HSLC offers insight on economic impact study

A joint meeting was held by the Oneida and Herkimer Nonprofit Executive Directors Group Steering Committee and the South Central NY Nonprofit Executive Directors Special Projects Committee to discuss the SCNY Group’s recent efforts around an economic impact study. The meeting, hosted by the Central New York Community Foundation, was attended by representatives from the SCNY ED Group, Oneida and Herkimer ED Group, and the Human Services Leadership Council in Syracuse. The main presenter and chair of the SCNY Special Projects committee was Joe Sellepack, Broome County Council of Churches Executive Director. Also, presenting was Katie McDonald, a Binghamton University master’s student working to help implement the study.

The discussion began with an understanding of why nonprofits were focusing on economic impact. In recent years, taxing nonprofits (whether by PILOT, a snow assessment fee, etc) has become an issue. With the downturn, nonprofits will be facing in more scrutiny and possible tax proposals. In response, the SCNY ED Group saw a need to communicate the economic impact of nonprofits on the local community and region. As Joe related, they also saw a need to make it more than about the numbers, and make a comparison to what the real costs would be if their services weren’t provided. The Special Projects Committee was formed, and is examining how the nonprofit sector in the Broome region shapes the community and environment through social and human services, arts and culture, and environmental services.

The Committee has been spending a great deal of time and effort looking at past studies, not only locally but nationally. Hospitals have been a good source, and two state studies, in Michigan and New Hampshire, have been good models.

The idea for the study will incorporate two streams. The first is the financial information taken from nonprofits’ 990s, while the second will be the “social capital” they contribute. The study will show how nonprofits shape and contribute to the community narrative. The study will incorporate personal interviews to help demonstrate this piece. The study will hopefully subvert the forces that want to tax nonprofits, and show their clout, but also the rest of the story. The message will be much clearer and powerful as a group.

Joe Sellepack related that the Committee under the guidance of Binghamton University and two interns has spent much time developing their study protocol. They have decided to focus on range of nonprofits, which would include only organizations that file 990s and exclude very large nonprofits (hospitals, universities, etc) that would skew the study (and already do their own studies). In a sense, the study will give a voice to the small to medium-sized organizations.

The study is slated to take about 2 years. Much of the work is being driven by Binghamton University’s interns in the Public Administration Master’s Program.

A question was asked by Darlene Ford, ED for the Mid-York Library System, concerning the target audience and overall purpose for this effort. A number of reasons were offered by Joe and other participants: showing return on investment, advocacy, use for collaboration, joint funding projects, etc. The qualitative analysis will help show gaps and overlaps in funding and can figure in ways to help address and form partnerships.

In looking at why the Oneida and Herkimer ED Group should undertake such an effort, the Steering Committee members related a number of reasons. One was the conflicting messages in the Oneida and Herkimer communities coming from nonprofits. There needs to be a clear message and story around how nonprofits help and impact the community. Also, a study would show what would happen if nonprofits disappeared.

A part of the discussion was spent on recent efforts of the Human Services Leadership Council (HSLC) on an economic impact study. Susan Horn, the ED from Hiscock Legal Aid Society, offered some of the lessons they learned in a group study. A discussion continued about the different data involved with nonprofits, including how things are reported (outcome vs outputs). Joe offered that using personal stories will help illuminate some of the challenges of data that won’t mesh. Katie McDonald added that being clear about the data collection and analysis is key. She has been developing the study’s introduction and methodology. She also is gathering social and cultural impact pieces (social network and social capital). She related that the study will include the history of nonprofits in the Broome County region (for example, what happened when IBM left), and how they’ve developed.

Overall, there was agreement that the study could be a template for other nonprofits, and the Oneida and Herkimer ED Group plans to follow up with Joe in the fall about the protocol and info they develop.