovation and job creation, and pass a strong 

economy on to our next generation. 

One thing that I hear over and over again is that we can’t continue down this path of uncertainty, complexity, and, most of all, 

inequity in our Tax Code. It is just not going to be sustainable. So 

I am very much encouraged by the fact that Chairman Camp and 

Ranking Member Levin are strongly committed to working together 

to pass comprehensive tax reform, because only through completing 

that task are we going to accomplish the goals of bringing in the 

revenue that we need. And I think the charitable tax deduction is 

a very important part of that discussion. 

I also know that Americans are—have a very long and proud tradition of taking care of our own. And that is why I support robust 

incentives for charitable giving. It is only through the sacrifices of 

friends and neighbors that everything from food banks to homeless 

shelters to museums and libraries are funded. And the Tax Code 

should encourage those charitable donations and try to treat all 

Americans equally in that giving. 

But one thing that I have heard more than once in this hearing 

already is that individuals who file itemized tax returns are the 

only ones who can take advantage of the charitable deduction. And 

those individuals only make up about a third of all of those who 

file returns. The National Philanthropic Trust recently found that 

65 percent of households give to charity. 

So, with that big disparity between those who give to charity and 

those who can actually claim the charitable deduction, I think it is 

time to think about expanding access to this credit to lower- and 

moderate-income workers—earners, pardon me—who take the 

standard deduction. 

Charities that are in my district serve every function imaginable, 

and they receive a very high percentage of their donations in the 

form of small gifts from everyday working people. And as I would 

suspect, that is the point that I think Mrs. Masaoka made earlier. 

Most of your charities, much like those in my district, benefit from 

similar small-dollar donations. Local charities in California receive 

donations from both high- and low-income earners. But it wouldn’t 

hurt the charity business model if we—if lower wage earners could 

deduct their contributions, as well. 

And I understand that there is somewhat of a difference in what 

the large-dollar donors tend to give money to and what low-dollar 

earners—or low-income earners tend to give their money to. Lowincome people are more likely to donate to things that are, like, directly benefitting local communities, things like food banks, homeless shelters, and churches. So, if that group can most benefit our 

community, why do we not incentivize their giving more under the 

Tax Code? 

Now, assuming that the charitable deduction incentivizes giving, 

encouraging low- and moderate-income individuals to donate would 

only increase charitable giving if taxpayers at these income levels 

become eligible for the deduction. So I am interested in getting 

your perspective on that. 


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I wonder if Ms. Masaoka could expand on that, on that theory? 

Ms. MASAOKA. I think you have made all the important points 

very wonderfully, that, in fact, what we do know is that while a 

great deal of the money to the charitable sector comes from highincome households, that people at lower ends of that spectrum are 

more likely to give to their local communities, to people that are 

disadvantaged in some way. And they are also more likely to give 

a higher percentage of their incomes. It may not be the same in 

dollars, but they are giving—lower-income people give a higher percentage of their income than do higher-income people. 

So, all of these things argue, I think, for not only, but for the inclusion of benefits to non-itemizers as part of a package in tax reform. 

Ms. SANCHEZ. Is there anybody on that panel that would disagree with what was just said? No? Okay. 

Then, very quickly—— 

Mr. TEMPEL. Ms. Sanchez, I would—— 

Ms. SANCHEZ. Oh, I am sorry, Mr.—— 

Mr. TEMPEL. I would only say that, you know, our survey of 

high-net-worth households does show that 80 percent of them give 

to higher education, but 79 percent of them give to direct needs 

causes, as well. So it is not true that the wealthy only give to, you 

know, very esoteric causes, or the causes that help enhance human 

potential, as opposed to reducing human suffering. 

Ms. SANCHEZ. I understand, and I didn’t mean to imply that. 

I was just making a—the case that lower-income earners tend to 

more specifically give to those needs. 

Chairman CAMP. All right. Thank—— 

Ms. SANCHEZ. Thank you, Mr. Chairman. 

Chairman CAMP. Thank you. Dr. Boustany is recognized. 

Mr. BOUSTANY. Thank you, Mr. Chairman, and thank you all 

for being here today. 

As Americans, we are all very, very proud of our unsurpassed 

generosity. I certainly saw it in my time in Congress when I took 

the oath of office in 2005. And since then, my home State of Louisiana has been hit by five hurricanes. Four directly affected my 

district. During all of that, oftentimes, charitable and tax-exempt 

organizations were the first to be involved in the first response, before the government could get involved in helping so many families. 

Given that we are seeing a lot of difficulty throughout our country today, a lot of Americans are struggling, I have a policy question and I would like to direct it to Mr. Tempel, to start with. 

Should we, as we craft policy in this area, should we give preferential tax treatment to those U.S. tax—to donors who give to 

U.S. organizations who preferentially—say 50 percent or more of 

the time—provide services to American citizens and residents 

versus some overseas charitable type of event? 

I mean, I have no doubt about the importance of public health 

globally, but is this something we should consider, as we look at 

policy? Mr. Tempel, if you want to, start with that. 

Mr. TEMPEL. Well, you know, and I would have to offer personal opinion, because I don’t think we have any research that 

shows this. I mean, one thing one might consider is what kind of 

an impact does that have on U.S. foreign policy, if we were to enVerDate Sep 11 2014 13:43 Feb 07, 2017 Jkt 021128 PO 00000 Frm 00089 Fmt 6633 Sfmt 6602 I:\WAYS\WAYSPS\21128\21128.XXX 21128

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courage people to give locally, rather than internationally. And 

international is growing, although it is a very small sliver of the 

total U.S. philanthropic pie. 

There is some—I think what happens is there are some very visible new donors who are spending a lot of their resources in, you 

know, in developing countries. And so we notice that. But it is still 

a very small sliver. I did ask one of those donors why he gave in 

Africa, and he said, ‘‘I have been to West Virginia, I have been everywhere in the United States.’’ And he said, ‘‘What you see in the 

United States, you can’t even imagine—it doesn’t even get close to 

what you see where I am putting my money.’’ So I think that is— 

you know, I think that is one of the ways one might consider it. 

This is a complicated issue. And, of course, we are one of the 

countries that allow people to make contributions here that benefit 

other countries. Many countries don’t do that. But I think it is 

probably something you want to take into consideration, in terms 

of the way in which the U.S. approaches its foreign aid program 

and foreign relations program. 

Mr. BOUSTANY. Thank you. Anybody else want to comment on 

this? 

Mr. STEUERLE. I would just say, in terms of the data, international organizations are probably more dependent upon charitable contribution than almost any other type of charity, and that 

is because other charities, such as hospitals, nonprofit hospitals, 

get a lot of their money through fees. Higher education, the same 

way. So you would have a fairly—much more deleterious impact 

upon international organizations, if you went after them. 

Let me also say—and I actually personally have dealt with this 

with the State Department and some other aspects of my life—and 

that is that the goodwill that the American people create through 

their private donations abroad is often, in many cases, greater than 

what the State Department can do. The State Department, almost 

inevitably, has to deal through governments, who often are corrupt. 

But you have to—they have to deal government to government, 

whereas the private international organizations can be much more 

effective in dealing one-on-one with schools, hospitals, and needs 

abroad. 

So they actually serve our country very much in promoting goodwill abroad, and I think, as a result, actually reducing such things 

as terrorism by creating that goodwill. 

Mr. BOUSTANY. No, I fully understand that. And having traveled abroad to a number of these troubled areas and taken an interest in public health, you know, clearly you are correct in your 

analysis and statements. 

But I wanted to ask this question on behalf of a lot of constituents I have in south Louisiana, who oftentimes wonder why are 

charitable dollars going out of the country when we have immense 

needs that were unmet on the Gulf Coast? And certainly now we 

are seeing that on the East Coast, and so forth. So, Mr. Wills. 

Mr. WILLS. Yes, I just—I want to just add and echo the point. 

I completely concur with this gentleman’s comments about how it 

would be harmful to international efforts. But also it is very important that we maintain philanthropic liberty, so that the donors 

have—they can give to what their intent is to give to. If we start 


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to tell them where they should and should not give, especially if 

you start to try to divide between whether or not an organization 

is doing work in the States or internationally, that could become 

very complex, very difficult to enforce, and also would harm giving 

significantly. 

Mr. BOUSTANY. Right. I was going to put aside the complexity 

of administering that for a minute, and just—— 

Mr. WILLS. Right. 

Mr. BOUSTANY [continuing]. I wanted to address the policy 

issue. So I appreciate it. 

I see that my time has expired. Thank you, Mr. Chairman. 

Chairman CAMP. Thank you. Mr. McDermott is recognized. 

Mr. MCDERMOTT. Thank you, Mr. Chairman. I always try to 

figure out what these hearings are about. I don’t know whether the 

purpose was to panic the charitable community into rushing to 

Washington to talk about what their deductions are all about. If 

that is the point, I guess we have done it. 

But what is troublesome to me is that I don’t think that is what 

it is about, really. The gentleman from Ohio was asserting that the 

President was the only person who was looking to limit the cost of 

tax expenditures, including charitable deductions. Now, it was the 

Chairman who proposed last year a lower—to lower the top individual rate to 25 percent in the revenue-neutral bases. So you have 

to have some revenue from someplace. That would require them to 

raise revenue from someplace by limiting certain tax expenditures. 

Now, during the election, Governor Romney had exactly the same 

proposal. The people rejected that at the polls. But he was proposing limiting the itemized deductions to $25,000, a proposal that 

most people think would have absolutely decimated charitable giving in this country, if that had been proposed by the President 

when he got into office. 

Now, I am really confused because if you think about this, the 

Majority wants to bring the individual rate down to 25 percent by 

finding revenues someplace. And I look around at where the places 

are you would look for revenue. There is broad agreement among 

the Members and the witnesses that we need to expand incentives 

to give, right? So where do you look for those revenues? 

I guess you could go to the deduction for health expenditures, or 

you could go to home mortgage interest. Or I deduct State sales tax 

that I pay in the State of Washington for my income tax. They 

could take that away from me. I don’t know where this revenue is 

going to come from to lower the rate on a neutral basis. 

Now, we could go after oil companies. That would be—but I don’t 

think that—the first hearing was not having oil companies in here 

to talk about their deductions. Or the first hearing in here was not 

about carried interest from hedge funds. But what we do is we 

scare you folks into running in here and signing up in droves to 

say, ‘‘Hey, do you realize what you are going to do to this country 

if you start limiting the deductions?’’ 

I heard from the president of Seattle University. And he said to 

me, ‘‘Jim, our charitable deductions will drop, we figure, by at least 

40 percent if you start fooling around with the limits that are in 

the law today.’’ And I can’t understand—and maybe the Chairman 

has already told you—but are we talking about lowering their—the 


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deduction for this? Or are we talking about getting rid of it all together? Or what are we doing here? 

Chairman CAMP. Is this rhetorically, or would you like me to 

comment? 

[Laughter.] 

Mr. MCDERMOTT. No, I would like—my question is to you, Mr. 

Chairman. 

Chairman CAMP. Well, on your time—— 

Mr. MCDERMOTT. Yes, sir. 

Chairman CAMP [continuing]. I will say that there have been a 

lot of public debates about these issues, whether it is the SimpsonBowles Commission, whether it is the President’s proposals, or 

whether it is candidates for the President’s proposals. And what we 

are trying to do is hear from the charitable giving community in 

a professional and open and businesslike way. And that is why we 

have developed the working groups. And I know that Mr. Lewis 

and Mr. Reichert will do a very fine job of exploring those issues. 

You know, a lot of this—some of the testimony today is about the 

complexity of this. And there might be ways to simplify some of 

these rules. So we are really approaching this with an open mind. 

And actually, I gave a longer answer than I wanted to, so why 

don’t I give you some time to continue. 

Mr. MCDERMOTT. Yes, I was just talking to Mr. Lewis. I said, 

‘‘You got to be the Vice Chair of the charitable giving working 

group. Congratulations.’’ 

These folks are going to be 100 percent against doing what is 

perceived as what might happen in tax reform in this country. And 

I can’t understand. Is it we are sort of softening them up for the 

fact that they are going to get clipped? 

Chairman CAMP. No. 

Mr. MCDERMOTT. Or are we saying today, ‘‘Gee, we heard from 

you and we understand that this is a bad idea?’’ 

Now, I can’t judge yet quite what this hearing is about. But I appreciate you all coming. And I am—Dr. Boustany asked a question 

that worries me. When you start saying we are only going to give 

to Americans, that is like buying American. A lot of us give a lot 

of money to organizations that are based outside this country that 

are doing things in global health all over the world. And for anybody to start putting those kind of prescriptions into law really 

don’t make sense to me. 

I yield back the balance of my time. 

Chairman CAMP. All right. Mr. Gerlach is recognized. 

Mr. GERLACH. Thank you, Mr. Chairman. Given the testimony 

we have had from this panel, which we all appreciate, and given 

the schedule we have today, I will yield back my time and thank 

you very much. 

Chairman CAMP. All right. Thank you. Mr. Becerra is recognized. 

Mr. BECERRA. Mr. Chairman, thank you very much for this 

hearing. And to all of you, thank you for not just your testimony, 

but your patience. There have been lots of questions, and you have 

done a tremendous job of trying to respond. 

Mr. Steuerle, let me ask you a few questions first, because I 

thought you did a great job in your—not just your oral, but your 


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written testimony, which was much more extensive, in trying to 

sort of navigate this whole question. And you start off—let me start 

off with what you said in your conclusion. ‘‘The charitable deduction and the rules governing tax exemption are in need of critical 

examination. The focus of any such examination should be on 

whether existing rules are maximizing the public benefit at the 

lowest cost to taxpayers.’’ 

I agree 100 percent with what you have just said, because I 

think most of us can personally—whether by example or observation—talk about some of the tremendous things that have been 

done by so many of the nonprofits that are out there today. In Los 

Angeles—and Ms. Masaoka could testify to this—there are some 

tremendous things being done on the educational side, on the 

homeless side—Los Angeles has perhaps the largest homeless population in the country because of its weather, lots of folks gravitate 

to it. 

But I wanted to get to a couple of points—still in your testimony. 

Now I am looking at page seven of your testimony, where you talk 

about: ‘‘The charitable deduction supports not charity as it is commonly understood, but rather the entire section 501(c)(3) sector, of 

which basic needs or traditional charitable organizations are just 

one of many supported types.’’ 

So, in other words, when we think charitable deduction, most 

Americans think, ‘‘Ah, we are giving to charity.’’ When we think 

charity, we think serving the basic needs of those who need it 

most. Yet, as you point out, so much of what is given through this 

taxable—or deductible contribution, doesn’t go to those—to serve 

those who have the most basic of needs. 

You also make a very important point in a footnote, footnote 17, 

that I want to read for the record, because it is so important, and 

it is based off of what I just—the quote I just mentioned from page 

seven. Your footnote 17 says, ‘‘Further, as a general matter, many 

basic needs of traditional charitable organizations would be more 

adversely impacted by cuts to direct government spending than by 

changes to the charitable deduction.’’ 

So, if the goal is to protect basic needs organizations from harm, 

the charitable deduction is but one small piece of a broader policy 

issue. So if you are truly trying to make sure you protect the basic 

needs or help those who have basic needs, we should really be looking at what the government is doing with its direct allocation of 

dollars and investments to services that go to those who we are trying to make sure don’t fall through the cracks, which is sometimes 

something I think too many Members of Congress neglect in this 

effort to just cut, cut, cut. And we leave those behind who need it 

the most, most, most. 

You go on to point out something on page six. You have a chart 

of what the wealthiest taxpayers who take the charitable deduction 

do and where they give. And the only thing I can extract from what 

you and others have said is that those who give the most don’t direct their giving to those who need the most. Let me repeat that: 

‘‘Those who give the most don’t direct their giving to those who 

need the most.’’ 

And so, I agree with your conclusion that we must examine the 

charitable deduction. Because when it is defended as giving to 


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charity, and most people conjure up this image of charity, most 

people don’t recognize that too much of what is being given is not 

being given to what we would traditionally define as charity. And 

I want this sector to do very well. 

I wish you all would do more enforcement of your own kind, because we have too many examples—and, unfortunately, too many 

examples in the area of our veterans, where organizations pop up 

by the minute saying they are going to protect our veterans, and 

we find out that they did nothing of the sort, except enrich themselves. 

I believe it is time for us, given this whole discussion of looking 

at how we invest, through taxpayer dollars, try to look at how we 

could make this charitable deduction work best for those of you 

who do some great things. United Way does some great things in 

Los Angeles. And I hope that we continue to support the nonprofit 

world, the charitable sector. But I do believe we have to examine 

some of these things. 

And I join in agreeing with some of my colleagues and some of 

the comments that have been made on both sides of the aisle on 

how this important sector does deserve a critical examination. I 

have lots more questions, if I could get to them, but I just wanted 

to point out that, Mr. Steuerle, I thought your testimony hit it 

right on the mark. 

Chairman CAMP. All right. 

Mr. BECERRA. I yield back. 

Chairman CAMP. Thank you. Mr. Smith is recognized. 

Mr. SMITH. Thank you, Mr. Chairman. And thank you to our 

witnesses for sharing your perspective here today. And I hope you 

can appreciate the balance that we are trying to approach this 

issue with. 

Mr. Gallagher, you illustrated in your testimony that perhaps a 

change, as suggested by various entities or parties, would perhaps 

lead to the elimination of the United Ways in Philadelphia, Washington, D.C., and Cleveland. Or—and I think you emboldened the 

print that says—‘‘or all of the work of 10 or 20 United Ways’’ if 

changes would occur. 

Now, for the record, that would be an option for you to take, not 

necessarily a mandate for you to take that approach, should 

changes occur. 

Mr. GALLAGHER. Correct. That is illustrative. 

Mr. SMITH. Right. Okay, thank you. Mr. Murphy, you used the 

comment, or the words, that ‘‘we should do nothing that would 

threaten charitable giving.’’ Is that accurate? 

Mr. MURPHY. Yes. 

Mr. SMITH. Let’s discuss the estate tax, for example. And now, 

some would argue that the existence of the estate tax actually 

drives up charitable giving. Would that be your assessment? 

Mr. MURPHY. Based on the work that I have done with individual donors, yes. 

Mr. SMITH. And does the latest estate tax reform—do you feel 

that would threaten your work? 

Mr. MURPHY. I think donors are still uncertain about what the 

final outcome will be. One of the difficulties with the estate tax is 

donors are fairly comfortable planning their income tax for the next 


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12 months; most of them not sure when they want to plan to die. 

And so there is uncertainty out there, yes. 

Mr. SMITH. But perhaps a balance of estate tax reform, you 

know, and other approaches, you know—we can achieve a balance, 

I guess, if we have a thoughtful dialogue and debate on the issue 

itself, rather than statements of ‘‘Do nothing that might threaten.’’ 

Mr. MURPHY. Well, you know, Mr. Smith, I think, fundamentally, our position is that we ought not tax people on the money 

they give to charitable purposes. And that is a fairly fundamental 

principle, that we are asking people in this country to voluntarily 

donate their dollars. And we simply shouldn’t tax them on it. 

Mr. SMITH. Okay, and I can understand that. I can appreciate 

that. But I would hope that donors are motivated out of charity 

more so than tax avoidance. Would you share that? 

Mr. MURPHY. My experience has been—and I have worked with 

thousands of donors—I have never had a donor make a gift because 

there was a charitable deduction. What—as I said in my testimony, 

what it has allowed them to do is to make a larger gift, to dream 

larger about the impact they can have on the community. But the 

motivation, as Mr. Gallagher pointed out, is very clear. It is to help 

their neighbors, to make their community a better place. 

Mr. SMITH. I fully understand. And as Mr. Becerra just shared, 

though, there are some examples out there and—I think you even 

acknowledged—there are some bad actors. And we need to approach the issue with the objective of some reforms to make sure 

that dollars end up where they need to be, rather than someone 

perhaps gaming the system, not necessarily with the rate here, but 

through some changes that I would hope you wouldn’t consider, you 

know, a threat to the beneficiaries of your organization. 

Mr. MURPHY. Well, I don’t know what specific changes you are 

proposing. But again, the Council on Foundations has a long history of supporting stronger enforcement by the IRS. Most of the 

abuses that are cited aren’t legal in the first place; they are illegal. 

And there has been an enforcement problem. 

Mr. SMITH. So you would not perceive those to be a threat 

to—— 

Mr. MURPHY. We would not perceive—I don’t think anybody 

here would perceive better enforcement of the law, the weeding out 

of bad actors, to be a threat. Quite to the contrary, as someone— 

I think Mr. Tempel—noted, we exist in the world of trust. And to 

the extent there are bad actors, we have to overcome the mistrust 

that creates. 

Mr. SMITH. Very well, very well. Thank you, Mr. Chairman. I 

yield back. 

Chairman CAMP. Well, thank you very much. Mr. Rangel is recognized. 

Mr. RANGEL. Thank you, Mr. Chairman. And thank you so 

much for having these hearings. They are very informative. And I 

am going to ask the panel to help me to frame the questions, because I want to find out what each one of you think, generally, is 

the amount of monies that is given to not-for-profit organizations— 

how much of that actually goes to assist people that have problems 

that concern poverty or their well-being or—there must be a word 

in the foundation business that you use to demonstrate that we are 


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not talking about the perpetuation of the arts or tennis or all of 

those good things that are important to the country, but those 

things that are directly related to issues such as education and 

health care and poverty. 

What percentage, generally speaking—and it is a guesstimate I 

am looking for—would you say goes to that, so that when we talk 

about tax-exempt organizations, we don’t automatically believe that 

we are talking about helping the poor? Mr. Steuerle. 

Mr. STEUERLE. Mr. Rangel, I don’t have the numbers with me. 

In—— 

Mr. RANGEL. You don’t need any numbers for what I want. 

Mr. STEUERLE. In various reports we do examine the percent 

of giving that goes to various types of organizations. 

Mr. RANGEL. I gathered that, that is why I—— 

Mr. STEUERLE. And you are quite correct. Only a minority of 

contributions goes to those organizations that directly serve the 

poor. So—— 

Mr. RANGEL. What is that? A minority? 

Mr. STEUERLE. Only a small minority of contributions go—— 

Mr. RANGEL. Oh, okay. 

Mr. STEUERLE [continuing]. That directly serve the poor. 

Mr. RANGEL. Let me withdraw the question and say now, would 

each of you describe in percentage form what a minority would be, 

so I can get a better handle on that? Mr. Murphy. 

Mr. MURPHY. Mr. Rangel, I think it is a slippery slope to try 

to—— 

Mr. RANGEL. I know it is a terrible slope to get onto, but—— 

Mr. MURPHY. There is—I mean we have a huge definitional 

problem here. 

Mr. RANGEL. Talking about the poor is never very comfortable. 

I know that. 

Mr. MURPHY. I mean, we fund—— 

Mr. RANGEL. But I just don’t want the poor to—you don’t want 

to deal with the question. 

Mr. MURPHY. Well, Mr. Rangel, you mentioned specifically tennis. Our community foundation funds a tennis program in our community that provides tennis lessons—— 

Mr. RANGEL. Here we go. I am not talking about tennis. I know 

how important that is for the poor. But that is exactly what I want 

to separate from food and homelessness and job training. I want to 

separate the two. 

Suppose I say only 10 percent of charitable dollars actually go to 

improve the quality of life of human beings. Suppose I just said 

that. And I am making it up, but there is no challenge to that. 

Having said that, you are not bound by—— 

Mr. MURPHY. Well, I would challenge that. 

Mr. RANGEL. I know, tennis. Excluding—— 

Mr. MURPHY. I would challenge that assertion, Mr. Rangel. 

Mr. RANGEL [continuing]. Taking people to learn how to play 

tennis and going to the opera and those things that are vital to 

make a whole person. But I am talking about where poverty 

doesn’t give a person an option. 

Now, having said that, what do you think we could do to make 

the contributions to this type of work? What types of incentives 


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could we do for this, as opposed to other worthwhile foundation and 

charitable work? Is there anything that you can do so that if I decide that I want to get my deductions from a tax provision, that 

I can target it to the 10 percent, rather than the 90 percent? 

Mr. TEMPEL. Mr. Rangel. 

Mr. RANGEL. Yes. 

Mr. TEMPEL. I would like to add a perspective to this. We actually did some research on this last year. 

Mr. RANGEL. Good. 

Mr. TEMPEL. About 8 percent of the money goes to direct-need 

organizations. And you know, you can turn into a philosopher here, 

if you are not careful. But philanthropy is really about reducing 

human suffering on one side, and enhancing human potential on 

the other side. I am a—— 

Mr. RANGEL. What is the other side? 

Mr. TEMPEL. Enhancing human potential. I am the—my father 

and mother did not go to college. I am a first-generation—they did 

not go to high school. And so, I am the beneficiary of a scholarship, 

a need-based scholarship. 

About 23 percent of money that goes through all other organizations ends up benefitting need-based scholarships, job opportunities, job training, and other kinds—food banks and other kinds 

of—— 

Mr. RANGEL. Is that within your 8 percent? 

Mr. TEMPEL. What is that? 

Mr. RANGEL. Is that within the—— 

Mr. TEMPEL. Twenty-three percent of the money that goes to all 

organizations goes back to these needs, yes. 

Mr. RANGEL. And you have some data that you have accumulated? 

Mr. TEMPEL. Yes, mm-hmm. Yes, we have a big study. 

Mr. RANGEL. Well, then I would broaden my question and ask, 

since so many people associate poverty and helping a person improve the quality of life, is there anything that you would think 

that we could target what we are talking about when we say charity? 

Chairman CAMP. And, obviously, time has expired. But if you 

could get us some of that data. And I think—I believe Mr. Rangel 

is asking about more basic needs. 

Mr. TEMPEL. Yes. 

Chairman CAMP. Not necessarily college education. I think you 

were thinking about basic needs. 

Mr. RANGEL. Exactly. 

Chairman CAMP. And I am not sure that is the correct term, 

but—— 

Mr. RANGEL. But he mentioned they hadn’t finished high 

school. And I would think that in today’s economy, that you have 

to include that. 

Now, how can you and I—before you leave, maybe you can direct 

me in the right direction? 

Mr. TEMPEL. We can send you things. Yes. 

Mr. RANGEL. I would like to see you before we leave, though. 

Chairman CAMP. That would be helpful. 

Mr. RANGEL. Thank you. 


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[Laughter.] 

Thank you, Mr. Chairman. 

Chairman CAMP. Mr. Young is recognized for 5 minutes. 

Mr. YOUNG. Thank you, Mr. Chairman. Dr. Tempel, earlier in 

your testimony you, I think very helpfully and pointedly, indicated 

that there is a direct correlation, very tight relationship, between 

the state of the economy and the incidence and amount of charitable giving. You specifically identified sort of two metrics to look 

at, which is household income and the S&P rate, and at any given 

moment to determine what sort of charitable giving one might expect in the economy. 

So, it is important, from my perspective, that we implement tax 

policy as we are embarking on comprehensive tax reform here, that 

will grow household incomes, in particular. 

I found it notable in your statement, Doctor, that higher-income 

households provide a disproportionate share of giving. And you said 

you did a study in 2012 that examined giving by higher-income 

households. What else can you tell us about giving by these households, based on your study, sir? 

Mr. TEMPEL. Congressman Young, I—this is why the task you 

have ahead of you is so complicated, because there are so many different factors that work in different ways on charitable giving. 

But, you know, high-income households, those incomes with—in- comes of $200,000 or more, $1 million in net worth, excluding their 

homes, do give a disproportionate share of philanthropy. And as 

you look at that and study that, they give about 9 percent, actually, 

about 9 percent of their household income, as compared to 2 percent, generally. About 95 percent of them give. And, as I said earlier, interestingly, 80 percent of them give to higher education. You 

would expect that. But 79 percent of them give to basic needs organizations, you know, as illustrated by Mr. Gallagher’s point, that 

he has $1 million and $10,000 donors. So, those are the donors that 

will be impacted by any kind of price sensitivity. So I think that 

is worth looking at. 

The other thing is we asked them for the first time 3 years ago— 

we do this study every 2 years—we asked them 3 years ago if they 

would be—if they would increase, keep the same, or decrease their 

giving if the tax deduction were eliminated. And we used the 

phrase ‘‘eliminated.’’ And interesting, about half of them said they 

would keep their giving the same. But about half of them said they 

would decrease their giving. And that percentage got worse as the 

economy got worse, and as we got closer to these discussions. So 

we know that, even—you know, that they are sensitive to those 

things. 

Mr. YOUNG. Thank you. What impact did the recession have on 

charitable giving? And how, generally, can you tell me, are charities doing right now? 

Mr. TEMPEL. Well, in the aggregate, charitable giving went 

down by 15 percent over a 2-year period of 2009 and 2010. And 

there has been some recovery, but the last 2 years have recovered 

at an average rate of 1.8 percent. 

And so, you know, going back to the earlier question I had, if you 

think about the slow growth of philanthropy now, and you did 

something—you know, the economy will help philanthropy grow, 


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there is no question about it. But if you do anything to dampen 

philanthropy now, it will simply prolong the length of time it 

needs—it takes to come out. 

The other thing is that not all charities and not all philanthropic 

organizations are hit the same by this downturn. There was, in 

fact, in 2009, an increase in giving in basic needs or human service 

organizations. But after that, after 2009, that kind of evaporated. 

So people turned attention back away from that. So you can see 

these kinds of things inside the economy. 

Mr. YOUNG. Which leads me to my final question. You and 

other panelists have indicated concern—understandably, I think— 

about the financial consequences of changing tax policy with respect to charitable giving. Doctor, are there other perhaps intangible or unforseen consequences that you can conceive of, and that 

this panel should consider, as we look to reform the overall Tax 

Code? 

Mr. TEMPEL. Yes. Just for the record, I did not come to argue 

in any direction, but just to point out how complex this issue is you 

are dealing with, from the data we have. 

I would echo some other comments here that, you know, one of 

the intangibles here is that this is the way people get involved. 

They get engaged in their communities this way. They give this 

way, they volunteer this way, you know, and those things are all 

beneficial. But we have some emerging research that shows that 

when people give and volunteer, they have better health outcomes. 

And those could have huge public policy implications, if we don’t 

encourage this kind of activity. 

Mr. GALLAGHER. And I would, if I could, add that—so we are 

a very large nonprofit that focuses only on human services, and 

mostly basic need. And we operate within an ecosystem of all nonprofits. 

I think the Committee, with all respect, should focus on the 

health of the nonprofit sector. Compliance, bad apples have to be 

managed, and regulation and enforcement have to be managed. 

But we need a stronger nonprofit sector. And we need to then balance what is the role of government versus the role of nonprofit. 

We are dwarfed in dollars by what local, State, and Federal Government put into human services, and that has to be balanced, in 

terms of your deliberation, I think. 

Chairman CAMP. All right. Thank you. Mr. Neal is recognized. 

Mr. NEAL. Thank you, Mr. Chairman. My question is going to 

be directed to any of the panelists. And by way of the question, you 

are going to understand my sympathies for the argument you have 

made. 

I represent a spectacular district, the Berkshires. So just a few 

names that you might quickly associate with the Berkshires: The 

Rockwell Museum, Barrington Stage, Shakespeare and Company. I 

have some of the best colleges and universities in the world. I sit 

on the board at Mount Holyoke. And the eastern part of the district, Sturbridge Village in between the Seuss Museum, Carnegie 

Libraries. 

