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Archive for May, 2011

Squeezed Cities Ask Nonprofits for More Money

Posted by admin On May 12th
 
Check Out this article in The New York Times about Non-profits having to particpate in the Budget Crisis and let us know your thoughts?
 
 
By Michael Cooper – May 11, 2011

 

As recession-racked cities struggle to balance their budgets with everything short of feeling behind sofa cushions for loose change, a growing number are seeking more money — just don’t use the word taxes — from nonprofit institutions that occupy valuable land but by law do not pay property taxes.

Boston has been sending letters to its largest nonprofit institutions this year, telling them the value of their land and asking them to begin making annual payments that would eventually rise to a quarter of what they would owe if they paid property taxes. Mayor-elect Rahm Emanuel of Chicago wants the city to begin charging water fees to nonprofits, which have been spared them in the past. And the mayor of Providence, R.I., Angel Taveras, cited Boston’s example this month when he called on nonprofits to pay more money to the city.

“Every citizen, every city worker, every taxpayer, every business and every organization — including tax-exempt institutions — must share part of the burden of saving our city,” Mr. Taveras said in his budget address. He proposed closing Providence’s $109 million budget gap by shutting schools, laying off workers, cutting the Police and Fire Department budgets and raising taxes on homeowners as well as seeking larger payments from the city’s prestigious universities and other nonprofit institutions.

There is no question that nonprofit universities and hospitals — eds and meds, as they are known to planners — have played a central role in helping cities weather the Great Recession and its aftermath. They provide high-paying jobs, draw visitors and keep downtowns vibrant. But for cities that rely heavily on property taxes, those benefits have a cost. As nonprofits grow in size and importance in many cities, manufacturing has disappeared and development has moved to the suburbs, leaving much of the best land in some cities off the tax rolls.

So as the fiscal crisis lingers, some cities are weighing new fees on nonprofits for things like water service, street drainage and streetlights. Others, including New Orleans, want to tighten the rules establishing how tax-exempt status is granted. And many are seeking new or larger voluntary payments — known as payments in lieu of taxes, or Pilots — from nonprofit institutions.

But the effort to get nonprofit institutions to contribute more comes as many nonprofits are feeling the same pinch as cities: their endowments shrank as their investments lost money, contributions from donors and governments dried up and demand for their services remained the same or rose. David L. Thompson, the vice president for public policy at the National Council of Nonprofits, said increasing calls for nonprofits to pay more money to governments have left many tax-exempt nonprofit groups feeling demonized.

“Very simply, the social compact between nonprofits and governments exists to serve the public good,” Mr. Thompson said. “Changing the rules undermines the work of the institutions, takes money out the community and out of the services provided to constituents.”

The question of the payments has become a new wrinkle in the often-contentious relationship between town and gown.

Princeton University, for example, pays $1.2 million voluntarily to the Borough of Princeton, and $500,000 to the township. But when the university met resistance from local officials this year to some zoning changes it is seeking to build a new $300 million arts complex — especially to its proposal to move a train station a little farther from downtown — university officials said that they might rethink those voluntary payments.

“It would be difficult to justify continuing contributions at existing levels to local officials who not only refuse to help the university achieve a key educational objective, but in some cases have sought to prevent the project from going forward,” Robert K. Durkee, the university’s vice president and secretary, said in an e-mail, adding that the university already pays taxes on some properties that could qualify for exemptions, including housing for graduate students.

Boston is trying to avoid those kinds of negotiations by making its payments more systematic — an approach other cities are watching closely.

Boston is sometimes known as the Athens of America for its universities, and its hospitals and museums draw visitors from around the world. As the capital of Massachusetts, it is home to many government buildings, from the golden-domed State House atop Beacon Hill to the most obscure agencies. But there is a downside to all that activity, which is so central to the city’s character: it leaves more than half of Boston’s land exempt from property taxes, said Ronald W. Rakow, the city’s commissioner of assessing.

