Navigating Tax Reform: Advocacy for Associations and Nonprofits

In this episode of Associations NOW Presents, guest hosts Steven Stout, CAE, FASAE, and Katy Markert from Better By Association lead a timely discussion with Mary Kate Cunningham, CAE, Chief Public and Governance Officer at ASAE, and Jarrod Clabaugh, CAE, President and CEO of the Ohio Society of Association Professionals. They explore the potential impacts of upcoming tax reforms on associations and nonprofits, including the expiration of the 2017 Jobs Act provisions and new threats under UBIT. The conversation emphasizes the critical role of coalition-building, advocacy, and grassroots efforts to protect the sector. They also discuss strategies for engaging lawmakers and preview ASAE's upcoming fly-in event, focused on lobbying against adverse tax policies.

 

Check out the video podcast here:

https://youtu.be/3gSTzeScv7Q

 

Associations NOW Presents is produced by Association Briefings.

 

Transcript

Steven Stout  0:04  
Welcome everyone to Associations NOW Presents, an original podcast produced by the American Society of Association Executives. Today, sitting in front of the mic is myself, Steven Stout with the Texas Society of Association Executives, alongside my colleague and friend Katy Markert, who will be serving as your guest co-hosts for today's episode.

Katy Markert  0:22  
Hi everyone. I'm Katy Markert, also with TSAE, and we are so thrilled to be here with you today. Usually, Steven and I are on our own podcast, as he mentioned, Better by Association, produced by TSAE. And on our podcast, we refer to our listeners as "100-Percenters," because, as you probably know, association executives give 100% of themselves all the time. So you might hear us refer to that today. And I want everyone to know. 

Steven Stout  0:49  
Absolutely. So all those listeners hearing us for the first time, welcome to the 100- Percenter family. And for those who found us here from our other podcast, welcome back. 

Katy Markert  0:58  
Welcome back. Normally, I know we're used to speaking to what we think is just Texans, but I'm really excited that this is a national stage Steven. 

Steven Stout  1:07  
Agreed. We sometimes have listeners in Australia, China and the Netherlands. So being here makes total sense. Were you nervous about being here today Katy? 

Katy Markert  1:16  
What's funny is I wasn't until I heard that we were going to be on camera, and then all of a sudden, I got a little bit nervous, but usually we don't do that, but I don't mind. I'm just pretending that's not happening. And I don't know. I think after this, we've completed two seasons of our podcast, and I think I started off a little more nervous, but the more we've done in it, the more I realized we just have really great conversations, and I always learn something. And it's really lowered that kind of nervousness level for me. I really don't think about it too much, but what about you? I don't know. I'm starting. I'm getting the vibe that maybe you're you feel opposite.

Steven Stout  1:51  
Yeah, I was a little nervous. No, to be honest with you, I changed my shirt three times. I did the teenager thing in the closet, like I went through things and was like, "I have nothing to wear. I hate all my clothes." I was nervous. But now we think you said we've done this so much that it it feels like home when we get to do stuff like this. But the point of all this is that we are happy to be with you today, and thanks for having us. 

Katy Markert  2:11  
Yes, absolutely. Now, Steven, we are recording this the second week of December, right before the holidays in 2024 and we all just came out of Thanksgiving with our families and loved ones. Yes, and typically, at Thanksgiving, I just, I love my family. I just want to say that about how to say there is that one question that I get a little nervous is going to come up. Do you know the question I'm talking about?  

Steven Stout  2:37  
Why can't you be more like your sister, Sharon? Is that the one? 

Katy Markert  2:43  
It probably should be. But no, the question I'm thinking of has a lot more to do with politics, as we know should never bring that up in the holidays, and in particular this year, I was worried about the who did you vote for question? 

Steven Stout  2:55  
Oh yeah, that is a sticky one at family gatherings. 

Katy Markert  2:58  
It can be now, perhaps we can sidestep that question here, but there are some more important issues tied to politics that we should all be keeping a close eye on in the association space, no matter who you voted for. 

Steven Stout  3:10  
That's right. And today we are diving into one of those topics, and that is tax reform.

Katy Markert  3:15  
That's right. And luckily, we get to ask the questions and not answer them, because this is actually going to be complex in 2025 today, we are speaking with Mary Kate Cunningham, CAE, Chief Public and Governance Officer with ASAE. 

Steven Stout  3:29  
Alongside my colleague and bestie from Ohio, Jared Clabaugh, CAE, president and CEO with the Ohio Society of Association Professionals. Welcome guys. 

Mary Kate Cunningham  3:40  
Thanks for having us. 

