Tax-exempt Status Research Articles

Index to Volume 63

Index to Volume 63 Justine Carson Page references in boldface indicate major treatments of a topic. Italic t, f, or n indicates tables, figures, or notes. A AACR/AACR2 (Anglo-American Cataloging Rules), 98, 171, 172, 491 AAUP (American Association of University Professionals), 76, 80, 86, 103n ABBPR (Association of Public Librarians and Libraries in Romania), 838 ABIR (Association of Librarians in Education in Romania), 838 ABLE (American-Bulgarian Library Exchange), 758–759 Abram, David, 480 Academia Operosorum Labacensium, 728 Academic libraries. See also Libraries Albania, 657–658 Belarus, 787–788, 789 Croatia, 680 Czech Republic, 162 East Germany pre-unification, 200–201 Germany, 205t Germany, during unification, 203–204 Hungary, 222 Lithuania, 261–263 Moldova, 803–805 Montenegro, 769 Romania, 818–822, 820f Russia, 151–152 Slovenia, 728, 732, 740–741 Academic Library of Tallinn University, 189 Academy Library of the University of Latvia (ALUL), 234–235 Academy of the Industrious Residents of Ljubljana, 728 Access restrictions, 36–37, 43. See also Censorship Central and Eastern European libraries, 117 Chicago Public Library, 34–35 Polish libraries, 304 Accidental falsehoods, 407 Acid-paper degradation, 175 ACONDA (ALA. Activities Committee on New Directions for ALA), 81, 88 Adaptive disinformation, 411–412, 414, 418 Adequatism, 560 Advanced Rapid Library System, 171 Agnostic-postmodern view of knowledge effects, 6, 11–26 AGRIS/CARIS, 263 [End Page 845] ALA. See also Freedom to Read Foundation (FTRF); Library associations; Library Bill of Rights (LBR) accused of pro-British propaganda campaign, 33–35 adoption of Library Bill of Rights, 42–56 disinformation resolution, 403 intellectual freedom and librarians, 8–9, 75–105 opposition to labeling, 19 opposition to Smoot-Hawley Act, 45–46 protecting tax-exempt status, 83 refusal to act re book burning, 47 statement against censorship, 48 ALA. Activities Committee on New Directions for ALA (ACONDA), 81, 88 ALA. Code of Ethics, 61, 101–102 ALA. Committee on Racial Discrimination, 49, 53 ALA. Intellectual Freedom Committee (IFC), 6. See also Intellectual freedom Daniel Gore case, 79–80 evolution and activities, 52–53 Grapes of Wrath (Steinbeck), 54 John Forsman case, 81–82 Richard Rosichan case, 82–83 ALA. Intellectual Freedom Manual, 42, 43 ALA. Junior Members Roundtable (JMRT), 88 ALA. Library History Round Table 2012, 3 ALA. National Plan for Libraries, 51 ALA. Newsletter on Intellectual Freedom, 63, 70 ALA. Office for Intellectual Freedom, 8, 76 ALA. Professional Ethics Committee, 99–102 ALA. Social Responsibility Roundtable (SRRT), 77, 88. See also Task Force on Gay Liberation ALA. Staff Committee on Mediation, Arbitration, and Inquiry (SCMAI), 91–92, 102 closing of, 96–97 final investigation of Michael McConnell case, 94–95 lack of authority in first amendment cases, 95–96 report on Michael McConnell case, 92–93 revised report on Michael McConnell case, 93–95 ALA. Staff Organization Round Table (SORT), 51 ALA. Standing Committee on Review, Inquiry and Mediation (SCRIM), 96–97 ALA. Statement on Labeling, 3 ALA Annual Conference, 1969 (Atlantic City, NJ), 81–82 ALA Annual Conference, 1933 (Chicago, IL), 46–47 ALA Annual Conference, 1935 (Denver, CO), 48–49 ALA Annual Conference, 1999 (New Orleans, LA), 98–99 ALA Annual Conference, 1936 (Richmond, VA), 49 ALA Annual Conference, 1939 (San Francisco, CA), 52 ALA Bulletin Brown and Harmon article, 50 Heyl article, 51–52 lack of articles on intellectual freedom, 47 Library Bill of Rights, 52, 54 social responsibility of librarians, 49 Van Doren defends popular literature, 49–50 ALA Statement on Labeling, 19 Albania COBISS network, 271 library education, 659–660 library legislation, 650 new technologies, 648–649 role of librarians, 649 Albania. Library Law, 651 Albania. Ministry of Culture, 651 Albanian librarians. See also Librarians continuing education, 659–660 professional education, 659–660 Albanian libraries, 647–662. See also Central and Eastern European libraries; Libraries academic libraries, 657–658 automation and digitization, 651–659 freedom of information, 650–651 international partnerships, 655–656 library traditions, 647–648 new trends in library and information studies, 649–651 [End Page 846] public libraries, 656–657 special libraries, 658–659 Albanica, 651 Albertina Icome Praha, 174 Albig, John William, 66, 67 ALEPH 500, 171, 172, 244 Allain, Alex P., 84 Alliance of Libraries and Information Institutes, 230 Almost Perfect...

