Rep. Cory Gardner (R-Colo.) recently introduced legislation to jump-start economic development in rural and urban areas.
The Philanthropic Facilitation Act would make it easier for foundations and other philanthropic organizations to contribute financially to job creators across the country. The bill would work by streamlining the approval process that determines eligible recipients of charitable investments. Foundations under current law must make charitable expenditures each year in order to keep their tax status.
Gardner’s proposed legislation would expedite the current process for Internal Revenue Service rulings on whether or not an investment to a low-profit entity would count towards yearly expenditures. The legislation would streamline the process by directing the IRS to respond within a certain time frame. All foundations wanting to make an investment in the same entity would then be able to rely on the IRS determination.
“Many of our rural areas continue to face declining populations because of dwindling job prospects,” Gardner said. “This bill will help encourage investment in rural communities by cutting government red tape and providing new opportunities for businesses. Private organizations are ready and able to invest in critical employers in rural areas, but are too often held-up by government approvals. This bill will unleash investment by removing redundant and harmful government roadblocks.”
Rep. Jared Polis (D-Colo.) is cosponsoring the legislation.
“Simplifying partnerships between nonprofit foundations and for-profit investors, the Philanthropic Facilitation Act will stimulate economic growth and support socially responsible businesses that are committed to charitable work,” Polis said.