Steven Stout  3:41  
Yeah, thanks for joining us today as we guest co host this podcast. Now, on our podcast, we always ask the same question to our guests, and we're taking the opportunity the same here. So our first question, it's an easy one, I promise. What is your fall-in story? How did you fall into the industry? As we all know, a lot of us did not go to school for this. We found this industry and fell in love with it and stayed so we'd love to hear your fallen stories and how you came across our space. 

Mary Kate Cunningham  4:07  
I can share that I worked on the Hill, and then I was at a think tank and struggling with kind of the lack of action sometimes that you have at think tanks. And my roommate from college, Beth Palmisano, worked in marketing at ASAE, and that is how I found ASAE, 12 and a half years ago.

Steven Stout  4:22  
Oh my gosh, wow. So you have your college roommate to thank for all this. 

Mary Kate Cunningham  4:26  
Absolutely, yes. 

Steven Stout  4:27  
I'm not sure I've ever thanked my college roommate for anything. So that's nice that your college roommate did something nice for you. And Jared, what about you?

Jarrod Clabaugh  4:34  
A buddy of mine actually worked for a newspaper here in Columbus, and he heard about a job offering with the Ohio Restaurant Association. They were looking for a communications director. In my life, I've only eaten in restaurants, never worked in one. So I thought, "What could I bring to that role? "And another college friend said to me, it's basically a PR job for an association, and that was almost 15 years ago, and that led to service on the Ohio Society of Association Professionals board, which led to me running the show here nine years later.

Steven Stout  5:07  
So you both have your college roommates to thank for your introduction to the space.

Jarrod Clabaugh  5:11  
Mine is a fellow RA and I'm not sure if he made the offer to help me out or to just give me a different perspective on going from real estate to something as sexy and as exciting as association management.

Katy Markert  5:24  
That's wonderful. We love that you guys made it into this industry, and we get to talk to you today. Now that we've got the softball question out of the way, it's time to get into what we're here to talk about. I just want to dive right in. So how will the expiration of the 2017 Jobs Act provision impact associations, particularly concerning UBIT compliance and potential new tax liabilities. 

Steven Stout  5:48  
A real soft want to get us started.

Jarrod Clabaugh  5:50  
Yeah, speaking of those sexy questions, yeah. 

Katy Markert  5:55  
Mary Kate, can you kick us off? 

Mary Kate Cunningham  5:57  
Sure, yeah. So I'm happy to talk about how much is at stake next year and why associations need to be at the table. There are a few bills that have major provisions that are expiring and well, the tax cuts and Jobs Act is one of them. There is, let's see, almost 10 trillion in proposed policies on the table, but there are a huge number of tax exemptions that are expiring at the end of next year. So that's why Congress has to act. We say Congress only acts when there's a deadline, and sometimes not even when there's a deadline, and this is going to be next year, the Super Bowl of tax there is the individual rates and the corporate rates that may change. And Congress is looking for a lot of revenue, and they're looking in every sector and profession, and that's why we're really concerned about the assistance community and not being a pay for this type of legislation.

Steven Stout  6:47  
And then why did they suddenly start focusing on associations, or the 501, C community? I should say

Mary Kate Cunningham  6:54  
So, there was two tax policy reports that came out in the summer, one from the Tax Foundation and one from Cato, and they are listing out all the different ways that associations are exempt, and they're advocating for taxing the entire 501, C community at the corporate rate. So it is really concerning. One is Tax Foundation, and one is from Cato, and we knew we were going to be prepared for a tax site next year, along with everyone else, but we didn't know that we were going to be specifically targeted to really have all non donation revenue be taxed at the corporate rate, which is right now, 21% that could change. So it's probably the biggest threat to associations in 30 years.

Jarrod Clabaugh  7:37  
There's also a threat, possibly, to what it could look like in regard to endowments, some of the lawmakers have mentioned that endowment should be taxed at the 35% rate as well, and that would obviously impact a lot of nonprofit organizations.

Mary Kate Cunningham  7:51  
Absolutely 

Steven Stout  7:53  
Jared you as a state group, you see this as a concern for you as well, obviously.

Jarrod Clabaugh  7:58  
We do, and we're trying to educate members about the fact that, as of right now, everyone is on the table. So a lot of associations have heard about this, but they've heard specifically that right now, it looks like Cato and the Tax Foundation are interested most at looking at 501 C threes. And from what Mary Kate and our colleagues on the Hill have been able to gather and share with us, if you have a 501, C designation of any type, there definitely needs to be some concern, and the fact that everything but donations are being looked at for taxation is a real threat. 

Steven Stout  8:33  
Yeah, that could change the life of a lot of groups, not or even maybe make groups some stop existing. 

