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Illinois House Passes Bipartisan Legislation To Relieve Administrative Burden on Small Nonprofits

HB1197 will allow small nonprofits to devote more resources to serving their communities


ROCKFORD, Ill. – Today, the Illinois House of Representatives passed HB1197, sponsored by State Rep. Maurice West (D-Rockford), in a bipartisan unanimous vote. The legislation adjusts the requirement threshold for charitable organizations to file an annual financial audit with the state from $300,000 in revenues to $500,000. The legislation is supported by dozens of charities and nonprofits across the state, as it would significantly relieve the administrative burden placed on small organizations. 


“This important legislation will substantially relieve the administrative burden placed on small nonprofits and charities so they can spend more of their time and energy serving their communities,”said State Representative Maurice West. “ I want to thank the amazing advocates who brought this issue to my attention and worked diligently to educate legislators as this bill passed through the House. I am pleased to see HB1197 pass with a strong bipartisan majority, and I look forward to its passage in the Illinois Senate before heading to the governor’s desk.” 


“For small organizations like the Ken-Rock Community Center, an annual audit is extremely burdensome on our budget,” said John K. Guth, Executive Director of the Ken-Rock Community Center. “The administrative cost of an annual audit can be up to 10% of our overall budget, and the current audit threshold has not been adjusted in over 30 years. Small organizations like Ken-Rock can now put those resources into our work for the community. Thank you to Rep. West and legislators in the Illinois House for making this important change, and we look forward to passage through the Senate.”


“Small nonprofits are a significant economic engine in Northern Illinois and across our state while providing a range of critical services,” said Pam Clark Reidenbach, Executive Director of the Northern Illinois Center for Nonprofit Excellence. “Requiring small nonprofits to conduct an annual independent audit is an unnecessary financial and administrative hardship and detracts from mission-based service delivery. We strongly support HB1197, as it will help small nonprofits support additional programs and services in their communities.”


Nonprofit organizations will still be subject to annual registration and reporting requirements. The legislation now goes to the Illinois Senate for deliberation. To date, no opposition has been identified.




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