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Category Archives: Economy

In The News …

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In Maryland, forecast calls for more hires (Gazette): “About 22 percent of companies in Maryland plan to hire more employees in the first quarter this year, up from 17 percent in 2012’s first quarter, according to a recent survey by employment services company Manpower Group.” Nationwide, that number is five percentage points lower and the best prospects, reportedly, are in professional and business services. One reason? Many “employers that have been piling up profitable quarters say factors such as the fiscal cliff and a lack of qualified employees put a damper on their hiring plans last year.”

Chancellor Kaya Henderson names 15 DC schools on closure list (Washington Post): “More than one in 10 DC public schools will close as part of a plan Chancellor Kaya Henderson put forth Thursday, a retrenchment amid budget pressures, low enrollment and growing competition from public charter schools […] Closing half-empty schools will allow her to use resources more efficiently, she said, redirecting dollars from administration and maintenance to teaching and learning.” Community feedback persuaded the Chancellor to keep open five schools originally slated for closure. You can read the detailed Consolidation and Reorganization Plan on the DCPS website.

Graduation Rate Hits Record High For High School Students: Government Report (Huffington Post): “More US high school students than ever are graduating on time, according to new information released by the research arm of the US Education Department. The percentage of students who graduated from high school within four years of starting ninth grade in the 2006-2007 school year hit a record high.” In that year, 4 million students began high school and, four years later, just over 78% have graduated — a 2% increase overall. But while more students are completing high school, “fewer than half of those in the class of 2012 were “college ready” as determined by the College Board last fall.”

Further Mapping

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Last week, the City Paper “mapped out” the income of Washington DC’s “neighborhood incomes by census tract.” Earlier on, the Washington Post mapped the “percentage of homes in each ZIP code that have negative equity:”

Over the past year, DC-area housing prices experienced “solid gains” (4.4%); however, progress was not even across the metropolitan area. In particular, “many of the homeowners with mortgages higher than their home’s value were clustered in the eastern parts of the District and in Prince George’s County,” where prices have been slower to rise since the housing bust.

Says Dean Baker of the Center for Economic and Policy Research, “I have no doubt that we have turned the corner […] What we can expect is to see modest price appreciation, something in the neighborhood of 4 percent for the next several years.”

Yesterday on Greater Greater Washington, David Alpert also points out that, as the map above reveals, “the economic recovery is not hitting all areas or all people equally. We need more jobs east of the river and in Prince George’s County.”

Share your thoughts on the housing market’s recovery — and its markedly uneven pace. What would provide the greatest catalyst for growth in the areas that need it?

Micro-Entrepreneurs

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by Marie LeBlanc, Community Partnerships Coordinator

For the past decade or so, microlending and microfinance have been a hot topic in international aid and development — and through microlending organizations like Kiva, an easy way for concerned global citizens from higher income countries to offer a helping hand to their brethren in lower income countries. Kiva is one of many crowd-sourcing organizations that lets donors lend amounts as small as $25 to collectively support micro-entrepreneurs around the world, who pay back those funds (through Kiva) to the original lenders. Nowadays, small business creation and entrepreneurship are very much at the heart of the conversation about kick-starting the United States economy, and Kiva has responded with an interesting solution: bring the international microfinance model to American cities.

This week, Kiva City launched its DC program, in partnership with Capital One Bank and Catalogue-nonprofit Latino Economic Development Center (LEDC). Kiva City DC is a new online portal connecting small business owners in our nation’s capital with Kiva’s global network of over 870,000 lenders. By providing loans to these entrepreneurs, lenders can help them start, sustain and grow their businesses — and even create new jobs. Kiva City DC is the fourth Kiva City site across the country — along with Detroit, New Orleans, and Los Angeles.

Capital One is helping to provide financial heft for the project — matching all loans made to businesses posted by LEDC online through Kiva through 2013. LEDC provides the borrower base, bringing its expertise in financial and small business skill building to the table, as well as its connections to the Latino community in Washington, DC. LEDC’s Community Asset Fund for Entrepreneurs works to identify qualifying borrowers in the D.C. area, administers the loans and posts profiles of each small business owner online at kiva.org. According to the Kiva City DC website, “Kiva lenders’ funds are used to ease the loan requirements for borrowers, including decreasing collateral requirements, interest rates and fees associated with loan disbursement. With Kiva capital, LEDC will reach out to borrowers that may not have met all of LEDC’s existing criteria, allowing the organization to grow its lending program.”

For more information on borrowers currently seeking loans through Kiva and LEDC, check out borrower profiles online here, and for information on recommending the lending process to potential borrowers, check out LEDC’s online application .

