Welcome
Thank you for making the NFCA's grassroots campaign in Washington a success! Our objective was to educate legislators about who we are and what we do, and the message was well received. Legislators received over 600 emails and letters from their constituents.
Our counsel in Olympia is currently working with legislators to ensure that fraternal are not included in any upcoming legislation or budget proposals.
Please visit this site often to read the latest about the NFCA's efforts to protect the fraternal tax exemption. Contact the NFCA if you have any questions - we look forward to hearing from you.
WA Budget Background
- Washington State has serious budget issues and legislators need to close a $2.6 billion budget gap in 2010. Closing this gap will be a top legislative priority in the 2010 session which runs from January 11 to March 11.
- The Governor has called for new revenues to close the budget gap. These would be derived from new or increased taxes. Securing enactment of such measures in the legislature will be difficult, however, because individual legislators are fully aware of the potential downsides – i.e. losing their seat in the next election – of passing broad-based tax increases. As such, they may look for other ways – eliminating tax exemptions, etc. – to address the budget gap.
- The budget deal will be the last piece of legislation acted on by the legislature, with a flurry of activity likely coming in the final two weeks of the session. However, much of the deal – including decisions regarding which organizations will maintain their tax exempt status – will be made much earlier in the session. That is why prompt mobilization of our grassroots resources was absolutely necessary.
JLARC Report
- The Joint Legislative Audit & Review Committee (JLARC) conducted a three year review of tax preferences including exemptions to the state tax code. In 2009, JLARC finalized its tax preference report and recommended that the legislature review the fraternal exemption to determine whether fraternal benefit societies fulfilled the legislative intent of the exemption.
- In the report, JLARC determined that the intent of the exemption was to provide death benefits to immigrants and lower-income populations. The report stated that fraternals no longer serve these populations and function in the same manner as for-profit corporations which donate funds to charities.
Legislative Action & NFCA Response
- December 4, 2009 - The JLARC report was discussed at a joint meeting of the House Finance and Senate Ways and Means Committees. There was no specific discussion of the fraternal exemption during this meeting.
o Prior to the meeting, NFCA sent each member of the JLARC, the House Finance Committee, and the Senate Ways and Means Committee a letter, the NFCA identity brochure, and a one-page insert on the impact of fraternal activities in Washington.
o The NFCA convened a Washington Task Force consisting of the Knights of Columbus, Modern Woodmen, National Catholic Society of Foresters, The Independent Order of Foresters, Thrivent Financial for Lutherans, Royal Neighbors of America, Sons of Norway, and WFLA.
o All task force members mobilized their members and agents to launch a grassroots campaign to educate legislators about the fraternal tax exemption. Thrivent Financial for Lutherans and the NFCA activated their online advocacy systems.
o The NFCA hired Olympia lobbyist Mel Sorenson to represent the interests of fraternal benefit societies doing business in Washington.
- January 5, 2010 - JLARC voted to approve the proposed report. That meeting was followed by another joint meeting of the House Finance and Senate Ways and Means Committees to hear the final JLARC report and recommendations.
- January 21, 2010 - The Senate Ways & Means Committee held a working session to discuss the JLARC report. Fraternals were briefly mentioned at the end of the meeting and no discussion took place.
• Prior to this meeting, the NFCA again sent letters and brochures to all committee members.
• NFCA counsel Mel Sorenson met with key committee leaders and determined that there was no legislative support for rescinding the premium tax exemption for fraternal benefit societies.
• Given low legislator interest in taxing fraternal benefit societies, Mel advised that the grassroots campaign cease to reduce the risk of over-exposure.
Grassroots Campaign Summary
• The initial grassroots campaign to educate legislators about fraternal benefit societies achieved its objective and concluded on January 22, 2010.
• Fraternalists in WA sent a total of 626 emails and an uncounted number of letters to legislators.
• WA Task Force members collected letters of support from 4 nonprofit organizations in Washington which benefited from the support of fraternal volunteers/funding.
Next Steps
• Mel Sorenson will work with lawmakers on tax writing committees, legislative leadership, and the executive branch to ensure that fraternals are not included in any new legislation or back-room budget deals.
Current Action Alerts
The NFCA is focused on cultivating legislative champions for the fraternal benefit system. The key contact link on the right is a convenient way to report your connections with legislators and help the NFCA map relationships with policymakers. Please take a moment to complete the key contact form and forward it to your colleagues. Curious about how many relationships your society has reported? Contact the NFCA to receive reports detailing your society's political connections.
Federal Alerts
There are no Action Alerts at this time.
State Alerts
There are no Action Alerts at this time.