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Dec 12, 2011

Nonprofit Digest: Proctor’s Linking Mission to Money Featured

This week I want you to know about my contribution to a new resource for nonprofit organizations. Self described as a “new journal of innovation for nonprofit leaders and scholars,” Nonprofit Digest recently published its inaugural issue on November 30. I wrote for the first issue on a topic that is relevant and timely ─ the impact of state budget cuts on nonprofits. If you loyally read the Linking Mission to Money blog, you may recall this topic from a previous post. As a sneak peak, here is their abstract of my article along with a link to find out how you can subscribe to this journal.

If you would like to learn more on ways to respond to state budget cuts affecting your favorite nonprofit, I would be happy to speak at your next board or annual meeting.  Topics especially relevant to this subject are “State Budget Impacts” and “Defining a Successful Nonprofit.”  Interested in finding out more? Then please fill out my online inquiry form, contact emails@linkingmissiontomoney.com, or call 614.540.5520.

Abstract from Strategic Choices in an Era of State Budget Cuts

Nonprofit Digest Inaugural Issue – November 2011

In this piece, economist and nonprofit consultant Allen J. Proctor, Ph.D., discusses the implications that possible spending cuts and tax increases might have on NPOs, given their current financially lean circumstances. Relying on data from the Urban Institute, he presents three options for NPOs to consider as the political landscape becomes clearer in the coming months.

An often overlooked reality in today’s political discussions about the U.S. government’s federal budget deficit and the overall debt—as well as individual state’s budgetary shortfalls—is the effect potential remedies may have on nonprofit organizations. Because of a history of slowly giving in to government regulations and requests from bureaucrats, nonprofit organizations (NPOs) that provide contracted services on behalf of governmental agencies are already at a severe disadvantage: they are not only not covering their costs in these government contracts, but they are actually losing money—often having to go to private foundations or individuals to help cover the gaps in their budgets.

Nonprofits have brought this on themselves. Being so committed to delivery of services in order to achieve their missions, NPO leaders have cut back and sacrificed to the point of no longer being able to provide services. Indeed, many of the government contracts into which NPOs enter wouldn’t even be considered by a for-profit enterprise: elimination of all profit margins, finding matching funds to pay for the services, and accepting late payments—sometimes 90 days late or more—without penalties.

[Click here to find out how to subscribe to the Winter 2011 edition of Nonprofit Digest.]