In The News …

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DC area unemployment rate is unchanged at 5.3 percent (Washington Post: Local): “The Washington area jobless rate hovered at 5.3% in November, according to a Labor Department report released Tuesday that revealed little change in the local employment picture […] the Washington economy has been steadily adding jobs, but not at a fast enough clip for the recovery to shift into higher gear.” Education and health services posted the largest job gains, with the latter alone adding 11,300 between November 2011 and 2012. Local leisure and hospitality continued to add jobs as well, while manufacturing and construction both subtracted. Overall, the area remains well below the national rate of 7.8%.

The Fiscal Cliff Legislation: A Primer for Nonprofits on Its Provisions (Nonprofit Quarterly): “The short message that should be taken away from the so-called “fiscal cliff” legislation passed last night is that it is no time to relax […] Here is our scorecard on the fiscal cliff mini-bargain.” At the NPQ website, you can read an overview of the final legislation on charitable deductions, marginal tax rates, and other taxes (such as the payroll tax); that said, “good news for nonprofits and the communities they serve is that a variety of programs that benefit working class and lower income people have been saved — for the time being.”

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Dividing Lines

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This past weekend, on the City Paper’s Housing Complex blog, Aaron Wiener questioned: “A City Divided — But More Than Most?”

I spent some time this morning playing around with a nifty tool that breaks down American neighborhood incomes by census tract. It’s a great way to see how divided a city is along income lines. So is DC more income-segregated than other major American cities? Let’s take a look. Green = rich, red = poor, yellow/white = somewhere in the middle.

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Fiscal Cliff — Averted?

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by Marie LeBlanc, Community Partnerships Coordinator

While many Americans across the county rang in New Year’s Day 2013 with pomp, circumstance, and auld lang syne, the United States Congress was (for once) hard at work — barely scraping through the passage of legislation that averted the dreaded “fiscal cliff.” However, is the danger really past? Various news outlets and media sources have been reporting on the “wins and losses”of the fiscal cliff bill, trying to help citizens make sense of it — and understand the real-world implications on their wallets this month and tax bills come April. Yesterday, the Nonprofit Quarterly’s Rick Cohen offered his take on the implications for nonprofits.

According to Cohen, changes made to charitable deductions and marginal tax rates (increasing only on households with annual incomes above $450,000) “constitutes an absolutely minimal touch on charitable contributions.” Due to various tax provisions, on everything from the expiration of the payroll tax “holiday,” to changes in capital gains and dividend income tax rates, the “fiscal cliff bill not only raises less revenues than the President’s proposal, but even less than Speaker Boehner’s Plan B.” However, many programs serving working class and lower income populations have been saved for now, including unemployment benefits and various tax credits on earned income, children, and renewable energy.

The specter of the cliff itself impacted municipal and county-level spending, even before emergency legislation was passed. According to the DC Fiscal Policy Institute, “the impact of the federal budget impasse on the District was felt 10 days before the New Year’s Eve fiscal cliff deal.” Despite signs of growth in the DC economy, instability in the federal budget prevents these signs from being fully recognized and providing the foundation needed for expanding, and even maintaining, levels of social spending. Programs for domestic violence, mental health, and educational enrichment have fallen victim to the budget gridlock.

Ultimately, Cohen offers this perspective on the budget solution, and its potential future impact:

The fiscal cliff isn’t just a matter of “saving” the maximum deductibility of charitable donations or avoiding the reinstatement of the arcane and minimal Pease amendment, but recognizing how dysfunctional the nation has become and how the communities’ nonprofits serve are the primary victims. If the focus of nonprofit advocates leaving shoe leather in the halls of the Capitol is simply on maximizing the value of the charitable deduction or, perhaps more accurately, maximizing the value of the deduction for ultra-wealthy tax itemizers, then the result, reflected in the fiscal cliff legislation and future bills to be addressed in the next couple of months, will be a truly pyrrhic victory for the communities nonprofits serve.

In The News …

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DC officials change policy on charter schools’ occupation of surplus buildings (Washington Post): “District officials have tweaked the way they determine which charter schools should be allowed to move into surplus public school buildings […] The new points-based system gives an edge to high-performing charter schools that are already operating in the city.” Newer charters can also receive points if they have strong prior records of raising achievement elsewhere. At present, the DGS is accepting offers from charters for two buildings: the former Young and J.F. Cook elementary school sites in Ward 5. “For fast-growing charter schools, which often struggle to find and afford suitable real estate, the unused buildings offer a rarity: a long-term home.”

