Monday, March 7, 2011

A Nonprofit Bail-Out of Government?

Tax-exempt organization law specialists are well aware that “charitable” purposes, as defined in the Treasury regulations interpreting Section 501(c)(3) of the Internal Revenue Code, include “lessening the burdens of government.”   See Treas. Reg. § 1.501(c)(3)-1(d)(2).  With all of the talk of “government bail-outs” of troubled firms in the financial sector through the great recession, attention is now focusing on the question of how cash-strapped, debt-ridden governments will fulfill their traditional public functions.   A couple of recent stories feature the role of the nonprofit sector in “bailing out” governments, in a manner of speaking.  

From the Washington Post, To bust the deficit, Britain tries a revolution in volunteerism:

The new Conservative-led government here is embracing an extreme experiment in deficit-busting as it prepares to cut public spending by $131 billion over the next four years. At the same time, it envisions the creation of an army of volunteers and charities to pitch in for queen and country, a notion Prime Minister David Cameron calls part of his vision for a "Big Society."

One of Europe's most indebted nations, Britain is becoming a testing ground for fiscal cures just as the United States is poised to embark on its own effort to tackle the deficit. On this side of the Atlantic, Cameron's Big Society movement is hoping to enlist a new class of citizen activists to take on roles as varied as postal clerk and librarian, park ranger and police officer to help fill the gap.

As the nation begins to absorb just how deep and fast the cuts will come, the Big Society has come under intense fire here. The government, critics say, is being a Pollyanna if it thinks the goodwill of the citizenry can make up for draconian state cuts.

But the government is calling a revolution in volunteerism at least part of the answer. In some cases, job hopefuls will have little choice. Cash-strapped Scotland Yard, for instance, has instituted a policy mandating that most recruits spend a minimum of one year on the job for free, as it increasingly relies on unpaid special constables … to help keep London's streets safe. 
                                                        * * *
Cameron's Big Society also aims to transfer power to local governments and cut bureaucratic red tape. Wherever possible, the government is seeking to find alternatives to the state. In recent months, it has moved to grant parents and teachers the right to set up their own schools, and to establish a Big Society Bank to help "social entrepreneurs" fund civil projects on their own.

Great Britain is not alone in relying on the assistance of volunteers and charitable organizations.  From The Cincinnati Enquirer, Religious groups increase work to help those in need:

Since the recession began in December 2007, congregations and other faith-based groups started to move into the community to help people hard-pressed by the economy.

In Florence, 7 Hills Church rehabbed four donated cars and gave them to poor church members. Other 7 Hills members fix cars for others in a ministry called Wrenches.

In Hyde Park, a Muslim congregation from Milford joined with Episcopal Church of the Redeemer to shelter, feed and clothe homeless families.

In Anderson Township, Immaculate Heart of Mary Catholic Church started a job-search ministry to respond to unprecedented requests for help from the newly unemployed.

In South Fairmount, a support group for ex-convicts, organized by a retired Baptist minister, grew into a church.

Roselawn Lutheran Church runs free dental and eye clinics.

Congregations across Greater Cincinnati and Northern Kentucky stretch just a bit further every month to help others whose needs aren't being met by shrinking government programs.

"I got to a point where I was weak and low, and they helped me build myself up again," said Rachel Wheeler, 19, of Hebron, a 7 Hills Church member who received the keys and title to a used Oldsmobile Silhouette minivan last month.

Wheeler, a single mother of a 2-year-old daughter, was a homeless hitchhiker as her old retail job back and start community college in medical technology, neither of which would be possible without transportation.

"They didn't judge me," she said. "They just helped me. I really want to do well to be able to give back."

No one would have helped Wheeler if the church hadn't.

"The safety net is frayed, but (faith-based groups) help us fill the gap," said Moira Weir, executive director of Hamilton County Jobs and Family Services, a government agency that has lost half of its employees and budget since the start of the recession.

Weir's agency had 1,638 employees in 2007, but has 780 today. The operating budget has shrunk from $106 million to $57 million in the same time period.

Religious-based organizations can't replace the breadth and depth of state and federal aid programs for the unemployed and working poor, but they can try.

In reviewing the activities that these religious organizations are conducting in and around Cincinnati, it occurred to me that they probably do not see themselves as lessening the burdens of government, but as fulfilling other purposes plainly recognized as charitable under the same Treasury regulations: “Relief of the poor and distressed or of the underprivileged” and “advancement of religion.”  I was also reminded of one of several reasons that many of them probably think this way: “Religion that God our Father accepts as pure and faultless is this: to look after orphans and widows in their distress and to keep oneself from being polluted by the world.” (James 1:27).  According to The Cincinnati Enquirer, a similar view was expressed by Lewis Kamrass, senior rabbi of Isaac M. Wise Temple in Amberley Village, which has enhanced its support of local food and homeless programs. "The world was not made perfect, and it is our sacred obligation to mend and repair it.”  Sometimes the purposes of charity, and the interests of government and private charity, merge in a way that persons of nearly every ideological stripe can celebrate.

JRB

http://lawprofessors.typepad.com/nonprofit/2011/03/a-nonprofit-bail-out-of-government.html

| Permalink

TrackBack URL for this entry:

http://www.typepad.com/services/trackback/6a00d8341bfae553ef014e5fb3dc73970c

Listed below are links to weblogs that reference A Nonprofit Bail-Out of Government?:

Comments

Should the US Government (or any government for that matter) “bail out” the residents & businesses in the storm devastated Southern states?

Posted by: Reggie Greene / The Logistician | May 1, 2011 1:30:39 PM

Post a comment