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February 10, 2010; The Philadelphia Inquirer | We have been bringing you a lot of stories about proposals to eliminate nonprofit tax and fee exemptions lately but this is a slightly different tack. Pennsylvania’s Governor Ed Rendell is proposing an expanded sales tax to offset the anticipated loss of stimulus funding in 2011. Specifically he has proposed reducing the sales tax from six percent to four percent, but expanding the number of items that would be taxed. This, naturally, is likely to bring him direct opposition from scads of special interest groups. The changes he is proposing would bring $530 million in new revenue, which would partially offset an estimated loss of more than $2 billion in federal aid in 2011. How is this nonprofit news? Well, naturally state revenues will effect spending on services delivered by nonprofits but also as we covered in our Newswire the Pennsylvania budget last year got badly stalled on the topic of spending level and the budget was not passed until October 9th, a record setting 101 days late. In the meantime a number of state contracted nonprofits were functioning on mere fumes for months. Ultimately, it makes enormous sense for nonprofit networks to involve themselves in the framing of these conversations and in advocating for our communities. But nothing will make this an easy year for that involvement as gaping holes promise to open up in many state budgets.—Ruth McCambridge
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