L3C facts
--An L3C must have a socially beneficial purpose.--It's designed to let foundations make program-related investments more easily.
--Investors can earn a return and hold equity in the company.
--L3Cs are not tax-exempt, and contributions to L3Cs are not tax-deductible.
--Other states that have passed L3C laws: Vermont, Michigan, Wyoming, Utah, North Dakota.
The article explains a new law that would allow non-profits to attract more capital and become more competitive in the private marketplace. I agree that non-profits should have the opportunity to compete. My problem with laws and opportunities such as this it gives an unfair advantage. The non-profit has advantages as does the private sector. They should both have to capitalize on their strengths. I would bet that this non-profit profiled is not competitive not only because of the federal filing status but because of other indicators as well. It is important to allow organizations to compete with each other, and that means not creating laws that make them more or less advantageous.
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