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Challenge 40 in the series 50 Reasons Why It Is Hard to Run a Nonprofit
Almost a year ago, on June 4, 2025, the House Oversight Subcommittee on Delivering on Government Efficiency held a hearing titled "Public Funds, Private Agendas: NGOs Gone Wild." The hearing's stated purpose was to expose how nonprofits use federal funds to "advance a radical agenda."
The sole witness called by the Democratic minority was Diane Yentel, president of the National Council of Nonprofits. She pointed out what the hearing's organizers did not: the vast majority of nonprofits are small, apolitical organizations that receive modest federal funding, if any at all. Pulling tax-exempt status based on ideology, she noted, would be illegal.
The hearing proceeded anyway. The title stayed. And millions of Americans who run food banks, mentor children, house the homeless, and deliver meals to seniors woke up to find their sector described as a slush fund for radical agendas.
Welcome to the political reality of being a nonprofit in today's world.
When I put "viewed as special interests" on the list of 50 challenges in Managing Your Nonprofit for Resilience, I was thinking about the persistent, low-grade problem of nonprofits being lumped in with lobbyists and PACs in the public imagination — dismissed as just another interest group with an agenda.
That problem hasn't gone away. It's gotten sharper.
The "special interest" label works because it does two things simultaneously. It strips the nonprofit of its public-benefit identity — you're not serving the community, you're advancing an agenda. And it implies that public dollars flowing to nonprofits are a form of patronage rather than a public investment.
This framing ignores the facts. More than 103,000 nonprofit organizations received a combined $267 billion in government grants in 2021, according to Independent Sector — funding that supported everything from Head Start classrooms to cancer research to veterans' services. These aren't political projects. They're the delivery mechanism for public policy that both parties have supported for decades.
But facts don't always win arguments. And once a nonprofit is labeled a "special interest," the conversation shifts from "are they doing good work?" to "whose side are they on?" — a question that has nothing to do with whether children are being fed.
You might think the "special interest" problem is limited to advocacy organizations — the ones working on immigration, climate, or civil rights. It isn't.
DOGE's actions in 2025 affected nonprofits across the spectrum. The dismantling of USAID disrupted international relief organizations. Grant freezes hit domestic service providers. DOGE attempted to install staff inside nonprofits receiving federal funds — including the Vera Institute of Justice, the Corporation for Public Broadcasting, and NeighborWorks America — as NPR and the Washington Post reported. The effort would have applied to any organization with federal contracts — including hospitals, universities, and community health centers.
When the political environment treats all nonprofits as potentially suspect, every nonprofit feels the chill. The ED running a rural literacy program starts wondering whether her federal grant makes her a target. The executive at a community health center worries that accepting Medicaid funding will invite scrutiny. The development director at a food bank hesitates to speak publicly about hunger because food insecurity has become "political."
This is the real cost of the "special interest" label. It doesn't just affect the organizations being attacked. It creates a climate of self-censorship across the entire sector.
Here's what the political rhetoric misses: nonprofits are the most trusted institutional sector in America. And it's not close.
Independent Sector's 2025 Trust in Civil Society report, conducted in partnership with Edelman Data & Intelligence, found that 57% of Americans report high trust in nonprofit organizations — higher than for small businesses, the military, philanthropy, government, or media. Nonprofits are also perceived as more competent and more ethical than foundations, corporations, media, or government.
And 84% of respondents said they were confident in the ability of nonprofits to strengthen American society.
Read those numbers again. In a country that can't agree on much of anything, 84% of people believe nonprofits make the country stronger. The sector being attacked as a "slush fund" is the sector that Americans trust most.
That trust wasn't built by lobbying. It was built by showing up — in communities, in crises, in the unglamorous daily work of serving people who have nowhere else to go.
The temptation when your sector gets politically targeted is to go quiet. Don't draw attention. Don't say anything that could be misconstrued. Keep your head down and hope the storm passes.
That's understandable. It's also exactly the wrong response.
Going quiet cedes the narrative to the people calling you a special interest. If you don't tell your story, someone else will — and they won't be kind.
Know the law cold. 501(c)(3) organizations can advocate. They can educate elected officials. They can take positions on policy issues. What they cannot do is endorse candidates or engage in partisan campaign activity. The line is clear, and most nonprofits are nowhere near it. If you're unsure where you stand, the National Council of Nonprofits has excellent guidance on what's permitted.
Tell your story in specifics. When someone calls your organization a "special interest," the most powerful response is a concrete account of what you actually do. "Last year, we provided 14,000 meals to homebound seniors in this county. Eighty-two percent of the funding came from federal nutrition programs. If that's a special interest, so is your grandmother." Specificity defeats abstraction every time.
Build relationships before you need them. The nonprofits that weather political storms best are the ones with existing relationships with elected officials, journalists, and community leaders — people who already know what the organization does and can vouch for it when the attacks come. If the first time you talk to your state representative is when you need her help, you've waited too long.
Document your public benefit relentlessly. Outcomes data, community testimonials, financial transparency — these aren't just funder requirements. They're your defense against the accusation that you're serving yourself rather than the public. Make them visible. Put them on your website. Include them in every annual report.
Don't do this alone. I track these policy developments and what they mean for nonprofit operations in Nonprofit Good News Premium — because the political environment is now an operational risk, not just a background condition. Your state nonprofit association also exists for moments like this. National organizations like the National Council of Nonprofits and Independent Sector are actively tracking threats to the sector and coordinating responses. Staying connected to the sector's infrastructure is how individual nonprofits become part of a collective voice that's harder to dismiss.
Go to the National Council of Nonprofits website and read their current policy alerts. Find out what's happening at the federal and state level that could affect your organization. If you're not already connected to your state nonprofit association, join this week.
Then write a one-paragraph description of what your organization does — in plain language, with specific numbers — that you could hand to a skeptical legislator, a reporter, or a neighbor at a barbecue. That paragraph is your first line of defense. And you're going to need it.
This is part of an ongoing series based on the 50 challenges outlined in Appendix 1 of Managing Your Nonprofit for Resilience (Wiley, 2023). Each post names one challenge clearly and offers a practical reframe with steps you can take this week. For deeper coverage of nonprofit strategy, risk, and resilience — including tools you can put to work immediately — check out Nonprofit Good News Premium.