CoffeyWritesImpact

The End of the Combined Federal Campaign

The government, as of August 2025, employs around 2.9 million people.¹ Every year, employees donate using the Combined Federal Campaign (CFC), which, since 1971, has been the uniform fundraising method of the federal government.² Started by Kennedy and furthered through Nixon, this fully combined charity campaign garnered $82.8 million by 1979.³ Essentially, employees of the government have the option to directly donate to a number of government-vetted charities with no middle person. This process, which used to be direct and encourage charitable giving, will be over within the next month.

Getting more into the inner-workings of the Combined Federal Campaign, starting in 1986, the Office of Personnel Management (OPM) identified six areas of concern, illustrating a great example of the federal government recognizing social needs.⁴ Since then, and as of the “2025 Charity List” from GiveCFC.org, there are now over 4,500 federations and independent charities participating in the campaign.⁵ These 4,500 organizations are generally in good standing and vetted by the government, giving employees another layer of trust during the donation process. Most importantly for fundraising, however, was the ease at which this system allowed donors to give. It has been widely noted that within philanthropy, cluttered and long billing sections can discourage donors.⁶ This direct process, on the other hand, was efficient and straight-forward, giving way to an influx of donations.

In the past, a federal employee would be able to give in one of four ways to an approved charity or charities in the directory. These ways included a payroll deduction, a credit or debit card, a bank transfer, or counted volunteer hours.⁷ From there, the government would give the proper form for itemization and tax deduction, alleviating the hassle of the person contacting the charity themselves. Essentially, the system thrived due to its centrality and simplicity, which, combined with the country’s largest workforce, provided a significant amount of funding towards the country’s charitable sector.

What’s Happening?

Originally, in 2025, the campaign was halted toward the end of summer, leaving receiving charities in a state of staunch uncertainty. Fortunately, in a memo sent in September, the OPM said it would continue the program for the near future but would be reviewing the 2026 campaign.⁸ This temporary reversal was due to weeks of advocacy led by the National Council of Nonprofits, United Way Worldwide, and other nonprofits across the country.¹² Then, on September 10th, Scott Kupor, the Director of the U.S. Office of Personnel Management, explained the current perspective of inefficiency and administrative fees.⁹ According to Kupor, the office will incur $22 million in outside contractor fees to administer the program.¹⁰ This number is extremely concerning, but it doesn’t have to be this high.

A great benefit of nonprofits in the directory is that they are tax-exempt entities. With these incentives, spending $22 million on transferring non-taxed and non-interest-bearing money is the result of a broken distribution system. Most likely, a solid chunk of that $22 million is being constructed by middle-fees and transfer costs. If given the proper feasibility resources, a new system with efficient transferring would certainly be possible, especially considering the tax-exempt condition of the situation. Whatever the case may be, the transfer costs could have been treated as a problem to be fixed, rather than a reason to dissolve.

Moving through the report, Kupor argues from the vantage point that due to nonprofit overhead costs, each dollar donated will equate to only 47 cents going to programming.¹¹ However, in any nonprofit, there will always be salaries and other overhead costs required to keep the organization funding; furthermore, with the added layer of trust from the government’s vetting of organizations on the CFC list, there are safeguards in place to ensure funding is being used with social impact as the top priority.

After this statement by Kupor, it was widely assumed by the nonprofit world that 2025 would be the last campaign for the Combined Federal Campaign. As of the last update, the campaign for 2025 ended on January 31st, meaning that funds must now be distributed to the nonprofits by the government.¹³ Recently, it was rumored that the portal will be put to rest starting March 4th, raising concern over a quick enough timeline to distribute over $60 million.¹⁴ Now, organizations and the National Council of Nonprofits are back to advocating to elongate this period, but the government seems to be taking a strong stance.

How Does the Government Want Its Employees to Donate?

