November 6, 2007

The little engine that could
Orange County's nonprofits contribute much to local economy, study says.
By TERI SFORZA
The Orange County Register

The nonprofit sector is an engine in Southern California's economy, contributing about 6 percent of the region's gross domestic product, according to a recent report.

Nonprofits in Los Angeles, Orange, San Diego, Riverside and the six other counties that make up Southern California clocked total revenue of $38 billion and assets of $62 billion in 2000, according to a study by Kathleen Costello of the Gianneschi Center for Nonprofit Research at CSU Fullerton and Peter Manzo of the Center for Nonprofit Management.

They paid $13.6 billion to workers in compensation and benefits, said the study, released in 2005.

"Nonprofits exist primarily to provide services and benefits to their communities, but their investments generate significant economic and employment impact as well," the report said.

The numbers are large: There were 13,370 nonprofits that filed tax returns with the Internal Revenue Service in 2000. Of these, just 199 organizations – 133 hospitals and 66 universities – took in nearly 40 percent of total revenue.

"Very large organizations such as hospitals and universities dominate nonprofit resources throughout the region, and to a highly disproportionate degree," the report says.

ORANGE COUNTY TOTALS

There were 1,899 nonprofits in Orange County that filed returns with the IRS, according to the report. They had revenue of $4.2 billion and assets of $7.1 billion in 2000 – an increase of nearly 50 percent from just three years before. That's about 4.1 percent of the county's GDP.

There has been great growth here, as elsewhere: Nearly 400 nonprofits were added in Orange County between 1994-95 and 1997, and more than 600 were added between 1997 and 2000.

WHAT ARE THEY?

Orange County's largest nonprofits are dominated by hospitals, with religious broadcaster Trinity Christian Center of Santa Ana and Chapman University appearing toward the bottom of the top 10 list.

The nonprofit profile of Orange County charities differs somewhat from the region as a whole.

"It has more education and religious nonprofits than average for the region, and fewer in the categories of (arts, culture and humanities), health and human services," the report says.

* While health and human services charities make up 32 percent of the region's and 34 percent of the nation's nonprofits, they're only 30 percent here.
* While education organizations make up 20 percent of the region's and 16 percent of the nation's nonprofits, they're a high 26 percent here.
* And while religious nonprofits make up 8 percent of the region's and 5 percent of the nation's nonprofits, they're a high 10 percent here.

WHO GETS THE MONEY?

Contributions flow differently in Orange County than they do elsewhere as well.

Nonprofits collected $1.1 billion in contributions – about 27 percent of total revenue, the report said.

Regionally, religious organizations claimed only 4 percent of total contributions, but in Orange County, religious charities collected five times that – 20 percent of total contributions, the report said.

Human-services organizations here claimed a smaller share of contributions: 26 percent in Orange County vs. 30 percent regionally.

FACTS

Orange County's median family income was $64,511, the second-highest of the 10 counties.

Orange County had the second-lowest percentage of residents in poverty in the region, at 10 percent.

Only 5 percent of local nonprofits had revenue of more than $5 million – but that 5 percent took in 83 percent of the money.

Southern California's largest nonprofit was the University of Southern California. Only one Orange County nonprofit hit the region's top 10 list: Hoag Memorial Hospital Presbyterian, coming in at No. 8.

LOCAL TOP TEN

* 1. Hoag Memorial Hospital Presbyterian
* 2. St. Jude Hospital Yorba Linda
* 3. Children's Hospital Orange County
* 4. St. Joseph Hospital of Orange
* 5. Mission Hospital Regional Medical Center
* 6. St. Jude Hospital Inc.
* 7. Trinity Christian Center of Santa Ana Inc.
* 8. Chapman University
* 9. Saddleback Memorial Medical Center
* 10. Anaheim Memorial Medical Center