A Delicate Balance

Edward Albee's play, A Delicate Balance, starring Glenn Close and John Lithgow, is playing at the Golden Theatre in New York. Winner of the Pulitzer Prize for Drama in 1967, the play draws the audience into reading between the lines, that is, what is left unsaid often is as important as what is said. Thus, the well-to-do suburban couple, Agnes and Tobias, manage to live relatively harmoniously despite Agnes's awareness of Tobias's affairs; her disdain for her alcoholic sister Claire, who lives with them; and the angst produced by their 36-year-old daughter Julia, now on her fourth divorce. Agnes, the main female character in the play, manages to keep her home in order, mostly by ignoring anything that might upset the peace.I could not help but think of A Delicate Balance after the extremists' attack on the satirical magazine, Charlie in Paris on January 7, 2015. It is widely recognized that the satirists' exercise of their freedom of i.e., their lampooning of Islam, provoked the wrath of the Al Qaeda-backed extremists. There was no delicate balance involved. Similarly, there was no delicate balance involved in Ian Paisley's vitriolic, hate-filled speeches in Northern Ireland against the Roman Catholic Church and the Republic of Ireland in the 1960s, 1970s, and 1980s. Those of us who lived in Ireland just listened and ignored him, recognizing Paisley as a hate-monger whose views were extremist and who provided certain subversive groups a raison d'etre in the North- and South-of Ireland.Admittedly, in this country, the First Amendment protects freedom of speech-but often within certain boundaries determined by the U.S. Supreme Court. And in Ireland, a blasphemy law now prohibits irreverent speech about religion.Where is the balance? How can balance be regulated?Two interesting columns in the New York Times in January 2015 addressed this matter of balance. One, by Frank Bruni, looked at religious bigotry, and gays. The other, by David Brooks, looked at the Charlie Hebdo tragedy.Examining political shibboleths that focus on same-sex marriage in light of the need to safeguard religious liberty, Bruni noted that marriage-equality laws not pertain to religious services or what happens in a church, temple or mosque. He added,Christian fundamentalists in this country are practiced at claiming marginalization and oppression. . . . They and their churches inject themselves into political debates while enjoying tax-exempt status. They get public support in questionable circumstances. . . . What's more, in a country that's not supposed to promote any one religion over others, we do precisely that. Would we be content to let a Muslim store owner who believes that a woman should always cover her hair refuse service to women who do not? Or a Mormon hairdresser who spurns coffee to turn away clients who saunter in with frappuccinos?In Am Not Charlie Hebdo, David Brooks pointed out that many people who lionize those offending the views of Islamist terrorists in France are a lot less tolerant toward people who offend the lionizers' own views at home.Americans may laud Charlie Hebdo for being brave enough to publish cartoons ridiculing the Prophet Muhammad, but, if Ayaan Hirsi Ali is invited to campus, there are often calls to deny her a podium, Brooks wrote, referring to the outspoken, Somali-born activist.He noted that if the Charlie Hebdo journalists had attempted to publish their satirical cartoons on any U.S. campus, they would not have had much success. Students and faculty groups would have accused them of hate speech, he wrote.Although most of us would be justified in seeing certain cartoons as inflammatory, in recognizing certain comments aimed at our particular religion as offensive, most of us who are not fundamentalists would filter out our sentiments.Although I often disagree with David Brooks' perspectives, I was impressed by his discourse on campus restrictions on free speech. …

