Economic presentation

Erin McClarty
Erin McClartyAttorney at Erin McClarty PLLC
Non-profits: Not so Small
          After All
A quick survey of the economic impact non-profits
           have nationally and in Texas.

            By: Erin McClarty
Non-profits ≠ No money?

The word “non-profit”
can be incredibly
deceptive. Most believe
non-profit to be
analogous to little to no
money.
Why is this???

•   Few understand just how immense an impact non-profits
    have on the economy. This can often be attributed to two
    (amongst many) things:

    •   A misperception as to the number of non-profits that
        exist.

    •   The stereotypes often portrayed by society.
Clarification
•   But, a quick survey of
    recent statistics shows that
    non-profit organizations
    are not only “profiting”,
    but many are beginning to
    pace for-profit
    organizations as well.
In fact, Nationally...
•   ...the number of 501(3)(c) charities
    increased by 32.7% and foundations
    63.6% between 1998 and 2008.


•   ...in 2007 public charities accounted
    for over 1.4 trillion in total revenues.


•   ...in 2006, non-profits accounted for
    8.11% of all wages and salaries paid
    in the United States.


•   ...there are 1,017,479 non-profit
    organizations as of today.




        (Sources: NCCS Core Files 2007; IRS Business Master File 04/2009 (with modifications by the National Center for Charitable Statistics at the Urban Institute to exclude foreign and governmental
        organizations, Nonprofit Almanac 2008.)
In Texas.....



                      •     ...there are 69, 558 organizations, 31, 393 of which file.

                      •     ...the organizations that must file yearly account for $59,000,613,663 in
                            revenues and have over $59,000,613,663 in assets.

                      •     ...Texan Foundations have awarded over 1,137,359,328 in grants while
                            Charitable organizations have awarded 1,350,319,187 in grants. All of this is
                            then re-invested back into local business and communities
Sources: IRS Business Master File (modified by NCCS) 04/2010; NCCS 501(c)(3) Public Charities Core File 2008; IRS Business Master File 04/2009 (with modifications by the National Center for Charitable Statistics at the Urban
Institute to exclude foreign and governmental organizations; IRS Statistics of Income, July 2009: <http://www.irs.gov/pub/irs-soi/07in54cm.xls>. Prepared by the National Center for Charitable Statistics at the Urban Institute .
Texas Continued.....
•   Also, the number of Texan 501(3)(c) charities has increased 75.3 percent
    with Foundations slightly ahead at 77.3% between 1998 to 2008.

•   In 2009 there were 11,278,559 tax returns made. Of these, 2,160,102 had
    charitable deductions amounting to $12,856,691.


                                            Total Returns Made
                                            Returns with Charitable Deductions
           16%




                        84%
Charts

The following are two charts detailing the top 10 non-profits in
    Texas by Gross Revenue and by assets. Keep in mind:


       • How incredibly large the numbers are. In many
       instances individual institutions handle several
       millions dollars.

       • These are just the top ten non-profits (for each
       category respectively) in Texas. Imagine how much
       non-profits contribute to the state cumulatively.
Top 10 Texas Non-profits By Gross
               Receipts

                                                                             Gross Receipts       Gross Assets
                                                               City
                                                                              (by dollars)
                                                                                4,438,702,857     (by dollars)

                 Christus Health                             Houston, Tx          9,289,680,501   2,556,476,045


                 Methodist Hospital                          Houston, Tx                          4,207,299,903


             Memorial Herman Hospital                        Houston, Tx          2,509,852,996   3,453,047,831


               Texas Childrens Hospital                      Houston, Tx          2,058,700,689   2,775,777,168


           William Marsh Rice University                     Houston, Tx          1,830,649,240   6,092,313,393


             Baylor College of Medicine                      Houston, Tx          1,416,938,637   2,753,179,210


                Boy Scouts of America                         Irving, Tx          1,320,090,753   868,591,890

Scott & White Memorial Hospital & Scott Sherwood Brindley    Houston, Tx          1,309,158,112   1,369,975,811
                      Foundation

   Daughters of Charity Health Services of Austin             Austin, Tx          1,291,325,093   1,538,826,895


              Texas Christian University                    Fort Worth, Tx        1,227,577,905   1,890,254,000
Top 10 Texas Non-profits by Assets
1. Brazos Higher Education Authority    10,000,000,000
Inc
    (Waco, TX)
                                        8,000,000,000
2. William Marsh Rice University
    (Houston, TX)
                                        6,000,000,000
3. Methodist Hospital
    (Houston, TX)
                                        4,000,000,000
4. Memorial Hermann Hospital System
   (Houston, TX)
                                        2,000,000,000
5. Texas Childrens Hospital
    (Houston, TX)

6. Baylor College of Medicine
                                                    0      os




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                                                                               od




                                                                                                                                                  od
    (Houston, TX)




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7. Christus Health




                                                                                                                                              h
                                                                                                                                           ut
                                                                                                                                        So
    (Houston, TX)

8. Southern Methodist University
                                                         Note: Here, revenues are being measured by almost the tens of millions!
    (Dallas, TX)

9. Trinity Higher Education Authority
Inc
    (Waco, TX)

10. Panhandle-Plains Higher Education
Authority Inc                                                                          Source: NCCS 501(c)(3) Public Charities Core File 2008
      (Canyon, TX)
Conclusion
•   In the end, it is important that tax-payers,
    governments, and businesses begin to understand
    just how large a role non-profits play in federal
    and state revenues.