And I think the question could be summed up—along with 

Tanglewood, where so many of you have visited at one time or 

another—I think the question that I have could best be summed 


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up by what the multiplier effect is of charitable giving, what it 

means to the creative economy, the people that it draws. And I 

would be happy to be instructed by any one of you, assuming that 

what you are about to say is entirely consistent with what I think. 

[Laughter.] 

Mr. STEUERLE. I still have a piece of data I would add. Although we talk about charitable contributions here in terms of dollars, the volunteer labor is a much larger portion of the economy 

than is the amount of dollar contributions. So we might talk about 

charitable contributions being about 2 percent of income. But I believe, in terms of labor supply, if we add volunteer labor we come 

to a number about 7 percent. Is that about right, Jean? I think it 

is. 

So, we—and, of course, the impact is beyond just what the volunteers are doing, but the people they are affecting. So it permeates 

throughout society. 

Mr. GALLAGHER. And two quick points. I mean there—over 10 

percent of the American workforce works for nonprofits. It is 12 to 

13 million people or more. 

The other—maybe the most compelling economic statement I 

have ever heard—piece of research I heard was by a man named 

Art Rolnick, who at the time was the Chief Economist for the Federal Reserve in Minneapolis, and he was speaking to a group of 

business leaders in the Twin Cities when they were debating on 

whether to build the Vikings a new football stadium, the Twins a 

new baseball stadium. He said, ‘‘If you take the $1 billion and put 

it into an endowment for making sure that every child born in Minnesota gets a quality early childhood education, the economic rate 

of return would outpace what you are going to put into those two 

stadiums.’’ His point was that there is an economic engine that is 

human development that goes neighborhood to neighborhood. And 

the Fed has modeled it. 

Mr. NEAL. And the number of students since then who come to 

Jacob’s Pillow and give freely of their time and volunteer and participate in stage is proof of its success. 

And I always have some fun with my Republican friends by 

pointing out that one thing that is inarguable is the best hospitals 

perhaps in the world are right in Massachusetts. And so, when 

anybody gets sick I have never heard them make the argument, ‘‘I 

don’t want to be in Massachusetts.’’ And those hospitals derive an 

enormous amount from charitable giving. 

And I think that is a very important consideration here, as well: 

Universities, arts, and hospitals. And the reputation that the State 

has, which is still a very low unemployment rate, relatively speaking, it is a very high-income State, and it is consistent with that 

creative economy argument that I made a few moments ago. People 

from all over the world come to Massachusetts to participate not 

only in what I have outlined, but, just as importantly, the sheer 

beauty of the State. And it has been a net winner for us. And I 

think protecting the charitable contribution is a very important 

part of this tax reform discussion because it induces behavior, it 

incents behavior, and that is a theme that is neither Republican 

nor Democratic. 


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So, if there is anybody else that would like to offer in the last 

2 or 3 seconds I have, Mr. Chairman, I—— 

Mr. MURPHY. Well, Mr. Neal, I think you point out the incredible diversity of the nonprofit sector, which is one of this country’s 

great assets, and why I am so hesitant to start parsing out what 

is a basic need and what is not. And I go back to my testimony. 

My wife was cured of cancer with treatments that were developed 

by medical researchers at universities, in part, in your State. And 

contributions to that medical research aren’t considered, generally, 

by folks to be a basic need. But they sure become a basic need 

when someone you love has cancer. 

Mr. NEAL. My colleague, John Lewis, was treated in some of the 

most difficult moments of his life, he was treated by the only group 

that would treat him at the time in the aftermath of Selma, and 

that was a group of Catholic nuns. He has never forgotten. As he 

reminds me, the order of Edmonites that also cared for him and 

the critical surgery that he took in his life was in Boston. Thank 

you all very much. 

Chairman CAMP. Thank you. Mr. Kelly is recognized. 

Mr. KELLY. Mr. Chairman, I am going to yield back my time to 

the Chair. 

Chairman CAMP. All right. Mr. Larson is recognized. 

Mr. LARSON. [No response.] 

Chairman CAMP. You are yielding to Mr. Blumenauer? All right, 

Mr. Blumenauer. All right. 

Mr. Griffin is recognized. Oh. Go ahead, Mr. Griffin. 

Mr. GRIFFIN. Thank you, Mr. Chairman. Thank you for having 

such a thoughtful and serious discussion. I want to add my voice 

to the others who have said that they want to encourage giving, 

they believe in the nonprofits and the work that they do. I would 

point out that Arkansas has historically been at the top. We are 

not a wealthy State, but we give a lot. And we are—I think we 

were ranked number one, per capita, in giving at one point. 

And so, nonprofits are a big part of the community where I live 

in Little Rock. And I have learned a lot about nonprofits, as I have 

been serving up here. And one of the things that I want to drill 

down on is the role of the Federal Government with nonprofits. It 

seems to me if we could encourage more giving, then—someone was 

asking where do we get the revenue—well, maybe the Federal Government could quit giving nonprofits so much money, and we could 

replace that with private donations, where people are making individual choices. 

And I want to lay some of this out, and then get your comment. 

I have learned, since being in Congress—I have toured a lot of nonprofits. I have toured food banks and a rice depot, and other things. 

And I—usually, the first question I ask is, ‘‘Where do you get your 

revenue? How much of your revenue is from contributions?’’ And 

some of them say, ‘‘We are proud that we get no government 

money,’’ and others say, ‘‘We get 80 percent government money,’’ 

which just shocked me, when I learned that a lot of these nonprofits are Federal agencies, in fact, and they get their money 

through—as a pass-through, you know. 

And when I started tracing the dollar that we, as taxpayers, give, 

and how much is left when it gets back to Arkansas and is distribVerDate Sep 11 2014 13:43 Feb 07, 2017 Jkt 021128 PO 00000 Frm 00101 Fmt 6633 Sfmt 6602 I:\WAYS\WAYSPS\21128\21128.XXX 21128

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uted by a State agency after it has been through seven steps to get 

there, a dollar gets back at, like, a quarter or $.10 or whatever. 

And it seems to me, if we want to find waste and better use of our 

dollars, we should encourage someone who lives down the street 

from the rice depot to just give them a check, instead of having taxpayers send all the money to Washington, where it is then sent 

over to an agency, they then divvy it up, send it back to the State, 

the State gives it to the county, and then they distribute it to a 

local community group that does good things, but it is a very inefficient way of doing good things. 

And one of the things that has bothered me is—and I have 

talked with some charities about this—they will start out—they 

will tell me, ‘‘We started out with no government money. Then it 

went to 5 percent, then it went to 10 percent. And then one time 

we got a big grant, and it was 75 percent. So we quit fundraising.’’ 

They have become dependent nonprofits, and they—the tools in 

their philanthropy toolbox rust, because they don’t have to court 

big donors, and they love that. And they don’t have to have annual 

dinners, and they love that. They just get that big check from the 

Federal Government. I know those are a minority, but this is the— 

what we have created. And so I would like to get your comment 

on that. 

And I just want to let you know that I want to encourage private 

individuals to make decisions of where they want to put their 

money. We have to remember that simplification is critical. There 

are a lot of great ideas that get complicated. 

So, if any—Mr. Gallagher. 

Mr. GALLAGHER. Congressman, just a point of fact, United 

Way is the second-largest funder of human services behind government. So we are the largest private supporter of human service 

programming. There are nonprofits that are overly dependent on 

government funding; there is no question about it. The private sector will never be able to replace government funding, in total. It 

is just—we are dwarfed by it. 

Having said that, where you see the partnership working is what 

is great about local private money in that it is local and it is flexible and it moves quickly. Where you see public investment working 

is when there is flexibility built in. So we will not be able to replace 

public money and Federal support and State support. But if you 

look at—if you look in Detroit right now, there has been a rehauling of the entire food distribution system. Local government, 

State government, with Federal money, created incentive and flexibility in the food bank system, and local nonprofits redesigned it 

together. 

Mr. GRIFFIN. Just real quickly, I want to say—— 

Chairman CAMP. Please, because we are out of time. Just very 

quickly. 

Mr. GRIFFIN. Thank you. 

Chairman CAMP. Thank you. I want to thank this panel very 

much for their testimony. I very much appreciate the amount of 

time and the quality of the remarks. I thank you very much. 

Mr. LEWIS. Thank you, Mr. Chairman. 

Chairman CAMP. All right. I would like to welcome our second 

panel. Thank you for being here, and welcome. 


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First, we will hear from Mr. Mark Huddleston, President of the 

University of New Hampshire, and testifying on behalf of the 

American Council on Education, the Association of American Universities, and the Association of Public and Land-Grant Universities. 

Second, we will hear from Conrad Teitell, who is Chairman of 

the Charitable Planning Group at Cummings & Lockwood, LLC, 

and is testifying on behalf of the American Council on Gift Annuities. 

Third, we will hear from Jake Schrum, who is President of 

Southwestern University in Georgetown, Texas, and is testifying on 

behalf of the Council for Advancement and Support of Education. 

Since joining Southwestern University, Mr. Schrum has led the 

largest fundraising campaign in the university’s history. 

Fourth, we will hear from Diana Aviv, who is President and CEO 

of Independent Sector, a national network of American nonprofit 

organizations. In that capacity, Ms. Aviv represents tens of thousands of organizations across the country. 

Fifth, we will hear from Vinsen Faris, who is Executive Director 

of Meals-on-Wheels of Johnson and Ellis Counties, and Chairman 

of the Board of Directors of the Meals On Wheels Association of 

America. Mr. Faris has consulted for the Center for Nonprofit Management, and has testified before Congress and the Texas legislature on several occasions. 

Sixth, we will hear from Mr. Bill Rieth, President and CEO of 

the United Way of Elkhart County. Mr. Rieth has over 25 years of 

experience in education and philanthropy. 

And, finally, we will hear from Jill Michal, President and CEO 

of the United Way of Greater Philadelphia and Southern New Jersey, who also serves as a Board Member of the Greater Philadelphia Chamber of Commerce and the Philadelphia Council for College and Career Success. 

Again, thank you all for being with us today. The Committee has 

received each of your written statements, and they will be made 

part of the formal hearing record. Each of you will be recognized 

for 5 minutes for your oral remarks. 

And Mr. Huddleston, we will begin with you, and you are recognized for 5 minutes. Thank you. 

STATEMENT OF MARK W. HUDDLESTON, PRESIDENT, UNIVERSITY OF NEW HAMPSHIRE, DURHAM, NH, ON BEHALF OF 

THE AMERICAN COUNCIL ON EDUCATION, THE ASSOCIATION OF AMERICAN UNIVERSITIES, AND THE ASSOCIATION 

OF PUBLIC AND LAND-GRANT UNIVERSITIES 

Mr. HUDDLESTON. Good morning—I think it is still morning— 

Chairman Camp, Ranking Member Levin, and Members of the 

Committee. My name is Mark Huddleston, and I am the President 

of the University of New Hampshire. In addition to representing 

UNH, I am here on behalf of organizations representing 4,300 2- 

and 4-year public and private colleges and universities. I appreciate the opportunity to share with you a broad perspective on the 

importance of the itemized deduction for charitable giving based on 

my current post at UNH and from my prior service as President 

of Ohio Wesleyan University. 


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As the Committee addresses long-term deficit reduction, a hugely 

important task, we urge you to proceed with caution in considering 

changes to the charitable deduction. At its core, our case is simple. 

Since it was enacted in 1917, the charitable deduction has encouraged and delivered vital private support for higher education, support that otherwise would have required even higher levels of direct public expenditure. 

In fact, for every dollar a typical donor receives in tax relief, the public gains approximately $3 of benefit. And, according to the 

Council for Aid to Education, colleges and universities received 

$30.3 billion in gifts in 2011. 

Charitable gifts advance scholarship, propel ground-breaking research, and promote technological innovations that drive the Nation’s economy. Most important, charitable gifts make higher education more accessible and affordable for our students. I imagine 

that almost everyone here has benefited from donors who gave generously to our alma maters. I certainly did. And, by the way, if 

there are any UNH alums in the audience, I would like to talk to 

you after the hearing. That was a joke. 

But certainly we could not achieve all that we do at UNH without private gifts. More than two-thirds of the donors who have created endowments at UNH have done so to support financial aid 

and scholarships. An additional 10 percent supports grants for research and teaching initiatives. And fortunately, some of our donors also direct their gifts toward better facilities for instruction 

and research. And these gifts are especially important, given the 

challenges associated with State bonding and deferred maintenance. 

Yet even as our private donors deliver enormous benefits, colleges and universities continue to face dire financial challenges. 

For our public institutions, which enroll 80 percent of all college 

students, the largest factor driving up tuition is declining State 

support. Unfortunately, the recession saw State support for higher 

education—for public higher education—drop to a 20-year low. And 

our students and their families are left to bear resulting tuition increases. 

At UNH we are proud of several distinctions, including our role 

as one of the Nation’s few land, sea, and space grant institutions. 

And we provide tremendous value and opportunity to our students, 

roughly 30 percent of whom are either Pell-eligible or first in their 

families to attend college. 

However, another distinction sets us apart. New Hampshire is 

last in the Nation in per capita support for higher education. 

Today, the State of New Hampshire provides less than 6 percent 

of our operating budget, the result of a 2011 vote to cut our appropriation by 49 percent—that is 49 percent in 1 year. That was the 

deepest cut, by the way, in the history of higher education in America. The State’s subsidy to each student has fallen by $5,000 in real 

terms over the past decade, and is now less than $600 per student 

per year. 

So, how do we make up the shortfall? We already operate efficiently and our cost per credit hour is 30 percent lower than our 

competitors. And we absorbed nearly 80 percent of the State 

budget cut through layoffs, a hiring freeze, and further cost-cutting. 


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Well, we have bridged that gap in no small part because generous 

alumni and friends are stepping up to help. Truly, we could not 

achieve what we do without them. And we certainly do not want 

to erect barriers to successful individuals to help new generations 

of students. 

Private colleges and universities face somewhat different circumstances. They have always relied upon charitable gifts, and 

many owe their very existence to generous donors. At these institutions, charitable donations that provide grants, scholarships, and 

fellowships for students have been increasing in recent years, and 

they are increasingly important. At Ohio Wesleyan, for instance, in 

a total annual budget of slightly more than $100 million this year, 

$39 million comes from private sources, which is devoted to student 

financial aid. 

During the height of the recession, private and public institutions had a common experience, as well. Our endowment values 

dropped across the board. Given the slow economy, many still have 

not fully recovered. In the last fiscal year, for instance, the average 

rate of endowment return was ¥.3 percent. And over the past 5 

years, it has been only 1.1 percent. 

Of course, this all comes at a time when the recession and the 

dynamics of the global economy reinforce the value of a college education. Recent projections show that by 2018, our country will need 

22 million new workers with college degrees. But on our current 

trajectory, we will not make that goal. In fact, we will miss it by 

3 million workers. And while Pell Grants and Federal financial aid 

help many students, we realize that limited Federal resources are 

also under intense pressure. 

Mr. KELLY [presiding]. Okay. 

Mr. HUDDLESTON. So what is the solution? A large part is to 

support continued private support for higher education. 

Thank you, Mr. Chairman, and I look forward to answering your 

questions. 

[The prepared statement of Mr. Huddleston follows:] 


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Mr. KELLY. And thank you, Mr. Huddleston. I am sorry the 

light system is not working right now, we are having a little bit 

of trouble with the clock. So, since we don’t have any officials on 

the field watching the game clock, we will let you know. I will let 

you know when there is about a minute left. I will just tap very 

lightly, so you know that you still have about a minute left. 

Mr. Teitell, if you would, please. 

STATEMENT OF CONRAD TEITELL, CHAIRMAN, CHARITABLE 

PLANNING GROUP, STANFORD, CT, ON BEHALF OF THE 

AMERICAN COUNCIL ON GIFT ANNUITIES 

Mr. TEITELL. Mr. Chairman Camp, Mr. Ranking Member 

Levin, Members of the Committee, I am Conrad Teitell with the 

Cummings & Lockwood law firm, and here today as volunteer legal 

counsel for the American Council on Gift Annuities, a publiclysupported charity sponsored by over 1,000 charities of all stripes, 

large and small, religious organizations, social welfare organizations, the Salvation Army. 

In your deliberations, Members of the Committee, I ask you to 

be aware—beware of salami tactics. Matyas Rakosi, Chairman of 

the Hungarian Communist Party in the 1950s coined the term ‘‘salami tactics.’’ He said, ‘‘If your opponent has a salami and you want 

it for your very own, you had better not grab it, because he will 

defend it. Rather, take for yourself a slice, and then another slice, 

and he will not notice. And if he does, he will not object. And then 

another slice, and then another slice. And slowly, but surely, that 

salami will pass from his possession into yours.’’ So it could be with 

the charitable tax incentives, a floor here, a cap there. 

Mr. Levin, you spoke about the Pease limitation. The Pease limitation introduced by Congressman Pease of Ohio in the 1990s was 

supposed to be temporary, 5 or 6 years. And the reason for that 

limitation was that Congress did not want to raise the tax rate by 

.09 of 1 percent, because that would have taken it into the next category, just the way on television nothing costs more than $19.95. 

Well, if it is a 39.6 percent bracket, you can’t make it over 40 percent, hence the Pease limitation. 

Now is the time to increase tax incentives, not to decrease them. 

And a few Members of the Committee have—and some of the witnesses have—spoken about non-itemizers. There currently are— 

there is a tax benefit right now for tax itemizers. And that is the 

tax-free distribution from an IRA to a qualified charity. The twothirds of the taxpayers who take the standard deduction who make 

gifts from their IRAs to charity aren’t taxed on the income that 

they take from their IRA. They don’t get a deduction. But not being 

taxed on something is the equivalent of a charitable deduction. 

So, the IRA charitable rollover, in the law since 2006, is a wonderful provision. But it has been on-again, off-again, on-again, offagain. And when it gets on again, frequently it is retroactive. And 

frequently it is too late for most of the taxpayers. And it is off 

again at the end of this year. So we ask that the non-itemizer charitable deduction, in effect, for the rollover from an IRA to a qualified charity be made permanent. 

There are many, many people who are middle class who would 

like to roll over gifts from their IRAs to charities, but they need 


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the income. We ask that the IRA charitable rollover, which now is 

for direct gifts, be expanded to include rollovers for charitable remainder trust life income gifts. 

Much has been said here today about President Reagan. He 

started out life as an actor, as we know. And he is known for ‘‘Let’s 

win this’’—when he was an actor—‘‘Let’s win this one for the 

Gipper.’’ Let’s win this one for the giver. And doing so will, in effect, really win it for the people served by American charities. 

[The prepared statement of Mr. Teitell follows:] 


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Mr. KELLY. Thank you, Mr. Teitell. 

Mr. Schrum. 

STATEMENT OF JAKE B. SCHRUM, PRESIDENT, SOUTHWESTERN UNIVERSITY, GEORGETOWN, TX, ON BEHALF 

OF THE COUNCIL FOR ADVANCEMENT AND SUPPORT OF 

EDUCATION 

Mr. SCHRUM. Chairman Camp, Ranking Member Levin, Members of the Committee, thank you for this opportunity to testify on 

behalf of the Council for the Advancement and Support of Education, CASE, and the National Association of Independent Colleges and Universities, NAICU, on the importance of preserving 

the value of the Federal income tax deduction for charitable contributions. 

Southwestern University, where I work, is a nationally-recognized private liberal arts college located in Georgetown, Texas. It 

is the oldest institution of higher learning in our State, and has a 

current enrollment of 1,400 students. Private support raised from 

individuals is an essential funding source for both private and public colleges and universities. According to the Council for Aid to 

Education, donors contributed $30 billion to colleges and universities in 2011. Charitable gifts help institutions fund scholarships 

for low-income students, recruit top-notch faculty, and strengthen 

academic programs. 

Like most private liberal arts institutions, Southwestern relies 

on private support to fund key institutional priorities. Each year 

our endowment covers a significant percentage of our operating 

budget. Endowment represents 25.95 percent of the current year 

education and general budget net of financial aid. Charitable giving 

helps us minimize tuition increases and provides a high-quality 

learning environment for our students. 

In the aftermath of the recent recession, colleges and universities 

continue to face challenges. Endowment investment returns continue to be volatile, with the most recent data, as pointed out by 

President Huddleston, showing the average return was ¥0.3 percent in 2011 and 2012. At the same time, colleges and universities 

are also seeing more and more cuts to their State and Federal 

spending. 

In Texas, schools experienced an 18 percent decrease in funding 

for the tuition equalization grant program for the last biennium. 

This represented a loss of over $37 million in grant funding for 

needy students seeking a higher education in the State of Texas. 

At Southwestern, this decrease in funding resulted in a loss of over 

$600,000 to our students, 1,400 of them, over a 2-year period. 

Many students and their families are struggling to afford higher 

education tuition costs. Unless institutions can convince donors to 

provide additional aid for deserving students, educational opportunity will shrink, even as the need for education grows. That is 

why we urge the Committee and Congress to support policies like 

the Federal tax deduction for charitable gifts, policies that incentivize giving to educational institutions. 

While charitable giving is a voluntary act driven by a desire to 

do good, to have impact, and to give back, tax incentives do play 

a role in encouraging donors to accelerate giving. Major donors to 


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our institutions often base the size and timing of their gifts, at 

least in part, on tax considerations. And major donors are exactly 

the taxpayers who would be most affected by proposals that limit 

the value of the charitable deduction. These are the donors who 

have the resources to give to charitable organizations consistently. 

And our tax policy should encourage them to continue to give generously. 

Proposals that cap the value of the charitable deduction with a 

hard dollar cap or a percentage of income cap do the opposite; 

they reduce the incentive for donors to give additional dollars to 

educational institutions and other charitable organizations. Highincome donors who give little or nothing to charity would be unaffected by a cap on a charitable deduction. Instead, a cap would 

target the most generous high-income donors, individuals, and families who want to make large gifts to educational institutions or 

other charitable organizations. Why would Congress want to penalize individuals who want to give more of their wealth away, particularly at a time of rapidly increasing wealth disparities? 

Unfortunately, some have mislabeled the charitable deduction as 

a tax break for the wealthy. A cap on the charitable deduction 

would not hurt high-income donors, many of whom would likely decide to give less if a cap was enacted. Students and others served 

by charitable organizations would feel the brunt of this policy 

change. 

Once again, we strongly urge the Committee to preserve the 

value of the charitable deduction and support other incentives that 

encourage individuals to give more to their alma mater and other 

organizations. Now is not the time to fundamentally change a tax 

incentive that has contributed to a cherished tradition of charitable 

giving unmatched in the world. 

Thanks again for this invitation. I would be glad to answer questions. 

[The prepared statement of Mr. Schrum follows:] 


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Mr. KELLY. Thank you, Mr. Schrum. 

Ms. Aviv, you are now recognized for 5 minutes. 

STATEMENT OF DIANA AVIV, PRESIDENT AND CEO, 

INDEPENDENT SECTOR, WASHINGTON, DC 

Ms. AVIV. Mr. Chairman, Representative Levin, and distinguished Members of the Committee, I serve as the President and 

CEO of Independent Sector, which is a national coalition of approximately 600 public charities, private foundations, and corporate giving programs, and, with their affiliates, total tens of 

thousands of charitable organizations across the country. I thank 

you for the opportunity to share with you some observations about 

the usefulness of tax incentives for charitable giving. 

Every day, public charities and private foundations work to provide educational and economic opportunities to alleviate poverty, 

assist victims of disaster, advance knowledge, enhance the cultural 

and spiritual developments of individuals and communities, and 

foster support for our collective commitment to justice and individual liberty. These life-enhancing initiatives, as well as the nonprofit sector’s 13.5 million jobs and $670 billion in annual wages, 

are made possible by the generosity of Americans who contribute 

millions of hours and billions of dollars of support to the charitable 

causes that they care about. 

Unfortunately, the economic downturn and sluggish recovery 

have made it harder for charitable organizations to fulfill their missions. Overall, sector revenue has been stagnant in recent years, in 

part because annual charitable giving is nearly $13 billion less 

than what it was in 2007. At the same time, 85 percent of charitable nonprofits experienced an increase in demand in their services—for their services in 2011. 

As this Committee considers ways to reform the tax system to 

strengthen the economy, we urge you to oppose tax policies that 

would harm charitable organizations. And of particular concern are 

proposals that would reduce charitable giving even further by limiting the value of the charitable deduction. 

Unlike tax incentives to purchase a home or save for retirement, 

the charitable deduction encourages behavior for which the taxpayer receives no personal tangible benefit. The deduction does not 

subsidize consumption or underwrite the accumulation of wealth. It 

simply and effectively encourages taxpayers to give away a portion 

of their income to benefit others. Limiting the deduction, therefore, 

would exact a sacrifice not from high net worth individuals, but 

rather from organizations whose express purpose, through their donation, is to serve the public good. 

At the core of the concern about the charitable deduction lies a 

deep apprehension that there are not enough or not sufficient resources available to charitable organizations to meet their responsibilities. Thus, in addition to preserving the deduction, I urge 

Congress to extend permanently a number of important giving 

incentives in the tax package, including the IRA charitable rollover, 

and enhanced deductions of donations of food and conservation 

easements. 

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perts from the private and charitable sectors, to examine new ways 

of capitalizing the sector. Specifically, I urge you to look into better 

use of existing funding streams, identify new potential streams of 

capital, explore obstacles to the flow of cash and non-cash contributions to charitable organizations, and review existing governmental 

structures and other financing vehicles. 

Through enactment of the Revenue Act of 1917, which first made 

donations to charitable organizations tax-deductible, Congress, in 

its wisdom, embraced the entire range of social purposes and important causes that citizens, individually or collectively, might 

choose to pursue through charitable organizations. With a focus on 

the arts, social services, scientific research, or spiritual matters, 

this great American tradition has sparked innovation, saved lives, 

and enriched our communities. 

Through the wisdom of this decision, Congress established a century-old policy that has stimulated charitable giving, and made it 

clear that our government and our society value the contributions 

made by every charitable organization. 

Thank you for the opportunity to share these perspectives, and 

I look forward to any questions that you may have. 

[The prepared statement of Ms. Aviv follows:] 


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Mr. KELLY. Thank you, Ms. Aviv. 

Mr. Faris, you have 5 minutes, please. 

STATEMENT OF VINSEN FARIS, CFRE, EXECUTIVE DIRECTOR, 

MEALS-ON-WHEELS OF JOHNSON AND ELLIS COUNTIES, AND 

CHAIRMAN OF THE BOARD OF DIRECTORS, MEALS ON 

WHEELS ASSOCIATION OF AMERICA, WASHINGTON, DC 

Mr. FARIS. Mr. Chairman, Ranking Member Levin, Members of 

the Committee, Committee staff, thank you for the opportunity to 

be with you today. Again, my name is Vinsen Faris. I am the Executive Director of Meals-on-Wheels of Johnson and Ellis Counties in 

North Central Texas. I also have the privilege of serving as the 

Board Chair of the Meals on Wheels Association of America, which 

represents local, community-based senior nutrition programs that 

are united and working to end senior hunger in America by the 

year 2020. 

The incredible task ahead to reduce the deficit and reform the 

Tax Code so that it is more effective and efficient is very, very challenging. So let me begin by urging the Committee to seek ways 

that will encourage more Americans to increase their philanthropic 

giving to valuable and impactful causes. Almost $300 billion is the amount of money that Americans generously donate to charities annually. This is a number that is important to our association, as well as to the Meals on Wheels programs in your States and your districts. But, like other charities, 

it is not enough to address the growing societal issues like senior 

hunger. That is why the charitable deduction is so important. 

Meals on Wheels programs are perhaps one of the very best examples of successful public-private partnerships, because of their 

ability to leverage multiple funding sources to provide a solid return on investment. Nationally, only about 30 percent of total 

spending for Meals on Wheels programs comes from Federal 

sources, with a significant number of programs receiving no government funding at all. This means that these programs must raise 

about 70 percent of their budgets from non-Federal sources, most 

of which are charitable contributions. 

Let me tell you about Emily, one of our over 2,800 clients we 

serve in Johnson and Ellis Counties, who has a similar story to the 

thousands of seniors in your States and districts who gather at senior centers or who receive home-delivered meals. A widow, Emily 

is 88, a retired nurse who worked for 40 years and brings in about 

$700 a month in Social Security benefits. She suffers from advanced osteoporosis, and is physically unable to leave her home to 

go to a grocery story or cook her own meals. Now she relies on a 

Meals on Wheels volunteer to bring her a nourishing, hot meal 

every day. This, along with a caring smile, is her only direct daily 

contact with another person. 

Keeping seniors in their homes and out of hospitals and nursing 

homes is critical to controlling healthcare costs. Please consider the 

fact that the cost of feeding a senior for 1 year through Meals on 

Wheels is roughly equal to the cost of just 1 day in the hospital, 

or 6 days in a nursing home. This is what Meals on Wheels does. 

Yet, despite these benefits, Meals on Wheels programs are 

threatened. They are currently facing a quadruple whammy to a 


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growing senior population facing the threat of hunger, State and 

local budget cuts, coupled with the threat of sequestration, higher 

cost for food and transportation, and, of course, challenging fundraising, due to a sluggish economy. 

Ensuring the long-term viability and prosperity of charitable organizations like Meals on Wheels that can efficiently and effectively help meet many of the health and nutritional needs facing 

our vulnerable senior citizens is critical. More people joining together in philanthropic efforts will also build a greater community 

spirit, and a spirit of partnership with our Federal Government, 

which will enable everyone to do more for more people in need. 

Seniors like Emily all across America will be impacted, should 

any negative changes in the charitable gift deduction go into effect. 

For us at Meals on Wheels, this debate is not about the intricate 

details of the Tax Code. Rather, it is about the seniors we serve 

every day. It is about the direct impact these decisions would have 

on the 8.3 million seniors facing the threat of hunger. It is about 

the doors our volunteers knock on, and the neighbors they nourish. 

It is about the hope our programs deliver to those who otherwise 

have little. Please help us to continue to reach out and help those 

in need, and to involve others as well, by maintaining the charitable tax deduction and finding new ways that will encourage more 

Americans to increase their philanthropic giving. 

To the Committee, thank you for the work you do. I would also 

like to thank the Chairman for his long-standing support of Meals 

on Wheels programs, and for all of you in looking at this important 

topic. Thank you. 

[The prepared statement of Mr. Faris follows:] 


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Mr. KELLY. Thank you, Mr. Faris. 

Mr. Rieth, you are recognized for 5 minutes. 

STATEMENT OF WILLIAM N. RIETH II, PRESIDENT AND CEO, 

UNITED WAY OF ELKHART COUNTY, ELKHART, IN 

Mr. RIETH. Thank you so much, and howdy. Thank you for taking time to listen to us today. Mr. Chairman, Ranking Member 

Levin, Mr. Young, and Mr. Roskam, I really appreciate your time 

today. I am the President and CEO of the United Way of Elkhart 

County in Indiana, and I am testifying in support of the charitable 

deduction. 

Let me tell you a little bit about Elkhart County, Indiana. Our 

community of just under 200,000 residents is home to manufacturing and high-tech industries. We are also known as the RV capital of the world. Now, Elkhart County became a focal point during 

the height of the recession when our unemployment rate skyrocketed to over 18 percent in 2009. That same year, President 

Obama visited my community because, in his words, it was the 

place where the Nation’s problems are most acute. 

