State and Local Nonprofit Organizations

Local organizations predominate among nonprofits

Most statewide programs are the result of challenges and opportunities that developed once the federal government began to fund some preservation outreach. 1. No consistent structure or mandate because there is no consistent financial incentive to establish a statewide organization.

a. Statewide programs almost always assume a paid staff, even if very small. b. Many states did not have a statewide non-profit until the past fifteen years.

2. Statewide agencies are most often involved in advocacy and educational programs.

a. Lobby state legislatures for improved conditions for preservation. b. Serve as clearinghouses for information about current "best practice" in preservation including both nonprofit and governmental agencies activities.

3. Preservation Virginia – formed from the combination of the APVA and Preservation Action – an advocacy group in Virginia

local preservation often will coalesce around a particular resource or situation

Many local preservation organizations initially evolved from quality of life associations, volunteer, civic pride, activist political movements in which women played a disproportionately large role.

League of Women Voters and Women's Clubs were organizations that raised the level of understanding of issues impacting the community and sought ways to ameliorate or reduce the harmful effects of change through both educational forums and political actions

Paying for preservation

Local preservation efforts in small towns and rural areas may also include a full range of heritage activities beyond saving building fabric-creation of museum spaces, undertaking maintenance of significant memorials and commemoratives, establishing festive events celebrating local and national patriotic associations.

Revolving Fund as a local preservation practice.

1. Revolving funds are categorized as either acquisition/ resale funds or lending funds. a. An acquisition/resale revolving fund usually purchases troublesome historic properties and resells them to sympathetic purchasers with preservation restrictions. These funds also are used to produce affordable housing and encourage neighborhood diversity. . b. A lending fund, also known as a revolving loan fund, commonly makes loans on favorable terms to persons or businesses for the purchase or rehabilitation of important structures; as the loans are repaid, new loans are made, recycling the same funds.

2. Revolving funds usually lose money on each transaction after administrative costs are factored in. a. Most revolving funds are financially replenished to sustain their level of capitalization. This may be through house tour ticket sales, or fund raising efforts.

3. Why haven't revolving funds multiplied in recent years at the same rate as their sister organizations, land trusts? a. Many nonprofits are averse to risk. b. Operating costs are high. c. Organizations lack highly specialized personnel needed, whether volunteer or paid. d. Revolving fund needs personnel knowledgeable about real estate, law, and finance. e. Few if any preservation degree or certificate programs offer in-depth training in these subjects.

4. Amount necessary for revolving fund is less when purchasing property options to carry out their transactions. The fund can find a buyer for the property before it obligates itself to an outright purchase.

5. Gifts of property can help capitalize a revolving fund

Preservation easement is a set of legally binding restrictions that are voluntarily placed on a property by its owner

1. Since 1969, federal (and often state) income tax laws have allowed a charitable deduction for the donation of preservation easements on historic properties. a. An owner may deduct the amount by which the easement is determined to have reduced the property's value. b. An easement may also have important ramifications for additional forms of taxation, such as local property taxes and federal estate and state inheritance taxes.

2. Holding easements carries with it substantial legal responsibilities for a nonprofit organization. a. Since an income tax deduction is often central to the language, timing, and valuation of the easement, the nonprofit recipient must take its enforcement responsibilities seriously or risk scrutiny and possible penalties from the IRS. b. Some organizations charged fees to hold easements in order to create endowments for future costs of monitoring and challenges.

3. In the 1990s easements were less popular as the IRS became more strict in their oversight. Still a tool for preservation.

Affinity groups in historic preservationA. Affinity groups are non-spatially focused volunteer associations.

1. Affinity groups focus on a particular kind of resource, whether it is based upon events (Civil War), ethnic heritage (German-American), or object form (furniture, Victorian houses).

2. Others are serving career interests: the Vernacular Architecture Forum, Society of Architectural Historians (SAH), and National Council on Public History. 3. A number of affinity groups have formed around professional and organizational issues: the National Council of Preservation Executives, National Alliance of Historic Preservation Commissions, and National Association of Statewide Preservation Organizations.

B. Affinity groups may develop to give weight to the common issues impacting the members and urge political action.

Issues for nonprofit preservation organizations

Preservation nonprofits generally succeed on the basis of their local leadership and support.

1. Other factors that will influence the effectiveness of nonprofits include

a. Preservation policies of federal and state governments

b. The health of the economy.

2. A critical need will be success in finding funding in both the private and public sectors.

Additional factors impacting local levels3. Progressive incentives for historic rehabilitation through tax advantages by federal, state and local governments will continue to be important.

a. The creation of a national tax incentive for the rehabilitation of owner-occupied historic homes would energize nonprofits nationwide.

4. Government actions that would adversely impact preservation indirectly would include:

a. The adoption of a flat tax without provision for charitable deductions, taking away any financial incentive to be charitable.

b. The elimination of federal estate and state inheritance taxes would be especially detrimental to planned giving efforts, through which charities receive their largest donations.

Forecast of intergenerational transfer of wealth anticipated in the first decades of the twenty-first century presents an unequaled opportunity for preservation organizations to build their endowments.

1. Over the next half-century more than $41 trillion will be transferred on the death of Americans who have experienced unprecedented wealth accumulation.

2. Tax laws strongly encourage planned charitable giving to avoid huge federal huge federal estate and state inheritance taxes.