•   Realize that non-profits contribute heavily not
    only in moral currency, but monetary currency as
    well.

•   By understanding how large a role non-profits
    play economically, perhaps people will begin to
    understand why investing in them is important
    and see to it that each and every one sustains.
1 of 11

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Economic presentation

  • 1. Non-profits: Not so Small After All A quick survey of the economic impact non-profits have nationally and in Texas. By: Erin McClarty
  • 2. Non-profits ≠ No money? The word “non-profit” can be incredibly deceptive. Most believe non-profit to be analogous to little to no money.
  • 3. Why is this??? • Few understand just how immense an impact non-profits have on the economy. This can often be attributed to two (amongst many) things: • A misperception as to the number of non-profits that exist. • The stereotypes often portrayed by society.
  • 4. Clarification • But, a quick survey of recent statistics shows that non-profit organizations are not only “profiting”, but many are beginning to pace for-profit organizations as well.
  • 5. In fact, Nationally... • ...the number of 501(3)(c) charities increased by 32.7% and foundations 63.6% between 1998 and 2008. • ...in 2007 public charities accounted for over 1.4 trillion in total revenues. • ...in 2006, non-profits accounted for 8.11% of all wages and salaries paid in the United States. • ...there are 1,017,479 non-profit organizations as of today. (Sources: NCCS Core Files 2007; IRS Business Master File 04/2009 (with modifications by the National Center for Charitable Statistics at the Urban Institute to exclude foreign and governmental organizations, Nonprofit Almanac 2008.)
  • 6. In Texas..... • ...there are 69, 558 organizations, 31, 393 of which file. • ...the organizations that must file yearly account for $59,000,613,663 in revenues and have over $59,000,613,663 in assets. • ...Texan Foundations have awarded over 1,137,359,328 in grants while Charitable organizations have awarded 1,350,319,187 in grants. All of this is then re-invested back into local business and communities Sources: IRS Business Master File (modified by NCCS) 04/2010; NCCS 501(c)(3) Public Charities Core File 2008; IRS Business Master File 04/2009 (with modifications by the National Center for Charitable Statistics at the Urban Institute to exclude foreign and governmental organizations; IRS Statistics of Income, July 2009: <http://www.irs.gov/pub/irs-soi/07in54cm.xls>. Prepared by the National Center for Charitable Statistics at the Urban Institute .
  • 7. Texas Continued..... • Also, the number of Texan 501(3)(c) charities has increased 75.3 percent with Foundations slightly ahead at 77.3% between 1998 to 2008. • In 2009 there were 11,278,559 tax returns made. Of these, 2,160,102 had charitable deductions amounting to $12,856,691. Total Returns Made Returns with Charitable Deductions 16% 84%
  • 8. Charts The following are two charts detailing the top 10 non-profits in Texas by Gross Revenue and by assets. Keep in mind: • How incredibly large the numbers are. In many instances individual institutions handle several millions dollars. • These are just the top ten non-profits (for each category respectively) in Texas. Imagine how much non-profits contribute to the state cumulatively.
  • 9. Top 10 Texas Non-profits By Gross Receipts Gross Receipts Gross Assets City (by dollars) 4,438,702,857 (by dollars) Christus Health Houston, Tx 9,289,680,501 2,556,476,045 Methodist Hospital Houston, Tx 4,207,299,903 Memorial Herman Hospital Houston, Tx 2,509,852,996 3,453,047,831 Texas Childrens Hospital Houston, Tx 2,058,700,689 2,775,777,168 William Marsh Rice University Houston, Tx 1,830,649,240 6,092,313,393 Baylor College of Medicine Houston, Tx 1,416,938,637 2,753,179,210 Boy Scouts of America Irving, Tx 1,320,090,753 868,591,890 Scott & White Memorial Hospital & Scott Sherwood Brindley Houston, Tx 1,309,158,112 1,369,975,811 Foundation Daughters of Charity Health Services of Austin Austin, Tx 1,291,325,093 1,538,826,895 Texas Christian University Fort Worth, Tx 1,227,577,905 1,890,254,000
  • 10. Top 10 Texas Non-profits by Assets 1. Brazos Higher Education Authority 10,000,000,000 Inc (Waco, TX) 8,000,000,000 2. William Marsh Rice University (Houston, TX) 6,000,000,000 3. Methodist Hospital (Houston, TX) 4,000,000,000 4. Memorial Hermann Hospital System (Houston, TX) 2,000,000,000 5. Texas Childrens Hospital (Houston, TX) 6. Baylor College of Medicine 0 os sh ist l ns ist r us ity e ia ylo dl az re ar t or in ris od od (Houston, TX) an Ba ild Br M Tr em eth eth Ch nh Ch m M M nM Pa ia as i" x er W Te 7. Christus Health h ut So (Houston, TX) 8. Southern Methodist University Note: Here, revenues are being measured by almost the tens of millions! (Dallas, TX) 9. Trinity Higher Education Authority Inc (Waco, TX) 10. Panhandle-Plains Higher Education Authority Inc Source: NCCS 501(c)(3) Public Charities Core File 2008 (Canyon, TX)
  • 11. Conclusion • In the end, it is important that tax-payers, governments, and businesses begin to understand just how large a role non-profits play in federal and state revenues. • Realize that non-profits contribute heavily not only in moral currency, but monetary currency as well. • By understanding how large a role non-profits play economically, perhaps people will begin to understand why investing in them is important and see to it that each and every one sustains.