Now, I am happy to report that we are recovering, and we are 

making progress, but we are still not there. In my community, our 

residents are generous. Folks give over $74 million a year to local 

charities, of which we receive approximately $2 million. Now, while 

we don’t know which of these donors take advantage of the charitable deduction, I believe a number do. 

For example, when we go out to raise funds to invest in our 

community, it doesn’t matter whether I am on the factory floor, 

whether I am in the front office, whether I am talking to a blue 

collar worker or a white collar worker. Every single time I am always asked, ‘‘Is this tax-deductible,’’ to which I can reply, ‘‘Yes.’’ So, 

I believe this is a highly motivational force in people’s lives. And 

as people invest in this, we are able to take that investment and 

bring back millions of dollars, impacting over 12,000 people in my 

community. 

For example, we are able to do something in the area of income 

through our income initiatives. One of our programs helps hundreds of families every year learn how to budget, get out of credit 

debt, start their first-ever savings account, where we see 50 families graduate every year having met their savings objectives, most 

of them becoming first-ever homeowners. And when they become 

first-ever homeowners, it brings greater stability, puts strong roots 

in our community, and it breaks the cycle of poverty. 

Our health initiatives. These assist hundreds of chronically ill 

people with no prescription insurance. That is a big problem in 

Elkhart County, people that lack prescription insurance. In 2012, 

we were able to give back to the community $3.1 million worth of 

essential medicines, medicines such as cancer meds, insulin, blood 

pressure, heart meds. These medicines not only keep people 

healthy, but they enable them to continue to work, be productive, 

and keep them out of the hospital, saving all of us, as taxpayers. 

Our educational initiatives impact thousands of students and 

help them succeed in school. For example, our reading camps, 

which target second graders who are a bit behind in their literacy 

skills. We see a 90-plus percent improvement in these second 


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graders, enabling them to be ready to successfully enter third 

grade. 

And these are just a few examples of many that I could share 

with you that are helping people to live better lives. The community and faith-based programs in my area are funded by individuals who take advantage of the charitable deduction. Just 

this weekend I was talking to a couple that said if they did not 

have the charitable deduction, it would dramatically decrease the 

amount that they give in my community. 

A strong charitable sector helps local communities weather economic and employment disruptions, much as we faced during the 

disruption. And I am very fearful—I have to be honest—very fearful that if the charitable deduction is eliminated, we are going to 

lose these programs, these programs that are helping take people 

out of poverty, these programs that are helping students succeed, 

these programs that are helping people to do better in the health 

area. If that would happen, that would be devastating for my community. Please, I encourage this Committee and Congress, please 

do not hinder us in advancing the common good. Please, please, on 

behalf of my community, maintain the charitable deduction. Thank 

you very much. 

[The prepared statement of Mr. Rieth follows:] 


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Mr. KELLY. Thank you, Mr. Rieth. 

Ms. Michal, 5 minutes, please. 

STATEMENT OF JILL MICHAL, PRESIDENT AND CEO, UNITED 

WAY OF GREATER PHILADELPHIA AND SOUTHERN NEW 

JERSEY, PHILADELPHIA, PA 

Ms. MICHAL. Thank you very much, Mr. Chairman, and thank 

you to the Members of the Committee for taking time to allow for 

this thoughtful conversation on what is an incredibly critical topic 

to all of us. 

At a time when nonprofits are already being asked to do more 

for more with less, a cap on the charitable deduction is a crippling 

blow to the human services sector at the time when we need it to 

perform at its best. This sector is one of the very few sectors where 

the demand actually goes up when the economy goes down. During 

the worst recession any of us have ever known, 78 percent of nonprofits have seen an increase in the demand for their services. But 

we are at a breaking point. The elasticity of our country’s safety 

net is gone. And if even a few more strands break, people are going 

to fall through it quickly, and they are going to land hard. 

With reserves exhausted, employees laid off, programs cut, and 

the pressure to deliver results at an all-time high, there is no room 

right now for nonprofits to breathe. And capping the charitable deduction is a choke-hold that isn’t going to take long to have a serious impact. 

I mentor a young girl back home in Philadelphia. And her 16- 

year-old friends are picking out baby names. And her neighbors are 

carrying guns to school. Her mom and her unborn baby brother 

were killed by a drunk driver. She walks two miles to get to the 

nearest grocery store with her dad, because there isn’t one in her 

neighborhood. And she was bullied in the public school system for 

being smart, so her dad works two jobs to put her in private school. 

But she is going to be okay. And the reason I know that is because she is brilliant, and she loves to learn, she has a father who 

will do anything in the world for her, but most importantly, because I know that they are not alone. She had the support of an 

amazing social service program in our community that helped her 

grow up as a young woman without a mother, and kept her from 

making the bad choices that would have been so incredibly easy for 

her to make, a school that was able to offer her subsidized tuition 

to escape the teasing and the torment, and organizations that support mentors like me, who will never let anything happen to her 

on my watch. 

But the organization that she believes saved her, they had to cut 

their staffing, their salaries, and their programs over the past 4 

years by over 50 percent, nearly bankrupting the organization. And 

it wouldn’t have survived if it weren’t for the tenacity of the board 

and the few remaining staff. And we are lucky that this amazing 

young woman made the cut, but I hate to think about all the other 

girls who won’t be that lucky. 

I know and I get that the numbers need to work. But I also know 

that there are real people behind these numbers. And while it is 

true that some people give solely out of the goodness of their heart, 

there is a reason that 20 percent of all online giving comes in on 


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December 30th and 31st. There is a reason that 80 percent of the 

Americans who itemize their deductions have a contribution to 

charity on that list. And these deductions aren’t the ones for their 

own mortgage. They are to pay for the first mortgage of somebody 

who might have been homeless just a year ago. These aren’t the 

services that they are getting for their own children; this deduction 

is taking care of somebody else’s children. 

Placing a cap on charitable deductions reduces the incentive to 

do the one thing that Americans take a deduction for from which 

they get no personal gain. And you can read studies, and the studies will tell you pretty much anything you want to hear. But when 

I talk to real people about this impact, I am hearing anything but 

what I want to hear. What they are telling me is that it is going 

to have an impact. Whether it is people giving $500 or people giving $5,000, it is part of their decision-making process. Our United Way raises roughly $60 million a year, but we don’t 

raise it from 60 millionaires. We raise it from nearly 100,000 people giving whatever they can give in whatever way they can give 

it. And I don’t want them to have to think twice about it. I don’t 

think you want them to have to think twice about it. And the family living in a homeless shelter whose kids could be hungry tonight, 

they definitely don’t want them to think twice about it. Thank you 

for your consideration. 

[The prepared statement of Ms. Michal follows:] 


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Mr. KELLY. Thank you, Ms. Michal, and thank you to the entire 

panel. 

I will now go to the Committee Members. Mr. Young. 

Mr. YOUNG. I thank my esteemed colleague and interim Chairman. 

We just heard in the first panel from Dean Tempel of Indiana 

University’s School of Philanthropy, and he authored a 2011 report 

titled, ‘‘Impact of the Obama Administration’s Proposed Tax Policy 

Changes on Itemized Charitable Giving.’’ His conclusion, among 

other things, was that a cap on itemized deductions in higher marginal tax rates would lead to a 1.3 percent decrease in itemized 

charitable giving. 

Now, we find ourself—the President of the United States has 

proposed a 28 percent cap on itemized deductions. And at the first 

of this year, Washington just implemented, at the President’s insistence, higher marginal tax rates. So I would kind of like to localize and humanize this very important issue we are discussing here 

by asking Mr. Rieth of Elkhart County, Indiana, exactly in those 

terms what the reduction that we can expect in charitable contributions will mean? Who will get cut? Who will that impact? And what 

will be the larger impact on your community? 

Mr. RIETH. Thank you, Mr. Young. Let me answer that with a 

true example. In 2011 we had a donor who donated $3,000 through 

the United Way. They are very philanthropic, but they also wanted 

to take advantage of the charitable deduction. One thousand dollars went to us and our programs, another $1,000 went to the Salvation Army, and another $1,000 went to a local homeless shelter. 

If that cap was there, I don’t think we would have seen that $3,000 

that benefited all of us. 

So, I would imagine, as I think of our donor base, it would definitely decrease from some of our larger donors the amount that 

they are able to give and some of these programs that I have highlighted that are funded through them. For example, I don’t know 

what I want to give up. Do I want to stop helping kids? Do I want 

to stop helping people break free from poverty? Do I want to stop 

helping people that need prescription insurance? It would be a 

tough one to know. We would probably have to cut all of them to 

some extent with that loss of revenue. 

Mr. YOUNG. Well, thank you for your feedback. I mean, these 

are important decisions we have to make, as a country, and as we 

comprehensively look at the Tax Code, I think it is important to 

remember the impact on individual Americans, especially our atrisk Americans. Of course, I am particularly concerned about Hoosiers. And I think it bears reminding that the tax policies put forward by the President of the United States, and insisted upon, will 

result in those specific impacts that you have identified. 

Thank you. I yield back. 

Mr. ROSKAM [presiding]. The Ranking Member, Mr. Levin. 

Mr. LEVIN. I just want to say, Mr. Young, and to everybody, I 

really think it would be beneficial if we tried to keep what I think 

sounds like partisan politics out of this. Governor Romney suggested something much lower than was suggested by the President. 

And we need to look at the question of limitations in a very analytVerDate Sep 11 2014 13:43 Feb 07, 2017 Jkt 021128 PO 00000 Frm 00155 Fmt 6633 Sfmt 6602 I:\WAYS\WAYSPS\21128\21128.XXX 21128

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ical, objective way, okay? We really need to do that. We have set 

up a working group to look at the facts. 

There are differing opinions about the impact of various limitations and various ways to do it. And we now have some limitations. 

The reinstitution of the Pease Amendment, whatever its origin 

was, it lasted a number of years. And the impact of it, there are 

differing opinions. Many studies indicate the impact of it was very, 

very minimal. 

If you look—and I introduced a document that shows the income 

distribution of the charitable deduction—it is true it isn’t just the 

very wealthy. It is not a loophole. A very substantial portion of it 

comes from very wealthy people, though it isn’t only very wealthy 

people. And so we really need to look at the impact, because a 

small number of very wealthy people give large amounts, and we 

need to take that into account, as well as looking at the huge numbers of people who aren’t wealthy who contribute. 

We also have had some testimony about the deduction when 

property is given. We have wrestled with the auto provision, right? 

We have really wrestled with that. And we have tried to make 

sense of it, and to avoid the abuses. Because there have been some. 

So my only suggestion is that this is an issue that needs to be 

seriously considered. We need to, I think, avoid the rhetoric wherever we can because there are some serious issues here. 

And I have already said one rhetorical slogan, that it is a loophole, I think is completely wrong. This is one of the policies that 

have been put into the Tax Code for reasons. There are provisions 

that came in because of lobbyists with a special interest that I 

think are loopholes. Maybe they didn’t come from lobbyists. I don’t 

think that is true of this, and I don’t think it is true of the mortgage interest deduction. I don’t think it is true of State and local 

taxes. These large provisions—it isn’t true of education, it isn’t true 

of how we handle health care. 

These are provisions that are embedded in the Code, and have 

been there for good—for policy reasons. And we need to look at 

them and be careful that we don’t place ourselves into a rhetorical 

position that will diminish our efforts to look at these issues. 

So I just say that, Mr. Young. I understand the temptation, and 

I don’t say you are the only one who hasn’t resisted it. I think we 

need to do that. 

Mr. YOUNG. Would the gentleman yield me—— 

Mr. LEVIN. Sure. 

Mr. YOUNG [continuing]. His remaining 15 seconds or so? 

Mr. LEVIN. Oh, sure. 

Mr. YOUNG. I would say, first, your comments are very well received. My comments were designed to illustrate the very difficult 

trade-offs. There is no party that has a monopoly on empathy or 

sympathy here with respect to pursuing tax reform, and perhaps 

the unintended implications of a particular course, one way or another. 

I would also say I—my comments were designed to illustrate the 

importance of economic growth. That should be a very important 

goal with respect to tax reform. Anything that undermines economic growth will also impair the ability of Elkhart County, IndiVerDate Sep 11 2014 13:43 Feb 07, 2017 Jkt 021128 PO 00000 Frm 00156 Fmt 6633 Sfmt 6602 I:\WAYS\WAYSPS\21128\21128.XXX 21128

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ana, to provide for its neediest citizens. So we should keep that in 

mind. Thank you so much for the dialogue. 

Mr. LEVIN. Thank you. 

Mr. ROSKAM. The gentleman from Arkansas, Mr. Griffin. 

Mr. GRIFFIN. Thank you, Mr. Chairman. I want to say that I 

am a huge supporter of this, of the charitable deduction. I have 

been involved with a lot of charities, was on the board of Big Brothers Big Sisters, and I understand the budgeting that you have to 

go through. And I understand how tight the money is. 

And so, having said that, I frankly want to encourage more charitable giving. And I think that we—when we are trying to better 

the law, we have to remember that part of that is simplicity. There 

are a lot of great ideas out there that complicate the Tax Code. And 

so, every time I come up with an idea, even if it is a good one, I 

have to ask: Is this making the Tax Code too complicated? But I— 

listening today I have heard several ideas that really don’t: Getting 

rid of PEP and Pease, possibly. That would be—that would make 

it less complicated, certainly. 

The other thing I would say is if we—maybe we could put a 

line—we could put an above-the-line option for people who don’t 

itemize, and maybe put a floor of 500, or whatever, for enforcement 

reasons, or whatever. But there are some things we can do, and I 

think we—there is a lot of agreement from a lot of people I have 

heard, that we want to encourage more giving to groups. 

So, my question is, when you are looking at saving some money, 

what sort of reforms do we need to be looking at? And a couple I 

would just mention, and then I will open it up to anyone who 

wants to comment, is are there certain groups that are able to be 

501(c)(3)’s now that maybe shouldn’t be? Is that something we 

should look at? 

Also, the government waste in funding I talked of at the earlier 

panel, about the dollar that starts in the State and goes all the way 

up here and accounts for a lot of the boom in this city, and then 

goes back to rural Arkansas as a dime. I just open it up. Do you 

have some ideas on reforms in this area that could save us money? 

[No response.] 

Mr. Huddleston, anyone. Yes. 

Ms. AVIV. With respect—if I could talk also about how to increase giving, I think Conrad Teitell mentioned the extenders package, and in particular the non-itemizer. One of the realities that we 

find is that donors are very tentative about giving when they are 

not sure what the rules are going to be this year, and if they think 

the rules are going to change from this year to next year, and then 

change back again. In addition to the problems with the economy, 

they will hold back. 

And I think that we see on the side of the organizations that 

gather money and then redistribute, or charities that receive this 

money directly, the degree to which there is uncertainty about 

some of these incentives is the degree to which there is less funding. So, one of the ways in which we can be very helpful, I think, 

is to make the tax extenders package permanent and clear. 

Second, I think that on the side of—in the previous panel some 

issues were raised about some people being in our sector who engage in bad practices, unethical conduct, and so on. And the point 


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was made—and I want to underscore it—that we operate on trust. 

And if there is no trust in our sector, people won’t give us money, 

because they think that what they are seeing is the tip of the iceberg. So the degree to which State oversight officials and Federal 

officials can do the job of enforcing the laws, and then we are 

happy to look to see if there is a gap in a place that would save, 

so that there is no fraud or abuse, I think that that would be an 

absolutely essential part of the work. 

And then, finally, I had mentioned in my oral testimony and in 

my written testimony as well, I think it would be a great opportunity, through the panels that have been created, for us to come 

together in partnership to think of new ways to capitalize the sector, and to see if—what kinds of obstacles exist, regulations, or 

anything else that stops different kinds of people from giving funds 

because of the current structure. 

Those three, I think, would be very helpful. 

Mr. GRIFFIN. Anyone else? Yes, sir, Mr. Schrum. 

Mr. SCHRUM. I would just like to quickly add that I think consistency is really important with our donors. I have been raising 

money—— 

Mr. GRIFFIN. Certainty? 

Mr. SCHRUM. Certainty, right. 

Mr. GRIFFIN. From year to year? 

Mr. SCHRUM. Yes. I have been raising money for 40 years. And 

every time something changes, donors step back, especially the 

wealthiest, you know, who really create the transformational 

gifts—— 

Mr. GRIFFIN. Sure. 

Mr. SCHRUM [continuing]. For all of our charities. 

Mr. GRIFFIN. Sure. I will just mention—I see I am running out 

of time—but one of the things that has interested me as I have 

learned more and more is how quickly the light turns to red. 

Thank you, Mr. Chairman. 

[Laughter.] 

Mr. ROSKAM. Well, thank you all. I want to thank this panel 

for your time and your courtesy and your testimony and your expertise. And we look forward to interacting with you in the days 

and weeks and months to come. Thank you very much. 

And with that I would like to welcome up our third panel. 

Well, welcome to the third panel. First, we are going to hear 

from Pamela King Sams, who is the Executive Vice President for 

Development at Children’s National Medical Center, here in Washington, D.C. Ms. Sams is responsible for managing the $500 million 

Transforming Children’s Health campaign. 

Second, we will hear from Nicole Busby, Executive Director of 

the National Association of Free and Charitable Clinics. She has 

been a featured guest on a number of television programs discussing free clinics. Welcome. 

Then we will hear from Rand Wentworth, President of the Land 

Trust Alliance here in Washington. Mr. Wentworth has served on 

numerous boards and previously testified before this Committee, as 

well as the Senate Finance Committee. 


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We will also hear from Kim Morgan, the CEO of United Way of 

Western Connecticut. Ms. Morgan serves on several boards, and 

has worked in this field of nonprofits for over 20 years. 

We will hear from Terry Mazany from Chicagoland, my home 

area. He is the President and CEO of The Chicago Community 

Trust. He is also a Member of the Board of Directors of the Federal 

Reserve Bank of Chicago and the Council on Foundations. 

We will hear from Brent Christopher, who is the President and 

CEO of Communities Foundation of Texas in Dallas. Mr. Christopher considers himself a reformed lawyer—God bless you—and 

has held several leadership roles in fundraising in administrations 

at a university and academic pediatric medical center setting. 

And, finally, we welcome Leslie Osche, who is the Executive Director of the United Way of Butler County in Pennsylvania, and is 

a constituent of our colleague, Mr. Kelly. And when it is her turn 

to testify, I will be pleased to yield to him for an introduction. 

Again, thank each of you for your time and your testimony and 

your professional commitment on these issues. As you know, all of 

your written testimony is submitted for the record, and that is incredibly helpful. So our time today will be limited to 5 minutes 

each. 

And, Ms. Sams, we will start with you. 

STATEMENT OF PAMELA KING SAMS, EXECUTIVE VICE PRESIDENT FOR DEVELOPMENT, CHILDREN’S NATIONAL MEDICAL 

CENTER, WASHINGTON, DC 

Ms. SAMS. Good afternoon. Mr. Chairman and Committee Members, I am Pam King Sams, as you mentioned. I am the Executive 

Vice President for Development at Children’s National Medical 

Center, here in Washington, D.C. We are a 303-bed not-for-profit 

academic medical center, and we have been around for 140 years, 

taking care of sick children. We would love to invite you down for 

a tour if you haven’t been down. It is only three miles up North 

Capitol, so please come on up. 

I am testifying today on behalf of the American Hospital Association and its more than 5,000 member hospitals, health systems, 

and health care organizations. We appreciate this opportunity to 

comment on the importance of the charitable contribution to America’s nonprofit hospitals. 

Let me give you a brief sketch of the financial environment in 

which hospitals now operate. A recent Moody’s report maintains a 

negative outlook for nonprofit health care for 2013. It cites Federal 

and State cuts to healthcare spending, limited reimbursement increases from commercial insurers, and a tepid economy as some of 

the reasons. Since 2010, Medicare hospital payments have been reduced by $250 billion over the past 10 years. As a result, hospital 

Medicare margins stand at an average ¥7 percent. In 2011, Medicare overall paid hospitals—Medicaid paid hospitals $6 billion less 

than the cost of treating Medicaid patients. 

At Children’s National, we collect an average of about $.44 on 

the dollar that is charged to all of our payers. Mr. Chairman, 

100,000 children live in the District of Columbia; 90,000 of those 

children are enrolled in Medicaid. Children’s National provides primary care for almost 40,000 of those children. Those primary care 


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sites are called the Goldberg Centers. And they are called the Goldberg Centers because wonderful philanthropists Stephen and Diana 

Goldberg contribute to make sure that they have them. 

Even in this environment, hospitals do more to assist the poor, 

sick, elderly, and infirm than any other entity in health care. Since 

2000, hospitals of all types have provided more than $367 billion 

in uncompensated care to patients. Children’s National, for instance, alone gave nearly $51 million in uncompensated care last 

year. 

The benefits to our communities greatly exceed the revenue that 

the Federal Government forgoes by granting tax-exempt status to 

hospitals. We believe that the incentive of the charitable deduction 

is a key to providing continued access to hospital services in 

communities across the county. Children’s National counts on 

contributions from the community simply to keep its doors open. 

Our operating budgets always assume philanthropy as part of our 

day-to-day operating funds. In fact, nearly $42 million in philanthropy directly funded our operations last year. 

Nationwide, hospitals allocated upwards of 50 percent of the 

funds they raise to operations for care, education, and research. Let 

me give you an example. We treat Hannah, who has cancer. She 

receives therapeutic drugs that were discovered with the help of 

philanthropy. Hannah had to have chemotherapy, so our child life 

specialist sat with her with a doll and played to teach her what 

that meant. That was funded through philanthropy. During her 

long weeks of stay for her treatment, she would wander down to 

the art room and visit with our art therapist and paint to cheer her 

days. And when she was too sick to come out of her room, our 

music therapist came into her room and played songs for her that 

made her smile, all funded through philanthropy. And then finally, 

when she could go home, her parents could not afford her outpatient medications, so we had a family fund, supported through 

philanthropy, that helped buy her medications for that first 30 

days, until our social workers, also funded through philanthropy, 

could work out the situation to get her home safely. 

America’s hospitals are always open, serving our communities 24 

hours a day, 365 days a year. But they are facing new challenges 

to maintaining access to high-quality care to everyone who needs 

it. We are seeing all forms of revenue shrink: Medicaid, Medicare, 

NIH, tightening reimbursements through insurance companies. 

Our only positive stream of revenue we may see is through philanthropy. Taking away the tax deductibility could cut that final avenue of funding dramatically. 

Hospitals need the support they find from generous members of 

the communities they serve now, more than ever. At Children’s National, our margin was less than 1 percent in 2012. Less that 1 percent. Without philanthropy, we would have lost $39 million, jeopardizing the care of kids like Hannah. 

As you work to reform the Nation’s tax laws, we urge you to continue to encourage private giving to hospitals, please exclude charitable giving from any limitations on deductions, and maintain the 

existing Federal charity deduction. Thank you. 

[The prepared statement of Ms. Sams follows:] 


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Mr. ROSKAM. Thanks, Ms. Sams. 

Ms. Busby. 

STATEMENT OF NICOLE LAMOUREUX BUSBY, EXECUTIVE 

DIRECTOR, NATIONAL ASSOCIATION OF FREE AND CHARITABLE CLINICS, ALEXANDRIA, VA 

Ms. BUSBY. Mr. Chairman, Members of this Committee, my 

name is Nicole Lamoureux Busby, and I am the Executive Director 

of the National Association of Free and Charitable Clinics. On behalf of our board, our members, and the 1,200 free and charitable 

clinics across the United States, I thank you for having me here 

today to give you our thoughts on how limiting the charitable deduction will dramatically and negatively impact our ability to provide quality health care to those who need it the most. 

The mission of the National Association of Free and Charitable 

Clinics is to broaden medical access to the underserved, as well as 

to promote volunteerism, and to support the free and charitable 

clinics across the country. However, I believe that it is our broader 

vision that activates our donors, our volunteers, and the communities that we work with every day, and that vision is to build a 

healthy America, one patient at a time. 

Many are surprised to hear that there are 1,200 free and charitable clinics across the United States who have been standing in 

the gap, providing healthcare to those who have fallen through the 

cracks of a broken healthcare system. Our clinics believe in giving 

a hand up, not a handout, and we are organized at the grass roots 

level, not at the government level. So what does that mean? That 

means that the charitable deduction is incredibly important to us, 

because we receive little to no State or Federal funding. We are not 

federally-qualified health centers, so that means we do not receive 

HRSA 330 money. We are not rural health centers. And, as I said 

before, we rely heavily on the donations of individuals, foundations, 

and grants to keep us going. 

Some interesting facts about our donors: We are split 50/50 between men and women. Our donors give $1 to $100. And we also 

have done a survey of our donors, and 44 percent of our donors 

have said that they will stop giving to our organization if the charitable deduction is gone. 

Some interesting impacts and stats about our clinics: 44 percent 

of our clinics have an operating budget of under $100,000; 83 percent of our patients come from a working household; and we have 

found, because of a recent Penn State study, that free and charitable clinics patients utilize the emergency rooms less, they don’t 

overcrowd our emergency rooms because of colds or bumps and 

bruises. And because of this, we have proven to be a very good return on investment for our donors. 

In fact, for every dollar that is donated to a free or charitable 

clinic, there are $5 in services that are given to patients. Free and 

charitable clinics are volunteer-run. We activate an army of volunteers to provide the health care that, quite frankly, many do not 

get right now in this county. 

One of the greatest misconceptions of the Affordable Care Act is 

that every single person in this country is going to have health care 

coverage after its implementation. And you and I know that, acVerDate Sep 11 2014 13:43 Feb 07, 2017 Jkt 021128 PO 00000 Frm 00164 Fmt 6633 Sfmt 6602 I:\WAYS\WAYSPS\21128\21128.XXX 21128

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cording to the Congressional Budget Office, there may be as many 

as 30 million people without access to health care. That includes 

documented, undocumented, and those people who are eligible for 

Medicaid but their States are not going to be expanding that. Because of this, free and charitable clinics will remain an important 

and critical part of the safety net. 

And that is why we are urging you to not limit the charitable deduction. We are asking you to not put a damper on the generosity 

of the American people. And we are inviting you to join us in our 

vision and help us build a healthy America one patient at a time. 

Thank you. 

[The prepared statement of Ms. Busby follows:] 


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Mr. ROSKAM. Thank you, Ms. Busby. 

Mr. Wentworth. 

STATEMENT OF RAND WENTWORTH, 

PRESIDENT, LAND TRUST ALLIANCE, WASHINGTON, DC 

Mr. WENTWORTH. My name is Rand Wentworth, and I am 

President of the Land Trust Alliance. Thank you for inviting me to 

testify today. 

The Land Trust Alliance advances land conservation by serving 

1,700 local citizen-led charities that are conserving land across 

America. They protect safe drinking water, farms, wildlife habitat, 

and places for children to play. Like any charity, a land trust needs 

charitable gifts to fund its operations. But a great deal of our work 

depends on a different kind of a donation: The gifts of land or of 

a conservation easement, which is a voluntary agreement to retire 

development rights. These donations provide big public benefits 

and protect land for a fraction of the market value. These are oncein-a-lifetime gifts that are usually valuable—unusually valuable, 

compared to other charitable gifts. 

The IRS says that the average value of a donated work of art is about $7,000. The average value of a gift of land was $170,000. 

And the average value of a conservation easement was $460,000. 

So, we were alarmed to hear proposals last year to limit tax deductions at $17,000 or $25,000 or $50,000 per year. 

Given the size of gifts of land, a cap on deductions would be catastrophic for land conservation in America. Because these gifts are 

so large, you might assume that they come from high-income people. But many are donations from family farmers, ranchers, and 

forest land owners with modest incomes, who inherited their land 

from their parents, which has now grown very valuable. The Tax 

Code generally limits these deductions for a donation of property 

to no more than 30 percent of the donor’s income, with a carryover 

of no more than 5 years. For a working farmer or rancher, though, 

their income is not large enough to use these deductions. The math 

simply doesn’t work. 

This is why Representatives Jim Gerlach and Mike Thompson 

wrote the Conservation Easement Incentive Act. It allows conservation easement donors to deduct more of their income each year, 

and to carry over deductions for more years. Last year that bill, 

H.R. 1964, had 311 cosponsors, a majority of the Republicans, a 

majority of the Democrats in the House, including most of the 

Members of this Committee. It makes permanent the provisions 

that Congress first enacted in 2006, and extended in 2008, 2010, 

and again last month. 

Here is a story to illustrate why this bill is so important. Dennis 

Maroni is a rancher in Arizona. His cattle graze on desert grassland and mountain pasture, which is habitat for a dozen rare species, including the Mexican Falcon and the Jaguar. It used to be 

in the middle of nowhere, but the growth of Tucson and Sierra 

Vista changed that. In 2007, Dennis donated a 960-acre conservation easement to the Arizona Land and Water Trust, a generous 

gift of his development rights, valued at $560,000. 

Raising cattle and sheep provides only a moderate income. And 

under the previous law, Dennis would only get a small fraction of 


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his donation. But, thanks to the Conservation Easement Incentive 

Act, he could deduct the entire value of his donation over time. 

That makes a big difference for land owners like Dennis. 

His ranch is now protected, and that is good for wildlife. But the 

easement will also keep his land in productive agriculture. And 

Dennis sells grass-fed beef to farmer’s markets, food co-ops, and 

restaurants. So this donation is a win-win-win for wildlife, for agriculture, for the economy. 

We are grateful that Congress has extended the Conservation 

Easement Incentive Act for another year. But it takes more than 

a year for families to decide on the largest charitable gift of their 

lives. We don’t want land owners to rush into conservation easements because of a short-term renewal of a tax extender. That is 

bad tax policy and bad conservation policy. 

We need certainty in tax policy, which is why we encourage Congress to make the Conservation Easement Incentive Act a permanent part of the Tax Code. Thank you for this opportunity to testify. 

[The prepared statement of Mr. Wentworth follows:] 


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Mr. ROSKAM. Thank you, Mr. Wentworth. 

Ms. Morgan. 

STATEMENT OF KIMBERLY MORGAN, CEO, 

UNITED WAY OF WESTERN CONNECTICUT, DANBURY, CT 

Ms. MORGAN. Thank you, Mr. Chairman and Members of the 

Committee. My name is Kim Morgan. I am the Chief Executive Officer of United Way of Western Connecticut, which provides services to fifteen communities and two counties, including the town of 

Newtown, Connecticut, which endured a grave tragedy on December 14th, as we all know. 

I have just a few thoughts I would like to share with the Committee today. First, I would like to acknowledge the tremendous 

outpouring of support that our community has received, and continues to receive, from across the country and around the world in 

response to this tragic event. The remarkably generous response in 

all its forms is the foundation upon which the Newtown community 

will begin its process of healing. 

Second, it is important that people understand the depth and the 

duration of the recovery challenge that we face. It will take many, 

many years, many millions of dollars, decades of mental health 

services, and an unending reserve of human compassion and support for this community to cope with the injury that it has suffered. 

Third, it is important for this Committee to recognize the important role that the charitable tax deduction can play in helping a 

community to respond to such severe circumstances. While taking 

nothing away from the pure compassion that has motivated the 

generous response, we must acknowledge that many of the most 

substantial donations may have been less substantial, except for 

the existence of the charitable tax deduction. I know this to be true 

from conversations that I have personally had with donors. 

