Hazardous to our health?

"Public-private partnership."  It’s one of those euphonious phrases describing something nobody can be against.

And it can work beautifully, even when the "private" is a nonprofit.  The city can sell an underused public space for a dollar to a plucky little theater company, and the company can repay the largesse with renovation work followed by performances that contribute to a reinvigorated night life in the area. 

But it can also work really badly, so a word to the nonprofit wise that goes beyond advice to be suspicious when you hear that someone from the government is here to help you.  Risky situations include:

  • The public partner insists on majority representation on the nonprofit’s Board in return for its funding.  It’s hard to turn the money down but if your purpose is to counsel child victims of domestic abuse and the city’s goal is to strengthen the hand of the police department and state’s attorney, that public majority will mean that you wake up one morning to find yourself with a new mission.  I call the result "captive charities" because they have the right to remain silent.
  • The public partner actually has the idea for the nonprofit in the first place.  It’s hard to resist appeals to civic virtue but if the city builds a fancy new park it shouldn’t look to the private sector to pay for its upkeep.  Every dime that goes to improve Central Park is a dime taken from the rest of the nonprofit sector, and moreover the trade-off is a dime you don’t really control (because it’s going into the government’s coffers) for a dime you do.  I call the result "pet charities," because when they put out their paws they’re rewarded: suddenly their Board chair’s corporation gets to hold a private function in ostensibly public locations. 

What safeguards can charities put in place to keep their virtue when getting in bed with the government?  I don’t know but would be glad to hear.


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