Nonprofits targeted by new law must check eligibility for taxpayer money

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A week after the city issued new rules that could void contracts with San Francisco nonprofits that defy government reporting requirements, an executive took the extra step Tuesday by introducing a bill that would put the policy into city law.

The proposed ruling from executive Asha Safai comes after The Standard reported in December that nearly 140 non-profits held more than $300 million worth of contracts with the city after the state’s Attorney General’s office revoked, suspended or flagged their charitable status as delinquent. .

Under Safai’s legislation, nonprofits that receive more than $100,000 a year from city funds will have to file paperwork with the city to show they are in good standing with the state. According to Safai’s office, this was a common practice in the city until 2011.

The new law will also require the city to post compliance forms and tax returns filed with the IRS on a public website no later than July 1 of each year.

“While we have a great network of city-funded nonprofits that are doing amazing work, taxpayers expect nonprofits to do their job well and comply with federal, state and local laws,” Safai said in a statement. “This common sense law protects taxpayers and increases government transparency by ensuring that the City verifies publicly available information from our federal and state partners before spending a dime.”

Last week, the offices of the City Comptroller, City Attorney, and City Administrator issued a series of new guidelines to ensure that San Francisco nonprofits that are not in good standing return to compliance or risk losing public funding.

The new policy provides for the strictest controls on suspended and recalled nonprofits. The Standard report lists five nonprofits that have been revoked and two more that have been suspended as of December. These non-profits had over $645,000 in outstanding contracts.

The policy gives city departments 30 days to determine a transition plan for these nonprofits, which may include the immediate termination of their services. Departments also have the option to outsource services to another City non-profit provider or work with a suspended or canceled non-profit to develop an action plan so they can return to good standing before the June 30 deadline.

The vast majority of San Francisco contractors who lost their reputation in the state were classified as delinquents. These non-profit organizations, which numbered 132 as of December last year, must now register their status in the state register by June 30. Until they do so, they will not be able to enter into any new contracts with the city, although departments remain authorized to issue purchase orders under existing agreements to offending organizations.

The bad reputation of some criminal organizations dates back years. The Prosecutor General’s Office assigned this status to 30 city non-profit organizations by the end of 2020.

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texasstandard.news contributed to this report.

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