And, finally, I want to emphasize that, even prior to the tragic 

events of December 14th, it was the existence of the charitable tax 

deduction, in part, which enabled United Way to be in a position 

to provide immediate resources, services, and structure to the Newtown community. I am convinced that we would not have been able 

to respond nearly as well, nor would our social service system, had 

our regular donors not been able to take advantage of that tax 

credit deduction. 

United Way of Western Connecticut received help from United 

Ways across the country and across the State after this tragedy. 

They were able to do this because United Ways have worked to engage communities for decades on working together and raising the 

resources necessary to tackle tough community challenges. People 

know that they can rely on the United Way to help garner those 

resources and use them wisely and responsibly, and to coordinate 

efforts and offers of volunteer assistance to best assist the community. 

United Ways in Connecticut also contribute to our United Way’s 

2–1–1 system, which has helped in the response to the Newtown 

tragedy, as well, taking calls and offers of assistance and providing 

crisis intervention and trauma resources to the many people looking for help in dealing with their grief and explaining the inexplicable to their children. 


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This community generosity is something we rely on at United 

Way. And, in turn, the charitable deduction certainly helps sustain 

and grow that generosity. I thank the Committee for this opportunity, and would urge the Members to consider these points during your deliberations. 

[The prepared statement of Ms. Morgan follows:] 


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Mr. ROSKAM. Thank you, Ms. Morgan. 

Mr. Mazany. 

STATEMENT OF TERRY MAZANY, PRESIDENT AND CEO, 

THE CHICAGO COMMUNITY TRUST, CHICAGO, IL 

Mr. MAZANY. Thank you, Congressman Roskam. I also want to 

recognize Congressmen Schock and Davis, one of the newest Members of this Committee, from my home State of Illinois. I am grateful for the invitation from Chairman Camp and Ranking Member 

Levin inviting us to provide testimony on the deduction. 

I am joined here today by my colleague, Brent Christopher, of 

the Communities Foundation of Texas. Regrettably, Alicia Philipp 

of the Community Foundation of Greater Atlanta is unable to attend. But her testimony is in the record. 

For the past 9 years, I have had the privilege of serving the metropolitan region of Chicago, home to more than 8 million people 

and 12 congressional districts, as President and CEO of The Chicago Community Trust. In 2012, our assets totaled $1.8 billion, we 

made grants of $175 million, and received $179 million in contributions from nearly 2,000 donors. The Chicago Community Trust is 

one of 11 community foundations started in 1915, a year after this 

powerful idea became an institution in Cleveland. Today there are 

more than 700 community foundations in the United States serving 

virtually every community—urban, rural, and suburban—in our 

country. 

It is important to note that even though The Chicago Community 

Trust primarily serves congressional districts in and around Chicago, our grantmaking via donor-advised and endowed funds has 

benefited every congressional district in the State. And when there 

is a national disaster, we backfill resources for the American Red 

Cross in Illinois, so that they can direct their resources to where 

they are most needed in other hard-hit communities. 

One of the key things that Brent and I want to help the Committee to understand today is that there are many different types 

of foundations, and that a community foundation is a public foundation, in contrast to private foundations like the MacArthur and 

Joyce Foundations, which are also based in Chicago. This is a very 

important distinction when it comes to tax law. A community foundation is a collection of charitable funds, contrasted with an endowment set up by a single donor. It operates as a 501(c)(3) tax-exempt 

public charity, and is focused entirely on improving the quality of 

life in that geographic area. 

As a public charity, community foundations are bound by the 

strict rules of behavior and must meet the same requirements as 

other charities like the American Red Cross and the YMCA. 

One of the most important differences between the trust and a 

private foundation is that community foundations accept both donations and make grants. This distinction is fundamental, when 

considering how change in the charitable deduction might affect 

the field of philanthropy. The idea of a community foundation fuses 

the capacity of a private foundation with the power of community 

philanthropy, connecting donors with opportunities to help the 

places and causes that they care deeply about, not only today but 

in perpetuity. 


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The charitable deduction is vitally important for us to deliver on 

our mission, especially with the growth of donor-advised funds. 

And collectively in 2012, The Chicago Community Foundation paid 

out $123 million in donor-advised grants at a payout rate several 

times that required of private foundations. 

We serve as the heart of local philanthropy, working with large 

donors such as pharmaceutical magnate John G. Searle, who created the first Searle Fund in 1964, and has provided resources for 

a $50 million 10-year commitment to establish Chicago as a global 

center for biomedical research, to more than $100 million invested 

to improve education in Chicago schools. 

But it is also the modest donor. During the great recession, we pulled contributions from more than $400 to amass $10 million 

above our regular grantmaking to support the food pantries, homeless shelters, winter coats for children, and other essential services 

for those neighbors most urgently in need. During the fourth quarter, as rumors were rampant about the charitable deduction being 

scaled back, we received a record $140 million in contributions, a 

strong reason to believe that this tax policy does matter. 

If we had a level playing field, I would be on the opposite side 

of this argument, advocating that we all must do our part. Instead, 

what we see is the continuing reduction of government spending, 

a trend most likely to continue for the foreseeable future. Given the 

reality that we face, and the fact that the charitable deduction encourages a key behavior to our democracy, giving for the common 

good, I am here to advocate for the full preservation of this deduction. If we expect communities to respond to the needs of their residents, we must preserve their charitable capacity. 

Thank you again for this opportunity to share what community 

foundations are able to do, and our perspective on this vital and 

important public policy. 

[The prepared statement of Mr. Mazany follows:] 


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Mr. ROSKAM. Thanks, Mr. Mazany. 

Mr. Christopher. 

STATEMENT OF BRENT E. CHRISTOPHER, PRESIDENT 

AND CEO, COMMUNITIES FOUNDATION OF TEXAS, DALLAS, TX 

Mr. CHRISTOPHER. Mr. Chairman and Members of the Committee, including Congressman Marchant, whose district is in 

north Texas, thank you for this opportunity to testify today. My 

name is Brent Christopher, and for the last almost 8 years I have 

served as the President and Chief Executive Officer at Communities Foundation of Texas in Dallas. 

When you hear the words ‘‘community chest,’’ you probably think 

of the game Monopoly. That square exists on the Monopoly board 

because there once were community chests all over America, which 

supported local agencies addressing health, hunger, and other basic 

needs. My foundation began in 1953 as the Dallas Community 

Chest Trust Fund, and we evolved over time into Communities 

Foundation of Texas. 

We work like sort of a philanthropic GPS, helping to steer charitable dollars not only to human service agencies, but also to education, the environment, the arts, medical research, the whole 

range of public needs across the north Texas region, around DallasFort Worth, and beyond. We have over $800 million in charitable 

assets. We have worked with thousands of donors. And we have 

paid more than $1.2 billion in charitable grants since we were 

founded in 1953. 

But I like that our roots come from the old community chest, because, really, that is what a community foundation is. As my colleague, Terry Mazany, indicated, each of the over 700 community 

foundations in America is a 501(c)(3) public foundation. Really, a 

collection of charitable donations from many people. Community 

foundations operate through a mix of donor-advised funds, scholarship funds, funds that are designated to support one particular 

charity, and discretionary endowments that are entrusted to us to 

meet local needs over time. And by depending on donations, we are 

affected by the charitable tax deduction in a direct way that most 

private foundations are not. 

One of the most commonly-used tools in a community foundation 

tool kit is the donor-advised fund. It is a public charity alternative 

to creating a private foundation that allows charitable assets to be 

managed more cost-effectively in a bigger pool, while also allowing 

donors to remain involved by recommending grants from that fund 

that align with their charitable interests. 

Last year, donor-advised funds at Communities Foundation of 

Texas held a total of $266 million, and they paid out 14 percent 

of that value in $37 million worth of grants. These funds are important charitable vehicles that are being used more frequently by 

donors. And the current IRA charitable rollover provisions that 

allow people to make tax-free charitable contributions from excess 

funds in their IRAs should be strengthened by including donoradvised funds as eligible recipients. 

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grounds. Our first major gift was in 1955 from a woman named 

Pearl Anderson. She was the widow of an African American physician, and had grown up in rural Louisiana during the days of segregation. Mrs. Anderson was prohibited from going to school until 

the age of 12, when an African American school was finally built 

just a few miles from her home. She would often walk by a plaque 

that credited the Rosenwald Fund with establishing that school. 

Rosenwald referred to Julius Rosenwald, the great Chicago philanthropist, and the Chairman of Sears Roebuck, who was inspired by 

Booker T. Washington to build schools in African American communities all across the rural south. 

Pearl Anderson vowed that one day she would pay back the debt 

that she owed to the people who made it possible for her to get an 

education. She brought that dream, along with the remainder interest in property that turned out to be worth $350,000 to the old 

Dallas Community Chest Trust Fund. All she asked was that the 

money be used to help youth and the poor, without regard to their 

race or religion. And today we are still using the Pearl C. Anderson 

Fund to do just that, and to honor her promise to give back. 

While you all were working on the fiscal cliff bill back at the end 

of December, Robert Shiller, the Yale professor and economist, 

wrote an op ed piece on the charitable deduction. And instead of 

a dry, academic rebuff to its significance, it is important to note 

that he began his op ed saying, ‘‘Whatever else we do about the 

Tax Code, we need to save the charitable deduction, which has 

done so much good in our country, and springs directly from some 

of our deepest values.’’ 

Most people give from their hearts. But I also know that, since 

1917, the charitable deduction has been a vital thread in the fabric 

of charitable giving in this country. It may not be the primary motivation, but it definitely affects the size and the timing of charitable gifts. As Ranking Member Levin said earlier today, it is not 

a loophole that needs to be closed. It is a multiplier of generosity. 

It is unique in our Tax Code, an encouragement to act selflessly by 

spending money on the public good instead of ourselves. And we 

need the full force of that encouragement in this country today, 

more than ever. Thank you very much. 

[The prepared statement of Mr. Christopher follows:] 


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Mr. TIBERI [presiding]. Thank you, sir, for your testimony. Mike 

Kelly had hoped to be here to introduce you. Unfortunately, he got 

tied up in a meeting and still may be back before you are finished. 

But, Ms. Osche, please—— 

Ms. OSCHE. Congressman, thank you. 

Mr. TIBERI [continuing]. Testify today. Thank you. 

STATEMENT OF LESLIE OSCHE, EXECUTIVE DIRECTOR, 

UNITED WAY OF BUTLER COUNTY, BUTLER, PA 

Ms. OSCHE. Thank you, Mr. Chairman and Members of the 

Committee. On behalf of the thousands of donors and our many 

charity partners of the United Way of Butler County and our entire 

United Way network, I thank you for the opportunity to appear 

today and share concerns of our citizens on the impact on charitable deduction. 

There has been much discussion, I think, this morning around 

the Tax Code and the high-level impact of charitable deduction. 

And I would like the opportunity to share with you what the real 

impact is at the local level, and what we are hearing from our donors at the local level. 

Butler County is one of the fastest-growing counties in Pennsylvania. In population, job growth, and median income, our county 

residents made contributions of $69.4 million in 2011, nearly 4 percent of their discretionary income. As a result of growth, our 

United Way in Butler County’s annual fundraising campaign 

topped $1.7 million last year, which was an increase of actually 33 

percent. Nearly one-third of that increase, or over $560,000, comes 

from leadership-level gifts of $500 or more. 

Over the last several years, as the proposed cap on charitable deductions has come to the forefront, I have heard from many donors 

whose gifts would be significantly impacted if tax reform means a 

limit on charitable deductions. In fact, one major donor stopped me 

as I was on my way into the polls during the November election 

to say that he would be forced to make tough choices, and that his 

generous contribution would either decrease or perhaps be lost all 

together. 

Losing his gift would mean that we would lose at least 25 days 

of after-school programming for nearly 100 children at our local elementary school, where 75 percent of those children are receiving 

free or reduced lunches, and where our partner agencies and volunteers are providing tutoring, teaching basketball and other exercise 

programs, providing healthy meals to those students and families, 

giving the students the opportunity to participate in Boy Scouts, 

Girl Scouts, 4H, and other community programs. The school district 

is so pleased with the results of the student academic performance, 

that they would like to expand that to other elementary schools. 

But we can’t make that happen if we lose that donor’s gift. 

Just a few months ago I received a call from a financial advisor— 

and a volunteer with us—who had indicated that he was working 

with a gentleman who needed to make a sizeable charitable gift, 

but wanted to be certain that it was going to have a real impact 

on somebody’s life. He made a contribution to our child care scholarship fund that assists those who are either on a waiting list for 

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gible for that assistance. His gift assisted a young family with two 

children whose life was interrupted when the father suffered an injury. It was debilitating and he was facing multiple surgeries and 

could no longer work. 

The mother was working full-time to maintain the family’s daily 

bills and healthcare costs, but her employer required her to work 

overtime, which made her ineligible for child care assistance. And 

child care would consume at least half of their monthly income. 

She was thinking about giving up, about staying home, and relying 

on public benefits. Imagine the cost that you and I would be paying 

for that, compared to the $5,000 gift that kept her employed for another 6 months, and provided quality early care and education for 

her children. 

Another concerned donor and fellow Rotarian provides an annual 

gift to our emergency relief fund that keeps the heat on for at least 

30 families in our community. If these folks are shut off, those reconnect costs would be triple the amount that it took—with that 

little bit of assistance—to keep the heat on. 

Butler County’s growth is largely due to the generosity and private support of citizens who give, advocate, and volunteer their 

time to ensure that those key building blocks of education, income, 

and health are solid, and that we can safely build on that foundation. Those $1.7 million in charitable contributions last year allowed us to invest in programs and initiatives that build character, 

improve academic outcome, and equip our young people for the careers of the future. 

We invested in initiatives and improved financial stability 

through employment services, free health care for underemployed, 

child care tax assistance, and affordable housing. The investments 

were widespread across 40 programs and 21 different nonprofit 

providers. They are the programs that close the door on vulnerabilities that lead to dependence on more costly Band-Aid solutions. 

We also distributed $700,000 in designated contributions to over 

700 separate charities across the country. 

And so, the critical message I am honored to carry from my community and from our United Way network today is that these efforts are driven and funded by the private sector, by the citizens 

of this great country, who support their religious and charitable institutions, and who literally come to the table with us, even at 7:30 

a.m. on Monday mornings, to advance the common good and resolve problems in our community. 

Any effort to limit those charitable deductions strikes at the 

heart of the citizens and the community, who are moving beyond 

government support and solving problems here, at the ground level. 

These efforts should be supported. And the incentive to give and 

to volunteer their time must be preserved. We work together with 

community institutions to solve problems and drive change. And 

they all rely on the generosity of our citizens and their charitable 

contributions that have long been exempt from taxation. 

Limiting charitable deductions has a negative multiplier effect on 

our community and on families, and that widespread consequence 

could be devastating. This country was built on the charitable 

spirit of its citizens. And this core value is unmatched anywhere 


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else in the world. Please preserve this value by protecting that deduction. And I thank you. 

[The prepared statement of Ms. Osche follows:] 


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Mr. TIBERI. Thank you. Thank you all for your testimony. It 

will be part of the record. 

Mr. Gerlach from Pennsylvania, you are recognized, if you would 

like to ask a question. 

Mr. GERLACH. Thank you, Mr. Chairman. I don’t have any 

questions for the panel, but I did read through your testimony. And 

let me just say thank you on behalf of those I represent, and on 

behalf of those that represent you in Congress that may not be 

here this afternoon with us, for all the great work you do in the 

communities where you serve. You do a tremendous amount of 

great work. And all across the board we want to say thank you. 

And a special thank you to Mr. Wentworth for the great work the 

Land Trust Alliance has been providing to us. And thank you to 

Congressman Mike Thompson here of the committee on the conservation easement legislation for the fact we had well over 300 

House Republicans and Democrats cosponsoring this legislation 

this last session as a testament to the importance of the good work 

that conservancies and land trusts do all across the United States. 

And we will continue to work with you on this issue during the 

113th Congress. So thank you for that. 

But, otherwise, all of you, thank you for the tremendous work 

you do in the various communities that you are involved in. We appreciate it very, very much. 

Mr. TIBERI. Thank you, Mr. Gerlach. The gentleman from Texas 

is recognized for 5 minutes. 

Mr. MARCHANT. Thank you, Mr. Chairman. I would just like 

to say—add my thanks to the previous statement, and tell you that 

the Chairman felt—told our Committee before we met today that 

it was very important the American people hear from all of you 

today. And so, this is an important part of our discussion of tax reform, but it was also very important that each of you got to add 

your voice to this debate and make your case. 

I would like to say thanks to Mr. Christopher from north Texas. 

I grew up in the Dallas area, and the Communities Foundation has 

done an incredible job in Texas—in Dallas, especially—in helping 

donors manage their donations. And it has had an incredible impact on north Texas. And I know that I, for one, am very grateful 

for that, and grateful to all of you for what you do every day. 

Thank you. 

Mr. TIBERI. Thank you. And last, but not least, Mr. Kelly has 

made it. We—you just barely missed your opportunity to introduce 

Ms. Osche. 

The gentleman is recognized for 5 minutes. 

Mr. KELLY. I thank you, Chairman. And Leslie, I am sorry I 

wasn’t here for it. We were talking before the hearing, and I—Leslie was in the back of the room. I said, ‘‘How would you like me 

to introduce you,’’ and we had talked yesterday. She says, ‘‘Well, 

it is’’—something about Gidget Goes to Washington. So—I have to 

tell you, though, we go back a long way, because we are both lifelong residents of Butler, Pennsylvania. 

I think the importance—and I would like to associate myself with 

the remarks of the other Members—of you being here today is 

really your day in court. It is your day to put out the information, 

your life experience, truly, I think, the anecdotal message that you 


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can bring, Leslie, when you talk about people back home. Because 

that is what we understand as Members of the Committee. We 

have to look at the whole country, but we really know what it is 

like back where we live, back where we work, back where we go 

to church, back where we have gone to school. And so it is critical 

to understand that relationship. 

I have always thought that, coming from the private sector my 

whole life, I know incentives work. And I know when you take incentives away, that it has a drastic effect. And I think as we look 

at—we are trying to reform this Tax Code, and trying to navigate 

it—and I don’t know, quite frankly, how anybody does—this is not 

a political thing for me, based on a Republican idea or a Democrat 

idea. This is about what is best for this country. 

You and I talked a little bit yesterday. When you start taking 

things away from people that they had before, incentives for doing 

the right thing, then you start to see results that maybe go the 

other way. And I heard in our first panel about 97 percent of 

United Way’s funding, where it came from in contributions and 

how critical that was. I think that has just always been unique 

about this country. I don’t know of anyplace else in the world that 

people are more generous with their own money and their own 

time. And especially time, because you really can place no dollar 

value on that. You are giving up a day of your life to do something 

for somebody else, and I think it is phenomenal that we do that. 

I don’t—haven’t experienced anyplace else in the world like 

America. So as much as we sometimes wonder about the direction 

of the country, I—when I look at America’s heart, I know it is still 

the way it has always been. 

You and I talked yesterday. Some of the people that you talked 

to, people that you and I know, and people that fund United Way 

and participate in United Way, the effect that it is going to have— 

and I know you all know what that is going to do. So—but, Leslie, 

some of the folks we know—— 

Ms. OSCHE. Yes. And I did speak to that a little earlier, just before you came in, about the donor who specifically stopped me during the election time and discussed what the impact would be on 

his gift, and, again, outlined directly what that impact would have 

on programs in our community. 

And so, when I go from Rotary meeting to church to all of these 

various organizations and talk with community members, many 

have called me in the last week, indicating the fear, again, that the 

multiplier effect would have if those charitable contributions are 

capped in any sort of way. And that multiplier effect, again, because it is the same people that I see at all of those same charity 

events who are giving to multiple organizations, and those organizations are inextricably tied to providing that safety net in our 

community. 

Mr. KELLY. I know—and you have all given testimony, to a certain degree, of how that does affect it. 

I am not going to use too much more time, Mr. Chairman, but 

I did want to thank you all for coming here. I know it would be 

great if we had a full panel. But I have to tell you this—when it 

comes to personal time, this is the worst part of my life. I control 

absolutely nothing in my life. It is all based on appointments and 


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times where I have to be. It is all sorted out for me, so it is a little 

bit difficult at times. But it is really important. 

I think that there is a disconnect between when I go home and 

people say, ‘‘People in Washington don’t know what we are going 

through.’’ The fact that the Chairman called this hearing gives you 

an opportunity. We do want to hear from you. We do want to know 

the effect that it has on you. We do want to know the effect that 

it is going to have on our charitable giving aspect of the Tax Code. 

So thank you so much for being here. And I will just tell you there 

will be great consideration given at all levels. 

So thank you so much, Mr. Chairman. 

Ms. OSCHE. Thank you. 

Mr. KELLY. I yield back. 

Mr. TIBERI. Thank you, Mr. Kelly. I couldn’t have said it better, 

myself. So I won’t say anything. Thank you all for being here, and 

spending time with us today. 

The next panel shall be seated as the third panel prepares to 

leave. And I will introduce our panelists as they settle into their 

seats. 

Welcome to the fourth panel. Thank you for sticking around. It 

is a busy day for a lot of Members. 

The first witness I would like to introduce is an old friend from 

Ohio, a former Ohioan, William Daroff, Vice President for Public 

Policy of The Jewish Federations of North America. Mr. Daroff is 

the leading advocate for the American Jewish issues on Capitol 

Hill. Thanks for being here. 

Second, we will hear from Ruth Thomas, who is Vice President 

of Finance and Administration of SAT–7 in Easton, Maryland. Ms. 

Thomas has extensive experience in human resources, accounting, 

and IT management. Thank you for coming today. 

Third, we will hear from John Ashmen, who is President of the 

Association of Gospel Rescue Missions in Colorado. Mr. Ashmen is 

the originator of an award-winning professional training CD series 

on Christian camp and conference leadership orientation and development. Thanks for coming such a long way. 

Fourth, we will hear from John Berry, who is CEO and Executive 

Director of the Society of St. Vincent de Paul Georgia in Atlanta. 

Mr. Berry entered the nonprofit sector after a 25-year business and 

Federal Government career. Thank you for being here, sir. 

Fifth, we will hear from Larry Minnix, who is President and 

CEO of Leading Age, here in Washington, D.C. Mr. Minnix has 

been an advocate for nonprofit aging services for over 35 years. 

Thank you, sir. 

Sixth, we will hear from Scott Ferguson, who is President and 

CEO of United Way of the Chattahoochee Valley, in Georgia. Mr. 

Ferguson has led four other United Way organizations across the 

United States during his 24 career years with the United Way. 

Thank you for being here. 

Last, but not least, we will hear from LaKisha Bryant, who is 

President and CEO of the United Way of Southwest Georgia. Ms. 

Bryant was previously Executive Director of Girls, Incorporated. 

Thank you for coming today. 


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Thank you all. The Committee has received each of your written 

statements that will be made part of the formal hearing record. 

Each of you will be recognized for 5 minutes for your oral remarks. 

And we will begin with the gentleman from—originally—Ohio. 

Mr. Daroff, you are recognized for 5 minutes. 

STATEMENT OF WILLIAM C. DAROFF, VICE PRESIDENT FOR 

PUBLIC POLICY AND DIRECTOR OF THE WASHINGTON 

OFFICE, THE JEWISH FEDERATIONS OF NORTH AMERICA, 

WASHINGTON, DC 

Mr. DAROFF. Thank you very much, Mr. Chairman. It is an 

honor to be here. It is an honor to be here with you, chairing this 

Committee, given our many decades of friendship, as well as your 

friendship with the Jewish community in your home State and 

across the country. 

I would like to thank you and the Committee for inviting me to 

testify. My name is William Daroff, and I am the Vice President 

for Public Policy, and Director of the Washington Office for The 

Jewish Federations of North America. We represent 154 Jewish 

federations across North America, as well as 300 independent network communities which are the fundraising organizations, as well 

as the central planning bodies for an extensive network of Jewish 

health, education, and social service agencies. And we raise and 

allocate funds for almost 1,000 affiliated agencies that provide 

needed services to almost 1 million individuals across the country. 

As the second-largest philanthropic network in North America, 

we know firsthand that tax incentives do result in increased charitable giving. We oppose proposals that would either limit the value 

of the charitable contribution deduction, or impose a dollar cap on 

the charitable deduction, as they would cripple our ability to provide needed social services to the most vulnerable among us. 

Jewish federations conduct an annual fundraising campaign that raises almost $950 million each year from over 400,000 donors. In addition, we raise $1.2 billion each year through a variety 

of planned-giving vehicles. We are especially proud of the important role that donor-advised funds play, as well as supporting organizations, in making grants and building endowment assets. Jewish federations have combined endowment assets of approximately 

$14 billion, and make annual grants from those funds that exceed 

$1.5 billion, with significant distributions for both Jewish and nonJewish charitable endeavors. 

We ask both sides—we see both sides of the charitable deduction 

equation: How donors react to tax provisions, as well as how philanthropic dollars flow to assist the most vulnerable. Perhaps the 

primary mission of JFNA is to assist Jewish federations as they inspire members of the Jewish community to fulfill our religious duty 

to be charitable—in Hebrew, ‘‘tzedakah’’—and to fulfill our collective responsibility to build community and improve the world, 

‘‘tikkun olam.’’ 

Although it is true that the importance of these principles transcend the Tax Code and incentives such as the charitable contribution deduction, we also recognize that such provisions lead to increased donations. These contributions truly are the lifeblood of the 

Jewish federation system. 


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Although the donor base of our annual campaign is large, over 

400,000 donors, the overwhelming percentage of dollars raised 

come from a relatively small percentage of donors who are tax sophisticated and extremely sensitive to the vagaries of the Tax 

Code. It is this tax sophistication that permits donors to structure 

gifts so that the maximum amount of funds flow to Jewish federations and, in turn, to beneficiary agencies, and that this flow happens to charities today, rather than later. 

This perspective convinces us that proposals that limit the deductibility of charitable contributions will lead to a significant decrease in donations to the Jewish federation system. As you know, 

the Center on Philanthropy at Indiana University published in 

2011 a study stating that charitable giving would decline by over 

$3 billion if the deduction was reduced, which is not an insignificant amount. For us, the debate by tax economists is largely an 

academic exercise, however. The true measure is the tens of thousands who benefit from our services every day. At a time when government funding at all levels is shrinking, charities are needed to 

fill the gap that government cannot address. 

Some examples of the work on the ground by Jewish federations 

and partner agencies tell the story. In Chicago, the Jewish Federation provides food, refuge, health care, and emergency assistance to 

300,000 individuals of all faiths. In Los Angeles, the Federation 

supports Bet Tzedek, an organization that provides free legal services to over 100,000 families. In Ann Arbor, the home of Chairman 

Camp, the Jewish Federation and the Jewish Family Services of 

Washtenaw County’s world-class Partners in Care Concierge Program pairs volunteers with seniors to help them better navigate 

the medical system and decrease hospital readmissions that could 

trigger significant Medicare cuts. 

Over the past several decades, the Jewish Federation System has 

fostered growth in charitable giving through donor-advised funds 

and supporting organizations known as participatory funds. They 

offer donors an ongoing partner with Jewish federations. These 

participatory funds provide a reliable pool of dollars to support the 

annual campaigns of Jewish federations, which is a primary financial source for ongoing operating budgets. Grants from these funds 

comprise up to 25 percent of the operating budgets of some federations. 

As you consider changes to charitable deductions, we urge that 

participatory funds be allowed to flourish with a minimum of regulatory burdens. We applaud your deliberative process in addressing 

these very important issues. However, we believe it is crucial, particularly with the Federal deficit—in a thoughtful manner. 

However, we believe it is crucial to recognize in the income tax 

law that the charitable deduction is the only place where an individual must give away income and assets in order to receive a deduction. This selfless act must be promoted by the Tax Code, and 

it is fundamental to the social contract that bonds individuals, 

charities, and governments. 

Again, we applaud the Committee for taking this action, and we 

remain committed, as the Jewish Federations of North America, to 

ensuring that Federal tax policies continue to incentivize the flow 

of funds from individuals to public charities. 


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I thank the Committee for the opportunity to present this testimony, and stand ready to answer your questions. 

[The prepared statement of Mr. Daroff follows:] 


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Mr. TIBERI. Thank you, Mr. Daroff. 

Ms. Thomas, you are recognized for 5 minutes. 

STATEMENT OF RUTH S. THOMAS, VICE PRESIDENT 

OF FINANCE AND ADMINISTRATION, SAT–7, EASTON, MD 

Ms. THOMAS. Thank you, Mr. Chairman and Committee Members. I am honored to be here today and thank you for the opportunity. My name is Ruth Thomas, and I am Vice President with 

SAT–7. 

SAT–7 is the largest Christian satellite network in the Middle 

East and North Africa, with five full-time, 24/7 channels, and with 

studios across the Middle East. For over 15 years, SAT–7 satellite 

broadcasts have bypassed rulers, religions, and regimes, bringing 

free Christian content directly to millions of individuals in the 

safety of their homes. We know that 9.25 million children are 

watching every day across the Middle East. One in four children 

in Saudi Arabia watch Christian programming. 

SAT–7 North America is a 501(c)(3) nonprofit organization in the 

United States. We raise funds and build awareness for our production teams. We neither seek nor receive any local, State, or government funding, but are fully funded by private donations, foundations, and churches. 

I thank you for considering this important topic. America is the 

most generous country in the world. And I am glad to hear the 

prior testimony from your Members speaking of enabling donations 

and not discouraging them. You would be surprised that the attitude around the world is that America is so generous. So we need 

to stand by that. 

Many organizations will falter if the charitable deduction is limited or removed. By working with integrity and great efficiency, 

nonprofits are doing more with less. And I will give you one example. In the case of SAT–7, our viewing audience in the Middle East 

is over 15 million people. We have an annual budget of $15 million. 

That equates to $1 per viewer per year. That is truly cost effective. 

Others are doing remarkable work, as well, with very few dollars, 

by utilizing volunteers and the gifts of generous Americans. 

Nonprofits are the many points of light spoken of by President 

Ronald Reagan, the Shining City on a Hill. Nonprofit employees 

are serving because they choose to do so, often giving up large salaries and generous retirement and benefits packages. 

So, as you consider limiting or capping the deduction, an American institution of our Tax Code, you are considering cutting off our 

life blood. The majority of nonprofits receive the largest portion of 

their operating funds from people who itemize on their taxes, so 

they can receive the deduction. High net worth donors are just as 

motivated by the tax deduction as the smaller donors. They are 

just able to give more, substantially more. 

Without reservation I can tell you that if the deduction is reduced, capped, or limited in any way, our donors will give much 

less, even though they like to give more. Donors even call us in 

January, anxiously awaiting their tax-deductible receipts. We know 

how much that tax deduction is a part of their thinking. The urgency to give at the end of the year is also important. And stock 

gifts are often received on the last few days of December. 


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Nonprofits have struggled since 2008 because of the recession. To 

hamstring the public’s generosity at this point would severely impact the good work of thousands of nonprofits. In our case, we 

would be forced to lay off staff and cut broadcasting. To change the 

law in such a way that limits the ability of nonprofits to do the 

good they do with well-established efficiency and effectiveness will 

mean that needs will go unmet. 

I thank you for the time today, and I appreciate the opportunity 

to be here. 

[The prepared statement of Ms. Thomas follows:] 


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Mr. TIBERI. Thank you, Ms. Thomas. 

Mr. Ashmen, you are recognized for 5 minutes. 

