In response to numerous complaints by small businesses about unfair competition with nonprofits, the Small Business Administration has reissued a report on the "growing problem" of nonprofits competing with small for-profit companies.
The revised report, which was first introduced in November 1983, is based on data presented at a symposium co-sponsored by the SBA Office of Advocacy and the Business Coalition for Fair Competition, a group of associations representing businesses that are affected by competition with nonprofits.
"If nonprofit organizations are going to compete with small businesses for profits, then they should not receive the benefits that nonprofit status provides," said Joe O'Neil, director of the Business Coalition for Fair Competition. "We are not against competition or against nonprofits, we just think that if there is competition, we want it to be fair," he said.
O'Neil is director of the American Counsel of Independent Laboratories, an association that represents more than 600 testing laboratories nationwide that feel nonprofits are cutting into their share of the consumer market. As an example, he cited Underwriters Laboratory, the electrical testing laboratory most often used by the federal government for product approval.
U. L. could be considered a "quasi-monopolistic organization," said O'Neil. "Their nonprofit status gives them a tremendously unfair advantage in the marketplace." According to O'Neil, Underwriters Laboratory was a for-profit company until 1950, when it became a nonprofit institution.
Some of the worst offenders, according to the study, are colleges and research organizations. They do not pay federal, state or local taxes but enjoy the benefits of free postal rates, unemployment insurance, freedom from minimum wage rates, exemption from federal trade competition laws and several others.
Trade associations represent an insignificant part of the problem, according to study findings.
The report calls for revisions in federal statutes and regulations governing nonprofits. "The increasing phenomenon of nonprofit organizations engaged in commercial activities in competition with for-profit small businesses cannot be ignored," it concludes.
"The traditional justifications for granting nonprofits tax-exempt status have been stretched beyond recognition by this development. Policymakers in Congress and the executive branch must undertake a thorough evaluation of the changing role of the nonprofit in our society."
The report, titled "Unfair Competition by Non-Profit Organizations With Small Businesses: An Issue for the '80s," can be obtained free from the SBA Advocacy Office of the Chief Counsel for Advocacy, 1441 L St. NW, Washington, D.C. 20416. TRADE
James A. Hilbert, an international trade specialist with the Department of Commerce for the past nine years, has joined the Automotive Parts and Accessories Association as managing director. Hilbert succeeds Debbie Orloff, who has been named assistant secretary of the Export Advisory Committee at Chemical Bank in New York. During his career with the Commerce Department's U.S. and Foreign Commercial Service, Hilbert aided small companies with exporting problems and developed projects on trade. He received service awards from Commerce in 1980, 1981 and 1982.
The Tobacco Institute, the Washington-based trade group that represents U.S. cigarette manufacturers, has named William P. Buckley as sector vice president of its state activities division. Buckley had been for the past four years director of state government relations for the Chemical Manufacturers Association.
The Travel Industry Association of America has hired T. B. Slattery, a 27-year veteran of the travel industry, as its director of development. Slattery has spent most of his career in executive sales and marketing positions with Pan American World Airways. Most recently, he served as system director of agency interline and commuter sales for Pan Am.
Richard Beach, will leave his post as congressional relations officer for the National Credit Union Administration next week to become the governmental affairs specialist at the Credit Union National Association. He will monitor congressional tax and banking committee activities for the association's 50 million state and federal credit union members.
The United States Telephone Association has hired Patrick C. Koch, former director of government affairs for the National Cable Television Association, as director of government relations. PROFESSIONAL
The newly formed Washington-area chapter of the Professional Energy Managers group held its first meeting last week and elected officers for 1985-86. The association, based in San Francisco, was formed in 1982 to represent the interests of industrial, commercial and government energy policymakers. The group emphasizes the need for energy managers to broaden their focus from the technical aspects of energy management to the financial, management and communications aspects of the field.
The American Association of Retired Persons has hired Joan Larson Kelly, a former account executive with the public relations firm of Gray & Co., as press officer for its field and services division.