Local nonprofits react to proposed House bill

2/16/2013

By SCOTT AUST

By SCOTT AUST

saust@gctelegram.com

Nonprofit organizations that receive public money could face more stringent documentation of income and expenditures of those public dollars if a bill being discussed by the state legislature’s Judiciary Committee becomes law.

If House Bill 2188 is approved, nonprofit groups that receive $350 or more per year in public funds would have to maintain detailed records about who gives them money and how it is spent, and must maintain those records on their websites in a downloadable and searchable format.

Beverly Schmitz-Glass, executive director of Downtown Vision, said itemizing every dollar and every check written spending that money will be burdensome on many local nonprofits, especially the smaller organizations that only have one or two people.

“It just becomes a bookkeeping nightmare,” she said.

Nonprofit organizations already maintain financial reports, but the new law would require much more detailed information about spending, and also would require donating organizations like cities and counties to maintain the same documentation.

“The big issue is they wanted transparency,” Glass said. “But a lot of nonprofits don’t have a website. What do they do? The flip side is, if I’m an anonymous donor and want to stay that way, I can’t. They would have to put my donation up there and what they’re using it for.”

Consuelo Sandoval, outgoing Finney County United Way executive director, said United Way agencies in the state are keeping an eye on the legislation, but haven’t established an official position on it yet, preferring to take a wait-and-see approach until a final version comes out of the committee.

“We’re all watching it closely, waiting to see where it leads,” she said. “For us, from a funding standpoint, no matter how small the agency, we always require financials, and pretty thorough ones. We’re pretty strict to begin with.”

State Rep. Russ Jennings, who serves on the Judiciary Committee, said a significant number of opponents attended the committee hearing on the bill earlier this week, and there were only a handful of proponents. Jennings expects the committee will work on the bill toward the end of next week, although it hasn’t been scheduled yet.

The bill was introduced by Rep. Steve Brunk of Wichita. Jennings said its genesis relates to difficulties in Wichita getting detailed information from that city’s economic development organization relating to a couple of projects.

To fix that specific problem, bill supporters propose subjecting every nonprofit organization in the state to a very detailed disclosure, Jennings said.

“It’s kind of like using a cannon to shoot a mosquito. It’s a little much,” he said. “It’s definitely a local problem to Wichita.”

Jennings opposes the bill as written, but thinks there may be an argument to be made for an increased level of transparency for economic development groups that would be different from a nonprofit like United Methodist Youthville, for example.

However, Jennings also does not want to harm the effectiveness of economic development efforts in their attempts to bring in new business and industry, efforts that often require some confidentiality due to the competitive environment.

“You want the accountability, but you don’t want to destroy those efforts in the process. I’m sure we’ll have some lively discussion in committee,” he said. 

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