STATEMENT OF JOHN ASHMEN, PRESIDENT, ASSOCIATION 

OF GOSPEL RESCUE MISSIONS, COLORADO SPRINGS, CO 

Mr. ASHMEN. Thank you, Mr. Chairman. And I want to thank 

the Committee for making charitable giving a priority, and bringing all these folks in to testify. I told my colleague here I feel a 

little bit like we are all band members, cover bands playing the 

same tune. But I think we all have a very different rendition, and 

I think it is good to hear all these perspectives. 

So, a week ago today I was at the National Prayer Breakfast and 

heard President Obama’s remarks when he spoke about Jesus and 

the two very important commandments. The second commandment 

we all know and have heard many times: Love your neighbor as 

yourself. And for many years, many Americans have lived out that 

commandment by giving money in large and small amounts to 

trusted institutions that they believe are doing life-saving work. I 

represent 300 of those associations. It is called the Association of 

Gospel Rescue Missions. And we are North America’s oldest and 

largest network of independent, faith-based crisis shelters and rehabilitation centers that do what we call radical hospitality for the 

poorest of our citizens. 

This testimony I am giving was submitted earlier in writing. And 

in it there is a list of 37 of those 300 missions that provide services 

that are represented in 24 of the districts represented by Members 

of this Committee. 

I want to focus my testimony on four realities that we stand by 

in the Association of Gospel Rescue Missions. I hope they will be 

instructive points as you make some important decisions, going forward. 

The first reality is kind of a backdrop for the other three, and 

it is simply this. Rescue missions are busier than they have 

ever been at any time in our 100-year history. The stream of people is endless. I have been to a lot of these missions, and I see it. 

Whether it is a chronically homeless man dealing with addictions 

or mental illness, or a young woman with her child who is shocked, 

embarrassed, devastated to be homeless for the very first time, 

what I am telling you is every available space and every contribution that comes in provides critical care services. 

One of your colleagues just this past week went to the rescue 

mission that is right here in Washington, D.C. Standing in the 

middle of this room with 180 beds, the question was asked, ‘‘How 

many nights throughout the course of the year are all these beds 

filled?’’ And the director, without hesitation, said, ‘‘Every single 

night.’’ 

One of our directors told a volunteer—to sum up this point I will 

use his saying: ‘‘If serving the poor and powerless brings you joy, 

hang out at our mission and you can be joyous for the rest of your 

life.’’ 

The second reality is that missions are not fee-for-service entities. That is very important. That means they are extremely dependent on the generosity of private donors. Let me say that another way. Private donations do not supplement the income that 


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rescue missions receive; they are the primary source of their income. 

For example, Crossroad Center Rescue Mission in Congressman 

Smith’s Nebraska district says that 99 percent of its annual funding comes from individuals. And that is echoed throughout our association. Rescue missions for years have counted on the current 

charitable deduction as an effective incentive. And, frankly, they 

dread what might happen if that incentive is reduced. 

To sum up my second point, rescue missions are extremely dependent on donations and the charitable deduction, probably more 

so than most charities. 

The third reality is that because rescue missions rely so heavily 

on private giving, they are especially vulnerable if there is even a 

small drop in contributions. Every drop impacts services. It costs 

two dollars and a nickel at Rescue Missions of Mid-Michigan, in 

Chairman Camp’s district, to feed someone a hot meal. So, for 

every $2.05 that doesn’t come in, that is one less meal to serve. 

Imagine yourself in a long line, waiting to get that first meal of the 

day. You get up to it, and the food runs out because the money has 

run out. 

In Congressman Becerra’s Los Angeles district, our director 

there, Andy Bales, said what they are currently experiencing is a 

21 percent drop in donations, but a 35 percent increase in people 

seeking services, which goes back to my first point. Those kind of 

numbers ultimately affect people in need. 

In my opinion, as everyone here so eloquently has said before 

me, this is a time in our history when government should be offering the fortunate among us more incentives to give generously, not 

suggesting and experimenting with disincentives. To sum up that 

point, any drop in donations has a human cost. 

Thank you very much for your time. 

[The prepared statement of Mr. Ashmen follows:] 


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Mr. TIBERI. Thank you, Mr. Ashmen. 

Mr. Berry, you are recognized for 5 minutes. 

STATEMENT OF JOHN A. BERRY, CEO AND EXECUTIVE DIRECTOR, SOCIETY OF ST. VINCENT DE PAUL GEORGIA, ATLANTA, 

GA 

Mr. BERRY. Thank you, Mr. Chairman, and thank you for the 

opportunity to testify here today. 

Since 2009 I have chaired our national vehicle donation program, 

which supports the work of more than 4,500 St. Vincent de Paul 

offices nationwide. I also chair our national charity coalition working to stem the sharp decline in vehicle donations. 

Let me start by saying that we strongly support retention of the 

overall charitable deduction. To change the tax treatment of individual donations would undermine our capacity to serve the community. But my testimony to you today focuses specifically on the 

deduction for vehicle donation. 

Over 5,000 charities rely on vehicle donations to underwrite their 

services to the needy. And most of them are testifying today. Often 

the nonprofit sector delivers these services instead of the government. In these times of budgetary challenge, we fill gaps to ensure 

that those in need are helped. Many charities like ours receive little or no government funding, and rely on the donations of noncash assets, especially vehicles. 

However, since a 2004 change in the tax treatment of vehicle donations, there has been a sharp decline in them, with a staggering 

impact on charitable services. At that time, Congress changed the 

valuation method as part of a package of reforms to address abuses 

in the process under the rules that then existed. Those changes 

strengthened tax reporting and enforcement and were excellent. 

The valuation provision was well-intended, but misjudged the psyche of the donor. The changes were meant to eliminate abuse, but 

have had the effect of also chasing away donors, actually undermining private philanthropy. 

Most of you and your colleagues already agree that this is a problem. I say that because last session legislation to address the problem attracted 333 House cosponsors, including 26 Members of the 

current House Ways and Means Committee, including the Chairman and Mr. Kelly. 

Sitting in this hearing room today it may seem like a small matter. But for charities like ours, the impact is enormous. To share 

my own experience, in 2004, just in Atlanta, we received 533 donated vehicles, the sale of which yielded over $237,000 in revenue. 

In 2005, the first year the new rule took effect, donations dropped 

to 382 vehicles, yielding only $143,000. By 2012, we had seen a 72 

percent decline in revenue. Small numbers, maybe. But those numbers literally are the difference between having—families having 

food on their table or a roof over their heads. For us, for $100, we 

can feed a family of four for a week, or provide light and heat for 

a month. 

A food recovery and distribution program we operate in Georgia 

partners with local retail food chains to collect food that is beyond 

store shelf date, but is still perfectly good to eat. That program 

today redistributes over 10 tons of food per month through our 38 


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food pantries. The vehicle donation revenue we have lost each year 

since 2005 would have more than fully funded that program every 

year with money left over for other programs. You can hear similar 

testimonials from thousands of other charities across the county. 

The national impact is also staggering. According to the IRS, in 

2004 charities received over 970,000 donated vehicles, with a total 

value of over $2.6 billion. In 2005, that dropped to 325,000 vehicles, 

with a value of $610 million, an overall decline of 77 percent in 

only 1 year. 

We do not seek repeal of the 2004 reforms. They have worked 

well to curb tax abuses. Charities have no desire to restore the 

black eye that vehicle donation had earned prior to the changes. 

Our goal is to restore the timing of the valuation to the beginning 

of the donation process, so prospective donors can make an informed decision about the gift. 

As Mr. Reichert alluded to earlier today, valuation of donated ve- hicles over the $500 threshold is based on the gross sale price. So 

donors don’t know the value of a donation until after the charity 

sells the car. This requires they hand over the car without any idea 

of the consequences. Even the most altruistic donor is reluctant to 

play roulette with the tax ramifications of the donation, particularly with a vehicle of significant value. 

Last session Representatives Reichert and Larson introduced legislation, H.R. 860, to solve the problem. It wouldn’t touch the tracking enforcement reforms, but it would address the valuation timing 

issue. We are encouraged that so many Members of Congress recognized the problem last session in cosponsoring H.R. 860. For me, 

someone whose focus is more on the streets of Atlanta than the 

halls of Congress, it sends a powerful bipartisan message. Thank 

you very much. 

[The prepared statement of Mr. Berry follows:] 


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Mr. TIBERI. Thank you, Mr. Berry. 

Mr. Minnix, you are recognized for 5 minutes. 

STATEMENT OF LARRY MINNIX, 

PRESIDENT AND CEO, LEADING AGE, WASHINGTON, DC 

Mr. MINNIX. Thank you very much, sir. We appreciate the opportunity. Leading Age represents 6,000 not-for-profit aging and 

other kinds of providers throughout the country. In the 19th century we were your widows and orphans homes. We were the homes 

for old women and widows of veterans of the Civil War and the old 

soldier’s home. Today we are things like Ecumen and Jewish Home 

Life Care and the Bivens Foundation in Amarillo and National 

Church Residences in Columbus. We are part of a philanthropic 

sector that we believe is now so embedded in our culture that we 

may be in danger of taking it for granted. Otherwise, we wouldn’t 

be talking about threats to the charitable deduction. 

Charity is in our gene pool. Benjamin Franklin started the tradition by establishing the Leather Apron Society to help sick and 

wounded soldiers, a major concern that is arisen in spades today. 

De Tocqueville commented on America’s unique penchant for enlarging the hearts of communities, which I think is a wonderful 

way to think about the American charitable spirit. 

Peter Drucker commented that America has three distinct sectors that make it great and different: Government, whose job is to 

protect and defend; business’ job to generate an economy; and the 

not-for-profit sector, to change lives. 

Dr. Lester Salamon at Johns Hopkins, who is probably arguably 

the most knowledgeable expert today on the importance and the resilience of the sector, says that we have four duties: One, guardian 

of values; two, meet difficult unmet needs that are not profitable; 

three, advocate for those who do not have advocates; and four, create social capital. 

The not-for-profit sector is surprisingly large in size. It is the 

third-largest employer in America, behind manufacturing and retail—13.5 million jobs. So, threats to the charitable sector mean 

threats to jobs, simply because that is where most of the money 

goes. 

So, as government reins in its spending, as we know that it must 

do to get our financial house in order, philanthropy will be asked 

to fill gaps that ordinary people and families cannot cover themselves. And it is the poor, yes, but it is also the middle-class poor. 

In our sector we see a number of people that need various types 

of long-term care services that have a little too much to qualify for 

Medicaid, but cannot sustain themselves on their own resources. 

Here is an example. Golden Years Home in Indiana had to demolish their old nursing homes. We have a lot of old nursing homes 

in America. And they had to have a capital campaign to do that. 

They have a new state-of-the-art facility. Seventy-five percent of 

their residents are Medicaid, Medicaid does not pay the full cost of 

care, so there are two gaps that they fill there. TELACU in Los Angeles, low-income senior housing, but they also have an academic 

program where they tutor disadvantaged students. They have a 

100 percent graduation rate for participating high school and college seniors in a county where the graduation rate is 40 percent. 


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In aging services, a low-income elderly housing with services is 

an emerging new model where, if they are allowed to provide nonmedical services, can help seniors age in place and keep them out 

of hospitals and nursing homes. A downstream effect on healthcare 

costs is beginning to emerge. Bethany Center in San Francisco reports they don’t remember the last time one of their residents had 

to go to a nursing home. So these outcomes are possible only with 

philanthropic contributions. 

Our retirement communities serving largely middle-income people, keep people off of Medicaid. And we are seeing results where 

they are staying out of hospitals and nursing homes unnecessarily. 

The power of the not-for-profit sector can be amazing. Dr. Claire 

Gaudiani at Yale offers a very provocative perspective in her book, 

‘‘The Greater Good: How Philanthropy Drives the American Economy and Can Save Capitalism.’’ I recommend it to you. It is well 

done. She asserts in there, ‘‘America is not generous because it is 

successful; it is successful because it is generous.’’ In my own folksy 

way of putting it, I would say philanthropy is the seed corn of 

American progress. 

And I urge us not to forget that, and to stop messing around with 

threatening the tax deductibility of charitable contributions, and 

encourage people to give, not discourage them. Thank you very, 

very much for this opportunity 

[The prepared statement of Mr. Minnix follows:] 


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Mr. TIBERI. Thank you, Mr. Minnix. I can’t help but tell you 

that I was with the National Church Residency folks a month ago 

in Columbus, Ohio, in a project that they built with a low-income 

housing tax credit to house, in transitional housing, homeless veterans. 

Mr. MINNIX. The homeless veterans, yes. 

Mr. TIBERI. Working with the nonprofit community to provide 

services, and then working with the for-profit community to place 

them in permanent jobs and get them into permanent housing. It 

is a great organization. 

Mr. MINNIX. Thank you. We are trying to work with them with 

HHS and HUD to show that there is a national model here. 

Mr. TIBERI. It is a great—— 

Mr. MINNIX. So—yes. 

Mr. TIBERI. It is a great concept. 

Mr. MINNIX. So thank you for that comment. 

Mr. TIBERI. No, you are welcome. Thank you for what you have 

done. 

Mr. Ferguson, you are recognized for 5 minutes. 

STATEMENT OF SCOTT D. FERGUSON, PRESIDENT AND CEO, 

UNITED WAY OF THE CHATTAHOOCHEE VALLEY, COLUMBUS, GA 

Mr. FERGUSON. Thank you very much, Mr. Chairman and the 

Committee. I am Scott Ferguson, President and CEO of the United 

Way of the Chattahoochee Valley in Columbus, Georgia—the other 

Columbus. It is a real honor to be here with a distinguished panel 

and many colleagues. And I am honored to be the leader of a 

United Way that has over 20,000 individual contributors every 

year, many of which use that incentive as a deduction. 

The United Way is committed to providing essential funding to 

local nonprofit organizations that will assist over 100,000 families 

this year. United Way volunteers invest money in local programs 

that demonstrate need, results, and good stewardship. Our United 

Way has also been entrusted to oversee and incubate and implement the City of Columbus’ 10-year plan to end homelessness. 

Working with many partners in our community, and specifically 

with our Columbus housing authority, they recently got HUD designation to work on permanent supportive housing. 

In that—we also have an Army base there, and we have a lot of 

homeless veterans, as well. And we do have an anonymous donor 

that is considering a seven-figure donation to jump-start this program for housing. And I am sure that this charitable deduction is 

going through their mind. They are generous, but there is also that 

tax implication. 

The United Way is also focused on teaching youth giving back. 

We are in our second year of having a youth United Way. We have 

juniors and seniors from all area high schools that learn leadership 

skills, they learn how to raise money and how to give it back to 

the community. We also tomorrow launch our fourth annual Live 

United Youth Camp, which is with 20 seventh graders, and that 

is funded by Aflac Insurance, which is headed in Columbus, Georgia. And they are learning about our focus areas, which are basic 

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tures, and tours. We have to get the young folks to learn about giving back of their time and their own money. 

We are also an active partner in the area for the volunteer in- come tax assistant program, which last year brought in $3 million 

of tax refunds and credits to people that needed the money. We 

currently fund 50 programs through 26 nonprofit agencies. It is 

what we are all talking about. It is local people. It is things as 

basic as food, clothing, and shelter, or keeping kids in school, tracking their grades, making sure that they are successful in life. 

In a recent study, the Columbus, Georgia, area actually ranked 

as the 23rd highest charitable giving area out of 366 metropolitan 

areas. And we are only a population of about 300,000 people, seven 

counties in Georgia, one in Alabama. And our folks support charity. 

And I am really afraid that—everybody gives for the right reasons, 

but it still affects, when you talk about charitable deductions. 

Our United Way is on track to raise the most money ever, and we will announce the results next week: $7.7 million. And we are 

proud of that. And we are the second-largest funder of social services behind government. And I think that is the whole United Way 

system, not just in Columbus, Georgia. And I am absolutely convinced that we must preserve the charitable deduction as it is in 

the Federal Tax Code. 

I would like to believe that people do give for the right reasons, 

and I know they do, but we had an Executive Committee meeting 

on Tuesday and we were talking about my appearance here. And 

many of those people give to a lot of different things in the United 

Way, and most of them are high-net-worth individuals. And they 

are concerned about this, and how it affects them. I am sure they 

will continue to give, but it still affects our ability to raise money. 

So, we oppose any limitations. I don’t have the answer for you; 

I am glad that you are in that leadership role. And we will—right? 

We have to help you. I don’t know how to do that, but we are here 

to say that it is important, and it helps all of us raise more money 

and make up the difference for what government may have to cut 

in health and human services or education. It is an important fabric of our community, and I thank you for the time. 

[The prepared statement of Mr. Ferguson follows:] 


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Mr. TIBERI. Thank you, Mr. Ferguson, for what you do. 

Ms. Bryant, you are recognized for 5 minutes. 

STATEMENT OF LAKISHA BRYANT, PRESIDENT AND CEO, 

UNITED WAY OF SOUTHWEST GEORGIA, ALBANY, GA 

Ms. BRYANT. Thank you, Mr. Chairman and other Members of 

the Committee, for allowing me to speak with you today. Again, I 

am LaKisha Bryant, and I am the President and CEO for United 

Way of Southwest Georgia. 

In recent years, the United Way of Southwest Georgia has undergone dramatic shifts on how we work to serve our community. The 

historic community chest that was started in 1954 with a broad 

charitable mission has transformed into a community agent that focuses measurable impact in the areas of education, income, basic 

needs, and health. We focus our efforts on building partnerships 

and collaborations, engaging our citizens on the common good and 

focuses on what matters the most to donors: Fiscal stewardship 

and a return on their investment. 

And as an agency that represents 27 partner agencies in our 13- 

county geographic territory, we feel that it is imperative that the 

charitable deduction be preserved as it is currently written in the 

Federal Tax Code and not be limited in any way. 

Southwest Georgia is comprised of pecan groves, pine trees, 

farms, and plantations, yet nestled in the hub of many major manufacturers like Proctor and Gamble and Miller Coors. And although 

the Marine Corps Logistics Base and the educational and health 

sector make us the foundation of southwest Georgia’s economy and 

the hub for their commerce, we are still in one of the poorest congressional districts in the State of Georgia, and we are at the bottom tier of economically disadvantaged districts in the country. According to recent Census figures, our geographic territory has an 

alarming poverty rate by counties ranging from 22.6 percent to 

36.4 percent. 

With these extremely high poverty rates, our citizens rely on the 

services provided by our partner agencies to help them live independent lives and provide things for their children. Without the 

generosity of countless philanthropic gifts that we are given annually, many of these services would be obsolete in our rural communities. And many of those gifts are given at certain levels based on 

the current Code. Without these deductions, many of these funds 

would be lessened, if not eliminated all together. And for a geographic community such as mine, that elimination of funds could 

simply be detrimental to agencies, and they would be faced with 

decisions such as closing their doors or serving smaller populations, 

and families would be forced to make difficult decisions about food, 

clothing, and shelter. 

The single-most important action that I feel the Committee can 

take is to ensure that the preservation of the charitable giving incentives that exist today remain in the Code. We strongly oppose 

a cap on charitable deductions as a means of financing other programs. A cap would reduce charitable giving and undermine our 

ability to ensure that individuals and families have access to food, 

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ices for seniors and disabled during these challenging economic 

times. 

I would like to share a story with you. There was once a little 

girl about to embark on a journey in her life. School was out for 

the summer and both of her parents had to work. She had to find 

something to occupy her time and mind during the day. So her parents asked around about a program that they could take her to, 

and they discovered a particular United Way-funded program that 

had activities that matched her personality. 

So, with a lunch box in hand and her book bag on her back, she 

embarked upon a new adventure and—that took her away from her 

extremely modest cinderblock home on the south side of town. As 

she entered the building, her nervousness soon vanished. She saw 

familiar faces, and she was greeted by hugs and strong supporting 

arms of teachers and staff that built and cultivated the characteristics within her. She learned many valuable lessons, new skills in 

education, learned about careers, and how to plan for her future. 

And before she knew it, the summer was over. 

But each year she went back to that United Way-funded program. She did this for 5 or 6 consecutive years before moving on 

to high school, and then furthering her education in college. But 

she never forgot the lessons that she learned and the molding that 

she was given by that funded program. 

But life has a way of getting more out of you. With the leadership skills that she learned in that program, and the many professional roles that she held in a number of years afterward, she returned to become the Executive Director of that organization. And 

now she continues to give back to her community in an even bigger 

fashion. 

I am that little girl in that story. I know firsthand that funding 

support that we provide our programs works. I know the values are 

irreplaceable. I know the message that we take to our consumers 

takes them to higher heights and deeper depths in this world. And 

none of that would be possible without charitable contributions. 

A United Way program played a major role in my development 

as a woman and as a leader. And there are countless faces of other 

girls, boys, men, and women that have benefited from programs 

and services of the United Way of Southwest Georgia and the 

United Ways in other communities. 

I implore you to please keep the current Code as it is, or expand 

it to foster more giving. Encourage more giving so that others can 

have the same opportunities that I had. Thank you. 

[The prepared statement of Ms. Bryant follows:] 


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Mr. TIBERI. Thank you for your story and your testimony today. 

Mr. Daroff, President Obama, back in 2009, first proposed limiting the charitable deductibility of contributions, or the contributions—limiting the deductibility of charitable contributions to fund, 

in part, Obamacare, and has proposed it in each of his budgets 

since then. And you have, since that time, been a national leader 

on trying to stop those proposed changes. 

Why are you and your organization so concerned about the 

changes that he has proposed? 

Mr. DAROFF. Thank you for the question, Mr. Chairman. In my 

71⁄2 years at the Jewish Federations of North America, there has 

been no other public policy issue in the domestic sphere that has 

brought as much attention by both our volunteer leadership and 

our professionals than these proposals to reduce the tax-deductibility of charitable contributions, and that is because we are all donors, we are all fundraisers. 

We recognize the importance that the charitable deduction has 

for us to have the ability, as a Jewish community and as a Jewish 

federation system, to be at the forefront of the fight to feed the 

hungry, clothe the naked, and heal the sick. 

We recognize that while folks give contributions for many reasons to try to make the world a better place, on the margins changing the Tax Code can have a tremendous impact on the ability of 

those folks to dig deeper into their pockets and to give substantial 

contributions to help us do the good work that we do every day. So 

this is an issue that really tugs at us, talks directly at who we are, 

as an organization and as a Jewish people, and that is why we 

have been so focused upon it. 

Mr. TIBERI. Back in Ohio the Cleveland Foundation and the Columbus Foundation have expressed the need and the importance to 

me of planned giving. I know planned giving is something that is 

and has been important to your organization. Can you help expand 

on that issue, as to why it is important to you all? 

Mr. DAROFF. Yes, sir. Mr. Chairman, planned giving is a process where donors, their advisors, and our endowment professionals 

collaborate to structure gifts to our system in vehicles such as gift 

annuities, charitable trusts, donor-advised funds, and supporting 

organizations. 

By definition, the charitable deduction plays a significant role in 

this process, as the parties try to maximize the flow of dollars to 

federations, as well as to assure that those funds flow to help real 

people with real issues sooner, rather than later, to help fund those 

social service programs. 

The vast majority of our planned giving dollars come from donors 

who have great tax sophistication. And so it is that, again, that 

group of sophisticated donors who are very sensitive to the vagaries 

of the Tax Code who itemize their deductions where the—reducing 

the deductibility of charitable contributions can just have a tremendous impact on their giving. And so it is incredibly important to us, 

as we look to the future, among this group of people. 

We said—as I said in my testimony, the vast majority of the 

funds that come in to our federations come from the top 10 percent 

of donors. And it is that group who, again, are very sensitive to the 

Tax Code. It is that group, again, who are very involved in planned 


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giving, both within the federation system and with the organizations you have mentioned, and with our Jewish federations in Ohio 

that are incredibly important to maintaining the operating budgets 

of those organizations that really help to support agencies across 

the country. 

Mr. TIBERI. Thank you. Thanks for being here today. 

Mr. DAROFF. Thank you, Mr. Chairman. 

Mr. TIBERI. Mr. Berry, thank you for testifying on an important 

issue that 300-plus Members of Congress also think—— 

Mr. BERRY. Three hundred and thirty-three. 

Mr. TIBERI [continuing]. Is very, very important. And thanks for 

testifying on behalf of, as you said, thousands of organizations, including many in my hometown, including Ronald McDonald House 

and Goodwill of Columbus, who have really had a huge drop-off in 

their donations. 

Aside from the House bill you mentioned, I know Mr. Reichert 

is really itching to get this moving and be helpful. Can you just explain to us in plain English real quickly what you think would be 

helpful? 

Mr. BERRY. The provisions of H.R. 860 were a relatively simple fix. And what it did was move the valuation number from $500 to 

$2,500, which was half of where it was in 2004, at $5,000. It is a 

good number, because it brings in most of the vehicles that are 

coming in donated that are operable vehicles that have questionable value. There aren’t too many that are over $2,500. The ones 

under $500 are pretty simple. They don’t have any wheels and they 

sit on blocks. So that middle ground is really where it is important. 

Today, with the advancements in technology and information, 

the ability to value a vehicle is so much easier than it was in 2004. 

So you can go to four or five Internet websites and easily come up 

with a list of approximate values of the vehicle. You go into any 

Carmax in the country and walk out 20 minutes later with a valuation. So it becomes a very easy and also a very auditable and enforceable process. 

Earlier today there was testimony about how can the IRS enforce 

some of the provisions around non-cash assets to ensure they are 

not being over-valued. And I think, as a nonprofit executive who 

has to file an IRS 990 form every year, it is not a very difficult 

process. The IRS already requires you to report on your fundraising 

dollars, your fundraising percentages, and your overhead expenses. 

Those reporting requirements could be expanded to include what 

percentage are you paying for your car donation vendor, what percentage are you paying for your thrift store operator, and then put 

some guidelines on it. So—— 

Mr. TIBERI. Great. 

Mr. BERRY. I think that is the—— 

Mr. TIBERI. Thanks for coming up today. 

Mr. BERRY. Thank you. 

Mr. TIBERI. Mr. Davis is recognized for 5 minutes. 

Mr. DAVIS. Thank you very much, Mr. Chairman. And I was 

just in the back, meeting with the Executive Director of the Community Trust of Chicago. And, Ms. Bryant, I was kind of struck as 

I got a chance to look at your testimony and hear about it. Your 

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plain to us the impact of your direct involvement and contact with 

one of the type agencies that we are talking about, and what it 

may have been, had you not been able to have those experiences. 

Ms. BRYANT. For me, my parents married young. However, they 

understood the need for hard work to be able to provide for their 

family. So both of them had to work. So I had to have somewhere 

to go during the day. However, they could not afford child care over 

a certain amount. So they were told about this particular United 

Way program, which was Girl’s Club, now Girls, Incorporated. And 

I was able to go there for a very nominal fee. But it gave me an 

opportunity to expand my academic skills, as well as learn about 

a world outside of where I lived. And at that particular time I did 

live on the south side of my community, which was considered one 

of your lower-income areas. 

And throughout time, my family—through the hard work—was 

able to utilize these programs to get to a more independent level 

of living, and work their way up to what is now—would be probably considered the upper-middle-class level. However, the impact 

of that program made sure it reinforced what my parents were giving me, but it made me see that I had to go to school, get a viable 

education, but also be able to give back to my community, because 

that is what the program taught us. 

And, like I said, God has a way and life has a way of getting 

more out of you, and I ended up being the Executive Director of 

that program, and for 7 years was able to impact other children 

that still come from that lower-income bracket. Sixty-seven to seventy-two percent of my children at that time lived in the poorest 

areas of Albany. And Girls, Incorporated is still a United Wayfunded program. 

So now, as a United Way CEO, I am working hard to leverage 

the dollars that we get in our community to help programs such 

as Girls, Incorporated, but countless other nonprofit agencies that 

we know—without that funding, without the charitable donations 

that we are giving, that we can then give to these agencies to make 

community impacts, we would be lost. 

A lot of the kids would not survive. A lot of families would not 

have food, clothing, and shelter. And a lot of children would not 

turn out and have the life that I have been blessed to have. 

Mr. DAVIS. And you can say without hesitation or reservation 

that there is a good chance that you might not be doing what you 

are doing today, had not you had the experiences of that program. 

Ms. BRYANT. That is definitely true. My parents had a very 

strong impact on me. But the partnership that they got from these 

programs to keep me occupied, to expose me to things that they 

couldn’t afford to expose me to at that time, really helped to build 

the person that I am today. 

Mr. DAVIS. Well, I certainly thank you for your testimony and 

for the answers. And I think it reinforces for anyone who has any 

doubt of the impact, that the program, through the utilization of 

resources that came from the United Way and other places, played 

a significant role. I thank you and I yield back, Mr. Chairman. 

Ms. BRYANT. Thank you. 


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Mr. TIBERI. Thank you very much, Mr. Davis. The far superior 

Co-Chairman of the Philanthropic Caucus, Mr. Lewis, is recognized 

for 5 minutes. 

Mr. LEWIS. Thank you very much, Mr. Chairman. It is very 

kind of you to—I don’t know where you get the word ‘‘superior’’ 

from, but I am just—— 

Mr. TIBERI. Well, you are—— 

Mr. LEWIS. I am from Alabama, and I live in Georgia, and I am 

just trying to help out and make a little contribution. What have 

you been drinking today? 

Mr. TIBERI. Well, it is my attempt to sooth my Big 10 feelings 

for an SEC guy. 

[Laughter.] 

Mr. LEWIS. Well, thank you so much. 

Mr. TIBERI. You are welcome. 

Mr. LEWIS. I appreciate it. I want to thank each member of the 

panel for being here. I listen to and watch most of your testimony 

from the monitor. And Mr. Berry, it is good to see you again. 

And—— 

Mr. BERRY. Good to see you, too, Mr. Lewis. 

Mr. LEWIS. Why, thank you. Ms. Bryant, let me ask you a question. Now, you mention in your testimony that the charitable deduction should not be eliminated, but reduced to fund spending. Do 

you think it should be reduced or eliminated to fund a tax cut for 

the wealthy? 

Ms. BRYANT. I think the current Code that we have cultivates 

a level of giving that allows citizens to feel good about giving to organizations that are going to make an impact in their community. 

I think the Code, as it stands now, should probably just simply be 

expanded to foster more giving, so that we can do more work in our 

communities. 

I don’t want to get too much into the discussion in regards to 

whether or not that tax cut goes to somebody else to help somebody 

that is wealthy. But I know for me, in my community, we need 

those charitable deductions to help the people that need it the 

most. And it is not just the donor that has the deep pockets that 

I am concerned about. I am also concerned about those donors that 

have maybe the slimmer pockets that are giving that $100, that 

$500, that $1,000 gift that this Tax Code change could affect, as 

well. 

So, like some of my colleagues have actually mentioned earlier, 

I think cultivating a larger system of giving and enhancing the 

Code to encourage more giving is what would help us all. 

Mr. LEWIS. I have lived in Georgia for almost 50 years. I think 

I know the State pretty well. You live in southwest Georgia, in Albany. 

Ms. BRYANT. Yes, sir. 

Mr. LEWIS. And I know Mr. Berry knows a great deal about the 

State. There is an unbelievable amount of unmet needs in our 

State, like in many other regions of our country. And you still see 

these unmet needs, and there is still a role for foundations and 

nonprofit organizations to play in helping to meet some of these 

unmet needs. 


