Philanthropy Front and Center-Cleveland

Cleveland Considers Annual Fees for Nonprofits

The Plain Dealer reported (November 15, 2009) that consultants hired by the City of Cleveland have proposed that nonprofit organizations pay an annual fee in lieu of property taxes in an effort to boost the city's revenue. Institutions like The Cleveland Clinic, The Cleveland Museum of Art and Case Western Reserve University would be among some of the major regional stakeholders affected by the proposal, which has been carried out in one form or another in the cities of Boston, Pittsburgh and Madison, Wisconsin.

Property taxation, or alternatively, fees for municipal services to tax-exempt organizations, is not a new concept; a 2006 report by the Chronicle of Philanthropy stated that property-tax exemption in 23 of the 30 largest U.S. cities (by population size) was costing those cities $1.5 billion annually. 

Earlier this year Minnesota legislators amended their state law regarding charitable property-tax exemptions, implementing a 6-point system for determining eligibility for property-tax exemption status. The bill, along with the 6 criteria, can be read here.

What are your thoughts on this issue? Add your comments below.

News Roundup: Research and Science Education, Team NEO, COSE Arts, Cleveland Carbon Fund

Representative Marcia L. Fudge named vice-chair of the Research and Science Education subcommittee.  This subcommittee of the House Science and Technology Committee oversees all programs at the National Science Foundation and the White House Office of Science and Technology Policy. Representative Fudge said:

“We have a very unique opportunity to elevate science once again. We have a White House and a Congress committed to affording scientists a platform to develop new innovation and technology for a more sustainable world.”

Team NEO, grantee of the Fund for Our Economic Future, recruited 10 new companies to Northeast Ohio in 2008 (Plain Dealer, 2/3/09).  Payroll at the new companies is projected to be $30 million within 3 years.

COSE Arts Business and Innovation Awards.The Council of Smaller Enterprises (COSE) is now accepting nominations for the 2nd Annual Arts Business and Innovation Awards. Nominations will be accepted through March 2, 2009.Winners and finalists will be recognized in four categories:  Individual Artist, Arts Business, Arts and Culture Community Champion, and Young Arts Entrepreneur. The awards will be presented at the Arts Business and Innovation Awards ceremony on April 23, 2009 at The Cleveland Play House.  Learn more at COSE.

Cleveland Carbon Fund launches.  As the first community-based, open-access carbon reduction fund in the United States, the Cleveland Carbon Fund invests in local community projects that reduce greenhouse gas emissions and spark economic development in Cleveland. The Fund provides an easy, highly transparent option for anyone wishing to play a role in reducing carbon emissions. By investing in the Cleveland Carbon Fund, donors can be assured their worthy contributions are making sustainable, positive change in local Cleveland neighborhoods.

Notables: Policy Matters Ohio

The Nation points to Policy Matters Ohio as the most valuable state or regional policy group of 2008 in its December feature, Most Valuable Progressives of 2008. Way to go Policy Matters Ohio and congratulations! Here's what The Nation had to say:

Bridging the gap between sometimes esoteric national debates about economic issues and the real-life challenges faced by people living in Cleveland, Youngstown and Dayton, Policy Matters Ohio is a non-profit research and advocacy organization that pushes the envelope on debates about tax policy and the funding of essential education and safety-net programs. Intellectually rigorous, yet always accessible in its approach, this group has produced more than 160 reports that have given Ohio's progressive activists and legislators the tools they need to challenge corporate spin and pressure tactics. In tight economic times, groups such as Policy Matters Ohio are absolutely essential players in life-and-death debates about how state and local governmental agencies should respond to revenue shortfalls and rising demands for services. PMO's founding executive director, Amy Hanauer, is great at making the link between the initiatives of national groups with which she works--the Economic Policy Institute, Demos and the Apollo Alliance--and local and legislative policymakers in Ohio, moving progressive priorities out of Washington to the communities where good ideas can and must be turned into practical programs. As an example of what Policy Matters Ohio does, check out the group's great report: Limiting Loopholes: A dozen tax breaks Ohio can do without.

Do you know of others who got an official notable nod recently? Tell us!

Recommendations to Presidential Transition Team

I received an e-mail message from the Ohio Association of Nonprofit Organizations containing recommendations to the Obama Transition Team, re-printed here in its entirety:

National Council of Nonprofits with State Nonprofit Associations Release Recommendations to the Presidential Transition Team

Washington, DC (Dec. 22, 2008)—Working in close collaboration with its state association members across the country, the National Council of Nonprofits has submitted its recommendations to President-Elect Obama’s Transition Team, which had requested the organization’s insights regarding ways the federal government can work better with nonprofits.

To put its recommendations in context, the National Council of Nonprofits’ report emphasizes: “The nonprofit sector serves as America’s social safety net to provide for people needing basic human services like food, shelter, and health care. Yet that community safety net is unraveling rapidly, straining to endure the additional weight dropping on it from the economy. With more people losing their jobs due to layoffs, losing their homes due to foreclosures, and losing all or a portion of their health insurance due to employers cutting jobs and benefits, the demand for nonprofit services is skyrocketing.”

At the same time, the report continues, “nonprofit revenues are plummeting as foundation assets evaporate, state and local governments cut contracts and freeze reimbursement rates, corporate donations shrink, and individuals suffer financially. The nonprofit sector remains committed to providing as much relief as possible to those in need. However, despite the purest intentions and the strongest dedication, community nonprofits cannot continue to do so much more with so much less for very much longer.”

The report provides an overview of how the economy is harming nonprofits, and cites a projection by noted public service expert Dr. Paul Light that the menacing economy could wipe out as many as 100,000 nonprofits within the next six months. “If that happens,” the National Council says, “then many needy people will have no place to turn.” Moreover, that will significantly increase the number of jobs lost across the country.

The National Council of Nonprofits’ recommendations include the following:

• Creating within the first 100 days the Social Entrepreneurship Agency for Nonprofits called for in the Obama Plan so it can help strengthen nonprofits—especially community-based organizations, because 93% of all charitable nonprofits have revenue under $1 million.
• Focusing the economic recovery plan “first on maximizing operating budget relief for state and local governments” to prevent additional state operating budget reductions because “future cuts to state and local governments will greatly exacerbate our nation’s current economic crisis.”
• Establishing a new Community Services Protection Fund to restore “the public/private covenant between governments and nonprofits by investing in nonprofits that perform work that traditionally has been performed and/or funded by government – because past government policies that shifted government human service programs to nonprofits often did so without full payment to provide those services.”
• Eliminating the distinction between the Standard Business Mileage Rate (now 58.5 cents per mile) given to corporate and federal employees and the substandard Charitable Mileage Rate (now just 14 cents per mile) for volunteers so there is one rate, set the same way, and treated the same way for tax purposes so volunteer workers helping others are treated the same as paid workers.
• Strengthening democracy by restoring the American people’s ability to amplify their voices through nonprofits so the people may participate meaningfully in their government.

The National Council of Nonprofits is the network of state and regional nonprofit associations serving more than 20,000 member organizations.  OANO is a member of the National Council of Nonprofits.

--Cindy Bailie