Skip to main content

To Profit- Or not to Profit? What the Heck- Why not Both!?!

It has come to my attention, through that grapevine known as "the internet", that under discussion in the Maine state legislature is the creation  of a legal business entity that is a hybrid between the non-profit and "low profit" organizations. I have not yet been able to locate any specifics about the bill as it would stand in Maine. In North Carolina, it includes small manufacturers, but the usual definition of an LC3 is just a manipulation of the non-profit category so that investors can make a profit.

Here is a defintion from The Non-Profit Law Blog

"The low-profit, limited liability company, or L3C, is a hybrid of a nonprofit and for-profit organization. More specifically, it is a new type of limited liability company (LLC) designed to attract private investments and philanthropic capital in ventures designed to provide a social benefit. Unlike a standard LLC, the L3C has an explicit primary charitable mission and only a secondary profit concern. But unlike a charity, the L3C is free to distribute the profits, after taxes, to owners or investors. "

I do not know if  the investor retains a tax benefit for "donating" money to a non-profit organization, and if so, if that would be before or after paying taxes on his profit. The language used in defining the hybrid is "low profit" organizations- with "low profit" as yet undefined. I will be interested to see if "low profit" is defined in the legislation, should it come to pass.

Burton A Weisbrod is an economist who has written in length about the non-profit sector and it's relationship to the government sector and the private economy sector. The problems of the nonprofits already hybrid capitalization will not go away if the legislature creates a new legal hybrid.

This is the blurb from "To Profit or Not to Profit " Edited by  Burton A Weisbrod
Nonprofit organizations are changing dramatically in the ways they are financed. They are becoming increasingly commercial, operating more like private firms. Far more is involved than the generation of revenue. As donations decline in importance and user fees and money-raising ancillary activities come to dominate, they bring side-effects on the social missions that justify public support. This book examines these little-recognized relationships for the overall nonprofit charitable sector and then focuses on each of six industries; important differences are found among hospitals, universities, social service providers, zoos, museums, and public broadcasting."


"

Labels

Labels:

Comments

Post a Comment

Popular posts from this blog

Mayor LePage on Baldacci Reducing Funding To Municipalities

Tweet This  http://goo.gl/Et0wWS As Governor, LePage seems on track to implement the Steve Woods plan of nudging the inhabitants of rural towns to move into urban centers. Steve Woods was then the would be CEO of the corporate state. In the video Mr Woods explains that the inhabitants of 108 Maine Towns are not serving the corporation as they should be. Mr Woods says the 108 municipalities of Maine are costing the  corporation five times as much as the corporations recieves from these instrumentalities in sales tax revenue. Mr Woods speaks as a man managing a corporation not as a would be Governor of a state. He speaks in calm Obamaesque tones signaling that we can surely trust this erudite man so pro-active for the cause of state corporatism . The corporate state replaced Maine's constitution back in 1976 when Governor Longely called in the heads of Maine industry to restructure Maine as corporatio n, kicking the old fashioned Maine constitution out of ...
Post a Comment
Read more

FaceBook Blocking- in-Q-Tel and the Private Hegemony Of Power

TWEET THIS:  http://goo.gl/9y2MiH  Recently a message appeared  on my screen , being identified as from Facebook. It brought up the Facebook login screen and warned against sending friend requests to people that one does not know in one's circle of friends , family, work, and classmates I first received the message several months ago. The first message included a list of twenty names of people who did not respond to my friend request over all the years that I have been on Facebook. It asked that I delete all the requests and suggested that I stop sending friend requests for a week. The next was a list of 7 names - some of them very recent requests, which I did not think were given adequate response time. The third message to appear  told  that I am blocked for a week from adding friends and displayed a list of five names- all very recent requests- all in response to those with whom I interacted on Facebook- and one within the last hour of receiving t...
5 comments
Read more

Why are social impact investors trying so hard to defeat smaller shelters for the homeless?

  "Social Impact” developers in Portland, Maine seek to squelch a referendum for smaller shelters called for by qualified practitioners with concrete experience in the field. A large sign says Vote C to support the Homeless, small handmade sign next to it says Untrue! That sign is paid for by developers who want / Photo by Jess Falero In   the 1970s under Governor Longley , Maine became a centrally managed economy that expanded Maine’s wealth gap and merged, almost seamlessly, the public and private and the non-profit and for-profit economic sectors into one mutually beneficial wealth-concentration & distribution system. Currently, mutually benefitting factions are coming together once again in hopes of building a mega-shelter for the homeless in a Portland, Maine industrial development district. In addition to beds for the homeless, the project will include, dining, and locker facilities, as well as offices and an attached health clinic. The promotion  describes the ...
Post a Comment
Read more