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Does any other member of the panel want to respond to what I 

tried to suggest? 

Mr. DAROFF. Yes, I—— 

Mr. LEWIS. I am not trying to lead the witness, now. 

Mr. DAROFF. I would say, Mr. Chairman, it is a pleasure being 

here. We spent Passover seder together last year. You know, based 

on your constituents, based on your life story, it is an incredible 

role that nonprofit charities play in the lives of millions of Americans. We heard from Ms. Bryant about the incredible role that 

United Way played in her life. 

So the answer is, definitively, yes, that there is an unmet need 

that the charitable sector fills every day of every month of every 

year. And we respectfully just ask, as this body seeks to figure out 

the Federal deficit issues, the fiscal cliff issues, the sequestration 

issues, that you look elsewhere for those solutions. The charitable 

sector is being hit hard by the economic downturn. It is being hit 

hard by a reduction in governmental assistance that flows to our 

agencies. And we are here to help. We are here to help fill that 

gap. And we suggest that we want to continue to fill that gap. 

And so, there are unmet needs, and we are here to help real people with real problems every day. 

Mr. LEWIS. Well, thank you. It is very good to see you again. 

Mr. DAROFF. Thank you, sir. 

Mr. LEWIS. Thank you for being here. 

Mr. BERRY. I would also, Mr. Lewis, just to address the unmet 

need, we are the number one or two referral source for United Way 

of Greater Atlanta, and we have been for the last 10 years. Last 

year we helped, in the north Georgia area, over 202,000 people. But 

the sad side story to that is that we turned away over 300,000 people, because we didn’t have the money or the human resources to 

handle it. 

So, the unmet need is there, and I agree, to try to do anything 

to minimize the ability of the nonprofit sector to deal with that 

need would be tragic. 

Mr. MINNIX. I would like to add to that, Mr. Lewis. And, by the 

way, I am from Atlanta. And there is no greater advocate for senior 

housing and things like that than you, and we are grateful for that. 

But I would say that while seniors are getting along better financially, the growing need for lower-income—especially women, we 

still have a generation of women that are going to be poor—there 

is a growing need of younger people with disabilities who are living 

longer, who will be living with those disabilities a long time. You 

add to that veterans that are coming back from this war that are 

going to have to be tended to. And the needs for charity in this 

country will continue to grow. 

And you are going to expect the not-for-profit sector to meet 

those needs because they are difficult, because they don’t pay for 

themselves, and so don’t hamstring us with that. Sorry. 

Mr. TIBERI. The gentleman’s time has expired. We have two 

more panels. Thank you, Mr. Co-Chairman. 

Thank you all for testifying. Thanks for your contribution today. 

The next panel will be seated. 


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Thank you all. We have a vote coming up, so we are going to try 

to get all of your testimony in. I am going to go ahead and just 

begin as you get settled in. 

I would like to welcome our fifth panel officially. First, we will 

hear from Mike King, President and CEO of the Volunteers of 

America in Alexandria, Virginia. Mr. King has more than 35 years 

of experience as a leader in the nonprofit sector. 

I am going to yield to Mr. Davis, who has a constituent who he 

would like to introduce personally. Mr. Davis. 

Mr. DAVIS. Thank you very much, Mr. Chairman. And I am indeed, as a strong supporter of the arts, I am pleased to welcome 

Jimalita Tillman, the Executive Director of the Harold Washington 

Cultural Center in Chicago. The mission of the Harold Washington 

Cultural Center is to preserve and protect African American culture, using the performing and media arts. Harold Washington engages youth and community members in the arts, using their time 

constructively, rather than on the streets. 

Ms. Tillman graduated from DePaul University with a degree in 

theater management and international marketing. She received 

training in theater operation from North Shore County Day School, 

the Black Ensemble Theater, Pontifical Catholic University of Rio 

de Janeiro, and the ETA Theater. She is a member of the National 

Association of Theater Owners, the International Association of 

Theater for Children, Young People, the Black Storytellers Alliance, the National Association of Youth Theaters, Sigma Gamma 

Rho, Incorporated Sorority, and the African American Arts Alliance. She is also the executive producer of the ‘‘Off-Broadway in 

Bronzeville’’ series at the Harold Washington Cultural Center, one 

of the many programs that enrich the lives of Chicagoans. 

We are pleased that she is here. I welcome her. And I also must 

make a disclaimer, that her mother served with me in the Chicago 

City Council, and is one of the heroes of Chicago. And her mother 

also worked with the Honorable John Lewis when she was 16 years 

old on the staff of Dr. Martin Luther King. 

Welcome, Ms. Tillman. 

Ms. TILLMAN. Thank you for having me. It is an honor and a 

pleasure to be here. I caught that flight when the opportunity 

came, and Mr. Camp’s team sent me that letter. I said, ‘‘A hundred 

fifty copies? How am I going to get 150 copies together?’’ So I got 

it together—— 

Mr. TIBERI. Thank you—— 

Ms. TILLMAN [continuing]. We overnighted it, same-day’d it, 

and we are very, very proud—— 

Mr. TIBERI. Thank you—— 

Ms. TILLMAN [continuing]. To represent our great congressional 

district, the seventh congressional district—— 

Mr. TIBERI. Thank you. 

Ms. TILLMAN [continuing]. In Chicago. 

Mr. TIBERI. Thank you. We need to continue on with our introductions before we vote. Thank you so much. 

Mr. Delaney is our third witness today. Tim Delaney is President 

and CEO of the National Council of Nonprofits, here in Washington, D.C., and was previously Solicitor General of Arizona. 

Thank you for being here. 


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Fourth, we will hear from Bill Kitson, who is President and CEO 

of the United Way of Greater Cleveland. Mr. Kitson has over 24 

years of experience in the United Way network. Thank you for 

being here. 

Fifth, we will hear from Naomi Adler, who is President and CEO 

of the United Way of Westchester and Putnam in New York. Ms. 

Adler is an attorney with a great deal of experience in both the 

legal and nonprofit sectors. Thanks for coming. 

Sixth, we will hear from Cynthia Gordineer, who is President 

and CEO of the United Way of Forsyth County, North Carolina, 

and she was previously a Regional Executive with the American 

Red Cross, and was named Executive of the Year in 2011. Thanks 

for coming out. 

Finally, we will welcome Karen Rathke, President and CPO of 

Heartland United Way of Nebraska, a constituent of our colleague, 

Mr. Smith, who wanted to introduce you today, but is probably late 

coming from another meeting. Hopefully, he will get here to say 

hello. And we welcome you, and I know he was excited that you 

were here, as well. 

So, thank you all. We will begin with Mr. King’s testimony. 

You have 5 minutes. 

STATEMENT OF MIKE KING, PRESIDENT AND CEO, 

VOLUNTEERS OF AMERICA, ALEXANDRIA, VA 

Mr. KING. Okay. Thank you, Mr. Chairman, and all your fellow 

Members. I am Mike King, CEO of Volunteers of America, located 

here in Alexandria. But I am like many of you, I hop on a plane 

about every other week to come up here, and I kept my home in 

Dallas, Texas, when I took this job 3 years ago, because I have 

three gorgeous granddaughters that I want to watch grow up. So 

I understand what you give to this, and I appreciate what you give 

to this. 

Earlier today Representative Rangel was asking a question about 

how much of the money gets to those agencies that serve the truly 

needy and are doing the hard-core work with the poverty folks. 

Well, you can look right at Volunteers of America and answer that 

question. That is exactly what we do. We are in 400 communities. 

We have 16,000 employees. We serve 2.5 million people a year. And 

we transform the lives of America’s most vulnerable citizens. 

We are talking about seniors in the twilight of life that are looking for affordable housing. We are the largest provider of affordable 

housing for low-income seniors in America of any nonprofit. We do 

that night and day, and we love doing it. And we love them. We 

are a faith-based nonprofit, and that is our love, that is our work. 

In addition to that, we serve homeless veterans. We offer them 

the same kinds of services, serving them in the kind of project you 

described earlier. We have done many of those with transitional 

housing, permanent housing, shelter, homelessness, treatment for 

addiction and PTSD. We are partners with the Veterans Administration, just as we are partners with HUD in the housing that we 

do for seniors. 

In addition to that, we serve addiction across the board for 

women with children who can’t bring their children with them to 

an insurance-paid rehab center, but they can with us, and we will 


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take care of their children while they get into recovery and restore 

their lives. We will also even take care of children whose parents 

are incarcerated, and take care of the care giver. We are dealing 

with the most vulnerable Americans that there are. 

No one is real excited to have us move into their neighborhood, 

to bring a program there, to be quite candid with you. I have been 

thrown out of more neighborhood meetings trying to find new site 

locations for drug rehab centers and affordable housing than I can 

remember. But what we do is absolutely at the core of the fabric 

of America. 

Let me share with you what we have been through the last few 

years, because I think it is directly relevant to this conversation 

that we are having today—and thank you for having the conversation today. 

You know, it hasn’t been a picnic for the last 4 or 5 years. Whenever we go into recession in our nonprofit world what that does to 

us is our needs go up. As you know, our needs go up. As you described earlier, Representative Lewis, our needs go up. We have 

less resources to meet those needs because of the recession. At the 

same time, in just the last couple of years, we have had to do adjustments in rates. And we understand what you deal with there. 

We understand the gravity of that challenge and of that problem. 

Just last year we had an 11 percent cut in Medicare rates, which 

cut us across the board for the skilled nursing care that we provide 

to the low-income seniors I just described. So, on the one hand, you 

have increased demand for services. On the other hand, you have 

reduction in charitable giving because of the recession. You are also 

getting hit with reduction in rates, because there is just too much 

need and not enough resources. 

And so, what is the last thing you need to do at that point in 

time? The last thing you need to do at that point in time is say, 

‘‘You know what? We are going to disincentivize private giving. We 

are going to discourage people from sharing part of their bounty 

with those who need it most.’’ 

We are absolutely here—if you are wondering why this woke the 

nonprofit world up—and I heard that question floated out today— 

well, this is why it woke us up. We have been doing everything we 

can in the last 5 years to hold on. And I am a nonprofit lifer. Okay? 

This is all I have ever done. So I have seen all the trends come 

and go. Let me tell you what nonprofits have been doing for the 

last 10 years. They have restructured more times than any auto 

company you will ever find, okay? They have cut and cut and cut 

and restructured and restructured and restructured. And I see 

heads nodding. We have all been there. You have everybody now 

doing two and three jobs. There is no place else left to cut. 

So, literally, why you have everybody’s attention is we are scared 

to death that we are going to have to start shutting down programs. And you see it is not because that is us, it is because of the 

people that we are engaged with that we don’t want to see on the 

street. That is why it has our attention. That is our customer. That 

is who we work for. We are just stewards. All of us here are stewards of that. That is why we came to you. That is why you have 

been flooded on Capitol Hill. Thank you. Thank you for asking us 

our opinion. 


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You know, I once heard the highest form of recognition you can 

give someone is to ask their opinion. You have done that, and we 

thank you for that. We trust you will do the right thing. Please 

incentivize giving and, frankly, caring for our fellow man. Thank 

you. 

[The prepared statement of Mr. King follows:] 


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Mr. TIBERI. Thank you, Mr. King. 

Ms. Tillman, you are recognized for 5 minutes. 

STATEMENT OF JIMALITA TILLMAN, EXECUTIVE DIRECTOR, 

HAROLD WASHINGTON CULTURAL CENTER, CHICAGO, IL 

Ms. TILLMAN. Thank you very much, and thank you for that 

very beautiful introduction, Congressman Davis. He has already 

summed up my credentials, my background, and much about our 

facility that is inside of the great congressional district of seven in 

Chicago. 

This position that we are taking at the Harold Washington Cultural Center is not an indictment on the current Administration, 

but an honest voice of advocacy for theater, music, and the arts. 

We utilize media and performing arts to deter at-risk behavior in 

youth. That borderlines on the quality of life as well as human resources and human services. 

At the Harold Washington Cultural Center, we have a 1,000-seat 

theater, a state-of-the-art computer resource lab, a studio, a fullservice recording studio, a video-editing lab, and we service over 

25,000 youth without Federal support, State, or local. It is the individual little old lady down the street, it is the neighbor, it is the 

local philanthropist, such as Mr. John Rogers, that will come from 

time to time, or that person who purchases that handle on the 

seats in the theater. We rely on the individual donor and the community to support what we do at the Harold Washington Cultural 

Center. 

We have reviewed the 10-page NEC report on charitable discussions and the fiscal cliff. Though we are not economic experts, we 

believe that all possible measures have not necessarily been taken 

to resolve the debt matter without cutting the charitable deduction 

percentage. 

We believe that the fact that Chicago has recently received much 

media attention on the rash of crime and murders perpetuated 

highly in our black community is a direct result of funding that has 

been cut in the arts and in constructive creative programs throughout our community. We provide young people with an opportunity 

to get off the streets and on the stage. And we tell our young people, ‘‘Put down the guns and get on the stage.’’ 

We have an alternative charter high school within our school 

that deals with the class of students ages 16 to 22 that are getting 

back into the school system. And we don’t just do job training 

there. We actually do on-the-job training there, because they learn 

light tech and design, they learn set design, they learn acting, directing, and they are actually able to apply it right there at the 

theater. 

Our ‘‘Broadway in Bronzeville’’ program has been acknowledged 

just recently—this is our inaugural year for ‘‘Broadway in Bronzeville.’’ We kicked it off with ‘‘Imitation of Life,’’ ‘‘Ain’t Misbehavin’,’’ 

‘‘Purlie,’’ and ‘‘Tap Dance Kid.’’ These are classic American Broadway Tony Award-winning shows that we are introducing our community to, and we are proud to bring that tie together. 

Every day more than 100,000 nonprofit art and cultural arts organizations act as economic drivers, creating an industry that supports jobs, generates government revenues, and acts as a cornerVerDate Sep 11 2014 13:43 Feb 07, 2017 Jkt 021128 PO 00000 Frm 00260 Fmt 6633 Sfmt 6602 I:\WAYS\WAYSPS\21128\21128.XXX 21128

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stone of our respective cities’ tourism industry. This study that is 

in my written document that I have submitted, goes into the key 

roles that are played by nonprofits in the art and cultural arts industry with their audiences, and how we strengthen our Nation’s 

economy. This cut within the nonprofit sector that affects the arts 

directly has an immediate effect to the economy, not just in Chicago, not just in Illinois, but throughout this country. 

As a Junior Senator from Illinois, President Obama attended 

many events at the Harold Washington Cultural Center. He gave 

us glowing remarks on our exceptional work within the community. 

And that work is currently in jeopardy, due to the unavailability 

of Federal and State funding. 

During our—during the 2000 economic downturn—2008—we 

were hit, our facility was hit with a foreclosure suit by our bank 

at the rate of a $1.5 million mortgage. Our building is valued at 

$15 million. It became difficult to pay the note without funding, 

and we stood in jeopardy of losing this community gem. However, 

due to community support and faithful individual donors buying 

those handles, putting their names on the wall, we are able to continue to operate our programs while we are battling the foreclosure. 

We do need help. We do need support. I am looking at all the 

CEOs, I have been shaking hands and collecting cards, because 

these are the ones that have the funds to give to us. When it rains 

on mainstream and well-endowed arts organizations, black arts organizations like us, we drown. So it is very—I implore—all those 

that are on this panel and those that have come before me, I agree. 

We need to not cut the tax—the charitable deduction of what they 

are able to get. 

But we need to look into the 60653, the low-income areas, to see 

who is actually doing the work, not just in theory, who is in action. 

We have boots on the ground. We are pulling ourselves up by our 

bootstraps. We need your help. We need the help of those on this 

panel, those that have spoken before us. 

And Congress, we need you to not cut it, because we are just getting our engines revved up with ‘‘Broadway in Bronzeville’’—I have 

10 seconds—and we need everyone to support what we are doing, 

because with us just starting, if the cuts happen we won’t even get 

in the game of getting money. Thank you. 

[The prepared statement of Ms. Tillman follows:] 


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Mr. TIBERI. Thanks for your passion. I wouldn’t be here today 

if it wasn’t for art and music. So thanks for what you are doing. 

Mr. Delaney, you are recognized for 5 minutes. 

STATEMENT OF TIM DELANEY, PRESIDENT AND CEO, 

NATIONAL COUNCIL OF NONPROFITS, WASHINGTON, DC 

Mr. DELANEY. Thank you, Mr. Chairman and Members of the 

Committee. I also want to thank the staff who are stuffed across 

the back row there, and those who are watching from your offices. 

Thank you for your patience listening today, and thank you for all 

the hours of preparation and the thousands of hours ahead, as we 

come together to try to solve this community problem. 

I talk about ‘‘we’’ coming together, because government and nonprofits, we serve the same constituents and we serve the same communities. We are teammates joined as one. We need to be operating together as one. And so, out of respect, what I want to do is 

to just share three different points, very quickly, so that you can 

move on with the panel. 

My first point, as your teammate, is we cannot have a meaningful discussion about charitable deduction without first looking at 

community needs and understanding how fragile the nonprofit 

community is right now. We have been asked to do so much more 

with so much less for so much longer, we are being stretched out 

of shape. 

I encourage you to look at page three of my written testimony, 

where I lay out—and the research shows—in 2008, 73 percent of 

nonprofits saw their workloads increase. In 2009, 71 percent more 

saw it increase. In 2010, a 77 percent increase. In 2011, an 85 percent increase. It is going up and up and up. And you heard from 

the earlier panels today about how the revenue is going down and 

down and down. And we have been doing this for too long. 

And we are, unfortunately, seeing a lot of government policies 

that are aggravating this at the Federal, at the State, and the local 

levels, that are making this unsustainable. So, any discussion 

about the charitable giving incentive must begin with looking at 

the fragility of the health of the nonprofit community. 

My second—and to that, I am hoping that the working group will 

bring nonprofits to the table and work with us and look at the 

health of the sector itself, and not just look at what a tax benefit 

might do to the donor, but let’s look at what the needs are in the 

local communities. That is where the right attention needs to be focused, is on the community, not on the donor. Because it is the 

communities that are having great needs right now. 

The second thing I would do is invite you to stop listening to me 

for a second, kick back and relax, and look at my written testimony 

that I submitted. And you will find in the appendix at the back the 

voices of 130 different nonprofits in your States who were—I am 

here simply relaying their voices, and lifting them so that you can 

see in your own districts, in your own States, how people are suffering. These are not the words of wealthy donors saying, ‘‘We want 

our tax breaks.’’ These are not the words of elite institutions saying, ‘‘We want to name another wing.’’ These are the voices of local 

people in your local communities, your constituents who are in 

pain. 


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And so, please, if you want more information about what is going 

on in your individual States, reach out to your State association of 

nonprofits, because they are the champions who can help connect 

you with real boots-on-the-ground information. 

The third thing I want to do in closing is share a story. And that 

story is about our Nation’s Founding President. And we were hearing earlier today a lot of people offering theories of what might 

happen and what if. And perhaps we could redesign and totally 

wholesale change the charitable giving deduction. But I want to 

share with you what happened when other people relied on theories. 

President Washington had retired. He was in Mount Vernon. 

And it was a dark and dreary day in December when he was out 

on his plantation. And he was surveying. And a rainstorm hit. It 

turned to sleet and then snow. He caught the chills. He then went 

home and he worked all night, and then he got up in the morning 

and he knew that he was sick. They called in the doctors who, on 

a theory, said, ‘‘We need to bleed him. We need to bleed him to get 

rid of bad blood.’’ And so they took more than three liters, three 

liters of his blood. And he died. 

Now, their theory was, ‘‘If we bleed him of the bad blood, then 

he will recuperate.’’ But in point of fact, they hastened his death 

by bleeding him. Please do not rely on theories. Please understand 

that theories alone can be dangerous. We know that the charitable 

giving incentive is real. It is reliable. It is proven to be effective in 

getting resources into local communities where there are great 

needs. 

So, as you are looking at different proposals, remember: First, do 

no harm. First, do no harm. Look at the great needs in communities across America. Thank you, Mr. Chairman. 

[The prepared statement of Mr. Delaney follows:] 


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Mr. TIBERI. Thank you. Those buzzers you heard mean there is 

a vote. And that is a 15-minute vote. And we have 20 minutes of 

testimony left. So I would encourage you to go as quickly as you 

can. 

Mr. Kitson is recognized. 

STATEMENT OF BILL KITSON, PRESIDENT AND CEO, 

UNITED WAY OF GREATER CLEVELAND, CLEVELAND, OH 

Mr. KITSON. Yes, thank you very much, Mr. Chairman and 

Members of the Committee. And thank you for providing me with 

the opportunity to testify today on behalf of the 450,000 Greater 

Cleveland residents who benefit from United Way of Greater Cleveland’s work. 

In my almost 25 years with United Way, I have witnessed the 

important role that the nonprofit sector plays in our community 

and in our great Nation. Our work relies on the generosity of donors and volunteers. And, without question, the charitable deduction is an effective and important incentive to stimulate support for 

the thousands of health and human services that we work on. 

For example, the charitable community is the single largest supporter of United Way 2–1–1, which covers 90 percent of the State 

of Ohio. Our Cleveland United Way 2–1–1 provides coverage for 7 

counties, or 1.9 million people. And we answered a quarter-million 

calls last year for help, a 33 percent increase in the last 5 years. 

And, as you know, many Americans today find it difficult to af- ford prescriptions. Our Med Refer program found $2.5 million of 

prescription benefits for people in need in the last 5 years. Without 

question, a cut in the charitable tax deduction will result in a loss 

of support from donors to the nonprofit sector, and would devastate 

our ability to continue to provide these services, and ultimately the 

responsibility could fall back on government. 

The New York Times reported last year nearly 60 percent of 

Cleveland’s poor, once concentrated in its urban core, now live in 

its suburbs; 40 percent of United Way’s 2–1–1 calls come from 

those very same suburbs. And their number one call is for food. Nationwide, 55 percent of the poor population in metropolitan areas 

is now in its suburbs. The charitable community is coming to the 

need of these new poor. 

The Cleveland Food Bank has doubled its food distribution in the 

last 5 years. The earned income tax incentive in Cuyahoga County 

is providing free tax preparation for some 10,000 families, and it 

returned $13 million to our community last year to help the working poor. And United Way partners with many folks in our community, including the Siemer Family Foundation and the Cleveland 

Foundation, to aid young people who so unfairly suffer when family 

finances jeopardize housing security. 

Not preserving the charitable deduction creates a disincentive for 

giving to charity. And millions of poor Americans will pay the 

price. Without the generous support of America, nonprofits will be 

forced to abandon their work. We lose our ability to provide food. 

We lose our ability to provide shelter, to graduate kids, to help 

families become financially stable. This also limits our ability to 

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And while I am here today representing United Way, I would 

also like to speak for just a moment on behalf of my alma mater, 

Hartwick College in Upstate New York, where I serve on its board 

of trustees. Independent colleges in New York State graduate more 

students than their public peers. And those future leaders have 

benefited from scholarships given by generous donors. The charitable deduction really matters in our country, and it matters for 

our future. 

I stand upon the 125-year history of the United Way system, 

with thousands and thousands of large and small nonprofit partners, to advocate for the charitable deduction. While the generosity 

of Americans is not solely based on tax incentives, it is part of the 

equation for many. On behalf of the millions of Americans who rely 

on the kindness and strength of the philanthropic community, 

please preserve the charitable tax deduction. Thank you. 

[The prepared statement of Mr. Kitson follows:] 


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Mr. TIBERI. Thank you. 

Ms. Adler, you are recognized. 

STATEMENT OF NAOMI L. ADLER, ESQ., PRESIDENT AND CEO, 

UNITED WAY OF WESTCHESTER AND PUTNAM, WHITE 

PLAINS, NY 

Ms. ADLER. Thank you, Mr. Chairman, Members of the Committee. I am honored to testify here today, and I will try to go as 

quickly as I can. 

As you may know, there is a United Way in every one of your 

districts. Each United Way works collectively with all the community leaders about whom you have spoken and heard from today. 

Health and human service providers need for you to listen to all 

of our testimony, for we are providing quality education for every 

child, sufficient income to sustain the needs of every family, and 

what is needed to create a foundation for a healthy life for all. 

United Way is seen as a community collaborator, as well as an 

advocate for everyone, from the smallest child to the most senior 

adult. As President and CEO of United Way of Westchester and 

Putnam, New York, located in the Lower Hudson Valley of New 

York State, just a few miles north of New York City, I am extremely familiar with the important role that non-governmental 

organizations serve in our community, as well as the issues that 

impact their abilities to fulfill their mission work. 

The preservation of the charitable deduction is a critically important issue in my community, as well as within the sector I 

represent. We work with thousands of not-for-profit organizations 

within a population of approximately 1.1 million people. In this 

role, our United Way is a major provider of training for nonprofit 

executives and staffs, and we hold the largest gathering of not-forprofit leaders throughout the region for this purpose. 

To put this into context for you and your staff, in 2010 there 

were 5,709 registered nonprofits just in Westchester County alone. 

This is representing $11.7 million in assets and $7.3 billion in revenue. The economic impact of the Westchester not-for-profit community was estimated to be $23.5 billion. This means there are 

more than 100,000 people that are employed by nonprofits in just 

this one county. 

In addition to our role as a partner and advocate with a diverse 

number of nonprofit organizations that provide health and human 

services, our United Way also provides millions of dollars of funding, expertise, and gifts in kind to all of them every year. In addition, we facilitate the coordination and placements of over 18,000 

volunteers to help the not-for-profits keep personnel costs down, as 

well as to enhance the level of efficient service given in the community. 

Finally, as we heard, we operate United Way’s 2–1–1 help line, 

and our United Way does it for 33 percent of New York State, connecting the public to the help that they need. This includes referrals to more than 25,000 services that are provided in our region. 

Just a few days ago, on February 11, 2–1–1 Day, Governor Cuomo 

and other public officials recognized that our States’ United Ways 

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mation and referral and, in particular, during Superstorm Sandy, 

where we helped more than 1.4 million people in just a few weeks. 

In our community there are huge disparities, including great 

wealth and significant poverty. Some of the best and worst schools 

in the Nation are within miles of one another. Therefore, it is our 

imperative to keep those residents who are in a position to give focused on supporting the work. 

As the entity that responds to thousands of donation receipt requests every year around this time, as it is tax season, our United 

Way experiences firsthand how the charitable tax deduction is such 

an incentive to giving in our area. These are not donors that give 

large chunks of money beyond the tax cap that exists in New York 

State. Instead, they are part of a group that donate in the range 

of $250 to $1,000 a year through payroll deduction within their 

workplaces, as well as attending fundraising events and online giving. 

For example, in our community there are 18,000 children who 

are hungry within 21,000 households. This year, the demand from 

residents who have never requested food from a food pantry rose 

30 percent, just in our community. The local food bank and community food pantries receive food to feed our families through various 

sources, mainly through corporate donations and food drives. However, the personnel and the other resources that are needed to 

properly inventory, house, transport, and distribute food to those 

in need is mainly funded through charitable donations. I cannot 

fathom how our food safety net would survive if one of the major 

incentives to give to those who feed our hungry is taken away. 

In conclusion, given our challenged economy, the recent natural 

disasters, and all that is impacting our not-for-profit sector, now is 

not the time to get rid of the charitable tax deduction. Thank you. 

[The prepared statement of Ms. Adler follows:] 


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Mr. TIBERI. Thank you. 

Ms. Gordineer, you are recognized. 

STATEMENT OF CYNTHIA GORDINEER, PRESIDENT AND CEO, 

UNITED WAY OF FORSYTH COUNTY, WINSTON-SALEM, NC 

Ms. GORDINEER. Thank you, Mr. Chairman and Members of 

the Committee. Thank you for the opportunity to talk about the importance of the charitable deduction, and to share the critical work 

that United Way is doing in Winston-Salem, North Carolina. 

Traditionally, nonprofits have delivered intervention services. 

That is, they help those who are facing a difficult time or are in 

a crisis situation. We address many of those issues in our community because we know that it is important to have a safety net to 

turn to. However, our focus has increasingly transitioned to prevention strategies. By addressing the root causes of our community’s 

most pressing needs, we can prepare people for a better life, and 

the need for intervention assistance later will be ameliorated. 

We believe people will be successful if they have an education, 

financial stability, and good health. And much of our investments 

are focused on these goals. Our highest priority is to increase the 

high school graduation rate in our county. Our economic viability 

depends on having an educated and prepared workforce. 

In 2008, when we launched our initial program at Parkland High 

School in Winston-Salem, the graduation rate in our community 

was 70 percent; 30 of every 100 students did not graduate. After 

starting ninth grade, 4 years later they were not graduating. The 

program included tutoring, mentoring, family engagement counselors, graduation coaches, and more. We have since expanded to 

two additional high schools. Since 2008 I am pleased to report that 

our graduation rate has increased from 70 to 81 percent. And our 

community goal is 90 percent by 2018. 

Our women’s leadership council supports this goal through their 

focus on three middle schools which feed the high schools we work 

with. They fund projects such as the 2-week summer Success Academy, designed to help rising sixth graders make the transition to 

middle school. One of the middle schools is a feeder to the high 

school that is most challenged in our community. And this middle 

school, Philo-Hill, the number of students who are—who test at 

grade level in math and reading has more than doubled since 2008, 

when our partnership began. 

More than 1,000 women contributed $650,000 in 2012 to this 

work because they believe it is important. But we know that a factor in their decision and their contribution is the charitable deduction. 

Our second priority is financial stability. And to address this we 

opened our first Prosperity Center in 2008. The Center offers a holistic array of services to help individuals increase their income levels through job training, career counseling, job search assistance, 

while providing classes to help participants improve their financial 

literacy, build credit and assets for future success, and other free 

financial services, including tax preparation. It was so successful 

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to help families build stronger, more stable lives and achieve their 

dreams. 

We did not realize these accomplishments alone, but through 

convening our community to form collective partnerships, including 

both the public and private sector. Just as we can’t accomplish our 

community change on our own, we also know it would be impossible to do without the necessary resources. 

My community is extraordinarily generous. It ranks in the top 1 

percent of per capita giving in the country. We know that many of 

our most generous donors are influenced by the charitable deduction, and that was evidenced by the number that rushed to pay 

their 2013 pledge by December 31, 2012 in the face of uncertainty 

around the charitable deduction. We know that some donors who 

contribute large gifts would not continue or would reduce their gifts 

in the future. This would diminish our ability to continue the level 

of strategic investments needed to create stronger lives through 

education, financial stability, and better health. 

I would also ask the Committee Members to consider the additional economic repercussions that would be caused by a decrease 

in our services. In the short term, the cost of basic and emergency 

needs would increasingly have to be assumed by the government, 

because we would lack the funds to do so. In the long term, our 

work to address root causes of poverty will create additional contributing members of our community, since we are preparing people to obtain higher levels of education, be financially stable, and 

lead healthier lives. 

A decision to eliminate or limit the charitable deduction would 

provide immediate budget relief, but the cost would surely outpace 

the savings in the long term. Thank you for your attention. 

[The prepared statement of Ms. Gordineer follows:] 


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Mr. TIBERI. Thank you so much. And I apologize. We have to 

go vote. If you could stay, your Congressman would like to give you 

a flattering introduction before your testimony. There are some 

questions from some of the Members if you have the ability to stay. 

We are going to reconvene in about 15 minutes or so. So, if you 

can, hang on for a little bit while we recess for about 15 minutes, 

more or less. Thank you. 

