Senate budget's collateral damage to nonprofits, communities

by Paul Raker, Alamance County YMCA, published in Burlington Times-News, June 20, 2015.

The recently introduced state Senate tax package proposes multiple new tax burdens on North Carolina’s nonprofits. As membership and marketing director for the Alamance County Community YMCA, I am gravely concerned about the far-reaching repercussions these new taxes will have not only on the nonprofit sector, but on the future and prosperity of the state and its citizens.

Just two years ago, nonprofits received full refunds on the sales taxes they paid to support their charitable missions. This year nonprofits are facing three distinct threats — new taxes on nonprofit organizations, a restructured refund process that will cut into the reserves of almost all nonprofits and the effective elimination of state tax incentives for charitable giving.

Nonprofits serve as a social safety net for the state, often filling the gaps and meeting the needs the government isn’t able to cover. Every new tax dollar paid to the state means that one less dollar goes to citizens in need. In the case of the Alamance County YMCA, such a burden would not only hinder our ability to offer programs and memberships at a reduced rate, but would also potentially compromise partnerships we have with larger organizations such as Cone Health / Alamance Regional and Elon University. Such hindrances and compromises would inhibit us from carrying out our mission of offering programs and memberships for all. The same is true for YMCAs across the state. Many partner with other large and small nonprofits to bring greater benefits to the communities they collectively serve. For example, more than 64 percent of YMCAs have partnerships with hospitals — half of those delivering programs or services that bring huge benefits to their communities.

Simply put, taxing nonprofits would lead to job losses, reduced services, and decreased ability to support public good. Regardless of size, nonprofits must lock arms and do what’s right for our organizations and the people we serve.

Recently, legislators have referred to the state’s nonprofits as corporations and special interests. This characterization ignores that fact that nonprofits exist to serve their communities. In fact, they are required by law invest all profits back into their charitable missions and people they serve. Levying new taxes on nonprofits won’t hurt profit margins or shareholders, but rather pass the burden onto taxpayers and underserved communities.

The state’s 27 YMCAs, like most charitable nonprofits, are dedicated to investing in North Carolina and improving the quality of life for its citizens. Without the critical services that nonprofits provide to millions of people of every day, the state and its citizens will suffer. I strongly urge lawmakers to protect all nonprofits and the invaluable services they provide to all North Carolinians.

http://www.thetimesnews.com/article/20150620/OPINION/150619380/15233/OPINION