Jarrod Clabaugh  8:40  
I agree with you, and I also think we're gonna see a lot more mergers and acquisitions. We saw a lot of that during the days after COVID and during the first couple years of the pandemic, but I think that something like this will pose a significant threat to a lot of our a lot of our entities.

Steven Stout  8:55  
Mary Kate, you mentioned think tanks, and I know think tanks like the Tax Foundation have proposed significant changes to ubit, including eliminating nonprofit exemptions for some activities, including new revenue sources subject to taxation, such as royalties and credentialing. How should associations prepare to counter these types of narratives?

Mary Kate Cunningham  9:13  
Great question, and yeah, it's really wild. We were preparing just to stop the expansion of ubit unrelated income tax. In the past, in tax reform, we've had to defeat provisions to tax, royalties, sponsorships, things like that. But this is really much bigger and across the board, taxing associations. So the question how can we go about defending against it? ASAE is launching a coalition of all 501 C organizations to speak for one song she and advocate to Congress why associations and nonprofits are exempt. Congress seems to understand they're expected to know every policy issue under the sun, and so they seem to understand for profit versus charity, but they don't really understand the associations, the other 501, C organizations. Why we're tax exempt, that we don't enrich our shareholders. We put that money back into the community, and we train the workforce, drive the economy, things like that. So we really have to be at the table to tell our story. There's going to be a ton of new faces next year, and there's a lot of work to do, as they say in Washington, if you're not at the table, you're on the menu, and that's why it's really important for associations to be part of the conversation.

Jarrod Clabaugh  10:25  
Just to piggyback off what Mary Kate said, it's also important to remember that nonprofits provide the most education of any group in the post secondary sector. We're providing services to the industry, to the world, the communities in which we operate that are often services that the government would have to subsidize if they're going to go away from allowing us to have access to the minimal tax exempt dollars we do have to enrich our communities. It's likely that government is going to have to get more involved and spend more money, which they claim is never what they want to do. 

Steven Stout  10:57  
Jared, how do you combat folks who aren't in the DC area that are like "This is a DC issue. It doesn't matter. We're in the state and we're fine. They'll sort it out up there, and we'll just keep our heads down here and just keep moving forward."What would you say to someone who said something like that to you?.

Jarrod Clabaugh  11:11  
I think I just tell them to look back at the last 10 years. If they look at how legislation in DC has impacted state organizations, regional and national organizations, it's very rare that something can happen anywhere in our 50 states that doesn't end up impacting us. And I also remind people about the old adage of as Ohio goes, so goes the rest of the country. I think many Ohioans we're lucky that we're headquartered here in the capital of Ohio, but you're right, Steven, there are organizations that are outliers, or that maybe have been their own islands for many years, and think it's not going to impact them. I just remind them of different changes in legislation that have impacted them, and the fact that they're the boots on the ground while DC is off making decisions that many of us don't agree with. If we put our hands in our pockets and don't say anything, we're allowing that change to happen. Yeah, we're trying to work with ASAE to make sure we can develop messages that allow our members to have a true grassroots focus, that they can elevate their message and get it in front of their lawmakers. The reality is, a lot of them know their lawmakers better than any of our state organizations or even the federal because they're right down the street because their constituents, which is a word I always want to remind our lawmakers of their constituents are involved with associations. One in five Americans is either employed by or part of an association during the span of their career. And if we remind people of that, I think it's a very strong message that we have a lot of force behind us. And as Mary Kate said, the economic drivers are essential to many communities. What might be a huge windfall for the federal government might shut down an organization that feeds the homeless, that that helps children have access to clothing that educates veterans. So that's a key aspect. I also think it's important to remember that most associations are two to five employees. They have smaller budgets than most for profit companies, and that makes them small businesses. And one thing that so many lawmakers campaign on is the idea that small business is the heart of America. So if they want to change the way that nonprofits operate, they're going to directly impact the success of small business. 

Steven Stout  13:23  
Yeah, I love that analogy. "Save the heart of America!" That's your campaign slogan, Mary Kate. you're welcome. 

Mary Kate Cunningham  13:29  
We'll get the buttons for our flying I do want to, since we mentioned the fly in, talk about ASAE's fly in is open for registration. Our dates are March 25 and 26th and you come to DC, we teach you about policy and asaes advocacy issues, including tax reform. And then you go to the Hill the next day in small groups with your states. Jared has been a state leader for many years, and it's really important, because every year there are new congressional staff and members of Congress, and when they meet someone face to face and learn about what associations do in their community, then it really changes hearts and minds. So that's what we're looking to do, and it's going to be really perfect timing for this fly in. It's going to be a period of tense legislation next March, so we're really excited to bring people to DC for that conference.