[Recess.] 

Mr. REICHERT [presiding]. Can I ask the witnesses to return to 

their seats, please? 

The Committee will reconvene. And we have one witness left to 

testify, I understand, in this panel. So we welcome Karen Rathke. 

And Karen, you are going to be introduced by my colleague, Mr. 

Smith. 

Mr. Smith, you are recognized. 

Mr. SMITH. Thank you, Mr. Chairman. Thank you. I am pleased 

to welcome Karen Rathke from Grand Island in Nebraska’s third 

district. Karen is President and CPO of the Heartland United Way, 

which serves Hall, Hamilton, Howard, and Merrick Counties, and 

raised $1.6 million in its most recent annual campaign. Karen has 

served in her current position for 13 years and doubled Heartland 

United Way’s annual fundraising in that time. 

Karen also serves on the Nebraska Governor’s Commission on 

Housing and Homeless, in 2012 was recognized as Woman of Distinction by the Grand Island YWCA, and as Woman of the Year by 

the Grand Island Independent newspaper. 

It is a pleasure and privilege to have a constituent before this 

Committee. Karen, welcome. 

Mr. REICHERT. Welcome. Thank you, Mr. Smith. And you are 

recognized for 5 minutes. 

STATEMENT OF KAREN RATHKE, PRESIDENT AND CPO, 

HEARTLAND UNITED WAY, GRAND ISLAND, NE 

Ms. RATHKE. Thank you. Thank you, Mr. Chairman, Committee, and certainly Congressman Smith, for that introduction. 

And I am honored to represent not only the Heartland United Way, 

but also the United Way network, and to testify in support of preserving the charitable deduction in the Federal Tax Code, and in 

opposition of any limitations on the charitable deduction for any 

taxpayers. 

At a time when government is constricting and contracting, it is 

critical that the nonprofit sector be as healthy and as resourced as 

possible. Any action that has negative impacts on the nonprofit sector only puts further demand on an already stressed system. 

In our community, charitable donations fund free medical and 

dental health care, emergency and transitional shelter, rent utility 

assistance, free education courses, mentoring in after-school programs, food, clothing, and disaster assistance. Our 16 partner agencies, which are provided in my written testimony, deeply rely on 

our United Way funding from thousands of small and private donations to provide help and hope for over 52,000 people. 

As discussed in some of the earlier meetings, a floor, as a possibility, would greatly impact donations, especially in small United 

Ways and nonprofits, as one gift, combined with the gifts of others, 


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add up to our $1.6 million annual campaign. The Good Life, 

which we were called before Nebraska joined the Big 10, our—in 

Nebraska our State benefits from $735.4 million in charitable contributions to our State. Most of these funds are locally raised, locally invested, and locally beneficial. 

I doubt you will remember statistics at the end of the day, so I 

want to share some stories that will put a face to the impact of 

charitable giving. 

Hunger is an issue in our community, with 67 percent of kids 

qualifying for free and reduced school lunches in Grand Island public school. There is nothing more painful than to look in the eyes 

of a hungry child and know that the next meal is not a guarantee, 

and to watch as students stuff leftovers in their pockets. 

So, in October we mobilized over 400 volunteers to package 

100,000 meals purchased totally by private donations. These fortified macaroni and cheese dinners are now in the hands of multiple food programs. But, most importantly, for teachers that now 

are able to discreetly slip a bag into a child’s backpack, it is comforting to know that the child will now have a hot meal at night. 

Private donations were collected to purchase new books, which 

our recruited volunteers took out to summer academic catchup programs. The readers created excitement for reading. And then every 

student was able to pick out a book of their choice. One fourth 

grade boy carefully deliberated over which book to pick, and was 

so proud to finally be able to write his name in that book, and insisted on using a pen, instead of a pencil, because that was the 

first book that he had ever owned. 

To respond to that on a larger scale, we are ramping up efforts 

to get more books in the hands of more children. On Monday, I received a check for $35,000 from a generous donor. The donor’s gift 

will provide over 1,000 children with a brand new book to be delivered to their home every month, thereby increasing their chances 

to be successful in school. Interestingly, I was preparing for this 

testimony and I asked him, if the charitable deduction was eliminated or capped, would his donation change, and his response was 

it would. Please don’t take these books out of the hands of children. 

Our community has one of the few free medical and dental 

health clinics that is totally funded by private donations. The clinic 

sees hundreds of patients each year, and—facing many multiple 

challenges, oftentimes chronic disease. We had one mom that was 

rationing out her blood pressure medicine to afford shoes for her 

kids, not realizing that, without that medicine, she might not be 

there to be the mom in the future. 

We had one little girl who came in, her face so swollen with infection and tooth decay, and in, obviously, a lot of pain, but not 

complaining of pain, because she had been in that situation for so 

long that she didn’t even know what life without pain felt like. She 

was treated, and the reports came back in from school that this little girl was now a healthy, vibrant student that was participating 

in class. 

Private donations help limit every day how poverty defines people’s lives. You see this in a single dad who is relieved that his 

daughter has an after-school place to go where healthy choices are 

taught to avoid risky behaviors, a grateful mom watching her 


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young child excitedly walk down the hall to his preschool classroom, knowing this was an opportunity that she otherwise would 

not be able to afford. A fifth grade boy has someone, his mentor 

in the bleachers, cheering him on, for the first time ever. 

These are just a few examples of what charitable contributions 

are doing in Grand Island, Nebraska. It is a risk of not being able 

to do these things, in addition to innovative programs we are rolling out, that brings me here today, as one example of hundreds of 

United Ways across the country providing vital services, as I have 

shared. 

Please protect the charitable tax deduction to give children a 

chance, and families a future. And I wouldn’t be a good fundraiser 

if I didn’t leave without encouraging you to find more ways to extend and to increase tax incentives. 

My dad always said that you can’t go wrong when you always do 

the right thing. The right thing today is to preserve the charitable 

tax deduction and support our efforts to inspire hope and create opportunities for a better tomorrow in communities across the country. Thank you. 

[The prepared statement of Ms. Rathke follows:] 


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Mr. REICHERT. Mr. Davis is recognized for 5 minutes. 

Mr. DAVIS. Thank you. Thank you very much, Mr. Chairman. 

And I want to thank all of the witnesses, not only for their patience, but for their testimony. 

Ms. Tillman, let me begin with you. I know that the Harold 

Washington Cultural Center is located in what would be described 

as a low-income community, in terms of the economics of the environment. And yet you indicate that you have been able to generate 

resources that have kept you alive, open, functioning, and going 

without substantial public government support. How have you been 

able to do that? 

Ms. TILLMAN. Thank you for the question. We initially received 

funding when we first opened in 2004 to build the building, to construct the building, but not funding to operate the programs. Many 

of the generous donors, such as the Joyce Foundation or the 

MacArthur Foundation, or some of the foundations that were represented earlier, they only give to you after you have 3 or 4 years 

of experience in operating. 

And so, by the time the third or fourth year came in, the economy was making a downturn. So we had to appeal to our local community residents. We have a—there is a radio station that is on 

iHeartRadio, as well as locally, in Chicago, WVON. And we would 

turn to WVON and the listeners and say, ‘‘Hey, this is what is 

going on. The light bill needs to be paid. We are having a light bill 

theater show. We are having a movie night.’’ We literally knocked 

on doors. It was a major canvassing campaign to preserve the arts, 

because we utilize arts as a form of grief counseling for young people, as well as theater therapy. 

We believe that theater can rock someone to their soul, not just 

for the person that is performing on the stage, but the person that 

is in the audience, having that theatrical experience. And when a 

young man has an opportunity to put down a gun and pick up a 

hammer and build a set, something that he is able to create with 

his own two hands, he has a whole other respect for what is going 

on around him. 

The young lady, Hadiya, that recently fell to gun violence, was 

a young person that participated in programs at our facility. And 

our facility is open, on average, from 7:00 a.m. to almost 11:00, 

midnight, and we have had some parents say, ‘‘Hey, can you all roll 

out the sleeping bags on the stage today, because there is gunfire 

going on in Englewood.’’ And because of things like that, we load 

in with our churches, we load in with our local community groups. 

We load in to the individual donor, be it a nameplate on a handle, 

a name on the wall, whatever it is, it is almost all for sale. 

So, it might be a Playbill, but that is the way we have been able 

to do it, one handle at a time. And we need more help. We are on 

BroadwayandBronzeville.com. We need to raise $1.5 million on a 

capital campaign. And if they cut this funding, if they cut this, we 

are just totally cut out of the game when we are just now getting 

started. 

Mr. DAVIS. Thank you very much. 

Ms. TILLMAN. Thank you. 

Mr. DAVIS. Ms. Rathke, let me ask you. I have had some experience with free clinics. Health clinics are expensive to run. How do 


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you manage to raise the money and coordinate the activities that 

you have been able to accomplish? 

Ms. RATHKE. You know, we are very fortunate to have a fabulous director of our third city community clinic, and we have an 

amazing group of volunteer doctors and volunteer dentists that 

come in and provide all the services. They have, like, a dental hygienist, but—and one nurse that they pay for. And we often joke 

that she is one of the best drug dealers in town, because she can 

leverage drugs like no other from pharmaceutical companies. 

And the really unfortunate thing for families is that they will— 

I know, right? They will come in and they qualify for some of these 

pharmaceutical programs that they are unaware of. And just by us 

making that linkage, these families can continue on. 

Mr. DAVIS. Well, thank you very much. I can see why you have 

been Woman of the Year, and I suspect you will continue to be 

Woman of the Year. I appreciate your testimony, and I yield back. 

Ms. RATHKE. Thank you. 

Mr. REICHERT. Thank you, Mr. Davis. Mr. Smith is recognized 

for 5 minutes. 

Mr. SMITH. Thank you, Mr. Chairman. Ms. Rathke, welcome 

again. Can you share a bit about the percentage of your donors 

who itemize their taxes on—their income taxes? And what percentage of the funds you raise come from those donors? 

Ms. RATHKE. You know, we don’t necessarily track how many 

of our donors itemize. You know, we send out their tax deduction 

letters to them. But beyond that, we aren’t able to track that in our 

system. 

But we have over 500 leadership donors, and we have about 

$500,000 of our $1.6 million that are raised by our leadership 

givers. And so, you are aware of our community, a manufacturing 

community. And so, the really great part of what we do with the 

people we do the work with is that if somebody has benefited from 

our services, and they are able, in a manufacturing company, to 

now do a workplace campaign and give back, they do. And whether 

they own a home or they qualify for some of those deductions—you 

know, some of those are really good-paying jobs, it is just really 

hard for us to scale that and figure that out. 

Mr. SMITH. Sure. But you would suspect, then, that perhaps 

your leadership donors would benefit from itemizing their deductions. 

Ms. RATHKE. Absolutely. 

Mr. SMITH. Sure. Mr. Kitson, we heard this morning that the 

Cleveland United Way may face elimination, should there be a cap 

on the—at the 28 percent rate. I mean, hypothetically. Would that 

be likely or unlikely to happen? 

Mr. KITSON. I think total elimination would be unlikely. We 

still have a charitable community. But at the end of the day, the 

mix of the donors that are necessary to bring in the $41 million 

that drive our work in the community, it involves lots of different 

donors at lots of different levels. Eighty thousand donors contribute 

to the United Way in Greater Cleveland. Two thousand of them are 

leadership donors. A number of them are significant donors. And 

so, all of those go into play. 


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And when you start to move those numbers around and get them 

thinking differently about where those charitable deductions might 

go, it becomes very dangerous for a United Way like ours. 

Mr. SMITH. Sure, sure. I certainly understand that, and I know 

that charitable organizations do an incredible amount for our entire country and even beyond. And so I am very grateful, and certainly I want to reflect on that a bit. So, thank you for your testimony. 

And, Mr. Chairman, I yield back. 

Mr. REICHERT. Thank you, Mr. Smith. Mr. Lewis, you are recognized. 

Mr. LEWIS. Thank you very much, Mr. Chairman. I want to 

thank each one of you for being here today, participating. 

Mr. Delaney, your testimony described the grim economic reality 

that charitable organizations face. It appears that there is a lot of 

unmet need. How does this charitable contribution deduction help 

to fill this unmet need, to fill this gap? 

Mr. DELANEY. Thank you, Mr. Lewis. Right now, as laid out in 

our written testimony, we are at a tipping point. And the nonprofit 

sector is just doing so much more for so many more with so much 

less, you take away just a little bit of that, as people talk about 

tinkering around some with the charitable giving, it then makes 

everything slide downhill. 

Let me just give you two examples of some of the pain that is 

being felt, and that is some research that The Urban Institute did 

in 2010, landmark research looking at government contracts with 

nonprofits, that found that there were five major trends showing 

that nonprofits are actually subsidizing government activities, because governments are not paying the full cost. Governments are 

paying late. Governments are changing the contract terms midstream. Governments are putting so many demands up front for 

application processes and for reporting processes that it is obscene. 

And these are at the Federal level, at the State level, and at the 

local level. 

And as a consequence, what do nonprofits do when we don’t have 

the resources to get the work done on behalf of government and the 

communities? According to the research—and this is on page 8— 

or footnote 15 of my written testimony—the first thing that nonprofit boards do is that they freeze or reduce employees’ salaries. 

Fifty percent of them do that. Thirty-eight percent reduce the number of employees. And then 23 percent reduce their health, retirement, or stop benefits. And the very last thing they do is they reduce services to the community, because job one is mission. And so 

that is what they do. 

Another example is from your own district, Congressman, and 

that is on page three in the handout. And again, just one example. 

We have attached over 100 different comments from your constituents from across the country. But in Georgia, for example, the Atlanta Community Food Bank points out that in the last 4 years 

they have seen food distribution increase by 85 percent, 85 percent 

in the 29 counties that they serve, and that over 28 percent of 

Georgia kids, more than one in every four, live in food-insecure 

households. People are suffering, and they need to get to these. 


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And again, I am just lifting the words there at Atlanta Community Food Bank, where they go on to say—and I quote—‘‘It seems 

quite ironic that at a time when government is cutting human 

service programs, they are also considering disincentives for the 

private sector to take up that important work.’’ 

And so, that is really why I think the 44 of us are here today 

to testify, is that we are being asked to do so much more by our 

teammates in government, who are taking things away from us. 

And now, on top of that, we are standing here feeling like Rome 

is burning. Rome is burning, and we are standing with our tiny 

fire hose, and Congress is threatening—Congress and the White 

House—threatening to perhaps take our fire hose away. And we 

are saying no, not at this time. Let’s come together and solve these 

community problems together. 

Mr. LEWIS. Mr. Delaney, I appreciate your responding. I know 

the Atlanta Food Bank very well, and they have many unmet 

needs. 

Mr. King, when you get a proposal or a—maybe a request, you 

cannot respond in a positive manner. What do you do? What do you 

say to the applicant? 

Mr. KING. Well, that is a great question. We have to form waiting lists in those circumstances, you know, when all our beds are 

filled. You know, when we have no more room at the inn, literally, 

because most of what we do is—24/7, is residential. And so we have 

to put them on waiting lists, or look for another place where we 

might be able to refer them. But to be candid with you, there is 

a big difference putting somebody on a list and putting somebody 

in a bed, you know. And that is the alternative we are left with, 

Representative Lewis. It is a very difficult circumstance. 

And I want to second what was said just now by Tim. He is exactly right on what happens when you have gone through a series 

of budget reductions, as far as the cuts, because we have done that. 

And you start cutting and holding off on staff increases, and salary 

increases. 

And let me tell you what. The quality of care that happens in 

those residences is directly attributable to the quality of employee 

you have that hasn’t gotten a raise in 3 years, and now you are 

paying them hourly wage for the graveyard shift. And the quality 

of that wage impacts the quality of care that you give. That is the 

fear we go to bed with, okay? That is the one you go to bed with. 

Mr. LEWIS. Thank you. Thank you. 

Mr. REICHERT. The gentleman’s time has expired. I want to 

thank the panel for your time today and your patience. I know you 

were interrupted by votes and it has been a long day for Members 

and also for you. 

And also a special thank you for what you do each and every day 

in our communities across this great Nation. I know it is not easy 

at times. But I was in the law enforcement arena in my previous 

career, and I know some of the struggles that you go through, I 

have worked with some of the groups that you have worked with 

on the streets. And if you can touch just one life, you know that 

that makes a difference, change one life, one day at a time. So we 

all on this Committee very much appreciate what you do each and 


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every day. So, thank you for being here today, and thank you for 

what you continue to do for our people. 

And we will call the last panel up for their testimony, please. 

Well, welcome. You are the last panel of the day, and we are excited about that, but we are also excited to see you. 

[Laughter.] 

You will be the most exciting panel, too, I am sure. But I would 

like to welcome you here today. 

First on the panel is Earle Mack, Chairman Emeritus of the New 

York State Council on the Arts. Mr. Mack is a retired Ambassador 

to the Republic of Finland. 

Second, we will hear from Andrew Watt, who is President and 

CEO of the Association of Fundraising Professionals in Arlington, 

Virginia. Mr. Watt is an honorary fellow of the Institute of Fundraising. 

Third, we will hear from John Palatiello, who is President of the 

Business Coalition for Fair Competition in Reston, Virginia. Mr. 

Palatiello is also the owner of his own public affairs and marketing 

firm. 

Fourth, we will hear from Anthony Ross, who is President of the 

United Way of Pennsylvania. And Mr. Ross began his career as a 

staffer with the Pennsylvania State House of Representatives. I 

want to sympathize with you, on behalf of my staff. 

Fifth, we will hear from Lisa Ireland, who is Executive Director 

of the United Way of Orleans County in New York. Ms. Ireland has 

a long history of community service in her community. 

And, sixth, we will hear from Tory Irgang, who is Executive Director of the United Way of Southern Chautauqua County, and 

constituent of our colleague, Mr. Reed. 

Mr. Reed, you are recognized. 

Mr. REED. Well, thank you very much, Mr. Chairman. And it is 

my great pleasure to welcome one of my constituents, Tory Irgang, 

who is going to be testifying last, but that means she is the best 

of all the witnesses today. So I welcome her here today, and a fellow western New Yorker, Ms. Ireland, from an adjoining county to 

our district. I look forward to your testimony, and I really do appreciate you being here and offering the important testimony you will 

provide today. 

So, with that, I yield back. Thank you, Mr. Chairman. 

Mr. REICHERT. And, finally, I will add that William Hanbury, 

who is President and CEO of United Way of the National Capital 

Area, was scheduled to appear today, but was unfortunately—and 

had to unfortunately withdraw due to illness. His testimony will be 

entered into the record. 

So, thank you all again for being here today. The Committee has 

received each of your written statements, and they will be made 

part of the formal hearing record. Each of you will be recognized 

for 5 minutes for your oral remarks. 

Mr. Mack, we will begin with you. You are recognized for 5 minutes. 


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STATEMENT OF EARLE I. MACK, CHAIRMAN EMERITUS, 

NEW YORK STATE COUNCIL ON THE ARTS, MANHATTAN, NY 

Mr. MACK. Good afternoon, everybody. It is a pleasure to be 

here and to speak today before this distinguished Committee. All 

day long we have been talking about donor behavior. Well, I am 

a donor. And I am here today as a private citizen and a philanthropist, someone who has been fortunate enough in his lifetime to 

give millions to charities. 

So, I can tell you definitively that if the charitable deduction is 

reduced or capped, I and people like me may not be giving nearly 

as much to charities. It is not that we donate to diverse charities 

because of the deduction; we need where we need to give, because 

it is the right thing to do. It is inherent in human nature that we 

usually need a gentle tap to make it at least somewhat in our own 

self-interest to do the right thing. 

The tax deduction is a strong motivating factor, not only for the 

largest donors, but for the small contributors, as well. In other 

words, if the incentive of the deduction is gone, people won’t stop 

giving, but they are likely to give much less. There is likely to be 

a noticeable attitude adjustment when people feel that government 

is not encouraging the giving. It could cast a pall over giving. People might find themselves feeling somewhat more selfish. Maybe I 

will give more money to my family. Maybe I will give more money 

to my relatives. Maybe I will save the money. And this certainly 

will reduce the velocity of spending, and increase the ripple effect 

that curbed spending would have on our economy. 

Consequently, these nonprofits that perform the vital services to 

our community and maintain our culture, our heritage, our education systems, our hospitals, our scientific research, and our religious institutions, they are going to be the ones that are going to 

get the short end. Please don’t take away these incentives that 

make our country great. Doing so will have a disastrous effect on 

the nonprofits and religious institutions that are all so vital to our 

society, and the outreach to helping the poor, the homeless, the 

mentally ill, and the troubled kids. And let’s not forget about the 

absolutely essential role of the nonprofits in research, health, education, and the arts. 

For instance, since its inception in 1993, the Prostate Cancer 

Foundation has raised more than $520 million to fund groundbreaking research that has prevented as many as 40 percent fewer 

deaths in U.S. men. And what about breast cancer? 

Venture philanthropy is a high risk, and it amounts to approximately 3 percent of the U.S. dollars invested in medical research 

today. However, this kind of philanthropy leads to hundreds and 

hundreds of millions of dollars of research to closer relationships 

with patient communities and enhancing the understanding of specific diseases. 

Having chaired several of these kinds of nonprofit institutions, I 

can tell you that your number one responsibility is to raise money 

for programs to serve the community or to run capital campaigns 

to build new wings. When I approach my peers to donate millions 

of dollars in these important causes, they say, ‘‘Is this 501(c)(3)? Is 

this a tax deduction?’’ 


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A personal experience of mine that I feel illustrates this point in 

our unique approach to charitable giving in the United States, but 

also demonstrates the potential danger of fixing something that 

has worked for nearly a century, in the late ’70s I heard from my 

friend, Sir Joseph Lockwood. He was then Chairman of the British 

conglomerate entertainment company called EMI. And he was telling me about his difficulties in raising money to rehabilitate the facilities of the Royal Opera and Ballet, both of which have been providing access to artistic excellence and educational resources for 75 

years throughout the communities and schools. Sir Joseph was 

Chairman of the reconstruction fund of the opera and ballet, and 

it had fallen into such disrepair that they couldn’t dance on the 

stage. And the few dressing rooms backstage were uninhabitable. 

It took him and his colleagues many—— 

Mr. REICHERT. I am sorry, Mr. Mack, but could you wrap up 

your testimony, please? 

Mr. MACK. Thank you. Well, the construction workers who were 

putting the new buildings up, the carpet layers, the computer 

workers, won’t have that privilege if we cut capital spending. 

Mr. REICHERT. And thank you for your—— 

Mr. MACK. It is not that I object to fair share. But please, hands 

off capital giving. We don’t want to end up like England, where we 

have to go to the government to repair nonprofit institutions. So 

thank you very much, and Happy Valentine’s Day. 

[The prepared statement of Mr. Mack follows:] 


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Mr. REICHERT. Happy Valentine’s Day to you, sir. Thank you, 

Mr. Mack. 

Mr. Watt, you are recognized for 5 minutes, please. 

STATEMENT OF ANDREW WATT, PRESIDENT AND CEO, ASSOCIATION OF FUNDRAISING PROFESSIONALS, ARLINGTON, 

VA 

Mr. WATT. Mr. Chairman, Members of the Committee, thank 

you for the privilege of allowing me to testify. And as you will probably recognize, I am not a U.S. citizen, and I do come from the UK. 

So I recognize the picture that Mr. Mack is trying to draw. 

I have the privilege of leading the largest community of fundraisers in the world. Our members, between them, raise approximately $100 billion a year. That is nearly a third of the philanthropic dollars raised in this country. 

You have heard a lot of data and statistics today, so I am going 

to cut that out of my comments. It is in our written remarks. The 

numbers are important, because they underscore the value of the 

deduction and what it means to us. But I think that there are 

things that are more important than that. The deduction is more 

than a revenue source. So, let me explain. 

As a non-U.S. citizen, it is a particular privilege to work in this 

field. For me, the defining characteristic of the United States is the 

strength of its community, the way in which communities across 

America come together to address the common need. Communities 

act swiftly, decisively. They are based on an understanding of the 

environment in a way that those of us who work at a national level 

often struggle to do. 

I think it is a uniquely American way of looking at problems. 

Americans don’t instantly think of looking at the government. We 

think of working with each other first, with community groups and 

businesses, to solve a problem. And that is an American mindset 

which is recognized and supported by government incentives, such 

as the deduction. 

I have worked for fundraisers for over 20 years in the UK, Europe, and now America. And during that time I have seen many 

different communities incentivize giving in many different ways. 

But the charitable tax deduction is unique in being established for 

nearly 100 years. And it has withstood the test of time. Its symbolic nature almost outweighs its monetary value. It represents a 

gesture of confidence between the people, by way of their elected 

representatives, and the effectiveness of nonprofit and community 

action. It binds together the interests and concerns of all of us in 

the betterment of our society. 

But the deduction doesn’t define who we are and what we do. 

Tax deductions are not what we are about. The defining characteristic of what we are about is impact, impacting communities. 

I look and sound like a banker. But like every single one of us in 

this room on both sides of it, I chose a career in service. I know 

what that means, you know what that means. And that is what we 

are talking about today. 

That mindset and structure is envied in other countries. Charities in other countries are desperately upset at the potential 

changes here, because they look to America for an example. They 


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look to this country as a model. And a step backwards here is a 

step backwards for them. That is why the deduction is so important. It is a powerful symbol of the American tradition and system 

of philanthropy, and it is a symbol of the continuing commitment 

to the impact and the change that nonprofits create. It is government, working together with individual donors, for-profit organizations, businesses, and foundations. 

To change that symbol, to limit the deduction in any way, is to 

alter that commitment, especially a commitment that we know 

works. You have heard it repeated several times today. For every 

dollar of tax revenue foregone, you are seeing a value of $3 in the 

community. I think that is a phenomenal rate of return, and one 

that any of us would be happy to see in our businesses. 

When my wife and I sit down at the beginning of the year to calculate what we can afford to give to charity, we don’t see this as 

a tax break or a tax deduction. We calculate what, with tuition fees 

and everything else that we have to pay, we can afford to invest 

in communities. And then we see the uplift that this brings. It is 

a 35 percent uplift on what we can afford to give. It is not a tax 

break. It benefits many, rather than the individual, and that is a 

really powerful message to send. 

Tim Delaney and many others have given passionate—made passionate remarks about the crisis that we face at the moment. But 

through it all, nonprofits continue to deliver service, deliver service 

at great expense to themselves, efficiently, effectively, and well. 

We have to have many conversations in this country. We need 

to talk about what we can do to encourage more public-private 

partnerships to tackle issues head on. We need to discuss incentivizing more social investment to address our core problems. We 

have to come together in dialogue about how we can mobilize resources more effectively—not just financial resources, but human, 

social, and other types of capital. 

But I truly believe that to put the charitable deduction in this 

conversation is a red herring. It is effective, it is proven to work. 

In the general context of things it is not expensive. But, most importantly, it is that symbol of the tradition of philanthropy in the 

United States. It is part of the culture of this country. And I firmly 

believe that you cannot simply limit or replace the deduction without losing something very vital. So thank you for your time. 

[The prepared statement of Mr. Watt follows:] 


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Mr. REICHERT. Thank you, Mr. Watt. 

Mr. Palatiello is recognized for 5 minutes. 

STATEMENT OF JOHN M. PALATIELLO, PRESIDENT, 

BUSINESS COALITION FOR FAIR COMPETITION, RESTON, VA 

Mr. PALATIELLO. Thank you, Mr. Chairman, Members of the 

Committee. I am John Palatiello, President of the Business Coalition for Fair Competition, BCFC. 

Don’t feel bad; it took me 4 years to learn how to pronounce it. 

There are thousands of legitimate charitable organizations that 

do exemplary work in American society, and you have heard a lot— 

from a lot of them, and heard a lot about them today. The tax 

treatment of these charities and those who donate to them is not 

an issue for BCFC. What is an issue is when nonprofit organizations operate in direct and unfair competition with private, forprofit, tax-paying businesses, including small businesses, by engaging in commercial activities, but not paying taxes. 

Billions of dollars a year in economic activity occurs that is 

untaxed. This results in lost revenue to the Federal Government, 

as well as State and local government, and it creates an unlevel 

playing field for the private sector, and particularly small businesses. 

Entities organized under various provisions of section 501© of 

the Internal Revenue Code are provided a special tax-exempt treatment which were clearly intended to perform activities and provide 

services that are otherwise considered governmental in nature. It 

was not intended that they use this privilege to engage in activities 

that are commercially available. The exemption for charitable and 

other purposes is based on the assumption that such organizations 

are providing general welfare services, and part of—and be part of 

our social safety net, and that government would otherwise have 

to provide those services with appropriated funds. 

So, in its wisdom, the Congress traded off the requirement to 

spend tax money directly with a tax benefit to offset what these 

organizations legitimately provide. It was never the intention of 

Congress that these organizations should be engaged in providing 

commercially-available products and services. 

The nonprofit organizations provided special treatment under 

section 501© are required to pay an unrelated business income tax, 

or UBIT, on their commercial or nonexempt activities. The problem 

is that this policy has not been adequately codified by Congress, 

nor effectively and efficiently implemented by the IRS. In our testimony we provide a number of resources that we would encourage 

the Committee to explore. 

Under the Chairmanship of Congressman Jake Pickle of Texas in 

the 1980s, this Committee conducted an exhaustive investigation of 

this issue and the lack of enforcement of UBIT. The Small Business Administration, the Government Accountability Office, and 

the Philadelphia Inquirer all have done exhaustive studies, and we 

have those cited in our testimony, and commend them to your attention. 

What am I talking about with regard to commercial activities 

performed by nonprofit organizations? Well, it is the YMCAs competing with private health clubs. YMCAs perform extraordinary 


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services, services for at-risk youth. Those are legitimate. Those 

should have the benefit of special treatment for their contributions 

to society. But when a local small business gym or health club has 

to compete with a tax-subsidized or a specially treated YMCA, that 

is unfair competition. 

Credit unions, compared to community banks. Same situation. 

Rural electric and telephone cooperatives competing with investyour-own utilities and small business energy firms. We have seen 

situations where nonprofits have been created to compete with private bicycle rental companies, laundry services, and a variety of 

other activities. We see universities venturing outside of the classroom and into owning and operating and running hotels, mapping 

services, and testing laboratories. It occurs in dozens of other industries and professions. 

It is only when we move beyond hidden subsidies and ineffectual 

regulations of UBIT that both consumers and producers and all 

taxpayers will be able to enjoy the benefit of a level playing field 

and even-handed competition. We would urge the Committee to 

look at implementing a commerciality clause, and thus implement 

the Yellow Pages test. If there is something that you can find from 

private business in the Yellow Pages, then you probably shouldn’t 

have government doing it, and you probably shouldn’t be providing 

special tax treatment for a nonprofit to do it. It is a very simple, 

commonsense test. 

So, we commend the very charitable and social welfare activities 

that most charities provide, but we would urge your attention to 

commercial activities, where the system is being abused and resulting in unfair competition with private enterprise, and particularly 

small business. 

Thank you very much, Mr. Chairman, for the opportunity. 

[The prepared statement of Mr. Palatiello follows:] 


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Mr. REICHERT. Thank you. 

And, Mr. Ross, you are recognized for 5 minutes. 