When Kupor gave his interview, he encouraged the use of DAFs (Donor Advised Funds) as the future of giving. DAFs are a relatively new vehicle of donating in the scheme of philanthropy, where a person can give money to an account marked for charitable purposes and get an immediate tax deduction upon inputting funds.¹⁵ You can also space out the deduction, depending on what is better for tax benefits. These DAFs are irrevocable, but also lack a payout rate requirement. Ideally, they grow over time, as they are invested in assets by their portfolio managers. Due to the simplicity of asset transfer, the biggest holders of these DAFs have become banks. In 2022, three of the five biggest charities (in terms of contributions) were run by Fidelity, Schwab, and Vanguard as DAF holdings, meaning that many of these assets are staying in banks and enlarging their balance sheets.¹⁶ Consequently, donors for DAFs generally let the banks or advisors make investment decisions, incentivizing banks to push for DAF accounts, as it increases influence.

DAFs are often used to donate appreciated assets and maneuver capital gains taxes, typically being used by the upper class and higher.¹⁷ As of now, there are over 1 million DAFs, showing their growth in prominence.¹⁸ Also, as stated, when it comes to DAFs, there is no minimum payout rate, which means that the money can sit there for years on end.¹⁹ Ultimately, DAFs are irrevocable and must be donated, so the money will eventually go to charity; however, the lack of payout rate leaves these financial accounts susceptible to market fluctuations, limiting immediate cash flow to charities.

When it comes to the salaries of federal employees, over 26% of the workers make under $70,000 and 43% make under $90,000.²⁰ Considering 96% of DAF owners has an average net worth of over $1 million, the likelihood of a mass increase in DAFs is low.²² Truly, this tool is mostly reserved for the ultra-wealthy, meaning that middle-class and marginalized federal workers are being given an unrealistic option.

All of these statistics and numbers suggest that nonprofits are going to lose donated income. As explained, DAFs are not used by the vast majority of people, and even if somebody has the capacity to afford a DAF account, it does not mean that they will. DAFs require planning, a transfer of large assets, and multiple financial regulatory steps. As stated earlier, ease of giving matters. If nothing else, donors that will not receive substantial tax breaks are dissuaded due to the increase in effort, further marginalizing the non-ultra wealthy.

What’s Going to Happen and What Can We Do?

According to a report by Nonprofit Times, there are nonprofits that receive between $100,000-$700,000 in funding from the CFC.²¹ As stated previously, there were over 4,000 charities on that list, meaning a significant amount of funding must be made up to recover the lost contributions. Unfortunately, compared to using the CFC, employees are less likely to donate directly to charities, as little beats the efficiency of a direct paycheck deduction donation. So, as the program is officially ending and the focus has shifted towards advocating for an extension of the current year to ensure disbursement, we must turn toward other options.

The biggest advantages of the Combined Federal Campaign were that it was simple and everything was in one place. While the direct paycheck contribution will not be currently possible, nonprofit coalitions can create their own platforms to allow easy-to-donate options. While setting up a monthly donation is a little more tedious than opting in to a direct paycheck contribution, an easy-to-use platform that is adopted by a variety of nonprofits can streamline the process. Nonprofits should dedicate more resources to creating “how-to’s” for new direct donors, as there will hopefully be an influx. Also, they can partner with different organizations to create “one-stop shops” with tools such as linked bank accounts, immediate tax-itemized receipts, and proper audits from the nonprofits.

Giving circles, community foundations, and regulated groups of donors that create power through combining assets are also good resources for government employees. Essentially, the way the independent sector is going to get through this issue is not through individual plans, but through collective action that streamlines fundraising for the federal workforce. This is an issue of infrastructure, and one that can be fixed.

