Last week, Congresswoman Betty McCollum (D-MN) introduced legislation to change the rules of the U.S. House in order to expand the jurisdiction of the Committee on Small Business to include nonprofit organizations. H. Res. 768 calls for the establishment of a Committee on Small Business and Nonprofit Organizations. McCollum is urging House members to support this expansion of committee jurisdiction when the 113th Congress commences in January 2013.
Nonprofit organizations are vital community employers providing services that are critical to our nation's economy. Many Americans would be surprised to learn there is no committee in the U.S. House responsible for supporting the success of the nonprofit sector. That means Congress is ignoring the nonprofit sector's vital contribution to the U.S. economy:
Employing nearly 10% of all American workers.
Generating 5.5% of U.S. Gross Domestic Product.
Supporting local jobs by purchasing billions of dollars in goods and services in their communities every year.
Delivering billions of dollars in services on behalf of local, state, and federal governments.
With 35,000 nonprofit organizations located in Minnesota alone, McCollum said, "Main streets across our country are filled with small businesses and nonprofit organizations. Both are vital employers working to keep families and community's strong and successful. Congress needs to be strengthening all small employers that help to keep our communities vibrant and growing."
As employers, nonprofit organizations have much in common with small businesses. Nonprofits and small businesses face similar management challenges in the areas of human resources, information technology, and customer service. Both exist to meet the needs of local communities. Government at the federal, state and local levels contract with nonprofits and small business for services and program delivery.
Nonprofits also face issues unique to their sector that require attention from Congress. For example, successful nonprofit organizations that want to hire and grow have many fewer public and private sector financing options than for-profit businesses. This prevents nonprofits with innovative and proven programs from expanding.
Another important issue is the absence of basic economic information about the nonprofit sector. Currently, the federal government does not collect basic employment data on nonprofit organizations, making it difficult for Congress to understand the significant impact of nonprofits in the U.S. economy and to identify economic trends in the sector.
"Nonprofit organizations need and deserve a seat at the table in Congress so their voices can be heard on issues that affect their mission, the communities they serve, and the millions of Americans they employ. In my opinion, the absence of jurisdiction for nonprofit issues in the U.S. House is unacceptable and irresponsible," said McCollum.
At present, the House Ways and Means Committee conducts oversight over nonprofit organizations' 501(c) tax exempt designation, but no House committee has jurisdiction over all other issues critical to the nonprofit sector. The result is predictable. An entire sector of the U.S. economy is ignored by Congress and, too often, disadvantaged by the legislation it passes.