The state of Illinois took a big step toward resolving its dire financial position last week when the state assembly passed legislation to reform Illinois' public pension system. Having been underfunded to the tune of $100 billion, the bill aims to cut $160 billion in pension liabilities over 30 years through cuts in benefits to union members and savings from debt reduction. The deal now heads to court, where public sector unions are contesting it.
The legislation comes as a relief to nonprofits, especially those the state relies on to provide critical services to individuals and families in Illinois. Our state ranks at the bottom of paying contracts for services on time, and estimates are that Illinois is more than half a billion dollars behind in meeting its current obligations to nonprofits. Nonprofit leaders are hopeful that as the state's pension obligations shrink over time, more dollars will be freed up to both pay off existing contracts and expand human services, healthcare and other critical services.
But there are larger issues at stake. Over the summer and throughout the fall my organization, Donors Forum, held a series of community forums with nonprofit and philanthropy leaders throughout the state to learn more about the public policy and other challenges facing their organizations. While we heard much about state funding issues and the squeeze being put on nonprofits because of the pension shortfall, we also heard more generally that nonprofits are not sufficiently equipped -- whether with time or skills -- to aggressively engage in public policy efforts.
These meetings culminated a few weeks ago in our first annual Nonprofit Summit, where we brought together more than 200 Illinois nonprofits and grantmakers and a panel of state senators and representatives. The idea centered on providing an opportunity for nonprofits to engage with each other and learn from legislators themselves about how best to reach out and communicate with them about the critical issues affecting the nonprofit and philanthropic sector.
To help shape our conversation with legislators former Illinois Governor Jim Edgar spoke about his administration's commitment to working with nonprofits and to not shifting the responsibilities of state government over to nonprofits and grantmakers. This shifting of responsibilities is often cited by legislators seeking to cut social services
Kyle Caldwell, Program Director at the Charles Stewart Mott Foundation, then outlined how his former organization, the Michigan Nonprofit Association, helped create a bi-partisan "nonprofit caucus" of legislators committed to supporting Michigan's nonprofit sector and to addressing the sector's challenges. The nonprofit caucus and other engagements with regulators and the executive branch in Michigan provides nonprofits with a powerful voice in shaping legislation that impacts the sector.A number of common themes emerged during our panel discussion with legislators. In addition to all eight of them agreeing that pension reform was by far Illinois' most pressing legislative issue -- and holding varying opinions about whether or not it would happen -- they recognize that nonprofits working in communities understand what approaches work, and what works should inform policy decisions. The panel also offered a number of very practical tips for nonprofits related to legislative outreach:
- Your initial contact with an elected official should not be when you have a problem; get to know them first by helping them learn more about an issue
- Demonstrate your ROI and impact; legislators have to defend funding decisions with credible evidence
- Understand how the appropriation process works; the more you know about appropriations the more forcefully you can make your case
In the end the legislators on the panel unanimously agreed to participate in an Illinois nonprofit caucus if it were to be established that, a fitting conclusion to a day that was all about engagement. As Kyle Caldwell stated in his remarks, "It's not enough to tell your story. You have to engage; you have to find a way to stay in the mix."