N.Y. Lawmaker Proposes Lottery-Driven Nonprofit Grant Fund

August 9, 2012; Source: Queens Chronicle

Remember how New York State legislators had access to pots of discretionary moneys called “member items” which they used—and sometimes abused—for grants to favored charities, particularly those controlled by their family members or their political associates? After enough member item scandals, the state legislature got rid of member items. It must put state legislators who tromp to Albany for the Assembly or the State Senate into a quandary: How do they deliver the goods for the groups in their home districts?

Democratic State Sen. Tony Avella has introduced legislation to give nonprofits a share of the funds from a new scratch-off lottery game. The funds for nonprofits would be deposited into a program called the Community Grant Fund. Avella’s bill has some points for it and against it:

On the plus side, Avella and his colleagues know that despite past member item abuses, the member items were important sources of revenue for a number of nonprofits, some of them good nonprofits (and not affiliated with legislators’ families or aides). More than a few groups actually depended on the member items for part of their general operating support, particularly advocacy groups that wouldn’t typically fit state government funding streams.

On the negative side, one can imagine the Community Grant Fund being divvied up into pieces that are essentially member items in all but name. What strictures would the Assembly and Senate tolerate when the elimination of member items deprived legislators of their access to unfettered grant cash? What important pieces of the state’s nonprofit funding agenda can’t be addressed by applicants going straight to state agencies, but can be addressed by having them go negotiate with politicians?

Flexible funding for a broad range of nonprofits is a good idea, but if access must happen through politicians rather than agency administrators, the structure sounds questionable.—Rick Cohen