Speaking Up: The Challenges to Section 501(c)(3)’s Political Activities Prohibition in a Post-Citizens United World

Following the Supreme Court’s decision in Citizens United v. Federal Election Commission, there is still one type of corporation that cannot engage in political speech: the nonprofit corporation. Section 501(c)(3) of the Internal Revenue Code prevents nonprofit corporations that hold tax-exempt status from participating in “any political campaign on behalf of (or in opposition to) any candidate for political office.” But recent events show a growing call to reform this provision, referred to as the political activities prohibition. These events include new First Amendment developments, charities allegedly flouting the prohibition in recent elections, the 2013 IRS targeting scandal, and finally a notice of proposed rulemaking promulgated by the IRS and the Treasury Department in 2013 that could change the political activity regulations for both section 501(c)(3) and section 501(c)(4) organizations. This Note responds to these recent events and discusses the purpose and structure of the political activities prohibition, both within section 501(c)(3) and in connection with section 501(c)(4). The Note then examines different constitutional challenges to the political activities prohibition, including First Amendment and selective prosecution challenges stemming from the IRS’ alleged haphazard enforcement of the prohibition. This Note concludes that the political activities prohibition should not be eliminated, but advocates implementing several laws and agency policies to ensure even enforcement of the prohibition.

Against Patriarchy

Against Patriarchy

Charity Care in Nonprofit Urban Hospitals: Analysis of the Role of Size and Ownership Type in Washington State for 2011

Nonprofit hospitals are expected to serve their communities as charitable organizations in exchange for the tax exemption benefits they receive. With the passage into law of the Affordable Care Act, additional guidelines were generated in 2010 to ensure nonprofit hospitals are compliant. Nonetheless, the debate continues on whether nonprofit hospitals provide adequate charity care to their patient population. In this study, charity care provided by 29 Washington State nonprofit urban hospitals was examined for 2011 using financial data from the Washington State Department of Health. Charity care levels were compared to both income tax savings and gross revenues to generate two financial ratios that were analyzed according to hospital bed size and nonprofit ownership type. For the first ratio, 97% of the hospitals (28 of 29) were providing charity care in greater amounts than the tax savings they accrued. The average ratio value using total charity care and total income tax savings of all the hospitals in the study was 6.10, and the median value was 3.46. The nonparametric Kruskal-Wallis test results by bed size and nonprofit ownership type indicate that ownership type has a significant effect on charity care to gross revenue ratios (p = .020). Our analysis indicates that church-owned hospitals had higher ratios of charity care to gross revenues than did the other two ownership types--government and voluntary--in this sample. Policy implications are offered and further studies are recommended to analyze appropriate levels of charity care in nonprofit hospitals given new requirements for maintaining a hospital's tax-exempt status.

Up in the air over taxing frequent flyer benefits: the American, Canadian and Australian experiences

... Since frequent flyer programmes first appeared in the early 1980s, the agencies charged with the administration of their nations’ income tax laws have struggled with the question of whether—and if so how—to tax employees who earn frequent flyer points (or ‘miles’) on employer-paid business trips, and who eventually redeem those points for personal travel rewards (or other personal consumption services or goods). This article describes and evaluates the ways in which three agencies—the Internal Revenue Service (IRS) in the USA, the Canada Revenue Agency (CRA) and the Australian Taxation Office (ATO)—have responded to the tax administration challenge presented by frequent flyer programmes. The rather disheartening end of the story (in all three countries) is that no significant amount of tax is being collected on frequent flyer benefits, even though the benefits are clearly taxable in theory (at least in the USA and Canada; the legal analysis in Australia is more complicated). Back-of-the-envelope calculations suggest that the forgone tax revenue is significant. One industry expert has estimated that US travellers alone earn as many as three trillion frequent flyer points each year.1 If the points are valued at one cent per mile,2 three trillion points are worth $30 billion. Even in theory, not all points are taxable. Points generated by personal consumption expenditures—most significantly, by personal travel and by charging personal expenses (of any sort) on a credit card awarding points based on dollars charged to the card—are not includible in gross income.3 If roughly half of all points are earned by air travel,4 and if about 40 per cent of air travel is for business,5 then the taxable points generated by air travel of US travellers should be roughly 600 billion annually, with a value of about $6 billion. Assuming that value would be taxed, on average, at the rate of 25 per cent, the annual federal income tax revenue lost by the failure of the IRS to enforce the taxation of frequent flyer benefits is in the neighbourhood of $1.5 billion. The revenue significance of the de facto tax-exempt status of frequent flyer benefits is similar to that of a number of well-known legislatively authorized tax expenditures, including the deferral of gain on like-kind exchanges, the exclusion of damages received on account of personal physical injuries or sickness and the exclusion of meals and lodging furnished on an employer’s business premises for the convenience of the employer.6