References

1. USAFacts. (2025, November 12). How many people work for the federal government? USAFacts. https://usafacts.org/articles/how-many-people-work-for-the-federal-government/
2. U.S. Office of Personnel Management. (n.d.). The history of the Combined Federal Campaign. Combined Federal Campaign. https://givecfc.org/history-cfc
3. U.S. Office of Personnel Management. (n.d.). The history of the Combined Federal Campaign. Combined Federal Campaign. https://givecfc.org/history-cfc
4. U.S. Office of Personnel Management. (n.d.). The history of the Combined Federal Campaign. Combined Federal Campaign. https://givecfc.org/history-cfc
5. U.S. Office of Personnel Management. (2025). 2025 Combined Federal Campaign charity list. Combined Federal Campaign. https://givecfc.org/sites/default/files/25-Materials/25CFC-Charity-List.pdf
6. O’Brien, A. (2025, January 13). Nonprofit donation page basics: How to optimize for more donations. iDonate. https://www.idonate.com/blog/nonprofit-donation-page-basics-how-to-optimize-for-more-donations
7. U.S. Office of Personnel Management. (n.d.). How the Combined Federal Campaign works. Combined Federal Campaign. https://givecfc.org/how-cfc-works
8. Federal News Network. (2025, September). Charitable donation campaign for feds to proceed but long-term future uncertain. Federal News Network. https://federalnewsnetwork.com/management/2025/09/charitable-donation-campaign-for-feds-to-proceed-but-long-term-future-uncertain/
9. Kupor, S. (2025, September 10). What you should know about the Combined Federal Campaign. U.S. Office of Personnel Management. https://www.opm.gov/news/secrets-of-opm/what-you-should-know-about-the-combined-federal-campaign/
10. Kupor, S. (2025, September 10). What you should know about the Combined Federal Campaign. U.S. Office of Personnel Management. https://www.opm.gov/news/secrets-of-opm/what-you-should-know-about-the-combined-federal-campaign/
11. Kupor, S. (2025, September 10). What you should know about the Combined Federal Campaign. U.S. Office of Personnel Management. https://www.opm.gov/news/secrets-of-opm/what-you-should-know-about-the-combined-federal-campaign/
12. National Council of Nonprofits. (2025, September 16). The Combined Federal Campaign resumes after action and advocacy by leading nonprofits. National Council of Nonprofits. https://www.councilofnonprofits.org/pressreleases/combined-federal-campaign-cfc-resumes-after-action-and-advocacy-leading-nonprofits
13. Clolery, P. (2026, February 22). Combined Federal Campaign again under threat. The NonProfit Times. https://thenonprofittimes.com/npt_articles/combined-federal-campaign-again-under-threat/
14. Clolery, P. (2026, February 22). Combined Federal Campaign again under threat. The NonProfit Times. https://thenonprofittimes.com/npt_articles/combined-federal-campaign-again-under-threat/
15. Fidelity Charitable. (n.d.). What is a donor-advised fund? Fidelity Charitable. https://www.fidelitycharitable.org/guidance/philanthropy/what-is-a-donor-advised-fund.html
16. Flannery, H. (2024, May 8). Top public charities: Donor-advised funds. Institute for Policy Studies. https://inequality.org/article/top-public-charities-dafs/
17. The Daffy Team. (2026, January 16). What is a donor-advised fund? Daffy. https://www.daffy.org/resources/what-is-a-donor-advised-fund
18. Heist, H. D., Vance-McMullen, D., Sumsion, R., & Williams, J. (2025). National survey of donor-advised fund donors. Donor Advised Fund Research Collaborative. https://coffeywritesimpact.com/wp-content/uploads/2026/03/e3b2e-thenationalsurveyofdonoradvisedfunddonors.pdf
19. The Daffy Team. (2026, January 16). What is a donor-advised fund? Daffy. https://www.daffy.org/resources/what-is-a-donor-advised-fund
20. Pew Research Center. (2025, January 7). What the data says about federal workers. Pew Research Center. https://www.pewresearch.org/short-reads/2025/01/07/what-the-data-says-about-federal-workers/
21. Clolery, P. (2026, February 22). Combined Federal Campaign again under threat. The NonProfit Times. https://thenonprofittimes.com/npt_articles/combined-federal-campaign-again-under-threat/
22. Bean, A. (2026, January 19). The nonprofit’s guide to donor-advised funds. Chariot. https://www.givechariot.com/resources/insights/what-is-a-daf