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Williamstown Select Board Members Fear 'Opening the Spigot' on Non-Profit Funding
By Stephen Dravis, iBerkshires Staff
02:29AM / Wednesday, September 26, 2018
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The Select Board Monday discussed a proposed application for non-profits requesting town funds.


Finance Committee member Steven Sheppard addresses the board on the non-profit funding application his working group developeed.
WILLIAMSTOWN, Mass. — The Select Board has reviewed a proposed application for non-profits seeking town funds and concluded that the document is a good vetting instrument, but, in general, the town officials hope it is little used.
 
"I think we do have to start from the position of … we don't want an increase in applications," Select Board member Hugh Daley said at Monday's meeting. "If anything, we're the funder of last resort."
 
His colleague Jeffrey Thomas said he feared at first that the application developed by a working group of the town's Finance Committee would "open the floodgates to lots and lots of requests."
 
"But, giving it a little thought, I know it already happens," Thomas said. "[Town Manager Jason Hoch] gets a lot of requests like this. The floodgates were open when the town decided to fund things like the Youth Center and the Chamber [of Commerce].
 
"If we're going to fund things like that, we have to consider requests from other non-profits. That's the spirit of what you're trying to do here."
 
For years, voters at the annual town meeting have approved separate warrant articles to help fund the operating expenses at the Williamstown Youth Center and Williamstown Chamber of Commerce. Last year, a request for similar funding from the Sand Springs Recreation Center — which ultimately passed with little dissent at town meeting — caused members of the Fin Comm and Select Board to wonder if the town needs a formal process to review such proposals.
 
"First off, non-profits already receive implicit support from the government in exemption from taxation," said Fin Comm member Stephen Shepard, who led the working group that developed the application. "How can we consider additional support above and beyond that? How can we improve the process or ensure that any support generates real benefit for the community and taxpayers of Williamstown?
 
"Non-profits typically seek donations from individuals and support from foundations. … We didn't want the town to replace that and become the funder of first and last resort."
 
To that end, the town's application seeks information about a non-profit's assets, total revenue and total contributions received, among other information that organizations routinely collect for state reporting purposes.
 
What the new town application does not do is set a limit on the percentage of a non-profit's revenue that can come from the town or restrict the number of years that a non-profit can receive funding. Both those concepts were considered by Sheppard's committee.
 
"We decided that although some towns do impose specific caps on the size of grants or the totality of grants [in a given year], we didn't feel that was a good idea for Williamstown's situation," Sheppard said. "We felt this is something that should be left to the good judgment of the Select Board and the Finance Committee when proposals come before us."
 
Thomas said he would argue against limiting the number of consecutive years a non-profit can come to the town, citing one of the groups currently receiving town funds as an example.
 
"With respect to perennial funding, I'll always support tax money going to the Youth Center," Thomas said. "Going back to our work on the Economic Development Committee, we found that making the town more affordable, making it friendlier to young families — these are things we need to do.
 
"Once you start getting into absolutes, it gets really, really tough."
 
Andrew Hogeland indicated that perhaps the town might need to set a cap on funding in any given year.
 
"It doesn't give us or the Fin Comm an objective number, which means it relies on our backbone to say no," Hogeland said. "I'm concerned about each body's ability to say no to nice people who come in with good ideas."
 
Sheppard said the application is not set in stone and that it could be amended and potentially strengthened in future years.
 
Monday's discussion was held against the backdrop of some preliminary legal research from resident Dan Caplinger, who noted to the Select Board in an email that the commonwealth's constitution specifically says, "[n]o grant, appropriation of use of public money or property or loan of public credit shall be made or authorized by the commonwealth or any political division thereof for the purpose of founding, maintaining or aiding … any college, infirmary, hospital, institution or educational, charitable or religious undertaking which is not publicly owned and under the exclusive control, order and superintendence of public officers or public agents."
 
"The constitution's words are always subject to [court] rulings," added Caplinger, an attorney. "The basis of the town's grants in the past … that's still permissible despite what seems to be very strict language.
 
"But it's worth citing the constitution. … The default answer [to a non-profit] should be no, and someone petitioning for support should have to be able to override that burden and overcome that default answer."
 
Caplinger stressed that he was not trying to make a definitive legal argument one way or another on the question but trying to give the Select Board some more information to consider as it weighs a town procedure for reviewing requests from non-profits. He also said he appreciated the general tone of the discussion — both from Sheppard and the board — which pointed to an inclination to set a very high bar for granting such requests.
 
"We don't expect and don't want to encourage more applications," Sheppard said. "What we want to do is regularize the types of information we're asking applicants to supply so we can make reasonable and consistent judgments about what we recommend to town meeting."
 
The full Finance Committee will consider the application later this fall with hopes of putting it in place for the fiscal 2020 funding cycle. The three non-profits that currently receive town funds — the WYC, the Chamber of Commerce and Sand Springs — would be required to complete the application on an annual basis.
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