STATEMENT OF ANTHONY L. ROSS, PRESIDENT, 

UNITED WAY OF PENNSYLVANIA, HARRISBURG, PA 

Mr. ROSS. Mr. Chairman, Members of the Committee, thank you 

for the opportunity to testify today about the importance of the 

charitable deduction. I am Tony Ross. I am President of the United 

Way of Pennsylvania. Our organization is the State association representing 54 local United Ways that serve every community in the 

Commonwealth of Pennsylvania. 

In my view, it is most appropriate that we gather today on Valentine’s Day to have a dialogue about the importance of charitable 

giving. In my view, one of the most meaningful ways that Pennsylvanians and all Americans demonstrate their caring and concern 

for their communities, friends, and neighbors, is through donating 

to charities of their choice. United Way of Pennsylvania and our 

members are unified in our support in preserving the charitable 

tax deduction, which is vital to our ability to serve our commonwealth’s most vulnerable citizens. 

And if you know anything about United Way, we are all local 

and independent organizations. So, to get 1,200 organizations—and 

54 in Pennsylvania—to agree on anything is quite remarkable and 

quite a challenge. 

Throughout the day you have heard about several proposals that 

might limit or eliminate the charitable deduction, so we won’t go 

too much into that. But the simple reality is without the support 

of our donors the important work by United Way and our partners 

in the charitable community which positively impact all of our community simply would not occur. 

Earlier today you heard from a couple of my colleagues from 

Pennsylvania, Jill Michal from Philadelphia and Leslie Osche from 

Butler County. But let me share a few other examples from Pennsylvania of some outstanding work done by United Way and our 

community partners: The United Way of Berks County in Reading, 

Pennsylvania, has started a Ready, Set, and Read initiative which 

brings together schools, businesses, organizations, and individuals 

to improve early grade reading success; Erie Together, an initiative 

of the United Way of Erie County, which develops comprehensive, 

community-wide responses to alleviate the impact of poverty on 

their community; United for Women, which assists newly-strugglng 

women who are one step away from crisis in Allegheny County, 

which is in the Pittsburgh region of Pennsylvania. 

Simply put, policies to cap or limit the charitable deduction 

would make these efforts impossible and be devastating to the 

human service organizations and the people that they serve. 

Just consider the impact on charitable giving during the recent 

economic downturn. From 2005 to 2010, charitable giving in Pennsylvania has declined from $181 billion to $169 billion, a 6.2 percent decrease. Do Pennsylvanians use the charitable deduction? 

Absolutely. In 2010, the year which the latest data is available, 1.9 

million Pennsylvanians, some 31 percent of those who filed tax returns, filed itemized returns with over $5.8 billion in charitable 

deductions. And I think this is really important, this next point. 


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The average contributions from those that itemized using the deduction was $3,048. And it is important to note that the nonitemizer contribution, the average contribution, in Pennsylvania 

was $2,181. So you certainly can see a financial impact there. 

Simply put, the proposals to cap or eliminate the charitable deduction present a triple threat to charities: Reduced Federal and 

State funding, increased demand for services, and fewer donations. 

Our organization undertook a survey to ask different organizations 

about the impacts of some of these budget cuts. And to underscore 

what Mr. Delaney said, the last thing that we saw in our survey, 

as well, the last thing that people do is eliminate services to community. They do all kinds of other things, eliminate staff, reduce 

hours. But the last thing they do is cut services. And so, certainly 

we have seen that impact in Pennsylvania, as well. 

Additionally, I think it is very important to note that nonprofits 

really assist the government, in terms of reducing the need for government services. Rest assured that the reduced capacity of charities to meet community needs will result in increased demand for 

public assistance from the public sector. 

I was very struck earlier today by the comments of the gentleman from Meals on Wheels who talked about the fact that feeding someone for 1 year was equal to the cost of 1 day for someone 

being in a nursing home. And I think that underscores another reality for all of us on this panel, or our colleagues who have spoken 

earlier today, that prevention is actually the most cost-effective 

way, in terms of policy. You know, we are talking about this in 

some respect because we have a fiscal policy issue. But the most 

fiscally responsible and conservative action the government can 

take and nonprofits can take is to be preventative. So I think that 

example relays that. 

Simply put, people—the money may go away, but the people and 

need do not. So, while many of our government partners often applaud us for helping to serve people in need, we simply ask, ‘‘Don’t 

handcuff us, and enact policies to help us positively impact the 

community that we both serve.’’ Thank you. 

[The prepared statement of Mr. Ross follows:] 


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Mr. REICHERT. And thank you, Mr. Ross. 

Ms. Ireland, you are recognized for 5 minutes. 

STATEMENT OF LISA IRELAND, EXECUTIVE DIRECTOR, 

UNITED WAY OF ORLEANS COUNTY, MEDINA, NY 

Ms. IRELAND. Thank you, Mr. Chairman. Good afternoon to Mr. 

Chairman and the Members of the Committee. Thank you for providing me the opportunity to testify at today’s hearing on behalf of 

both the United Way of Orleans County, as well as the United Way 

network here in the United States. 

New York State, as you are well aware, has suffered 2 years of 

devastating storms, concerns over a very challenging economy, as 

well as both State and Federal cuts to the ultimately important 

human service programs. All of these have put a tremendous 

amount of pressure on the charitable sector to address community 

needs. Any effort to limit the charitable deduction sends the wrong 

signal to the donors at the time that their gifts, especially our large 

donors, are needed the most. 

As an Executive Director of a smaller United Way that is situated in a mostly rural area, we rely heavily on a few major donors 

to continue to support our mission and the programs that we sponsor in our local area. We currently sponsor over 20 programs from 

a very wide variety of service areas, including support for children, 

the elderly, those in poverty, and those with disabilities. 

As an example, we fund the only youth mentoring program in 

our local community. Entitled Just Friends, it has successfully created over 100 relationships between children and adults. The children in this program have what we call and can be seen as difficult 

home lives. In many cases, they are from either a single-parent 

home, or they are being raised by a grandparent, an aunt, an 

uncle, and, in some cases, a next-door neighbor. Many of them also 

come from households with transient members, where on a daily or 

weekly basis these children have different family members, different people living in their homes with them. 

As the name of the program implies, our Just Friends youth 

mentoring program matches at-risk youth with an adult figure who 

really wants to just be their friend. This allows for a constant positive role model in their lives, who will take the time to build a special, one-on-one relationship with them. In many instances, the 

mentor and the child spend their time together doing simple 

things. We don’t ask our mentors to go out and spend hundreds of 

dollars on them every time they see them. They are asked to give 

life back to this child. They take the time, on a daily basis when 

they see these kids, doing such activities as fishing—because in our 

area we are the number one fishing area, so that is really important—baking cookies—which you and I may see as a regular daily 

thing, but to some of these children, no one has ever taken the time 

to bake cookies with them—to teach them how to plant a garden 

and to watch it come to fruition, where they have flowers or fruit 

or vegetables that they have grown themselves. 

Imagine a child the first time they walked into a county fair, 

learning about the animals they have only ever seen in books, and 

having the opportunity to walk around with someone holding their 


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hand, caring about them. And maybe they could just spend some 

time having some ice cream. 

We live in a region in our area that has two State facilities, two 

State prisons. And we had a child in this program who came from 

the inner city of New York City. Her mentor, the first time they 

went out, they went to a local place out by Lake Ontario called 

Brown’s Berry Patch. And what they did is they walked around, 

they picked apples, and they just spent the day together. The only 

time this child had ever seen an apple was in the local supermarket on the street in Manhattan. They didn’t know what an 

apple tree even looked like. These are special one-on-one opportunities given to these children. 

The activities that these children are going through with these 

mentors are simple, things that, in our daily lives, we take for 

granted. You may have a child, a grandchild. I have little children. 

Every single day when I tuck my children into bed, I don’t take 

that for granted, because these children don’t have that. 

In building these relationships, our mentors are able to build the 

child’s self esteem, and are able to offer encouragement to aspire 

them to achieve a better tomorrow for themselves. 

As an outcome to these relationships, we have seen an increase 

in school attendance, higher graduation rates, and more involvement in school activities. One of our greatest moments is when our 

mentor was able to watch her mentee walk across the stage at 

graduation, because that child had no one in their lives that had 

ever graduated college. 

Our local United Way is very concerned that any limitation on 

charitable giving will have a detrimental effect on our ability to 

raise funds and support these programs. 

In closing, I have had the privilege of working in the nonprofit 

sector in Orleans County for the past 12 years. I have worked with 

a variety of programs and an array of people whose lives have been 

directly impacted by the work of United Way. I have seen firsthand 

the success of these programs and the individual successes of the 

people whose lives have been changed by these programs. I cannot 

begin to put into words how important it is that we do whatever 

we can do to enable our major donors to give. I encourage you to 

preserve the charitable deduction as it exists in the Tax Code. 

Again, thank you for the honor and the privilege of being here 

with you today, and thank you for everything that you do. 

[The prepared statement of Ms. Ireland follows:] 


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Mr. REICHERT. And thank you. 

Ms. Irgang, you are recognized for 5 minutes. 

STATEMENT OF TORY IRGANG, EXECUTIVE DIRECTOR, UNITED 

WAY OF SOUTHERN CHAUTAUQUA COUNTY, JAMESTOWN, NY 

Ms. IRGANG. Thank you very much for your patience and for 

your stamina. I think I am the last thing holding you here today. 

Our United Way is located in the southwestern corner of New 

York State, and we have a service area of approximately 72,000 

residents. Ours is a traditional community, where the United Way 

has an impeccable reputation as the charity of choice. And I inherited that when I came there, not bragging about myself. 

In 2012 we invested just over $1 million into community-based 

programs that impact 31,000 lives. And here are just a few examples of how those dollars are translating to outcomes. 

Students participating in school-based mentoring at Jamestown 

High School are remaining in the same match with an adult for an 

average of 30 months, versus the national average of only 9 

months. In 2011, 80 percent of these students pursued post-secondary education or job training upon high school graduation. During the last school year, all of the teenage mothers enrolled in a 

combination education and parenting program graduated on time, 

and their children had received all recommended immunizations. 

The number of older adults receiving home-delivered meals in 

2012 in our community increased by more than 10 percent. This 

$4-per-day remedy kept more people in their homes and saved us 

thousands in Medicaid expenses associated with facility-based care. 

Families filing their taxes through our volunteer income tax assistance program received $330,000 in a combination of earned income and child care tax credits last year. Nearly 50 percent of 

those who filed with us expressed an intent to use their refunds to 

purchase a home or car or establish a savings account. 

These programs are administered by community-based organizations that remain nimble. What I mean by that is they can respond 

to emerging needs quickly, and adjust their service as demand 

shifts. Our United Way is at the heart of this, annually utilizing 

a team of 40 individual volunteers to compile and monitor program 

outcomes and make recommendations that lead to efficiency and 

improvement. 

What is behind this system of investment, review, and improvement in our community? It is charitable giving. The United Way 

of Southern Chautauqua County’s 2012 campaign raised just over 

$1.3 million. Approximately 17 percent, or $221,000, came directly 

from individual donations of $1,000 or more. Yes, these gifts came 

from the hearts of good people who care about the community. But 

it would be foolish to believe that these donors were not also motivated by the tax incentive that they received. 

The Chronicle of Philanthropy reports $21.9 million in charitable 

giving annually in Chautauqua County, which is quite impressive. 

With a median household income of only $41,000, I believe we need 

all the incentives available to encourage this high level of charitable contribution to continue. For lower-wage earners, the itemized deduction is a modest incentive. 


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For the highest wage earners, those with the greatest capacity to 

give, the ability to itemize is a huge incentive. And without this incentive, the United Way of Southern Chautauqua County stands to 

lose a significant portion of its campaign revenue. This would devastate the 44 programs that receive funding currently. And these 

are exactly the types of programs community members and donors 

want to support, those that keep their administration simple and 

low-cost, those that adapt to a changing landscape, those with 

whom they have a personal connection. 

Just to give a face to the type of programming that changes lives 

and benefits from United Way support, I will conclude by telling 

you about Len and Armando. Len serves as a mentor to Armando, 

and has for over 4 years. They meet for lunch at school once a 

week. Over the time they have been in a mentoring match, 

Armando has been moved to three different schools. Each time, Len 

has been there to help him cope with the transition. He keeps 

Armando focused on his schoolwork, even when other things seem 

more important. Most of all, Len listens to Armando in a way that 

a friend or a parent just can’t do. 

On the other hand, Len has found the relationship beneficial. 

Armando has helped him become more accepting and patient with 

others, including his own children. Len’s visits with Armando are 

the bright spot in his week, and he can see the time he has invested is already paying dividends. 

There are thousands of stories like this one from southern Chautauqua County. What they all share in common is that they 

wouldn’t be possible without the generosity of caring individuals. 

Protecting the charitable deduction is a critical piece to ensuring 

that this generosity continues in communities like mine. Thank 

you. 

[The prepared statement of Ms. Irgang follows:] 


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Mr. REICHERT. Thank you for your testimony. Mr. Davis, you 

are recognized for 5 minutes. 

Mr. DAVIS. Thank you. Thank you very much, Mr. Chairman. 

And, again, I certainly appreciate the witnesses who have been 

here for a sustained period of time. 

I would appreciate it if each one of you who are affiliated with 

a United Way organization would answer this question for me. I 

have always wanted to know more about who the people were who 

donate to the United Way. Some people think that you have to be 

wealthy. Some people think that wealthy people are the individuals 

who do it. So, if you could, give us a description of who you think 

your donors are, whether they are a mixed group, low-income, 

high-level donors, and what motivates them. I think we heard from 

Mr. Mack considerable information relative to what motivates him 

and other people like him. 

So, if perhaps we would just begin with you. 

Ms. IRGANG. I think they nominated me. In southern Chautauqua County, we are a very small rural community. The vast majority of our campaign comes from regular, everyday people who 

are donating $26 or $52 a year. So a dollar a paycheck or a dollar 

a week. We have about 150 donors who make up that leadership 

circle, that highest level of giving. But certainly if we were looking 

at the volume that comes in, it is really from people just like you 

and I, everyday people who are working and contributing at a sacrificial rate for themselves. 

I heard Brian Gallagher say earlier today in our meeting that 

the average gift across all of United Way worldwide is $300. So we 

really are looking at donors who are giving—many donors are giving smaller amounts of money. And what we are looking at is that 

a portion of our campaign—in my case, 17 percent—comes from 

those large donors. 

Ms. IRELAND. Thank you very much for the question. We in Orleans County are an extremely rural county, as well. And I would 

answer you in saying that we have what you might want to call 

a mixed bag of donors. I am fortunate enough to have in our one 

area a large manufacturing company who is currently based out of 

Chicago. But with their foundation, every dollar that the employees 

donate, they double that to $500, and then they, you know, match 

above and beyond that. The employees themselves this year raised 

$26,000. The company matched by $26,000, which is generosity beyond belief for us. 

On the other hand, I have the $75 donors that send that in. But 

one of my favorite, favorite donors is a lady that, since I started 

11⁄2 years ago, comes in every single month and gives me $5. It is 

all she can afford, and she said, ‘‘It is what I can give to make a 

better tomorrow after I am not here.’’ So I have both ends. But 

they give because they care, and they give because they know that, 

although today might be a good day for someone, somebody might 

need that money tomorrow. 

Mr. ROSS. From a statewide perspective, I would just echo what 

my colleague Jill Michal said a little bit earlier. She talked about 

their United Way raised $60 million, but they don’t raise it from 

60 millionaires. What I like to say in Pennsylvania, we raise $175 


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million across every United Way in the State, which is great. But 

when you look at our State budget, it is $28.7 billion. 

But what I like to tell donors in Pennsylvania is that every donor, whether you gave the $52 or whether you gave the $10,000 

or the $1 million, every donor is a $175 million donor in Pennsylvania. Because without all of those aggregate donations, we don’t 

get to that $175 million. 

So I think another way of looking at it, as well, is to look at how 

United Way campaigns are organized. I often have divisions. So 

you have schools, you have labor, you have businesses. Actually, 

one of the things I think is most impressive is the fact that the 

agencies that we often support often do fundraising campaigns to 

support the United Way. So the agencies that actually get the 

funds actually raise money from their employees to contribute to 

the campaign. So it really is a comprehensive community effort. 

And this one last point regarding the type of donors, we do have 26,000 donors that give over $10,000 a year. And that equals about 

$500 million, nationally. 

Mr. DAVIS. Thank you very much. And thank you, Mr. Chairman. I yield back. 

Mr. REICHERT. Thank you. The gentleman’s time has expired. 

Mr. Reed, you are recognized for 5 minutes. 

Mr. REED. Thank you, Mr. Chairman. And I would like to thank 

the entire panel, and especially Tory, for your testimony, and for 

all the hard work that you do in our district in Chautauqua County 

and our neighboring county of Orleans, Ms. Ireland. 

One question I have for you is if you are not in business—say 

the charitable deduction, whatever happens to it, jeopardizes your 

very existence if it goes away—who would do the work that you do 

now, in your mind? 

Ms. IRGANG. I think you would have a lot of calls to your office, 

probably. But in truth, there are 19 agencies located in the greater 

Jamestown area that receive support from the United Way. And 

their collective revenues are around $20 million. So it is a big 

chunk of our community. United Way is a small piece of that, obviously, but we are kind of the lynch pin. We are the leverage point. 

We are what they need to bring in other dollars, the foundation 

that they can count on. 

And so, I don’t want to say we are irreplaceable, but I think that 

we play an extremely critical role. And I am not sure there is a replacement for it. 

Mr. REED. Well, I appreciate that, because some of the discussions I have had with Members on this issue, some have kind of 

played devil’s advocate and had the argument of, well, if we got rid 

of the charitable deduction, that would produce more revenue to 

the government, and then the government could step in and provide the services. 

And one of the things I am concerned with in regard to that, 

for every dollar that is given to you—for example, a United Way— 

how much of that dollar is utilized on the front line, versus if the 

dollar was a taxpayer dollar that went to the government—say to 

Washington—and then back to provide the service, how much of 

that dollar would make it to the service of the people that you are 

intending to serve? 


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Anyone on the panel, if—Mr. Mack is eagerly jumping forward. 

Thank you, I appreciate it. 

Mr. MACK. Thank you. I go along with President Obama and his 

concept. Instead of top-down, bottom-up, the people that are on the 

bottom, that are on the bottom of the start-ups, they could be 

wealthy people, they could be poor people. They have great ideas. 

And if they feed from the bottom up, instead of feeding from the 

top down, where the government tells you where to give, it would 

wipe out the whole creativity, it would wipe out all the dedication 

of these people that work because they are dedicated. They make 

sometimes little money or no money, but they believe in what they 

do. 

Mr. REED. Good point. Mr. Watt. 

Mr. WATT. Mr. Mack touched on something earlier, which is 

coming from the UK, where you are used to having government 

pick up the tab for education, health care, a wide range of things. 

It means that the philanthropic incentive in the UK is focused very 

differently: Overseas aid, cuddly animals, and children. It goes to 

different causes. The problem with that is that at times like this, 

when things are very tight, budgets are being balanced, we are 

about to move to the sequester—we will see the same thing here— 

the first thing that gets cut is government commitment to cofunded projects with nonprofit organizations. 

So, the kind of approach where government becomes responsible, 

you take away something like the tax deduction, which puts the responsibility on the community to deliver service, and transfer it 

back to government, it is a very, very slippery slope to go down. 

I have lived here long enough to recognize where I think the 

merit of the balance lies, and I have to say that I don’t think that 

government should assume the responsibility of nonprofit activity. 

Mr. REED. I appreciate that. Did you want to offer something, 

Ms. Ireland? Please—— 

Ms. IRELAND. Just one example of what would happen. We 

have what’s called Camp Rainbow, and it is run by the ARC, and 

it is a camp up in Lyndonville, New York. It was started years ago 

for children with disabilities because these parents started it saying, you know, ‘‘There is no camp for my child who has disabilities.’’ It has since been open to children without disabilities to 

teach children to learn together, and to be inclusive, not exclusive. 

And we fund heavily into that program. 

And their Executive Director, when she does presentations with 

me, lets everyone know that if funding from United Way were to 

be cut to that program, that that program would have to stop, because they do not receive any funds. They lost a Federal grant for 

transportation, and transportation alone, to get the children back 

and forth to camp for the summer, is $17,000. 

So, that is an example of your question if it were to go away, 

what would happen. And these children, this is the only camp that 

they have. It is specially designed for wheelchair access and children with leg braces. And it is the greatest time they have. So 

there is an answer to what would happen. 

Mr. REED. Well, I appreciate that. I see my time is expiring. 

And Lyndonville is up on Oak Orchard Creek, and I think I have 

caught a few salmon and brown trout there. 


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Ms. IRELAND. I am sure. 

Mr. REED. I appreciate the reference to the fishing. Thank you 

all. 

And with that, Chairman, I yield back. 

Mr. REICHERT. Thank you, Mr. Reed. Mr. Lewis, you are recognized for 5 minutes. 

Mr. LEWIS. Thank you very much, Mr. Chairman. And I will be 

very brief. I want to thank each of you for being here, and thank 

you for being so patient. 

This is a question for all of the United Way organizations that 

are on the panel. I want to know more about the people you do not 

have the resources to serve, to help. Do you have to turn people 

away from your program? How does the charitable deduction help 

your organization to provide these services? 

Mr. ROSS. Oh, I am going first this time? Thank you for the 

question, Mr. Lewis. I think there are a couple of ways to answer 

that question. 

First of all, I want to make the point that serving people in need 

does not occur in a vacuum. It really takes an infrastructure to 

make that happen. It is not just the philanthropic sector or the 

government sector. Because when someone needs a need, they don’t 

care where the particular help might come from. So it may be a 

government program, it may be a nonprofit program. We all work 

in concert. So that is one answer to the question. Certainly, when 

there is a cut in services that—from our government partners, then 

often United Way has come to—to try to fill that gap. 

There is always more need than dollars, no matter how much 

money you raise. And I think part of that is because, you know, 

human beings evolve. The challenges that we had in the ’70s and 

the ’60s are not the ones that we have today. So certainly there is 

always an unmet need. I think most United Ways undergo a process called community needs assessment, in which they try to 

prioritize what are the most critical needs in the community. 

And—because the resources are limited, you have to be sort of strategic about this. But my colleagues at the local level I think can 

talk a little bit more in depth about that process. 

Ms. IRELAND. Thank you, Mr. Lewis, for that question and the 

opportunity to speak about it. There is always going to be more 

need than we can take care of. And again, we are a small rural 

community with limited resources. The number one thing that I 

have encouraged our agencies and our community to do is to collaborate together. And we have, in our community, a large need for 

literacy. And that is something that we are working on right now. 

For example, we have so many programs that we work on in getting literacy into the family and to the children. But if the parents 

can’t read, then what is that helping? So we—for example, we had 

all these kindergarten forms that came home, and the parents were 

just signing them and sending them back. They didn’t know what 

they said. So we are working as a collaborative unit to kind of say, 

‘‘I can do this; what can you do?’’ 

And in a case where there is a need that we can’t meet, we go 

back to the local community that supports us so well, and we just 

say, ‘‘Here is the need. What can we do together?’’ And our community is so small and so rural, but so amazing and so giving that 


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there is never a circumstance that they won’t rally around. A sick 

child without medical insurance? They will, you know, set up a 

chicken barbecue, do whatever they can. 

So, any incentives such as, you know, the charitable tax giving, 

all of those, you know, Tax Codes—which is so far removed from 

my expertise—but anything that we can do to, you know, keep our 

donors, encourage our donors, so that we can go to that donor that 

gives us $1,500 a year and say, ‘‘This is the story. Can you give 

us $2,000 next year?’’ So we work with our community to meet the 

needs as best we can. 

Mr. LEWIS. Thank you. 

Ms. IRGANG. And I think just to bring up something that—I 

think what they have said is wonderful. In conclusion, United Way 

is in a position to help hold the programming and the agencies in 

our community somewhat accountable for the funding that they 

receive. 

We also, as was mentioned earlier, we often do community needs 

assessing. So we are able to direct agencies and programs that 

maybe are not as necessary as they once were to evolve and follow 

the needs, so that we can try to meet the needs that are most 

pressing and most important, not necessarily legacy programs and 

keep them going forever. So I think that is an important role for 

United Way in almost every community that it is in. 

Ms. IRELAND. I agree. 

Mr. LEWIS. Thank you. Thank you, Mr. Chairman. I yield back. 

Mr. REICHERT. Thank you. Well, thank you for your time today 

and thank you for your testimony. And even though this has been 

a long process for everyone today, almost 7 hours and 41 witnesses, 

6 different panels today, it really has been, I think, a very worthwhile exercise. And again, thank you for hanging in there and staying until the very end. And we have a number of witnesses—or 

Members here with us still, people moving in and out throughout 

the day. 

But the process here is going to be one, as we move forward, is 

going to be very open, as was today’s hearing. And I am proud to 

say—and I don’t know if some of you were in the audience earlier 

in the day when I said that I have been chosen as the Chair of the 

Charitable Organization Working Group. And Mr. Lewis is the CoChair. And he and I together, I think, are very excited about working with all of you in finding a way that we can keep working to 

help those people that need help, and also make the system fair. 

And I know I am going to ruin your name again, but I think 

Mr. Palatiello—— 

Mr. PALATIELLO. John. 

[Laughter.] 

Mr. REICHERT. That works, too. I will call you JP, how is that? 

John, I think you pointed out a very interesting thought in making 

sure that there are organizations out there that aren’t in it to create revenue for themselves and compete with private businesses, 

but they really are truly there to help folks who really need help. 

And that is one of the things that we will be looking at, too, as we 

have our working groups. 

But I also want to say to the question that Mr. Davis asked on 

who donates and who contributes, I know that United Way and 


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Special Olympics are very innovative in their fundraising events. 

I have participated in those events as the sheriff back in Seattle 

and King County. People get a great deal of fun out of watching 

a full-grown sheriff with 1,100 people working for him riding a tricycle in a tricycle race. They will come to see that and pay a lot 

of money. They will also pay to see a Saturday jump in Lake Union 

in the Polar Bear Plunge. 

So those are fun events, but—and they bring the community together in a way that I know you recognize. You see, it is not only 

about the money, it is about the unity of the community and working together to provide for those people that really need our help. 

We are going to move forward again with this open process, and 

I look forward to your continued input. And thank you all for what 

you do for those people in need each and every day. We really appreciate your efforts. 

So, with that, the Committee stands adjourned. 

[Whereupon, at 4:51 p.m., the Committee was adjourned.] 

[Submissions for the Record follow:] 


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f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.278
428 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.279
429 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.280
430 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.281
431 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.282
432 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.283
433 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.284
434 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.285
435 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.286
436 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.287
437 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.288
438 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.289
439 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.290
440 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.291
441 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.292
442 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.293
443 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.294
444 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.295
445 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.296
446 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.297
447 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.298
448 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.299
449 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.300
450 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.301
451 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.302
452 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.303
453 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.304
454 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.305
455 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.306
456 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.307
457 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.308
458 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.309
459 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.310
460 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.311
461 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.312
462 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.313
463 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.314
464 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.315
465 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.316
466 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.317
467 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.318
468 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.319
469 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.320
470 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.321
471 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.322
472 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.323
473 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.324
474 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.325
475 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.326
476 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.327
477 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.328
478 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.329
479 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.330
480 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.331
481 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.332
482 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.333
483 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.334
484 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.335
485 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.336
486 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.337
487 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.338
488 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.339
489 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.340
490 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.341
491 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.342
492 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.343
493 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.344
494 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.345
495 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.346
496 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.347
497 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.348
498 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.349
499 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.350
500 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.351
501 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.352
502 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.353
503 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.354
504 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.355
505 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.356
506 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.357
507 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.358
508 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.359
509 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.360
510 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.361
511 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.362
512 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.363
513 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.364
514 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.365
515 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.366
516 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.367
517 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.368
518 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.369
519 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.370
520 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.371
521 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.372
522 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.373
523 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.374
524 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.375
525 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.376
526 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.377
527 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.378
528 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.379
529 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.380
530 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.381
531 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.382
532 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.383
533 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.384
534 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.385
535 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.386
536 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.387
537 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.388
538 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.389
539 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.390
540 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.391
541 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.392
542 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.393
543 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.394
544 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.395
545 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.396
546 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.397
547 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.398
548 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.399
549 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.400
550 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.401
551 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.402
552 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.403
553 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.404
554 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.405
555 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.406
556 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.407
557 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.408
558 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.409
559 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.410
560 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.411
561 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.412
562 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.413
563 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.414
564 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.415
565 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.416
566 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.417
567 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.418
568 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.419
569 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.420
570 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.421
571 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.422
572 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.423
573 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.424
574 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.425
575 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.426
576 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.427
577 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.428
578 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.429
579 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.430
580 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.431
581 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.432
582 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.433
583 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.434
584 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.435
585 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.436
586 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.437
587 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.438
588 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.439
589 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.440
590 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.441
591 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.442
592 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.443
593 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.444
594 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.445
595 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.446
596 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.447
597 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.448
598 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.449
599 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.450
600 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.451
601 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.452
602 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.453
603 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.454
604 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.455
605 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.456
606 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.457
607 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.458
608 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.459
609 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.460
610 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.461
611 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.462
612 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.463
613 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.464
614 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.465
615 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.466
616 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.467
617 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.468
618 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.469
619 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.470
620 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.471
621 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.472
622 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.473
623 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.474
624 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.475
625 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.476
626 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.477
627 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.478
628 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.479
629 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.480
630 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.481
631 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.482
632 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.483
633 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.484
634 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.485
635 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.486
636 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.487
637 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.488
638 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.489
639 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.490
640 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.491
641 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.492
642 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.493
643 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.494
644 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.495
645 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.496
646 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.497
647 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.498
648 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.499
649 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.500
650 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.501
651 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.502
652 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.503
653 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.504
654 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.505
655 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.506
656 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.507
657 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.508
658 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.509
659 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.510
660 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.511
661 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.512
662 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.513
663 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.514
664 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.515
665 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.516
666 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.517
667 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.518
668 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.519
669 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.520
670 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.521
671 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.522
672 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.523
673 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.524
674 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.525
675 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.526
676 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.527
677 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.528
678 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.529
679 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.530
680 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.531
681 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.532
682 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.533
683 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.534
684 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.535
685 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.536
686 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.537
687 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.538
688 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.539
689 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.540
690 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.541
691 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.542
692 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.543
693 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.544
694 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.545
695 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.546
696 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.547
697 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.548
698 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.549
699 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.550
700 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.551
701 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.552
702 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.553
703 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.554
704 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.555
705 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.556
706 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.557
707 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.558
708 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.559
709 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.560
710 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.561
711 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.562
712 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.563
713 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.564
714 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.565
715 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.566
716 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.567
717 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.568
718 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.569
719 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.570
720 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.571
721 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.572
722 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.573
723 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.574
724 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.575
725 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.576
726 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.577
727 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.578
728 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.579
729 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.580
730 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.581
731 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.582
732 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.583
733 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.584
734 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.585
735 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.586
736 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.587
737 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.588
738 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.589
739 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.590
740 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.591
741 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.592
742 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.593
743 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.594
744 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.595
745 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.596
746 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.597
747 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.598
748 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.599
749 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.600
750 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.601
751 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.602
752 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.603
753 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.604
754 

f 


dkrause on DSKHT7XVN1PROD with LOCATORS21128A.605
755 

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dkrause on DSKHT7XVN1PROD with LOCATORS21128A.606