Fiscal cliff concerns area non-profits

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GRAYSON CO., TX-If lawmakers don't work out a deal before the end of the year, nearly everyone's taxes will go up and deep spending cuts will kick in. And that could mean a lot more people needing help from area non-profits, but those non profits could also end up suffering.

Area charities are concerned that if Congress doesn't reach a deal by the end of the year, tax hikes will leave people with less disposable income to donate.

Salvation Army Maj. Don Wildish said donations have been down this year.

"As we have counted to see where we are right now, we're in the last day of November and we're down about $8,000 from where we were this time last year," he said.

And it's the same for the Grayson County Shelter, said Ashley Earls.

"I have noticed a difference this year with donations getting a little bit slow coming in, but it is still early in the season so I'm optimistic. But there has been a big difference," said Earls.

Both are concerned about the possible tax increase the so-called "fiscal cliff" may trigger, which can keep potential donors from giving.
Austin College Economics Associate Professor, Dr. Melanie Fox, said non-profits fear the unexpected.

"Nobody knows whether or not Congress will allow us to go over the fiscal cliff or will a budget compromise be reached or what the effects of this compromise will be, so right now the main effect is uncertainty," she said.

Non-profits are also concerned that Congress might cut out the income tax deduction for donating to charities.

"When those tax benefits are removed, then some of the donations will just simply won't come in. And that does bring some concern and it does change in which we operate as well as other non profits will operate," said Wildish.

"It also depends on the motivation for that charitable giving is. If the motivation is internal and unrelated to the tax code, then there should be no change in charitable giving," said Fox.

Dr. Fox said the effects of the fiscal cliff can go either way for non-profits: either people will donate less or people will donate more. But Maj. Wildish said he believes the Salvation Army will make it through.

"The Lord has been with the Salvation Army through recessions, depressions and wars. And I'm sure the Lord will see us through as well," he said.

So will the shelter, said Earls.

"I'm very optimistic that we'll work it out in some way. We've been here for 25 years this year so we've seen bad times, we've seen good times, we're still here," she said.

Both Wildish and Earls said no matter what the outcome, their organizations would find a way to serve as many people as they could.

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