I read with interest the June 16 article on Scott Schnapp’s retirement from the Maine Association of Nonprofits (“Champion of Maine’s nonprofits moving on”).
The influence of nonprofits in Maine is impressive: employing 1 in 7 workers, contributing about $10 billion per year to the economy and accounting for nearly 19 percent of the gross domestic product (although I’d be interested to know how that’s calculated).
about the author
Philip A. Brooks is a resident of Southport.
I believe the heart of most nonprofits is their endowment fund, which they always seek to grow through wise investment and new contributions to generate the income needed to support their mission – including paying the $3.6 billion a year in wages referred to in the article.
I’d like to know the total value of the assets held in nonprofit endowments, both in Maine and nationally. That’s not a number or an estimate that I’ve ever seen published.
Of course, some of those assets are in non-income producing real estate – such as the college or hospital campus or buildings. But I’m sure, as in the case of Bowdoin, for example, these assets aren’t included in the listing of the college’s endowment as exceeding $1 billion.
Is the principal of these endowments, in Maine or nationally, growing faster than the GDP – and if so, how long can this continue? The income generated by the stocks, bonds and income-producing real estate, as well as the nonprofit endowments’ trading gains, escapes the taxes that would be collected if the assets were held by individuals.
Could government continue to provide services in their present form if it got to the point where government’s only source of revenue was taxes on individual wages, excise taxes and sales taxes on goods or services sold to individuals and non-tax-exempt entities and perhaps import duties and the like – and there were no taxes on investment income?
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