Bill Clinton Urges Donors to Think About Results From the Start (Chronicle of Philanthropy): “The theme of this year’s Clinton Global Initiative is “Designing for Impact,” a nod to the growing influence of “design thinking” in shaping efforts to eradicate poverty and improve society. Explained Tim Brown, the chief executive of IDEO, “design is about being intentional about what you want your outcome to be” in the context of efforts to eliminate hunger and poverty. Have you ever planned in similar terms on a local scale? Or is this type of thinking, in fact, more inherent in local philanthropy?

With Charity for All: Big Philanthropy and the Challenge of Democracy (Forbes): “Philanthropy remains vital as a force for change and societal support — and as a growing portion of the US social safety net; where governments cut services, nonprofit organizations often step in to support those on the bottom economic rungs. Giving rebounded after the Great Recession of 2008, rising to $298.3 billion in 2011 according to Giving USA, an increase of nearly four percent over 2010.” The article also cites two “extraordinary chapters in US philanthropy” — the Giving Pledge, made public two years ago, and the annual gathering of the Clinton Global Initiative — and asserts that “there remains a disproportionate power gap between those doing the work (nonprofits and other organizations) and those funding that work.” Do you agree or disagree?

Tax For Arts

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Just caught this Marketplace story on the way home today:

The Detroit Institute of Arts is joining a small group of museums experimenting with a new way to fundraise. They’ve asked local taxpayers to chip in. Voters in three Michigan counties passed a tax increase — known as a millage.

According to Annmarie Erickson, executive vice president and chief operating officer:

“A home that has a market value of about $150,000, those individuals will pay about $15 a year for this tax.” But that adds up quickly for the museum. She says the millage plan allows the Detroit Institute of Arts to take in $23 million a year for 10 years, and that money will be spent on the museum’s operating budget.

With the fundraising burdened eased, at least in part, the development staff could then focus on building an endowment to strengthen the 125-year-old museum for the future.

What do you think about supporting community nonprofits through community taxes? Would you vote for a similar millage in your city or county in order to support a local museum or theatre?

Measuring Economic Achievement

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By Marie LeBlanc, Community Partnerships Coordinator

Within the nonprofit community, there’s a movement towards data-driven, quantitative measurement and analysis of impact. These conversations lead to the bigger question of how “impact” and nonprofit “success” are measured, particularly for those providing services that might not lend themselves to a numerical calculation. This week, that conversation reached a broader level, in terms of the way that we measure our economic success on a national scale. Federal Reserve Chairman Ben Bernanke remarked that Gross Domestic Product (GDP) — a fairly straight-forward measure of income and expenses — might not be the best and only way to measure economic well-being, suggesting that there are “better and more direct measures” to gauge how economic policies impact individuals.

Several alternative measures to GDP-based economic analysis have been offered in the past, such as the Genuine Progress Indicator, and more recently, the OECD and the Gross National Happiness index, pioneered by Bhutan. As Nonprofit Quarterly mentions, “the suggestion that there might be a better way to measure a nation’s wellbeing is nothing new to many in the nonprofit sector whose work and worth is often not measured in dollars and cents.”

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In The News …

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Boom in autistic students prompts new Montgomery school centers (Washington Examiner): “Montgomery County Public Schools is planning to open autism centers at three high schools in the new school year, as the district grapples with a fivefold increase in the number of students diagnosed with autism over the last decade.” Since the 2000/2001 school year, the number of MCPS students on the autism spectrum has jumped from 266 to 1,642 — which, assumedly, is in part due to improvements in diagnostic procedures. In particular, “special education staff acknowledged they also need to ramp up efforts to reach the diversifying swath of students who have special needs, such as immigrant families who may not speak English.”

Some States Looking to (and Funding) Arts as Economic Driver (Nonprofit Quarterly): “The news service for the Pew Center on the States reports that “there has been a 37 percent drop in funding for state arts agencies since 2001.” However, a creative repackaging of the arts as an economic engine has, in some states, reversed this trend over the last year.” And according to the National Assembly of State Arts Agencies (NASAA), this year’s state arts funding budgets have increased by approximately nine percent. You can check out all of Catalogue’s local arts organizations right here.

Everything I Need To Know About Life I Learned On My Nonprofit Board (Fast Company): “This is a life lesson for people in workplaces, families, classrooms, and any relationship. That peace, happiness, and fulfillment come from creating a mutual understanding of what you?re trying to accomplish and each person?s role in achieving success,” writes Alice Korngold, CSR consultant to global corporations. She also points to the value of clearly-articulated values, discussed with the Board and shared with the public. “It is usually a […] source of energy and even exhilaration when people finally see how and what they can contribute to achieve success for a cause in which they believe.