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The Public Benefit Sector of
American Society
The
public benefit sector of American life is huge, growing, and impactful.
About 1.8 million nonprofit organizations are registered with the IRS,
and this represents a 121% increase over the previous five years.
Nonprofit organizations are diverse in mission, size, and
sponsorship—ranging from hospitals and human service organizations to
advocacy groups and chambers of commerce. Some 42% have annual
operating expenses of less than $100,000, while 4% exceed $10 million.
When compared to
the business and government sectors of our national economy, the public
benefit sector accounts for 5.2% of gross domestic product (GDP) and
8.3% of wages and salaries paid. Individuals, corporations, and
foundations annually give $260 billion in charitable contributions to
public benefit sector organizations, and 29% of Americans volunteer
their services through them. (A
Decade of Research on the Nonprofit World: The Urban Institute, 2006*)
The Public Benefit Sector of
Nevada
County
Nevada County is a typical
cross-section of the nation’s public benefit sector in terms of
mission, size, and sponsorship. There are approximately 424 nonprofit
organizations in the county, ranking 13th among
California ’s 58 counties of nonprofit
organizations per thousand persons (4.61). Total annual income to these
organizations exceeds $88,000,000. (USF Institute for Nonprofit Organization Management, 2003*)
Knowledge about
and understanding of Nevada
County ’s
nonprofit organizations is mostly anecdotal: The organizations are
believed to provide an array of important public benefits, but the
actual magnitude of their social and economic impacts largely is
unknown. Of 424 Nevada
County nonprofit
organizations that are registered with the IRS, the vast majority are
small and relatively invisible. Most struggle with mission and
governance, strategic planning and evaluation, fund raising and
financial management, staffing and human resources, and civic
engagement and collaborative alliances. Their general knowledge about
nonprofit “best practices” is limited and lacks uniformity. And while
individual nonprofits market themselves in various ways, no single
voice exists to make the case for the collective public benefits that
this sector provides.
Nevada County Nonprofit Organizations: From Competition to
Collaboration
Until the
mid-1990s most relations among
Nevada County ’s
nonprofit organizations were based on mutual suspicion and unbridled
competition. It was not until 1994, with the creation of Nevada County
Leave A Legacy by staff from five nonprofit organizations (Hospital
Foundation, United Way, Music in the Mountains, Hospice, Land Trust),
that momentum shifted toward collaboration. Leave a Legacy was a “call
to arms” to address three needs: Raise community awareness that planned
giving opportunities exist within the county. Keep estate gifts in
Nevada
County . Help individual
nonprofit organizations learn the processes and skills required for
successful planned giving. The program resulted in the boards of 53
organizations agreeing to collaborate—a
Nevada County
nonprofit first.
Over the next
several years, the county’s public benefit organizations continued to
explore ways to strengthen themselves and their sector. A needs
analysis by the county’s nonprofit executive directors was undertaken
in October of 2002 and resulted in fourteen organizations deciding to
create an “informal collaborative” on April 4, 2003. They called it the
Center for Nonprofit Leadership (CNL). CNL’s founding purpose was to provide high quality, low priced
programs and services to which nonprofit governing boards and executive
directors can turn for continuing education and development.
As to CNL
governance, the decision was made to proceed with an informal
Leadership Team of highly committed lay volunteers and executive
directors rather than pursue the conventional route of creating CNL as
a 501 c (3) organization. The Leadership Team’s rationale was that IRS
status and formal organizational structure should follow only if CNL
program results and emerging needs of
Nevada County ’s
nonprofit organizations eventually warrant it.
The CNL Experience Thus Far: 2003-07
Since its founding in 2003 CNL has sponsored high quality,
low priced workshops for governing board members and executive
directors from 48 member nonprofit organizations. Workshops have been
supplemented by informal “best practices exchanges” (e.g., finance) and
periodic coaching/mentoring of individual nonprofit organizations (e.g.
on the five life stages of nonprofit organizations).
Leadership for
CNL programming has been provided by highly experienced professionals
of unmatched reputation (e.g., Kay Sprinkel
Grace—Fund Development; Betty Stallings—Recruiting and Retaining
Volunteers; Bill Bergquist—Creating and
Managing Organizational Change). Workshop themes have ranged widely:
strategic planning, fund raising, finance, board recruitment and
evaluation, building successful boards, board president/executive
director relations, planning and conducting effective board meetings,
recruiting and training volunteers. Every workshop has been judged
“excellent” by participants, affirming the value of CNL programming
over the organization’s formative years.
The
success of CNL programming, combined with the need for public benefit
organizations to continue strengthening their performance in serving
Nevada
County , led the CNL Leadership
Team to undertake comprehensive strategic planning during 2007. Three
questions were central:
1.
Should CNL’s mission be continued or
modified?
2.
Should CNL expand its products and services beyond programming
offered
since its founding?
3. What are the benefits, risks,
and concerns of CNL evolving into an
independent 501 c (3)
organization if expanded programming makes
that
desirable?
The results of
strategic planning were presented to member nonprofit organizations
during a forum at CNL’s Annual Meeting on
September 7, 2007.
Next Steps for CNL
The Center for
Nonprofit Leadership will implement the following strategic decisions
and goals over a three-stage transition period, beginning in 2007 and
estimated to reach maturity in 2012:
Service
Area: The principal focus will continue to be Nevada
County , with invitations for participation
and membership extended to nonprofit organizations from other Northern
Sierra California
counties as desired and needed.
Mission: CNL will continue to
strengthen nonprofit organizations in order to advance the quality of
community life.
Purposes: CNL’s
mission will be realized through the implementation of five purposes on
the basis of annual priorities:
1.
Provide continuing education to strengthen the
capabilities and
performances
of member nonprofit organizations.
2.
Identify and provide technical and other resources
to support member nonprofit organizations.
3.
Engage in collaboration and sharing among member
nonprofit organizations for the common good.
4.
Advocate and promote better understanding of the
public benefit role that nonprofit organizations play in sustaining and
advancing the quality of community life.
5.
Engage with nonprofit, business, service club,
education, media, and government organizations in addressing critical
community issues through cross-sector partnerships.
Governance: CNL’s
governance will change from an informal Leadership Team to a Board of
Directors of 13-15 members. Board members will be drawn from the
current Leadership Team and key leaders from the community’s business,
service club, education, media, and government sectors. This transition
will begin in 2007 and conclude in 2008.
IRS
Status: When the founding of the CNL Board of Directors is in place,
a timetable will be established to file papers for the organization’s
501c (3) status. This will provide CNL advantages that are required to
carry-out its mission and deliver much-needed products and services:
build on existing image and strengthened credibility, professionalize
functions and heighten expectations, establish program autonomy and
control over all aspects of the organization, provide tax exemption and
the ability to obtain grants and funding for operations and projects,
ensure public accountability by adopting standards that are required of
all 501 c (3) organizations.
Products and Services: The Board of Directors
will establish annual priorities among the following five program areas
in meeting the needs of CNL member organizations: Education, Nonprofit
Collaboration, Technical and Other Resources, Advocacy, and
Cross-Sector Collaboration.
Finances and Funding: Financial policies
needed to deliver CNL products and services will be under the auspices
of the Board of Directors. Membership dues and workshop and seminar
fees will continue to be at modest levels and used to support programs
and basic operations. Additional revenues required to support
operations and programs, and undertake special projects, will be sought
from appropriate funding sources—with the understanding that every
effort will be made to avoid direct competition with the missions of
member nonprofit organizations. In every case, the rationale for fund
raising will be to support CNL’s unique
mission: to strengthen nonprofit organizations in order to advance the
quality of community life.
*Most
recent reports
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