Wednesday, February 2, 2011

Tim Delaney on State Threats to Nonprofits

Tim Delaney, President and CEO of the National Council of Nonprofits, has initiated what he calls "an uncomfortable -- but necessary conversation" regarding the way state and local governments are coming to view nonprofits as more burden than benefit.  In Part I, he identified "three dangerous policy trends" emerging across the nation:

These trends are interrelated and need to be addressed proactively with the nonprofit sector’s focused collective energy.

"The trends are:

  1. State and local governments shifting their fiscal burdens onto nonprofits and foundations;
  2. Policymakers still know frighteningly little about nonprofit organizations; and
  3. A steady marginalization of nonprofits from the public policy process that, in turn, represses the voice of the American people."

 In Part II, he argues that nonprofits are conceding these trends by their collective failure to speak up and participate in the political process: 

"The Steady Marginalization of Nonprofits from Public Policy

Numerous forces have conspired, sometimes unwittingly, to steadily marginalize nonprofits from the public policymaking process. By erecting and reinforcing several barriers that limit and often exclude nonprofit participation, they have been silencing the voices of the American people."

Anybody who is paying half attention should be aware that the threats to tax exemption are emanating largely from the states, notwithstanding Senator Grassley's bullpulpit.  Despite occasional complaints regarding what nonprofits don't do, federal tax exemption for charities is a relatively safe aspect of the federal tax code.  The states and local governments, though, are leading a rather active charge against charitable tax exemption.  So Delaney's article is worth reading and thinking about. 


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