Texas Senators Echo Other Legislators' Concerns Over Proposed Supporting Org Guidance

Texas Senators Echo Other Legislators' Concerns Over Proposed Supporting Org Guidance

News story posted in Congressional Correspondence on 2 April 2008| 2 comments
audience: National Publication | last updated: 18 May 2011
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Summary

Texas Senators Kay Bailey Hutchison and John Cornyn have sent a letter to Treasury Secretary Paulson expressing their concerns about possible unintended consequences that may result from proposed rulemaking to historical supporting organizations. The letter comes in the wake of similar concerns expressed by other Texas legislators.

Full Text:

February 29, 2008

The Honorable Henry M. Paulson, Jr.
Secretary
The Department of the Treasury
1500 Pennsylvania Avenue NW
Washington, D.C. 20220

Dear Secretary Paulson:

The Pension Protection Act of 2006 authorized the Department of Treasury to promulgate rules that target donor abuse of Type III supporting organizations. I am concerned about possible unintended consequences that may result from a proposed rule by the Treasury Department (Advance Notice of Proposed Rulemaking REG-155929-06) to historical organizations that have a long and continuous philanthropic history with a supported charity.

There are supporting organizations in Texas which have operated for decades, amassed large endowments, and made significant contributions to charities that provide valuable educational, healthcare and community services. The proposed asset test for functionally integrated Type III supporting organizations may be difficult for some historical organizations to meet because the test does not allow for the consideration of investments as assets. Furthermore, while I am in favor of payout requirements for charitable entities, I want to ensure that such requirements do not jeopardize the ability of the historical organizations to exist in perpetuity.

Numerous Texas-based supporting organizations play a vital role in our communities and have had a positive impact for our constituents. I am supportive of actions by the Treasury Department to prevent abuse of the supporting organization structure; however, I respectfully ask that you work with historical organizations to adopt tailored regulations that will preserve the services these organizations provide to the citizens of Texas. Your careful consideration of this request and prompt attention to this important issue is sincerely appreciated.

Sincerely,

Kay Bailey Hutchison
John Cornyn
United States Senate
Washington, DC

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Comments

I wish they had supported this before-hand!

I very much agree with the previous comment-- it would have been very nice indeed if they had supported this before hand.

PPA

It would have been nice if they would have thought about this BEFORE they passed the legislation!

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