Steven Stout  14:17  
So thoughts some support, Mary Kate say the dates one more time. 

Mary Kate Cunningham  14:20  
March 25 and 26th ASAE fly in, we're going to be in DC, and we're really excited about it, and we will certainly have buttons to wear to go to the Hill and make our message known. 

Steven Stout  14:30  
Love it. 

Katy Markert  14:31  
No that's really great, and that's that kind of leads me to my next question. As we're talking about this 10 trillion in tax policies, my question is, how can associations advocate for the value that they provide that you've been talking about so they're not disproportionately taxed?

Mary Kate Cunningham  14:46  
I think there's many different ways joining our coalition, the Community Impact Coalition, where also we have a tax reform action list that you can join for ASAE, so you can get the latest on our issues. If you're not able to join the coalition. We will have ways to be involved the good and the bad part of the this tax threat is coming from think tanks. It's not currently bill text. We never want it to be bill text. We're trying to stop it in its tracks. Make this radioactive, but it means there's a lack of specifics about what it would actually cover, and we've just got to defend against everything, as Jared said, especially trade show income, investment income, things like that, are really concerning for associations. There are different ways to be involved that will share, join the coalition, joining ASAE's grassroots network, are two big ones,

Katy Markert  15:35  
And how do they do that? How can they join the Coalition? And how can they join the grassroot network? 

Mary Kate Cunningham  15:40  
We will share the links to join that will be in this podcast description. How does that sound?

Steven Stout  15:45  
So convenient? We'll put it right in front of you.

Jarrod Clabaugh  15:47  
I would say one thing that Mary Kate and I have been messaging this a lot, but the stories on the ground are going to be what matters. What does the 21% tax look like on an organization that, again, feeds those in need. They're saying that there's 3.6 trillion I believe that they can get from our sector in the first year, what's that going to look like the second year, when half of our sector is gone? Yeah, and the people who know me on this podcast know I like to develop a one liner or two, but I can passionately say that I'm tired of nonprofits continuing to fix for profit problems, and we're really relied upon in our communities to ensure that those in need get help. And we're being asked again to not only continue to finance maybe some wasteful spending, but we're also being told that the work we're doing isn't enough, and so I think that it's getting that message out from those communities that are local. I'm a part of my local Kiwanis, this would vastly impact the work we do to feed our community's children and to offer scholarships that are truly the definitive difference between someone going to be college or university or not. So I think Katie to expound about what Mary Kate said. It's just merely reminding people that this isn't a segment, or that they're just looking at the quote, unquote wealthy associations. This will impact all of us, and that will ultimately impact every community in our country.

Mary Kate Cunningham  17:16  
Jared, you're so right. 

Jarrod Clabaugh  17:17  
Can you repeat that? Yeah, exactly. That on recording one more time. I never hear that enough.

Mary Kate Cunningham  17:23  
How can we get our bullet points ready for here's the one top line message to the hill. And what would your association have to stop doing if you're paying a 21% tax on your net so we had a dental association say, here are the Mission of Mercy clinics we would not be able to put on for veterans, things like that. If you can get that ready so that when we call upon you to tell your story, you have it that is going to be the most impactful for sharing the real world impact with Congress.

Steven Stout  17:49  
Yeah. 

Jarrod Clabaugh 17:50  
A lot of this is just education. Yeah, I've spoken to a lot of groups now that don't even know about this, or they say it's somebody else's problem. They'll fix that for me. And we've all seen where not taking action has ended up hurting our communities in the long run. 

Katy Markert  18:05  
I love both of y'all talking about just like the stories that each association has, because truthfully, I wholeheartedly believe in storytelling, and that's how people remember us and how we can really impact people and connect through their emotions and the stories that we tell. So just hearing you talk about those specifics and how it will impact the communities, I think, is such a huge impact.

Jarrod Clabaugh  18:27  
Yeah, now is not a time to be humble. 

Mary Kate Cunningham  18:30  
Yeah, absolutely. And I think ASAE--the AC board--sees what a big threat this is, and they've invested up to a million dollars in from our reserves in this effort, and now we've raised over $300,000 for the coalition itself. So there's a lot of energy and enthusiasm, and we know there are smaller organizations that will be able to find it in their budget, but there's other ways they can definitely help. So definitely be thinking about what's your one liner? What would happen in your community if your associations didn't exist. 

Jarrod Clabaugh  19:01  
Mary Kate, how many organizations are involved with the tax coalition reform group right now? 

Mary Kate Cunningham  19:06  
We are at over 40 now. 

Steven Stout  19:08  
That's great. 