While Boston has long collected voluntary payments from its nonprofit institutions, it has done so haphazardly, with some universities paying millions of dollars, while their peers paid little or nothing. So Boston’s mayor, Thomas M. Menino, convened a task force that studied the issue for much of last year and decided to try to establish guidelines for the voluntary payments. This year the city is trying to collect voluntary payments from all nonprofits with property worth more than $15 million. The payments will eventually rise to a quarter of what the nonprofits would pay in property taxes if they were taxable, with the provision that they can get credit for up to half of the money they owe by providing quantifiable “community benefits” that directly help city residents. By the time the system is phased in, the city hopes its annual payments from nonprofits will rise to $48 million from $15 million.

“There are some institutions that have already signed on to the program,” Mr. Rakow said. “Others are taking a wait-and-see approach.”

A study last year by the Lincoln Institute of Land Policy, a research institute in Cambridge, found that the voluntary payments had already been made in at least 117 municipalities in at least 18 states. But Daphne A. Kenyon, a visiting fellow at the institute who was an author of the report, said more cities were expressing interest in such payments as the fiscal crisis had continued, views of nonprofits had evolved and the antitax climate had grown more pronounced in many places.

“I think the most important conclusion is that this should be a collaborative process,” Ms. Kenyon said. “Because if you don’t make it collaborative — if it’s highly contentious, you could end up with no increase in revenue for the municipalities, a lot of legal bills and a lot of ill will.”

Food Pantry at Risk of Closure?

Posted by admin On May 4th

Fort Myers food pantry at risk of closure over permits

IF YOU GO

• What: Fort Myers Planning Board Meeting
• When: 1 p.m today
• Where: Council Chambers, Oscar M. Corbin Jr. City Hall, 2200 Second St., Fort Myers

 A disgruntled neighbor of one of the most popular food pantries in Fort Myers wants it shut down.  Wilheim Verhoven has complained about St. Vincent de Paul’s food pantry for over a year, citing excessive noise, visual blight, declining property value, and inappropriate, anti-social and unsanitary behavior of some of the clients. 

The food pantry, which is run out of a small church, provides more than 1 million pounds of food annually to those in need.  Three mornings a week, a line of clients wrap around the church waiting to get bags of groceries or other services they may need such as money for utilities.

Verhoven and his attorney, William Uhle, will present their concerns at a Fort Myers Planning Board meeting at City Hall today.  “They should move to a more appropriate location,” he said of the pantry.

The pantry has operated at 2073 Lafayette St. for more than 4 years and is on commercially zoned land. 

Al Brislain, executive director of The Harry Chapin Food Bank, which provides the bulk of the food distributed by St. Vincent’s de Paul, understands why Verhoven might be upset.  “‘Not in my backyard’ is a real common problem that all social services have to deal with,” he said. “However, our concern is that thousands of people get food at Vincent de Paul, and if they shut down, I don’t know of any pantry in the area that has the capacity to serve those kinds of numbers.”

Although Verhoven has complained dozens of times about the food pantry, he is at a disadvantage, said Lynee Rodriguez, principal planner for Fort Myers. She will attend today’s meeting.  “The main problem with his complaint is that unfortunately he bought a home zoned commercial general,” she said. “There can be any kind of commercial properties around him.”

But Verhoven’s complaints flagged the problem that the food pantry did not have a conditional use permit.

The application costs $3,000, which amounts to two weeks of feeding the hungry, said Bernie Fettkether, president of St. Vincent de Paul, who oversees more than 100 volunteers.

“It’s very sad they had to pay fees,” Rodriguez said. “But it doesn’t matter if you are a nonprofit, you still have to pay the fees. I wish they could have kept the money for food distribution.”

The church also has to follow code enforcement issues such as establishing handicapped parking and fixing its Dumpster, she said.

The planning board will make a recommendation about the food pantry’s future, and then the board of adjustment will make a final ruling in a few months.

St. Vincent’s de Paul can continue to operate until a final decision has been made.

Please let us know your thoughts?

Check out the link below for more information:

http://www.news-press.com/article/20110504/NEWS0110/105040383/Fort-Myers-food-pantry-risk-closure-over-permits?odyssey=mod|newswell|text|Home|p