If there was ever a time to stand up for those in need — that time is now, Arizona nonprofit officials contend.
The Arizona nonprofit industry, estimates suggest, is experiencing a historic drop in funding accounting in the hundreds of millions of dollars impacting day-to-day operations of 501(c)(3) endeavors offering vital community services.
This trend is occurring statewide, across the nation with Scottsdale being no exception, but an untapped revenue resource could change the annual prospects of any approved nonprofit effort through the Internal Revenue Service.
Here’s how it works: a single Arizona taxpayer can give up to $400 to a qualified charitable organization and receive $400 back from Arizona in a tax credit. So, if you owe $500 in taxes, but you gave $400 in a qualifying donation, you will only owe Arizona $100 in taxes.
If you are a married taxpayer filing a joint return, you can give up to $800. It works the same for qualifying foster care charities, except the limits are higher: $500 for a single filer and $1,000 for a joint filer.
Those dollars can be directed toward any approved Arizona charity registered with the state of Arizona through an innovative program born through the Scottsdale Charros.
The Scottsdale Charros — through the established Charro Foundation — have created the Child Assistance Program Sponsors. A program meant to give people an opportunity to contribute tax credit dollars toward certain qualified charities.
For 60 years, the Scottsdale Charros have been in constant pursuit of improving the lives of Scottsdale residents while preserving the community’s ties to its western heritage.
Arizona nonprofits employ more than 170,000 Arizonians or 1 in 16 paid jobs in Arizona, according to the 2018 report from the L. William Seidman Research Institute, the consulting arm of W. P. Carey School of Business at Arizona State University.
Jason Klonoski, who serves as patron of the Scottsdale Charros, says he seized the tax credit offer as an opportunity to make a difference. Turns out, he was right.
“I created CHAPS in my second year in the group,” he recalled.
“As a second-year Charro, I was struggling to raise money because our baseball assets sell out so quick. In another organization, I had created a similar program when we lost a major sponsor for an event we put on. I saw the benefit it could bring to our group, and made it happen with the help of a few others.”
If you offer it — and educate others — patrons will come. As Mr. Klonoski points out, only 12% of Arizona taxpayers participate in the tax credit program.
“I believe the number is somewhere around 12% of Arizonans who take advantage of the tax credit program. That is a lot of lost opportunity,” he said. “We gave $400,000 raised by other means to charities that are eligible for tax credits last year.”
However, that is just the beginning, Mr. Klonoski explains.
“What I see is an opportunity, through tax credits, to raise more and give more to more worthy organizations in our community. There is literally no limit to how much we can raise,” he said. “We just need to put in the work, raising awareness of friends, families, and our corporate partners that this program exists. Time will tell how impactful this can be. I know this. It is a COVID-friendly way to make a difference.”
Numbers show every year, CHAPS contributions grow and Scottsdale Charros Executive Director, Dennis Robbins, points out local nonprofits will find a way despite dire economic circumstances amid a public health crisis.
“The nonprofits in Scottsdale are resilient. From the arts, to tourism, to desert preservation and education, to equine therapy, to homelessness, to youth sports, and everything in between, the nonprofits in Scottsdale are finding new ways to carry out their missions,” he said.
“It’s like being in a snow globe in the middle of the desert. Nothing is the same as it was last year except the human need never wanes and the focus on service by our local nonprofits never falters.”
“When there is a will, there is a way,” Mr. Robbins says.
“Services still need to be provided and funds still need to be raised,” he said. “The nonprofits in Scottsdale are finding innovative ways to respond to the needs of the community in these very challenging times.”
The ongoing COVID-19 pandemic continues to ravage revenue projections in all sectors with no certain end in sight, Mr. Robbins explains.
“Thankfully, we were able to keep our commitments to our local charitable partners and our public education partners as we have done in the past,” he said. “However, COVID-19 is lasting longer than anyone anticipated. So, we are moving our annual Charro Education Banquet from an in-person event for 400 people to a virtual event that can be attended by many more. This will actually give us an opportunity to expand our reach in the community so that we can honor Scottsdale students and teachers with a much larger audience.”
Through the CHAPS charities program, Mr. Robbins explains, a taxpayer can direct his or her tax credit donation toward any qualified nonprofit directly.
“Any taxpayer can write a check to CHAPS, tell us what charity or school they want to support and 100% of their tax money will go directly to that charity or school,” he said. “It is a great way to support our community.”
At the education committee level of the Scottsdale Charros charitable arm, there are two emerging initiatives, Mr. Klonoski explains.
“We have two main initiatives at the moment. The first, to help address the shortage of school psychologists in SUSD. We currently have six. We need 28,” he said. “At our education round table this year Scottsdale school leaders and district administrators asked us to pivot away from technology and look toward social and emotional learning.”
Mr. Klonoski explains data provided during recent discussions brought the issue of socio-emotional health into acute focus.
“The statistics about self-harm and suicide were shocking,” he said. “We immediately recognized the problem and changed our mindset. We are working to raise awareness and help fund new positions.”
Mr. Klonoski points out a new program emerging from the Coronado High School region of the Scottsdale Schools learning communities is a significant change for new opportunities.
“Second, the Coronado Promise,” he said.
“We hope to offer a scholarship to SCC or a trade school to every child that graduates from Coronado High School, a Title 1 school. We have been a part of trying to elevate outcomes in that community for four years now. We are hoping this removes the financial barrier many of Coronado’s students face when considering continuing their education.”
Coming together as one Scottsdale community is what Mr. Klonoski hopes can become more a reality than an idea.
“More than ever this year we need the help of individuals in our community,” he said.
“Our normal channels of fundraising - baseball, Parada del Sol Parade, education banquet, Rodeo Scottsdale are all canceled or impaired this year. If you have an Arizona State tax obligation, please consider going to chapscharities.org and redirect those dollars to a local charity.”
But even in the face of economic uncertainty, the Charro Foundation continues to meet its financial obligations to local charities, Mr. Klonoski reports.
“We received more requests for support this year than in any time in our history,” he said. “Close to 100 grant requests from local charities. All great causes. We funded half of the requests. It felt great to do so. It didn’t feel great to say no to many others. This program can put us on the path to saying, ‘yes’ to all of them.”