Mary Kate Cunningham  19:09  
Yeah, we're in our soft launch phase, but it's just really growing quickly, and we are excited to tell the story. There's going to be such a competitive environment, and because of all the legislation that'll happen next year. That's why we really need the support to be able to break through the noise

Jarrod Clabaugh  19:26  
And correct me if I'm wrong, but hasn't the new administration said they want to put together some type of tax plan within the first 100 days?

Mary Kate Cunningham  19:34  
Yes, there's so much pressure to move quickly on this, both from the administration, the kind of pressure to continue their the legacy of the tax cuts and Jobs Act, and then in Congress, they know there's the first 100 days are where the most action happens. They have the most momentum. There's some debate about, if they're between the House and Senate, of course, on what the actual strategy will be. The House wants to go first with tax reform. I think the Senate's more interested in some other policy first, but it will be regardless, intense policy making period, and we really need to be at the table there.

Jarrod Clabaugh  20:08  
That times the fly in at a great point in this discussion. 

Steven Stout  20:11  
I was going to say that sounds like the first part of the year is going to be very important for this fight that we ahead of us.

Jarrod Clabaugh  20:16  
And as all things political, there's a good chance that this will not have a stamp on it by the end of 2025 that does not reduce the concern, but we have those wonderful midterm elections that will start, I think, on day 101 of the next administration. So I think it's important that we realize that this may be a battle that no from both the federal level and state and regional that we have to keep our eye on in the long term? Yeah, I've also been trying to remind groups that are mainly state based that whenever the federal government finds money somewhere, it isn't long before state and local start looking at that as well. If this doesn't get defeated at the federal level, we need to realize that the states will likely start coming for revenue as well. 

Steven Stout  20:58  
Yeah, that's a great point. Jared, I think people forget about that piece of it. And I like that you pointed out that this fight may not have an expiration date. It might be a while, a long fight, which makes sense. Mary Kate, why the ASAE  executive board  put so much faith in you and money behind the fight. 

Mary Kate Cunningham  21:14  
Yes, having something like a laundry list in the Tax Foundation report of all the different ways to tax organizations is really concerning because it just exists for tax policy staffers to go back and look at so it's very concerning.

Steven Stout  21:28  
Yeah, many new members of Congress, we talked a little bit about that. There's a lot of those now lack historical context on the tax cuts and Jobs Act. You talked a little about the fly-in Mary Kate, but how can associations educate policy makers to protect the sector's interests?

Mary Kate Cunningham  21:43  
Absolutely, yes, there are going to be a lot of new faces, and we're going to have sign on letters where we'll ask your association to join. And the way we divide the sign on letter when it goes to the hill is by state elected official can pull it open and see, I'm from Arkansas. Here are all the Arkansas associations. So really, every voice counts there. I think that will be really important, and it will be certainly a tough road for because the margin is so thin in the house, and some of those elected officials are going to join the administration. They're going to have elections to replace them. It's going to be, I think, a really interesting but tough path ahead to get this legislation through the house, in a situation where almost every member of Congress has a veto, in a sense, in the house, because there's such a just a few vote majority, then I think it's really means that every voice is important to be educated on this issue. Yes, it'll definitely be an interesting time the new Congress, yeah. 

Jarrod Clabaugh  22:41  
And I know one thing Mary Kate and I have talked about is, you know, maybe there's a lawmaker or a legislator that's within our own organizations, or maybe we have a connection to those folks. Let's find those voices. Let's elevate those voices in a way that helps others realize that the impact of our industries and the work that we do, because let's face it, it comes down to friendship, no matter where you are in your career and in your role. Yeah. So if you fellow lawmakers in DC who maybe are in your caucus that can share the value of association management and the great work that nonprofits do, they're automatically going to trust their voices more. So that's something that I've been trying to work with my membership to do is finding those wonderful voices and finding those strong advocates, because we need as many people to talk about the great work that we're doing as possible.

Mary Kate Cunningham  23:30  
That's so true. And if you have a connection to a member of Congress, we are mapping that. So if you can email publicpolicy@ASAEcenter.org and we're working on the map of all the members of Congress who's received awards from associations, who's a member of an association, exactly what Jarrod said there. If you have a connection like that, you're a trusted voice within them, and that's super helpful. And we have one member of Congress who is on the Ways and Means Committee, who is an ASAE member might carry, and it's just so great to have someone who understands association management. He said association management is similar to being in Congress. It's like juggling jello or we can have those connections. I think the better. So it's public policy at ASAE center.org and send us who you're connected to. We just had a member over the weekend tell us that they're connected with Billy long who's going to be nominated to run the IRS. So things like that can always be super helpful to us. 

Steven Stout  24:25  
Yeah. So you pointed out you get your talking point ready of what your priority is, and then if you have a connection, make sure you inform you guys you have that as in your arsenal as you take on this fight.

