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Sunday, June 5, 2011

The Effects of Public Funding on Nonprofits – Brian C.

A large number of nonprofit organizations are dependent on funding from the Federal, state, and local governments. Without these public funding sources, they would not be able to achieve their mission or possibly exist at all. I have been in countless conversations regarding the use of public funds, or taxpayer dollars, to fund nonprofit organizations and causes. Most of the comments are usually negative. Citizens do not believe their tax dollars should be used to fund nonprofits. If they wanted to give to a nonprofit, they would have done so themselves. They do not feel it is up to the government to use their taxpayer dollars to fund a nonprofit mission. There is an interesting article recently (Hall 2011) that discusses the dwindling of public support for Planned Parenthood. Many states are drastically reducing or eliminating funding for Planned Parenthood. This appears to be mostly politically motivated, but there is less of a backlash from the public. As states and local governments grapple with budget shortfalls, I wonder if the citizens are willing to sacrifice public funding for nonprofits in order to fund what they consider the core purposes of government. Planned Parenthood has seen an increase in private donations, but this is not enough to bridge the gap. David Nova, a vice president at Planned Parenthood Health Systems in Roanoke, VA, is quoted in the article as saying, “The loss of public dollars far outweighs any uptick in contributions.”

I think we can all agree that the mission of Planned Parenthood and many other nonprofits facing the same funding shortfalls is noble and necessary. However, government funding for nonprofits can become politically charged. For example, an anti-abortion activist would definitely be upset to see tax dollars going to Planned Parenthood. They would not want to support that organization, and they would not want the government to use their dollars to support that organization either. This can be said for many nonprofits funded with public dollars. Many local governments routinely include funding for local nonprofit organizations in their budget ordinances each year. When weighing a tax increase, or a reduction in nonprofit funding, most governments will choose the latter.

However, there is always another side of the discussion. If public dollars are not used to support these nonprofits, many will not be able to accomplish their mission in serving their communities. They may cease to exist altogether. If nonprofits cannot provide some of these services, then it falls back to the government to provide them. So would you rather have the government make a contribution to a nonprofit to serve the community, or would you rather have the government take over the service? The government would most assuredly have to raise taxes to offer new services. As discussed on the first night of class, the reasons nonprofits exist are:

· They can serve the community or provide a service better than the public or for-profit sectors.

· They can focus on niche or specialty causes.

· They can deal with things that government doesn’t want to deal with because of the political sensitivity.

There are valid points for both sides of this debate. In the end, I think that nonprofits serve a valuable purpose to address needs in our society that must be funded. Should public funds be used to support these nonprofits? I think that needs to be decided on a case by case basis. The long-term effect of reducing public funding should definitely be considered rather than acting on a political whim. The ultimate goal is the enhancement of society as a whole, whether that comes from the nonprofit, public, or for-profit sectors. This debate will no doubt rage on as governments will continue to face budget shortfalls for years to come. Hopefully, our decision-makers take the long-term effects of their decisions into consideration before making funding cuts regardless of the organization, or purpose it supports.


Hall, H. (2011). With Public Support in Peril, Planned Parenthood Attracts Private

Gifts. The Chronicle of Philanthropy. Retrieved June 4, 2011, from

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