Anonymous Speech and Section 527 of the Internal Revenue Code

In an attempt to avoid the traditional constitutional problems associated with campaign finance disclosure laws, campaign finance reform advocates took an alternative approach. Reformers amended the Internal Revenue Code and used the tax status of political organizations as a mechanism for encouraging campaign disclosure of campaign related spending. The reformers conditioned a political organization's tax-exempt status on the willingness of the organization to disclose its contributors and expenditures. This article deals with the constitutionality and wisdom of the recently enacted legislation and suggests possible alternatives.

An empirical study on the determinants of information disclosure of Malaysian non-profit organizations

Purpose– The purpose of this paper is to examine the determinants of the extent of disclosure by non-profit organizations (NPOs) in Malaysia due to the growing interest in the disclosure practice studies of NPOs and given the importance of disclosure to ensure accountability and transparency.Design/methodology/approach– This study involves three phases. First, the paper identifies information items NPOs need to disclose. Second, the paper conducts an online survey to determine the ratings of importance for the disclosure items. Third, the paper measures the extent of disclosure from the annual returns of 101 Malaysian NPOs for the year 2009. The paper uses hierarchical regression analysis to determine the significant determinants of information disclosure.Findings– The key determinants are establishment of an external audit, financial performance and government support in terms of grants. The results show that the presence of external auditors promotes better reporting practice. Malaysian NPOs that receive funding and those with better financial standing disclose more information.Research limitations/implications– The sample only covers NPOs with tax-exempt status in the state of Selangor and Wilayah Persekutuan in Malaysia. The sample size of 101 registered NPOs limits the generalization of the results. Inclusion and analyses of additional NPOs may offer generalizable results.Practical implications– This study provides empirical evidence concerning the establishment of external audit for better information disclosure. It also provides 88 items that are important and required by stakeholders.Originality/value– The study is based on 88 items of information according to the needs of stakeholders for information. The NPOs reporting index can assist the preparers of charity reporting in fulfilling the stakeholders’ requirements. The reporting index can also be used to assess the information disclosure of NPOs in Malaysia.

Community benefits provided by religious, other nonprofit, and for-profit hospitals

Nonprofit hospitals (NFPs) are expected to provide community benefits to justify the tax benefits they receive, but recent budgetary constraints have called into question the degree to which the tax benefits are justified. The empirical literature comparing community benefits provided by NFPs and their for-profit counterparts is mixed. However, NFPs are not a homogenous group and can include religious hospitals, community-owned hospitals, or academic medical centers. This longitudinal study examines how religious hospitals compare with other NFPs and for-profit hospitals with respect to providing community benefits and how the provision of community benefits by hospitals has changed over time. Using a pooled cross-sectional design, we examine two summated scores based on questions from the American Hospital Association annual survey that focus on community orientation among hospitals. We analyze two regressions with year, facility, and market controls to determine how religious hospitals compare with the other groups over time. Overall, 11% of U.S. hospitals are religious. Religious hospitals were more likely to engage in each individual community benefit activity examined. In addition, the mean values of community benefits provided by religious hospitals, as measured on two summated scores, were significantly higher than those provided by other hospital types in bivariate and regression analyses. Overall, community benefits provided by all hospitals increased over time and then leveled off during the start of the recent economic downturn. As the debate continues regarding federal tax exemption status, policymakers should consider religious hospitals separately from NFPs. Managers at religious hospitals should consider how their increased levels of community benefits are related to their missions and set benchmarks that recognize and communicate those achievements.