Mary Kate Cunningham  24:36  
Absolutely. And we're looking for also, we're looking at charities to join the coalition, and we're looking at the charities that are both connected to members of Congress and to the incoming administration. All the different ways to be connected are great.

Jarrod Clabaugh  24:49  
Yeah, and I would just indicate that the leadership at ASAE has been very engaged with the state leaders. They are working very closely to support the work that the SAEs do. And they want to make sure that we have a place at the table. And ultimately, I think that's something we need to remember, that we can't let this be a deep sea issue. This has to be something states are delivering. I've had some members tell me that we're not worried about this, and what I tell them is, I'd rather blow out a candle than try to put down a forest fire. So at this point, we know it's out there. We don't know what's going to be in a bill, or if there will even be a bill, but it's better to be educated about it than to be surprised. 

Mary Kate Cunningham  25:27  
Absolutely, it's so much harder to defeat something when there's already bill text so absolutely Jarrod.

Jarrod Clabaugh  25:32  
And Mary, Kate and I were both saying many prayers that it would not be a trifecta. We knew that if one party won a segment of the government we had a better chance at this, but the way things came out up until just last week, they were still calling races. But the way this came out is Congress is controlled in both houses by the Republicans, and obviously the administration is Republican, so we need to be on top of this.

Mary Kate Cunningham  25:56  
Yeah, it just adds to the sense of urgency when one party is able to move forward because they can use reconciliation, which is the process to get something through the Senate, without having to get the 60-vote majority. So they'll be able to use that. There are some quirks within it, but they'll be able to use that to pass tax before Democrats use it to pass the Affordable Care Act. Republicans use it to pass the tax cuts and Jobs Act in 2017 so it reduces the hurdles that they have to get to. It's still immensely complicated to find that many votes. And if you might remember, the Republicans lost 22 votes on the budget resolution to start reconciliation for tax reform last time, and they lost 12 votes on the actual tax reform. So it'll be a tough road to make everyone happy in order, they don't have 12 votes to lose this time, unless they find enough Democrats. So it will be really interesting to see how that all unfolds.

Jarrod Clabaugh  26:46  
And just as a reminder, this would have been a threat no matter which party won, I've been encouraging all of my members to dust off their copies of the West Wing and remind themselves how we can all be a voice and all be a part of this fight

Steven Stout  27:00  
Practice, walking and talking and like the doing the West Wing.

Jarrod Clabaugh  27:04  
Correct, Aaron Sorkin is yet to financially support any of my commitment to the West Wing, but I would say that it's a good reminder that we have a voice and we can get involved. And Mary Kate and her team are doing so many positive things for the industry in DC, but this is just a reminder of how we can all come together. One message I've been really thankful that I can deliver to my members is, no matter what your role in the association spectrum is, if you're a CVB, if you're a hotelier, if you're a financial services firm, this will impact the work associations and nonprofits are doing in your communities, and it will impact what you're doing. And as a has been phenomenal at bringing together the many various stakeholders in this to make sure we're all a part of the conversation and to make sure that the messaging that's being delivered to our lawmakers and to our members is not beltway heavy. It's how people talk where they are, it's understandable, it's applicable. And that's, I think, why these grassroots messages are going to be so important to winning this fight. 

Katy Markert  28:09  
Yeah, I love hearing the breakdown the house and how close it's going to be. And you mentioned that there's not bills written, there's not current language yet, but are there some specific legislative items that associations should be keeping an eye on. 

Mary Kate Cunningham  28:24  
Outside of tax reform, I have to take the time to talk about our we've got really exciting legislation that is positive, that might pass a tax reform next year. So the freedom to invest in tomorrow's workforce Act is the legislation, and it would open up 529  savings accounts that are tax favored to be able to be used for certification and licensure. So we have 149 co-sponsors in the house and 25 in the Senate. It's one of the most bipartisan bills in Congress, and it was actually passed through the Ways and Means Committee in July. So our plan is to reintroduce in January and do our best to make sure this legislation is included in tax reform, it has a really low score, about 85 million over 10 years from the joint tax that means it's more of a possibility to be included, and it's really an offensive measure as well, because every office that we meet with, we explain all the certifications that associations provide, how we train the workforce. We frankly, lean on a lot of the blue collar certifications, because every legislator wants a stronger workforce, and the people that can transition to a great career really thrilled about the work. We have a coalition, the tomorrow's workforce coalition, to try to help get this passed, with over 900 organizations that have joined on that is a free coalition next year, because it's a Super Bowl of tax we're doing everything possible to try to get that included in the tax bill. That's one positive. And then 

Jarrod Clabaugh  29:46  
I just want to interrupt here real quick and say that part of that 529, the success forward, has been ASAE working with lawmakers and their members to get that message across. I think we've at least two years, maybe three. We've been in DC during the fly-in talking about the importance of this piece of legislation and how it would expand accreditations to various parts of our communities. As Mary Kate said, this helps every level of your society. So it's not geared at just as of right now, 529s can only be used for colleges and universities, and there are a lot of younger people in today's workforce that they don't want to go that route. So what better way than expanding those offerings without a huge hit to their investment? And the success of this is related to as a ease work through the fly in and obviously their ongoing campaign.

