Brower: The eye-opening impact of Grand County nonprofits
Grand Enterprise Initiative
I’ve just returned from a conclave of nonprofit entities in northwestern Colorado and I was struck yet again by the number of these in just our region.
But what really struck me was the number of not-for-profits in Grand County and how, when I thought further about it, they constitute a large part of our business-based economy. This is despite the fact that they are nonprofits.
What’s a nonprofit? For the purposes of this article they are entities that have a legally recognized 501(c)(3) status under the internal revenue service’s tax code. This classification allows these entities to accept donations and contributions that can then be legally written off by the donors, giving a tax break to donors who are inclined to give. If a nonprofit does have “free cash flow,” then that money must be directed back into the nonprofit’s mission, not into the pockets of shareholders or owners.
Consider this. Megan Ledin, the director of the Grand Foundation, Grand County’s community foundation, said there are roughly 180 nonprofits in the county. When you throw in entities like the National Sport Center for the Disabled, with its large program in Winter Park, they help to create about 700 jobs in the county. Not all of those jobs are full time, but they are jobs that pay.
Take this into consideration: Megan said there have been studies conducted in the county which show that 15% of the total business activity in Grand County can be attributed to nonprofits. That’s payroll, purchases by employees of nonprofits — the overall economic impact.
Even more eye-opening, in light of those numbers, is the fact that many of the people who work for nonprofits do so on a volunteer basis. By that I mean that many of the nonprofits devote their funds and resources to the services they offer without paying a cent in payroll. But that non-paid nonprofit activity still creates significant economic activity.
What accounts for this large nonprofit sector in Grand County? Opportunity and demand.
Let’s start with the demand. When considering a not-for-profit entity like the Mountain Family Center, it’s easy to see that people have a need for the services and products they offer. But to offer that and expect to make a profit while also satisfying the demands of private ownership would be a difficult proposition. By being nonprofit, a variety of revenue sources open up and the demands for profit diminish.
Which is not to say nonprofits can operate on a fiscally irresponsible basis (more on that in my next column). In fact, many nonprofits are more fiscally accountable that private enterprises due to heightened reporting requirements of the government and donors.
Anyway, there are other demand issues, like the Grand County Rural Health Network, which offers health navigation and resources in this difficult health care environment in which we live. Or there’s Habitat for Humanity Grand County, which works to provide affordable home ownership in this challenging real estate environment.
I could go on. Even the work I do, which is under the auspices of a nonprofit, offers free business management coaching for businesspeople and entrepreneurs who normally would not be able to afford it.
So there is demand and there’s opportunity to find funding through non-profit channels to meet that demand. Government funds, foundations and private individuals want to use their resources (money) to help meet the needs and demands of our population. Many times they do that by helping to fund non-profits.
Now I could go on forever about why many non-profits are doing the work that perhaps our government should be doing. That’s a debate for another forum. But the truth is that non-profits, for the most part, help to meet critical community needs that make our lives better in Grand County.
We should be grateful for that, whether they make a profit or not.
(In two weeks I’ll go more into the dynamics of being a nonprofit in Grand County and elsewhere. Take it from me, it’s not as easy as a person might think.)
Patrick Brower is the Enterprise Facilitator for the Grand Enterprise Initiative. He provides free and confidential business management coaching for anyone who wants to start or expand a business in Grand County. He is also the author of “KILLDOZER: The True Story of the Colorado Bulldozer Rampage.” He can be reached at 970-531-0632 or at email@example.com.
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