Charitable Nonprofits in the West and Their Implications for Public Policy

DOI 10.1515/cjpp-2014-0004 Calif. J. Politics Policy 2014; 6(1): 187–206 Nancy Winemiller Basinger* Charitable Nonprofits in the West and Their Implications for Public Policy Abstract: In the West, several distinctive features of the region’s development and culture affect the size, scope, and evolution of the nonprofit sector. In this article, I provide information about our understanding of the existence, the current size and scope of charitable nonprofits in the West, and their importance in the public policy arena. I begin by discussing the theoretical foundations of the sector and its role in the policy process. I then describe the regional dimen- sions of the nonprofit sector in the Mountain West and Pacific West including the density of the sector, the types of organizations in the sector, and revenue distributions. Finally, I discuss the implications of the nonprofits in the West for public policies. Keywords: advocacy; nonprofit; public charities. *Corresponding author: Nancy Winemiller Basinger, Bennion Center, University of Utah, 260 S. Central Campus Dr. Union 101, Salt Lake City, UT 84112, USA, Tel.: +801-585-9100, e-mail: nancy.basinger@utah.edu Rarely would one include an environmental scan of the charitable nonprofit organizations in the region when considering the important elements of public policy. 1 It is time to reconsider this stance. In all regions of the country, charities are increasingly involved in public policy as advocates and providers. The growth in the sector over the past two decades is unprecedented (Roeger et al. 2012) and the level of professionalization in charities is also at its highest historical level (Hwang and Powell 2009). Charitable nonprofits serve democracy by advocating on behalf of under-rep- resented portions of the population (Berry 2003). Increased education and pro- fessional development in the sector have made charity leaders more aware of the many ways the organization may access the policy process. Approximately 20% 1 For the purposes of this analysis, only those nonprofit corporations that have been granted public charity tax exempt status will be considered and the terms “nonprofit” and “charity” will be used interchangeably.

Municipal Bond Liquidity and Default Risk

This paper examines the pricing of bonds issued by states and local governments. I use three distinct, complementary approaches to decompose municipal bond spreads into default and liquidity components, finding that default risk accounts for 74% to 84% of the average municipal bond spread after adjusting for tax-exempt status. The first approach estimates the liquidity component using transaction data, the second measures the default component with credit default swap data, and the third is a quasi-natural experiment that estimates changes in default risk around pre-refunding events. The price of default risk is high given the rare incidence of municipal default and implies a high risk premium.

The Church of Scientology: Legitimacy through Perception Management

AbstractIn 1967 the Church of Scientology's tax-exempt status was revoked on the basis that it failed to meet the criteria outlined in section 501(c)(3) of the Internal Revenue Service. Between its loss, and eventual reacquisition in 1993, the Church of Scientology employed a number of political based tactics in an attempt to legitimize itself to the public sector. This article explores these tactics in relation to the religion's use of perception management. The article argues that the processes of both legal recognition and legitimization draw upon each other in a new faith's transition to mainstream theology. In this, the Church employed perception management in attempt to influence both processes. In exploring this, the paper contributes to our understanding of role that public legitimacy plays in a new faith's development.

Assessing Community-Based Injury Prevention Services in U.S. Children's Hospitals.

ObjectiveNot-for-profit hospitals are required to meet federal reporting requirements detailing their community benefit activities, which support their tax-exempt status. Children's hospitals have long provided community injury prevention (IP) programming and thus can inform public health outreach work in other areas. This work describes IP programming as a community service offered by children's hospitals in the U.S.MethodsThe IP specialist at 232 US-based member institutions of the Children's Hospital Association were invited to complete an assessment of their hospital's IP outreach programming.Results47.7 percent of hospitals request financial data from IP programming for tax reporting purposes. Almost all offer injury prevention (IP) services; the majority are in the community (60.3%) and 34.5% are hospital-based. Most IP units are independent (60.3%) and 71.8% are responsible for their own budgets.ConclusionsBy integrating dissemination and implementation sciences and community health needs assessments, these findings can help advance community services provided by hospitals to impact public health.