Katy Markert  30:37  
 Yeah, that's great. 

Mary Kate Cunningham  30:39  
Oh yes. And obviously, Ohio, your society, has been really helpful as well. Jared and yeah, the fly in every year that helps us get co-sponsors. It's just that type of shoe leather lobbying is really useful for sharing the message on the hill.

Jarrod Clabaugh  30:54  
It's easy to ask a lawmaker, do you not want to help more of your constituents work and make better careers and spend more money and stay in your communities.

Mary Kate Cunningham  31:02  
Absolutely, it's such a bipartisan piece of legislation, it's really exciting to work on.

Steven Stout  31:07  
Yeah, so that's a win. Mary Kate, any other wins we should know about?

Mary Kate Cunningham  31:11  
I think that something to put on the radar that I've had a lot of members ask me about is there is more, I think, of a concern about telling our story, especially in the house, Ways and Means Committee, I think there's a little more skepticism about associations and a need to do that education. And I just want to highlight a bill that passed the stop terror financing and tax penalties on American hostages act that sounds like something we can all be in favor of stopping to American hostages paying taxes. But within that legislation, it's HR, 9495 a lot of members have asked about it, because it would allow the Treasury Department to revoke the tax exempt status of a nonprofit deems to be supporting terrorism. Our concern is that any kind of unilateral power that it's giving to remove tax exempt status. So it's something just to be aware of, and it's a reminder of how we need to show Congress how associations are the incredibly strong governance that we have. I think we are not the target of this legislation, but just something to consider as Congress looks to provide more oversight on tax exempt organizations. There's really a strong need to explain who associations are, how we benefit the society. And I'm really thrilled we have new economic impact research that Oxford Economics did for ASAE, and we have a map on our power of associations website that we'll share the link to, where you can look at every state and see the number of associations, the number of employees employed by associations, the taxes that we pay for State and Local and that's really helpful for quantifying the power of associations to Congress, and something that we'll continue to do next year. 

Steven Stout  32:54  
Yeah, that's so powerful, too here in Texas, that helps those types of data points really help us here to make the case here in Texas for our existence. So thank you for all the work you do with that piece. It's very important to us. I will tell you guys, you got me a little fired up. I'm ready to, like, I need, like, a boxing montage with Eye of the Tiger, like, I'm ready to knock some stuff out. But before Katy gets to her last question, I wanted to ask Mary Kate, if people are listening, and they've never been to the fly-in before, and they want to get involved. They hear your passion. They hear Jarrod's passion. Can you give people a sort of little snippet of what a fly ins like if they've never done one before? Because I think it sounds like we need everybody that can come this year, whether you've been coming for years, or this will be your very first time. We need everybody, as you said, to help us with that shoe leather, lobbying, lawmaking, explain the fly in a few one more time for those folks who have never, ever been.

Mary Kate Cunningham  33:43  
Absolutely. So it's March 25 and 26th we have every type of folks attend, from association lobbyists to CEOs to people who are in association  management but have never gone to the hill before. So we will teach you everything you need to know. It comes with a lot of CAE credit hours. We're finding out the exact amount now, but we will do a 90 minute prep webinar in February to teach you the basics of a hill meeting, how to request them, how to join your state groups, and the top level on our policy issues, which are going to be taxed in our five to nine bill. And then when you come to the fly in on the first day, we will have a special first timer session that kicks off at 11, and we'll do more practicing Hill meetings in small groups. And then we will have speakers from the hill and then teach you the policy issues. And then we also provide some general government relations kind of education, because we know people need to help justify their attendance and registration. Sure, this year we're gonna have an ethics credit, which is very exciting. We get help people with doing CAE renewal, and then we'll do a short session on political communications. We're gonna have some great experts join us. It's more important than ever to try to break through the noise. So excited about that session. So we'll give you all the education, and we'll put you. Into state groups, and then you will go to the Hill the next day, and we will have a lunch on the hill, and then you'll do your meetings in individual groups, and we'll give you the packets that you bring to the Hill show you how to do it. And it's a really great way to learn about advocacy from if you're new. And then we have seasoned professionals go and help share the message with Congress, and I would say, if you haven't done Hill meetings before, don't be intimidated. You're often meeting with someone who's 25 they want to hear about your industry. So just explaining what your association is and the benefit you provide to the society is super helpful. And then ASA, staff can always follow up that there are specific policy questions in our lobbying team.

