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University of Pittsburgh

October 25, 2012

Nonprofits finalizing public service fund pledges

Pledges from the local nonprofit community in support of a $2.6 million 2012 contribution to the city of Pittsburgh are nearly complete, said nonprofit consortium co-chair G. Reynolds Clark, Pitt vice chancellor for community initiatives.

Under an agreement accepted by city officials earlier this year, the Pittsburgh Public Service Fund would provide a total of $5.2 million — $2.6 million per year in 2012 and 2013 — in lieu of taxes. (See Aug. 30 University Times.)

The figure is similar to contributions the nonprofits made in 2010 and 2011.

In 2005, the consortium agreed to contribute a total of $13.25 million over three years in lieu of taxes to aid the city. No contribution was made in 2008-09 because the consortium and the city could not agree on an amount.

The public service fund contributed nearly $2.63 million in 2010 and $2.68 million in 2011.

Clark said the fund, housed in the Pittsburgh Foundation, would make its first half-year payment to the city as soon as it receives documents from state fiscal overseers indicating that the city is operating in fiscal compliance. City financial plans and budgets have been under state oversight since 2004, when Pittsburgh was declared financially distressed.

Clark said that because some nonprofits make a single donation at the end of the year, the half-year amount that would be released likely would be less than half of the $2.6 million total.

In addition, some organizations have not submitted multi-year pledges, Clark said, adding that additional pledges for 2013 are expected after Jan. 1.

The Intergovernmental Cooperation Authority (ICA), a state-created board charged with helping solve Pittsburgh’s financial woes, recently has sought the formation of a task force that would work to increase financial support for the city from nonprofits.

Clark said he is awaiting word on how the task force would be structured, adding that he is hoping for “open dialogue with no preconceived destination” regarding funding from the nonprofits.

He defended the public service fund as “fairly successful” in getting the nonprofit community engaged in conversation with the city administration.

He noted that the Pittsburgh Public Service Fund was established during a time when the city was in a severe financial crisis. Now, Clark said, state financial controls may be lifted and the city is projecting budget surpluses.

Both are positive signs, but they cause some nonprofits to question whether they should take dollars away from their own mission to shore up the city budget, particularly in light of reduced social services funding from federal, state and local sources, Clark said.

“If a social service agency makes a contribution of $10,000 or $15,000 or $20,000, that’s an amount that can’t be used to further their stated mission,” he said. “Each nonprofit has to look at it and answer from their own perspective.”

Clark said he hopes any task force would provide a platform for open dialogue and exchange of information, adding that part of the conversation must center around the valuable services that nonprofits provide and how their presence in the city contributes to the quality of life in the region.

“I’m a believer that if everyone comes to the table and wants to partner in open dialogue and listen to everyone’s perspective, an understanding can be reached. And from understanding, an appropriate action can come forth. But if there is a preconceived endpoint, talks will be less productive,” he said.

—Kimberly K. Barlow

Filed under: Feature, Volume 45 Issue 5

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