Modeling the future of US arts policy: Beyond supply-side pump-priming

This commentary begins with an examination of how culture, including the arts, sports and religion typically operates from an anthropological perspective. The acquisition of cultural knowledge from socially transmitted sources leads to individual cultural expression (amateur practice), which in turn generates demand for the consumption of professionally produced cultural goods and services. Using this generic model of culture, the article then traces the evolution of the arts and arts policy in the USA beginning with baseline policies protecting free speech and intellectual property, and providing tax-exempt status to non-profit forms of artistic production. Tax exemption is shown to be a significant element in the early twentieth century when emerging elites and immigrant artists split away from the mainstream of the commercial arts sector to found a separate high arts sector. In the postwar period, the high arts sector is judged to be lagging in quality and in financial decline, factors that are cited to justify major new policies characterized as “supply-side pump-priming”. Beginning in the mid-1960s, these policies become widespread among federal, state and municipal governmental agencies and many non-governmental funders, and though the high arts grow in quality, output, and geographic distribution, they never achieve a breakthrough in attracting substantial non-elite audiences, which continue to patronize the vastly larger commercial arts. In light of recent trends of declining audiences and reduced contributed and earned income, the future of supply-side policies becomes questionable. A case is made that demand-side policies may offer a more democratic way forward for both arts and sports policies. In addition, reference is made to a new online arts policy simulation, entitled “Medici's Lever”, which provides a laboratory for testing alternative demand-side and supply-side policies.

Reforming the Taxation of Exempt Organizations and Their Patrons

The paper contemplates a radical reformation of our entire system for taxing exempt organizations and their patrons. First, all non-charitable exempt organizations that compete with taxable commercial businesses (such as fraternal benefit societies that provide insurance (section 501(c)(8)) and credit unions (501(c)(4))) would become taxable. Also, business leagues, chambers of commerce, and the Professional Golf Association and National Football League would be taxable but could operate as partnerships. Thus, section 501(c)(6) would be repealed.Most other tax-exempt organizations would be reassigned into one of five categories, corresponding roughly to current section 501(c)(1) (U.S. governmental organizations), section 501(c)(3) (charitable), section 501(c)(4) (social welfare), section 501(c)(7) (social clubs, but stated more generally as mutual benefit organizations), and retirement plans.The paper leaves section 501(c)(1) entirely intact, and largely leaves section 501(c)(3) alone, except that it proposes that certain very large public charities with “excessive endowments” be taxable on their investment income to the extent the income is not used directly for charitable purposes.This paper also generally leaves section 501(c)(4) alone, except that any 501(c)(4) (or other tax-exempt organization) that engages in a significant amount of lobbying or campaigning would be taxable on all of its investment income.The fourth catchall category – corresponding roughly to the tax treatment of social clubs ‒ would cover virtually all other tax-exempt organizations (other than retirement plans). Very generally, these organizations would not be subject to tax on donations or per capita membership dues, but would be taxable on investment income, fees charged to non-members, and fees charged to members disproportionately.The paper proposes two significant changes to the treatment of donors. First, section 84 would be expanded to treat any donation of appreciated property to a tax-exempt organization as a sale of that property. Second, any donation to a tax-exempt organization that engages in significant lobbying or campaigning and does not disclose the name of the donor would be treated as a taxable gift by the donor (subject to the annual exclusion and lifetime exemption).Finally, the paper proposes two measures of relief for tax-exempt organizations. First, the unrelated debt-financed income rules would be repealed. Second, limited amounts of political statements by the management of 501(c)(3) organizations (like election-time sermons) would not jeopardize the tax-exempt status of the organization.

Do Workers Profit from the Nonprofit Tax Exemption? The Impact of State Tax Exemption on the Nonprofit Wage Differential of Hospital Workers

Previous studies on the impact of nonprofit status on employee compensation view nonprofit status as yielding a fixed benefit attributable to the legal prohibition against distributing profits. However, nonprofit status also exempts firms from many federal, state, and local taxes resulting in the size of economic rents varying by the jurisdiction. This study examines how differences in the implied subsidy of state and local tax exemption impact the nonprofit wage differential in the hospital industry. The study also takes advantage of the fact that a significant proportion of nonprofit hospitals are religiously affiliated to control for worker self-selection into the nonprofit sector. Results indicate that nonprofit hospital workers receive a wage premium; however, the wage premium decreases as state tax burden increases. This finding suggests that the nonprofit wage differential is not accentuated by a hospital’s tax-exempt status but is instead a byproduct of the nondistribution constraint.

