Gov. Affairs | Issue 31 | July 16, 2026
Published July 16, 2026 - This content will be updated as developments unfold.
Good News:
From Diane Yentel, President & CEO - National Council of Nonprofits – June 30, 2026
We won! In the case of National Council of Nonprofits et al. v. McMahon, a federal court just ordered the Trump administration to stop its unlawful rewriting of the Public Service Loan Forgiveness (PSLF) program as a way of silencing nonprofit organizations and local governments that do work counter to the administration’s political agenda.
The court found that the PSLF rule is in excess of statutory authority, arbitrary and capricious, and violates the First Amendment—finding in our favor on all our claims. The court has vacated the rule in its entirety, meaning it will not go into effect.
NCN was joined in this case by a broad coalition of more than a dozen cities, labor unions, and nonprofit organizations, and represented in court by our fantastic attorneys at Democracy Forward. Our case sought to stop a new rule that would allow the Secretary of Education to disqualify government and nonprofit employers that disagree with the administration’s policies from a program intended to support borrowers working in public service jobs.
This decision is a win for the communities that depend on local nonprofits and for the workers who serve them! By protecting a proven, bipartisan program, we’re ensuring that dedicated nonprofit employees can keep the benefits they’ve earned and continue doing the work that matters.
Read the brief HERE.
What’s in the Housing Affordability Bill That Just Became Law - New York Times (Gift Article)
The 21st Century ROAD to Housing Act, a landmark bipartisan housing bill aimed at addressing national affordability woes, has officially become law without President Trump’s signature. The president had previously canceled a planned signing ceremony, refusing to sign the legislation unless Congress passed a separate, stalled national voter ID bill; however, because he did not exercise his veto, the bill automatically enacted at midnight on July 11, 2026. The legislation contains dozens of provisions designed to boost housing supply and lower costs, including capping future single-family home purchases by corporate landlords owning more than 350 properties, easing structural regulations on manufactured homes, and penalizing high-cost cities that fail to build sufficient housing. While hailed as the most significant federal housing package in a generation, experts warn that market barriers like high material costs and interest rates mean any relief for home buyers and renters will take years to fully filter into the marketplace.
Read: Congress passed an affordable housing package. What can it do for Georgia? - Atlanta Journal Constitution
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Trump’s Proposed Grant Rules Spark Outcry, 100K Comments - Chronicle of Philanthropy
A proposed Trump administration plan to overhaul federal grant funding for nonprofits and researchers has sparked widespread backlash, generating nearly 100,000 public comments ahead of its deadline. The rule would give federal agencies greater power to terminate grants, ban funding for projects the administration disapproves of (such as diversity initiatives and voter registration drives) and install political appointees to ensure awards align with a vaguely defined national interest. Nonprofit, scientific, and philanthropic organizations argue the changes would create a dangerous, politically motivated environment that risks cutting off funding for vital community services and penalizing groups working on social equity. Critics and advocacy groups have flooded the Office of Management and Budget with specific feedback in hopes of legally complicating and slowing down the implementation process, which the White House aims to finalize by October 1.
Read: Proposed Changes to Federal Grant Rules for Nonprofits - Aprio (Breakdown of proposed changes and how they could affect your nonprofit)
Latest Developments:
(For organizations paying any staff members more than $1M in salary)
IRS Notice 2026-36 eases executive comp excise tax rules - Ryan & Wetmore — released June 5, 2026
The notice gives nonprofits interim relief/clarity on the OBBBA-expanded excise tax on exec comp over $1M, including protections for volunteers/board members.
