Editor’s Note

This issue encompasses many of the diverse elements associated with nonprofits’ relationships with government, the impacts of public policy on nonprofit organizations, and the influence of nonprofits on public policy formulation and implementation. These elements include lobbying, government and foundation funding programs, regulation of entry and exit into the sector, measuring and monitoring the size and scope of the sector, and influencing the actors responsible for establishing and developing individual nonprofit organizations.

The first paper by Christopher Prentice examines how nonprofits in the state of North Carolina report their lobbying activities. In particular, the author finds discrepancies between the levels and nature of lobbying activities reported to the state versus federal government. North Carolina is an interesting choice because it does not constrain lobbying expenses, while the federal government does so. Prentice finds that many nonprofits underreport their activity to the federal government, as a possible result of the federal government’s lobbying restrictions and its less intensive oversight. Underlying this phenomenon is the tension between nonprofits’ desire to advocate and affect change while complying with legal restrictions on lobbying by charitable organizations.

The second paper, by Paolo Barbetta, Paolo Canino, Stefano Cima and Flavio Verrachia, scrutinizes data from the Italian census of nonprofit organizations between 2001 and 2011, in order to understand the entry and exit of organizations to and from the nonprofit sector over time. This is important because the sector grew considerably during this period but this growth was somewhat deceiving. In particular, while many small organizations entered the sector given low entry barriers, they also exited at a high rate. Indeed, part of the growth of employment in the sector came from nonprofits already active in the sector at the beginning of the period. The authors also find that some of the apparent growth in organizations was a result of pre-existing organizations not identified at the start of the period. These findings call for closer examination of the data collection and analysis process as well as the impacts of policy barriers to entry and exit.

The third paper by Shihyun Noh and Catherine H. Brown examines the effects of Medicaid expansion under the federal Affordable Care Act in the U.S., as well as Certificate of Need policies at the state level, on the growth of nonprofits providing substance abuse services, using data from all fifty U.S. states. This turns out to be a more nuanced issue than one might expect, posing a challenge to state policymakers. While neither Medicaid expansion or state regulation alone appears to promote expansion of this subsector, combinations of the two do have a positive effect on growth, suggesting the need for a more comprehensive approach to policymaking.

The fourth paper by Fredrik Andersson offers a new perspective on entrepreneurship in the nonprofit sector. Andersson analyzes an important subgroup of nonprofit entrepreneurs motivated more by “necessity” to find employment and income support than by intrinsic motivations to establish a nonprofit organization or address a social cause. According to his preliminary findings, these opportunity-focused necessity entrepreneurs, compared to their more intrinsically driven colleagues, form more tenuous organizations, are less oriented towards growth and less likely to remain with their organizations as other opportunities arise over time. The presence of this subgroup of potential social entrepreneurs raises interesting policy questions such as whether they can be better assisted in their efforts, or if they should be more strongly filtered out through greater barriers to entry. In these respects, this paper complements the analysis of the second paper by Barbetta et al which also cites high entry and exit by smaller, newer organizations facing low barriers to entry, and the third paper by Noh and Brown which assesses the impact of state level certificate of need requirements.

Our final paper, by Tara Bryant and Kimberly Issett examines strategies of a large foundation to influence juvenile justice reform in four U.S. states, through interviews with top officials from government and the nonprofit sector. The paper offers a robust account of how foundations engage in policy work at the state and local levels, with combinations of targeted policy change initiatives and field building programs to boost the capacity of professionals to implement change effectively.

We close the issue with a review by John Casey of a new book by Stuart C. Mendel and Jeffrey L. Brudney entitled Partnership the Nonprofit Way. Casey offers high praise for the book, which examines public/private partnerships from the particular perspective of the nonprofit partners. As suggested directly and indirectly in the various papers in this issue, partnership arrangements between government and nonprofits are complex and often fraught with risk. Not surprisingly then, Casey’s summary of Mendel’s and Brudney’s central message is to “trust and verify”.

I hope you enjoy the issue and find it helpful. Please let us know.

Dennis R. Young

Editor-in-Chief

September 2018