Traversing the Regulatory Maze of Charity Care: The Institutional Method and IRC §501(r)

ABSTRACT The search for a concise definition of charity care continues to elude both practitioners and healthcare administrators. U.S. legislators recently took action by creating the new Internal Revenue Code (IRC) §501(r), mandating hospitals document and justify their tax-exempt status. The new provisions still do not provide a succinct definition of charity care, but may provide an opportunity to establish a quantifiable baseline of the normal level of charity care for hospitals. This paper looks to the history of charity care in the U.S., recent regulatory challenges, the theory of legal realism, and the institutional method to develop an approach to provide clear guidance on acceptable levels of charity care.

The Affordable Care Act and Community Benefit: A Mandate Catholic Health Care Can (Partly) Embrace

The 2010 Patient Protection and Affordable Care Act (ACA) requires not-for-profit hospitals, including Catholic hospitals, to engage in meaningful community assessment and collaboration efforts in order to maintain their tax-exempt status. Now that the ACA has been upheld by the U.S. Supreme Court, this paper argues that the requirements related to a more robust community engagement process should be embraced by Catholic not-for-profit hospitals and health systems. Apart from the legal requirements under ACA, an equally persuasive moral mandate to engage in community-level assessment and action exists in the ethical tradition of Catholic health care, particularly in the notions of the common good, preferential option for the poor, and subsidiarity. This paper examines the compelling nature of these moral norms in light of the dual goals of improving overall community health and reducing health disparities among vulnerable populations. It concludes with the examination of one model of community collaboration: Mobilizing for Action through Planning and Partnerships (MAPP).

Nonprofit Electioneering Post Citizens United: Has the System Become More 'Complex'?

Nonprofits face a complex web of congressional statutes and administrative rules designed to regulate their advocacy activities. As a result, most politically active nonprofits have formed “complex organization structures” of multiple tax-exempt statuses, which are intended to bolster an organization’s overall advocacy by allowing the group to delegate specific activities to different entities. Citizens United v. FEC (2010) and the subsequent rise of “super PACs” has further incentivized groups to develop these complex structures. This study describes the system of regulations governing nonprofits involved in elections and examines the electioneering activities of 50 of the most politically active nonprofits involved in the last four elections: 2006 through 2012. The findings show that groups – especially 501(c)(4) social welfare organizations – are relying less on their traditional PACs to make direct contributions to candidates and are, following Citizens, increasingly making independent expenditures directly from their 501(c) tax-exempt status and from loosely affiliated super PACs.

Charitable Nonprofits’ Use of Noncompetition Agreements: Having the Best of Both Worlds

For years, individuals have been challenging the noncompetition agreements they entered into with their employers on the basis that the agreements violate public policy. However, in a competitive marketplace, courts and legislatures in many jurisdictions are reluctant to invalidate otherwise reasonable noncompetition agreements. Perhaps they are right, at least when it comes to the general class of nonprofits and to nonprofits that are protecting their interests against for-profit entities. As for charitable — or § 501(c)(3) — nonprofits that are attempting to protect their interests against other charitable nonprofits, however, the decision-making bodies should reconsider their position. Unlike traditional for-profit entities, whose main goal is profit maximization, charitable nonprofits are organized and operated to benefit some greater good. As a result, charitable nonprofits receive donations from individuals and corporations, as well as tax breaks from the government, which are unavailable to for-profit entities. At the same time, charitable nonprofits use many of the same tools that for-profit firms utilize to maximize profits, including noncompetition agreements. Thus, charitable nonprofits are able to benefit from an anti-competition, profit-maximizing tool while also reaping the rewards of their tax-exempt status. In short, charitable nonprofits (wrongly) enjoy the best of both the for-profit and nonprofit worlds. This article discusses the unique nature of the charitable nonprofit’s mission and the tax benefits conferred on charitable nonprofits by the federal and state governments. It then discusses noncompetition agreements and demonstrates that charitable nonprofits’ use of noncompetition agreements is contrary to their mission and tax-exempt status, as well as to the public interest. Finally, the article proposes an amendment to the federal tax code that would render unenforceable any language in a noncompetition agreement that prevents an individual from leaving the employment of one charitable nonprofit for employment at another.