Jarrod Clabaugh  35:38  
They also provide digital copies of everything that you'll share. Last year, I went on one of the meetings I was in. I handed them the paper copy, and they looked at it paper. So it's nice, because you literally can sit right there and say the PDF is in your inbox. So they've got that information. It's easily shareable. It's easily understood. It is written in layman's terms. They do a great job of making, you know, the fly in simple and understandable. And like Mary Kate said, there's no reason to be intimidated at the end of the day, these people, they want the same things we do. So sitting down with them and trying to better our society is what all of us are doing. It's just trying to bring everyone to that same point. Great, all great stuff. Yeah,

Katy Markert  36:19  
Thank you all for breaking that down. I really it's really helpful to know that you prepare and it's not as intimidating as one might be with that. You guys, thank you all so much for chatting with us today and sharing this hugely important information. We do have one last question. We asked the same question as we mentioned at the beginning of the podcast to all of the people we interview, and we just want to know, why do you think being engaged with organizations like ASAE, TSAE, OSAP, why is that so important?

Mary Kate Cunningham  36:52  
I would say it's just the sense of community and the continual learning that it provides. I think that's what makes life worth living. I think that joy that it brings you is super important.

Jarrod Clabaugh  37:03  
And I would reiterate that. I would also say our unofficial tagline here at OSAP is we build relationships, and ultimately, that's what this is all about, relationships that benefit our communities, no matter what that community might be, no matter what role the nonprofit or the association is playing. I think that when you don't have that type of connection, it leaves you out in the cold and having these types of relationships and being able to pick up the phone and say, Hey, Steve, and I have a question about it means funny. You mentioned that we just dealt with that. We're picking up the phone and saying, Mary Kate, what do you think about x? And it helps keep those issues on one another's radar, but it also allows us to discuss them with people that understand what it is we do. Yeah, and everybody on this call works for an association. And how many times in your life have you had someone say to you, is that really a thing? So it's nice to know and to network with people who understand what the thing is. So that's what I think the benefit of involvement with national and regional associations is

Katy Markert  38:03  
thank you guys so much for everything that you do and for being with us today.

Steven Stout  38:07  
For fighting the good fight, man. I wish the flying was like today. Mary Kate, I am ready. Let's go. Let's go. 

Mary Kate Cunningham  38:13  
Absolutely, we appreciate it. Yeah, you in the fight and

Steven Stout  38:16  
We'll be there. Thanks again to Jarrod and Mary Kate for joining us today, and thank you for listening to the Associations NOW podcast. We really appreciate everyone listening. And again, thank you guys for all that you do for all of us across the country, not just in our states, but nationally as well. We are all deeply in debt to you. Thank you both. 

Jarrod Clabaugh  38:32  
Thank you. 

Steven Stout  38:33  
I find it's always best when you have a complex problem like tax reform, it's best to just throw a bunch of smart people at it to help solve it.

Katy Markert  38:39  
Exactly, No kidding. So many of the issues with tax reform could really hurt associations, but with people like Mary Kate and Jarrod fighting alongside us, I really feel like we have a chance to affect a positive turnout. 

Steven Stout  38:52  
Here, in my head, I have this image of Mary Kate on a black horse with half her face painted blue, Braveheart style. Yeah, totally Braveheart. And she rides up and down, yelling at the association community that we need everyone to join to fight to protect association on tax reform. We don't get hyped. And he face is blue. We follow her into battle.

Katy Markert  39:10  
I love it. So Mary Kate is William Wallace in this scenario I see, okay.

Steven Stout  39:14  
But yeah, just go with me here. And she ends with a rallying cry. Instead of to fight English, it's to protect our 501. C status and UBIT.

Katy Markert  39:23  
I love it. I'm with you. 

Steven Stout  39:25  
Thanks 100-Presenters for joining us today on the Associations NOW Presents podcast. Be sure to listen to this and other episodes of the podcast wherever you find your favorite podcast. 

Katy Markert  39:35  
And we want to thank our guests, both Mary Kate Cunningham and Jarrod Clabaugh. Also, thanks to ASAE for letting us co-host today's show. 

Steven Stout  39:42  
Very exciting. And if you want to continue hanging out with me and Katy, check out Better by Association, an original podcast produced by the Texas Society of Association Executives. You can also find us anywhere you listen to your favorite podcasts. Thanks for listening, everybody. Bye.