Survey says nonprofits are ‘important economic force’

By MIKE LEWIS
mlewis@crossroadsbizjournal.com

FREDERICK, Md. — Nonprofit organizations have a “significantly higher” economic impact than people might realize, said Michael Planz, CEO of Community Living Inc. in Frederick, Md.

That’s more than his hunch. It’s the result of a study that measured the economic impact of nonprofit organizations in the county.

“We pay a little over $83 million in wages and salaries to the employees of our organizations,” said Planz, who chairs the Frederick Nonprofit Alliance, a committee of the Frederick County Chamber of Commerce. “That’s a lot of money that’s going back into the Frederick community.”

A Leadership Frederick County Leaders-on-Loan Alumni group, in conjunction with Mount St. Mary’s University, conducted the study. In all, more than 70 groups answered the survey.

“The economic impact is significantly higher than most people would think,” Planz said.

The survey found that nonprofits:

• Paid at least $83 million in annual wages/salaries.

• Paid at least $64 million annually for rent, utilities and supplies.

• Estimated the value of their services at more than $92 million annually.

• Generated a philanthropic impact of least $58 million yearly that augments fees for service, insurance payments and government grants.

“All the numbers we came up with were somewhat conservative,” Planz added.

“Our nonprofits are an important economic force,” the study states. “They have direct and measurable impacts, as well as indirect yet still vitally important impacts on our economy and way of life.”

Planz said many people understand and value the work done by nonprofits. But those organizations still face a stigma among some people.

“Too often, nonprofit organizations are viewed in what can be called a negative light,” he said, because they are often in the position of seeking donations or asking for other financial support.

The survey, he said, was an effort to measure the organizations’ positive financial impact. The response also has been positive.

“People would like to take a slightly deeper dive into this,” he said.

For example, he said, some have suggested partnering with area educational institutions for longitudinal studies or other explorations of the data.

In a news release, the Frederick County Chamber of Commerce reported that more than 70 people gathered to hear the findings during a recent event.

“The Frederick County Nonprofit Economic Impact Study shows that 501c3s are economic generators in our community with direct and measurable impacts that also provide vitally important services to our residents and way of life,” Betsy Day, president and CEO of the Community Foundation of Frederick County, said in the release.