| Nonprofits are businesses, not government entities
Will Stewart, Greater Manchester Chamber of Commerce
On Tuesday, the Senate Public and Municipal Affairs Committee briefly heard public testimony on House Bill 1308, a bill which seeks to subject certain nonprofit businesses to the state's Right to Know law.
The goal of the bill is to make fully transparent the operations of certain entities organized to perform taxpayer-funded services. The scope of the bill, however, is broader than intended or necessary, which is why the Chamber opposes HB 1308.
As currently written, the bill would include "primarily government-funded" nonprofits in the state's definition of a "public body." It is public bodies that are subjected to the Right to Know law.
To come under the expanded definition of "public body", a nonprofit must meet two tests: (1) it must be formed by an "action" of a state or local governmental agency, department or political subdivision; and (2) it must be "primarily" funded by a state or local governmental agency, department or political subdivision.
lt is unclear what these terms mean. What constitutes governmental "action" - an act of the legislature or a declaration of the Secretary of State incorporating a nonprofit? And with regard to a nonprofit being "primarily" funded by government, what government funds will be used to determine the applicability of the bill - service contracts with nonprofit organizations? Grants? Medicare and Medicaid?
What is clear is that HB 1308, as drafted, can be interpreted to cover many more organizations than intended.
Additional concerns include the fact that the deliberations of the boards of covered nonprofit businesses would be required to be held in public, which could lead to difficulty in obtaining board members and potential donors, whose donations might also be exposed to Right to Know.
Likewise, subjecting nonprofits to Right to Know requests will mean increased costs to these often cash-strapped businesses as Right-to-Know requests are frequently expensive and time consuming.
Given the late start to Tuesday's public hearing on HB 1308, and the fact that there were many people there to testify, only the bill's sponsor and one opponent, former Sen. Joe Foster, were allowed to testify. The hearing will be re-opened this coming Tuesday, April 17, at 9 a.m.
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