Federal Activities
Executive Actions
Budget Actions
Nonprofit Nonpartisanship
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In March 2026, the General Services Administration (GSA) has proposed requiring all federal grantees, including nonprofits and state, local, and Tribal governments, to sign new certifications under threat of civil and criminal penalties before receiving federal funds. These certifications aim to align with President Trump’s executive order and the U.S. Department of Justice guidance, labeling certain diversity, equity, inclusion, immigration, and terrorism-related activities as “illegal.”
Executive Actions
Since taking office, President Trump has signed many Executive Orders (EOs) with wide-ranging consequences for nonprofits and the communities they serve. These actions have targeted DEI programs, government grants and contracts, civic engagement, immigration, LGBTQ+ rights, and environmental protection, with measures ranging from political scrutiny of federal grantmaking to increased enforcement actions against organizations serving immigrant communities. While many of these EOs have been challenged in court, litigation remains ongoing. Taken together, these actions reflect a sustained effort to restrict nonprofit independence, reduce public investment in civil society, and limit the sector’s ability to serve and advocate for the communities that depend on it.
GSA to impose new rules on nonprofits
In March 2026, the General Services Administration (GSA) proposed requiring all federal grantees, including nonprofits and state, local, and Tribal governments, to sign new certifications under threat of civil and criminal penalties before receiving federal funds. These certifications aim to align with President Trump’s executive order and the U.S. Department of Justice guidance, labeling certain diversity, equity, inclusion, immigration, and terrorism-related activities as “illegal.”
The proposed changes create significant legal and financial risks to grantees, jeopardizing community access to critical services. They have vague requirements that make compliance difficult, and grantees could face audits, investigations, and lawsuits, potentially discouraging them from seeking federal funding. This could disrupt essential services nationwide, including housing, health, education, food assistance, disaster recovery, and community development, ultimately harming the communities that rely on them.
Take Action
Sign onto a national letter opposing the proposed changes and submit your own public comment by March 30.
Resources
Budget Actions
Since taking office, the Trump administration has enacted significant budget cuts that are deeply impacting charitable nonprofits and the communities they serve. These cuts have been carried out through multiple channels, including the H.R. 1 budget reconciliation bill, as well as ongoing rescission efforts seeking to roll back previously approved funding. Learn more below.
What NAO's monitoring
On July 4, 2025, the Congress passed H.R. 1, President Trump’s 2025 budget reconciliation bill, also known as the Big, Beautiful Bill Act. The final version of the bill contains sweeping changes, with most provisions expected to negatively impact the nonprofit sector. Key provisions include:
OPPOSE:
- Largest Medicaid Cuts in History — $1 trillion in cuts nationwide over 10 years, causing 11.8 million people nationwide to lose their health insurance. Adds work requirements, limits the use of the state provider taxes, changes administrative and application procedures, and requires the reverification of eligibility every 6 months.
- An estimated 450,000-600,000 Oregonians will be impacted by new administrative requirements. Possibly 200,000 families and children will lose coverage.
- SNAP Cuts — $287 billion in cuts nationwide over 10 years, causing 3 million Americans to lose benefits, by expanding work requirements to 20 hours/week for able bodied adults by raising age limit from 55 years old to 64 years old. Increases state share of the cost to administer the program from 50% to 70%. States with high error rates would pay for part of the food costs, up to 15%.
- Oregon’s administrative error rate is 14.06%. The state would need to reduce the error rate below 6%, or they would have to pay 75% of administrative costs for running SNAP in the state, about $500 million every two years.
- 1% Floor for Charitable Contributions by Corporations— Estimated to eliminate $4.2–$4.8 billion in annual charitable giving.
- 0.5% Floor on Charitable Giving for Itemizers — Further weakens incentives for and amount of charitable giving.
- 1.4% tax to colleges and universities with a “student adjusted endowment” between $500,000-$750,000. – Decreases the financial resources available to nonprofits to advance their mission.
SUPPORT:
- Expanded non-itemizer charitable income tax deduction — further incentivizes charitable giving among the 90% of taxpayers who do not itemize their tax deductions.
The bill’s projected $3.4 trillion deficit over the 2025–2034 period falls far short of addressing the nonprofit sector’s expanding role in filling gaps left by government and the private sector. In Oregon alone, H.R. 1 is projected to cut $15 billion in federal funding from Oregon for Medicaid, food benefits and other programs over the next 10 years. The state will be unable to absorb these substantial reductions in the coming years, making it unavoidable that many Oregonians will be negatively impacted by these federal actions.
Refer to the Resources below to see a more in-depth breakdown of the provisions of the bill. Visit NAO’s State Activities page to learn more about the estimated state-level impacts of H.R. 1.
The Trump administration has begun submitting multiple rescission packages to Congress, aiming to cancel billions of dollars in funds already approved by lawmakers. In July, both chambers narrowly passed H.R. 4, a $9 billion rescissions package that cut funding from the U.S. Agency for International Development (USAID), world health programs, the Public Broadcasting Service (PBS), and National Public Radio (NPR). The bill was signed into law just days before the July 18 deadline under the Impoundment Control Act, after which Congress would have been required to spend the authorized funds.
Under the Act, the President can request to delay or cancel previously approved spending, and Congress then has 45 legislative days to act. During this time, the executive branch can temporarily withhold the funds. If Congress takes no action, the funds must be released. The passage of H.R. 4 has raised alarms among advocates, setting a precedent for using the rescissions process to roll back previously agreed-upon investments in public services, including those provided by charitable nonprofits. It also complicates the appropriations process if funding is approved in a fiscal year only to be nulled the next. Senate Democrats warn that this undermines the bipartisanship needed to pass spending bills, which requires 60 votes in the Senate.
NAO will provide updates as more details are released.
Resources
- Trust-Based Philanthropy Project - The Ripple Effect of Federal Actions
- National Council of Nonprofits - Analysis of the 2025 Tax Bill and Its Impact on Charitable Nonprofits
- Independent Sector - Tax Provisions in House-Passed and Senate-Passed Reconciliation Legislation Impacting the Charitable Sector
Nonprofit Nonpartisanship
The Johnson Amendment is an important provision in federal tax code Section 501(c)(3), that states that a charitable nonprofit may “not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office.” Since it’s inception in 1954, this language has protected the integrity of charitable nonprofits, foundations, and religious organizations. In exchange for tax-exempt status, these entities agree not to participate in or intervene in any political campaign, ensuring that they focus on their missions and remain dedicated to the public good.
In recent years, there have been numerous efforts to repeal or weaken the Johnson Amendment. Most recently, the IRS has sought court approval of a settlement with the National Religious Broadcasters and two Texas churches that would effectively undermine the law. If approved, the settlement would declare the Johnson Amendment unconstitutional and bar its enforcement against the two churches involved. This would set a dangerous precedent that could open the door for broader dismantling of the provision.
Take Action
Nonprofit organizations are invited to sign onto a national letter calling on the Trump Administration to protect nonprofit nonpartisanship.
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