Nonprofits Increasingly Pay Local and State Taxes, Study Finds

State and local governments across the country, faced with severe fiscal pressure and budget deficits, are increasingly targeting nonprofit organizations as potential sources of needed revenues, sometimes using special fees that get around the longâ€standing nonprofit exemptions from property and other taxes, according to a study released Thursday by the Johns Hopkins Center for Civil Society Studies.

The survey,“Taxing the Tax-Exempt Sector—A Growing Danger for Nonprofit Organizations,” was conducted as part of the center’s Listening Post Project, a research effort to examine issues facing tax-exempt groups.

Nearly two-thirds of 358 nonprofits that provided data said they paid some type of local or state tax, user fee or other compensation to local governments to finance services and benefits supported by tax-paying entities. These types of payments are not new; indeed, respondents that make such payments generally have been doing so for several years.