Stonington official to nonprofits: ‘Stop the double-dipping’
Every year, some nonprofits ask voters for funding at town meetings, in addition to receiving property tax exemptions. One town’s economic development director questions the practice.
By Linda Nelson
There’s a controversy brewing around our town budgets and the annual inclusion of nonprofit, or third-party, requests for funding.
When I first landed in Stonington more than 25 years ago, third party requests were granted to regionally-based social services: the Red Cross. Hospice. Community Action Partners, Head Start, Downeast Transportation, and others. These are important social services needed and used by islanders but not supported by the taxpayers through property tax exemptions and municipal services because they are not based locally.
Today our towns are experiencing local nonprofits who receive property tax exemptions and municipal services coming back around to tax payers with third party requests on top of their annual fund drives—and with no mention of adding a “payment in lieu of taxes,” or PILOT.
The year-over-year growth of these requests is occurring during a period in which our local labor supply is crippled by a lack of affordable housing—a process fueled by spiraling property values and taxes. In a destabilized economy where the gap between those who can afford to be resilient and those who cannot is widening, most towns are in a position where they are unwilling to continually increase taxes above and beyond necessary municipal service increases, because to do so is driving out year-round workers and families.
Linda Nelson, Stonington’s economic and community development director.
Photo courtesy of Christina Breen.
In September, I completed three terms (nine years) as a board member for the Maine Association of Nonprofits. I came to Stonington in the late 1990’s to launch a nonprofit which I directed for many years and now work for the town of Stonington, and thus bring a two-pronged perspective to this issue.
Nonprofits who own property in our towns are given property tax exemptions based on their fulfillment of specific, charitable purposes: their missions, whether social services, health care, cultural, environmental, or other must demonstrate critical impact as part of the whole community ecosystem.
These tax exemptions are extremely valuable, often totaling tens of thousands of dollars in revenues lost to the town. In simple math, this means that those remaining taxpayers footing the bill for roads, waste diversion, snow plowing, fire and public safety and more pay an increased share.
I continue to work statewide as a nonprofit consultant, leading retreats, strategic planning, and advancement campaigns. I tell my clients that the nonprofit sector—a critical component of community stability and wholeness, sitting between the public (municipal) and private sectors—is invaluable as a more effective wealth transfer engine than taxation. Nonprofits have the legal ability to shift wealth to services needed by our most vulnerable in ways municipalities are unable given the state’s statutory tax restrictions; and to provide impact and investment beyond that of government.
We are all in this together.
This is why it saddens me to see my nonprofit colleagues act as if they are unaware of the larger community ecosystem in which they seek to have positive impact. Where do they give the towns credit for their support via property tax exemptions? Where do they acknowledge the impact these have on tax payers, and how do they communicate their awareness of offsetting this?
Not by “double-dipping” the system for support, requesting both property tax exemptions and third-party funding while expecting their share of municipal services.
Nonprofits do create jobs, employing 15% of Maine’s workforce across the state, but that is not part of nonprofits’ charitable impact: Private business creates jobs, too, without the same supports from tax payers.
Times are hard for everyone right now. Many nonprofit organizations have come under the current administration’s censorship and anti-immigration fire; many others have had grants for exhibits and programs “clawed back” even after being Congressionally awarded. Staff at high-profile nonprofits whose services appear to conflict with the federal government’s messaging have received threats of violence. Many do not feel safe.
I can’t repeat enough that our communities need all three sectors—public, private, and nonprofit—to thrive and be resilient.
Community support for nonprofits takes many forms. Perhaps none are more important than individual donations and the testimonials and letters of support from local leaders and voters who are grateful for the charitable impact and services of those organizations aligned with and in support of town needs.
This is the time of year when third-party requests are due and end-of-year development efforts kick in. Towns will have to make some hard decisions as many taxpayers can’t afford more than they already pay and most have no intention of driving more property holders away due to a lack of affordability. If you have the capacity to give to a nonprofit end-of-year appeal, be generous. It is a way you help to support those with less than yourself.
And to my fellow nonprofit warriors out there: Stop the double-dipping and be more sensitive to the community ecosystems of which you are a part. I paraphrase the words of President John Fitzgerald Kennedy: stop asking what your communities can do for you, and ask more often what your communities need you to do for them.
That’s the mission.
Let’s get to it.
—Nelson is the economic and community development director for Stonington.
The views expressed in this or any other guest opinion piece do not reflect any editorial stance of The Rising Tide. All letters and guest columns are the sole views of their authors.
If you have a letter or opinion piece you would like to see published, please submit it to info@risingtide.media. We request that all submissions be exclusive to The Rising Tide.
