Nonprofits growing faster in California than other states

Nonprofits are starting to flex their muscle in California, showing Sacramento politicians the sector comprises an important economic and social force in the state.

Last fall, the California Association of Nonprofits released a report detailing the economic impact of community-based organizations across the state. It found that nonprofits had a combined economic output of $260 billion in direct goods, services and indirect financial impact - or 15 percent of California’s total gross state product of $1.7 trillion.

Such statistics are commonplace in the business sector, and often are used by the private sector to promote its interests in Congress and statehouses.

“Often, when legislators are thinking of passing a bill, they ask, ‘What does business think?’ We want them to also think of how does this affect nonprofits,” said Kristen Wolslegel, a project manager for CAN.

Wolslegel said that unlike businesses, nonprofits are on a mission to serve their communities rather than to earn a profit. Revenues generated by the organization are not sent to shareholders but put back into it to support services and programs, she said.

In California, it’s a growing sector - in revenue but not numbers.

CAN’s report - which is largely based on the IRS Form 990s filed annually by nonprofits - found that revenue has increased steadily since 2009, when the sector was struggling to avoid contraction. In 2012, California nonprofits reported a 12 percent increase in revenue, three times higher than the 4 percent growth rate notched by nonprofits across the United States.

Wolslegel said Sonoma County nonprofits are probably experiencing the same growth trend.

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Editor’s note: In the original version of this story we misspelled the name of Kristen Wolslegel. Her name has been corrected in the story above.