Posted Mondays, Jeremy Rosenberg's (@LosJeremy) Laws That Shaped L.A. spotlights regulations that have played a significant role in the development of contemporary Los Angeles. These laws -- as nominated and explained each week by a locally-based expert -- may be civil or criminal, and they may have been put into practice by city, county, state, federal or even international authority
This Week's Law That Shaped L.A.
Law: Internal Revenue Code -- Section 501(c)(3)
Nominated by: Paul Vandeventer
There are more than a million non-profit organizations in these United States of America.
At last count, in 2010, more than 19,000 of these non-profits were located here in Los Angeles.
That constellation of entities operating for the public good ranges from hospitals and universities to museums and media institutions -- such as KCET -- to think tanks, health clinics, environmental organizations, professional guilds, providers of assistance to recent immigrants, history societies and so many more.
"These organizations are peppered throughout communities; they are typically there to fill gaps in services, to preserve culture and to help people acquaint themselves with the community in a connective way," Paul Vandeventer says. "The ecosystem of those organizations in Los Angeles is rich and diverse."
Vandeventer would know. He's the President and CEO of the much-celebrated non-profit incubator, fiscal sponsor, and back office provider, Community Partners.
His group has been a fixture of the Southland non-profit scene since its 1992 founding; its centrality was amplified seven years ago when Community Partners moved as an original tenant into the California Endowment's building near Downtown L.A. Today, Community Partners works to assist an astounding 135 budding or in-bloom non-profits -- or "projects" -- to borrow Community Partners' nomenclature.
A partial list of these projects is here. The list includes The City Project (see Robert Garcia's Land of Sunshine Green Justice column here), Climate Resolve (see Jonathan Parfrey's Laws That Shaped LA interview here), Move LA (see Denny Zane's Laws That Shaped LA interview here), WriteGirl (see Keren Taylor's Arrival Story here) and PressFriends (I've volunteered for this group). The list also includes the Deaf and Hard of Hearing Educational Athletic Foundation, Rock n' Roll Camp for Girls Los Angeles, Southern California College Access Network, and We Can, Pediatric Brain Tumor Network.
It's extremely easy to be enamored with non-profits when you listen to Vandeventer describe the good works of groups, such as the children's hospital that helped his own then-two-month-old, ill son; or the county-wide network of subsidized childcare facilities that Vandeventer calls, "responsible for making sure that kids have meals, safe surroundings and educational opportunities."
What might to some readers be a bit more unexpected, though, is to hear Vandeventer place non-profits squarely in the camp of American rugged individualism. This includes the notion that Americans possess a certain healthy distrust for government as well as an emphasis on personal and neighborly responsibility and action.
"The tax code in America is fundamentally different than the tax code in other nations." Vandeventer says, as he nominates a particular portion of that code as a Law That Shaped L.A.
"Section 501(c)(3)," Vandeventer says, "grows out of an American cultural tradition that says too much government in our community life destroys or compromises the bonds of community."
Four years ago, when I wrote the Think Tank L.A. blog for this website, I asked one of the country's leading scholars of think tanks why the U.S. possessed so many more of those policy research groups than the rest of the world.
Jim McGann, the scholar, told me the following, foreshadowing Vandeventer's 501(c)(3) remarks:
"There are 1,777 [U.S.] think tanks," McGann said at the time. "The question is, what it is about the American political culture makes that possible?:
McGann offered up a series of explanation: "One is the fact that it's not just a Republican mantra, [but] deeply part of the American culture that, 'The government that governs best, governs least.'"
"Another part," McGann said, "goes back to [Alexis] de Toqueville's observations how we're a pluralistic society, and some would say a hyper-pluralistic society, in which there are factions."
Vandeventer has spent a good amount of time over the years visiting Germany. When asked about the differences between a European social democracy and American democracy, Vandeventer says that the U.S. possesses more of an activist culture that is expert at mediating between citizen and government.
"We are much more accustomed to the kind of warring between government and community than other countries," Vandeventer says. "And the organizer -- the loyal opposition, if you will -- in communities is frequently a non-profit organization."
In Los Angeles, it is difficult to imagine daily life without non-profits. As a decidedly unscientific experiment, I grabbed a print copy of last Wednesday's Los Angeles Times.
Leafing through the fifty-eight pages, I counted more than 100 references to organizations that at least at first glance I believe to be non-profits. The majority were colleges and universities.
Meanwhile, Vandeventer points out that in Los Angeles, six percent of the overall workforce is engaged with non-profits. (Fourteen percent, he says, work in government and eighty percent in private enterprise.)
"So we're the smallest economically," Vandeventer says of the 501(c)(3) crowd. "But those numbers belie the trust that's placed in non-profit organizations by citizens to organize and represent interest in those larger spheres."
Vandeventer mentions, as just one recent example, the efforts of non-profits working to forward the interests of groups who reside in Pico Union, near the proposed Downtown L.A. football stadium. Vandeventer also mentions the ongoing work of Community Partner project, the Empowerment Congress, a twenty-year-old organizing and citizen engagement effort that started back when he was a Los Angeles City Councilmember, by now-L.A. County 2nd District Supervisor Mark Ridley-Thomas. Community Partners provides the Empowerment Congress with technical and other support through its long-time project, the California Community Empowerment Foundation.
All the above said, it's clear that Los Angeles -- and the rest of the nation -- has too many non-profits. I say this having once encouraged fellow board members of one non-profit to merge the organization with another; and in another case, having attempted (and failed) to broker another such merger, this one involving east coast and west coast non-profits.
There is, Vandeventer says, both an upside and a downside to having so many non-profits. He praises the nimbleness and flexibility of organizations to respond in ways a large federal or state bureaucracy often can't -- or perhaps shouldn't. He also stresses the importance of having citizens animated by a community problem having an outlet to set about resolving that problem.
But that doesn't mean that every single one of the 1,500 non-profits launched in L.A. County in 2010 will be useful and productive.
"The diffusion of so many disparate efforts with so many different histories, so many different causes for being there in the first place, and so many different preferences and relationships and ways that they do their work," Vandeventer says, "often means that non-profits are either disconnected from one another, or they are in direct competition with one another for governmental resources, for private philanthropic resources, and for individual donors and business contributions."
"That diffusion," Vandeventer says, "can create a diminishment of what you might get in the way of efficiency where they all operating in lockstep and on the same page."
As happens every so often during national conversations about budgets and deficits and taxes, talk in certain quarters turned recently to the idea of eliminating the tax deductions given to people who donate money to non-profits. So, what would happen if such an extraordinary change ever did occur?
Vandeventer hypothesizes that in the short run there would be "a freeze or chilling" of discretionary gifts made to non-profits. And in the long run? "Inordinate demands" would be placed on government, he says, forcing elected officials to respond. As in: forcing them to raise taxes and run these same sort of programs from the federal and state level.
Or, as Vandeventer says: "Non-profits serve as replacement institutions for public services or alternate channels for public service. The demand for good health care access or child care is not going to go away."
Top photo: St. Joseph Hospital's Children Clinic, in Burbank, 1964. Photo from the Hollywood Citizen News / Valley Times Collection. Courtesy the Los Angeles Public Library
Have a suggestion for a Law That Shaped LA or someone to interview? Contact Jeremy Rosenberg via: arrivalstory AT gmail DOT com.
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