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Over the past two years, as communities across America faced enormous challenges and heartache, a critical sector of our economy unfailingly answered the call for help: the nonprofit sector. Whether providing health care, offering food and shelter, job training and education, connection through art or music, or any number of critical community services, nonprofits responded to the COVID-19 pandemic as an integral and irreplaceable partner to federal, state and local governments. The nonprofit sector was there when Americans needed them, and they are always there for us.

Across our nation, the nonprofit sector is composed of 12 million employees, 20 million board members and 63 million volunteers. This is a vital sector of the American economy motivated by service and community impact rather than financial profit. Still, nonprofits have needed help over the past two years themselves. They have been squeezed by lost revenue, labor shortages, disrupted operations and increased demand.

When the federal government developed the Paycheck Protection Program (PPP) to help businesses stay afloat through the worst of the pandemic, we worked in Congress to make sure nonprofits were eligible. Few things could be more counterproductive in a time of need than layoffs of the very people best positioned to help in our communities.

When the Small Business Administration (SBA) opened PPP in April 2020, nonprofit and for-profit entities scrambled to complete the application process while news reports warned of quickly dwindling funding. As nonprofits tried to grasp this lifeline, many were stumped by a section on the application form requiring information about their ownership. Their ownership? Nobody owns a nonprofit. They belong to their community and to all of us. That's part of why they're so effective and so important. Was a nonprofit supposed to list its board members, its executive director, or no one at all? Experts had varying advice, and the clock was ticking.

The SBA's dedicated staff did heroic work in setting up the PPP, but they had little history working with nonprofits. This lack of nonprofit expertise amounted to more than a mere paperwork headache: Researchers estimate that PPP protected fewer nonprofit jobs than expected, with smaller nonprofits disproportionately missing out. Despite relying on the nonprofit sector to help implement programs and serve those in need, the federal government's pandemic response left many nonprofits behind.

It is time the federal government formally recognize the importance of the nonprofit sector. Our landmark bipartisan legislation, the Nonprofit Sector Strength and Partnership Act of 2022, formally establishes a partnership between the federal government and the nonprofit sector. Our legislation gives nonprofits a seat at the table when federal policies are created — instead of being asked impossible questions when they apply for assistance. Specifically, our bill will create a three-part structure:

  • White House Office: Nonprofits have a powerful voice in our communities, but they need a formal voice within the federal government, similar to how the Small Business Administration provides critical information and support to small businesses. With nonprofits at the table, policies can be designed to maximize benefit for our communities.
  • Interagency Council: Every federal agency works with the nonprofit sector in some capacity, but agencies lack a streamlined mechanism for coordination. The council will draw on these relationships to produce regular reports on how nonprofits can help the government use taxpayer dollars more effectively.
  • Federal Advisory Board: Congress and the president need the expertise of the nonprofit sector, and this board will ensure a diverse set of community-based and national nonprofit leaders are at the ready to provide consultation.

Our bill also takes important steps that will bolster the nonprofit sector: adequate nonprofit jobs data, streamlined fundraising registration, expanded access to national service, fairer federal grants processes and more.

We have also each seen the power of nonprofit sector partnership in our own states. The groundbreaking work of Minnesota Council of Nonprofits has been a leading voice and partner for more than a decade in working to achieve a formal federal partnership. And in Michigan, the success of the Governor's Office of Foundation Liaison makes clear that this concept can deliver results for nonprofits, government and the people we serve.

Nonprofits have always represented the best of what America can be because they put people's well-being and the greater good at the center of their missions. The pandemic era has been a powerful reminder of nonprofits' impact and the importance of their partnership with the federal government. The time is now for Congress, the White House and all our federal agencies to formalize this relationship and be a true partner.

Betty McCollum, a Democrat, represents Minnesota's Fourth Congressional District and Fred Upton, a Republican, represents Michigan's Sixth Congressional District in the U.S. House.