Our social media timelines are full of articles detailing how California drives companies out of the state or how outrageous policies have forced thousands to flee the Golden State.

We have heard all about the terrible impact of California policies on business and quality of life.

However, California has also become a hellhole for philanthropists, nonprofits, and those who just want to work for their community.

Nonprofit organizations of all kinds are critical to solving a litany of issues and provide services for members of the community, cutting out the government’s bureaucratic blackhole. From directly helping people and saving animals, to figuring out policy solutions or holding public officials accountable, nonprofits play a significant role in our society.

Additionally, the nonprofit sector is one of the largest job-creating sectors in our economy, employing millions of people nationally.  According to Jan Masaoka, the CEO of California Association of Nonprofits, in an op-ed for CalMatters, “one in 14 California jobs is at a nonprofit, and California nonprofits bring in more than $40 billion each year from out of state.”

However, nonprofits have found themselves dealing with red tape that ties their hands throughout the pandemic. Nonprofits have had to cut back operations and some are even leaving the state altogether. “Like small businesses, many nonprofits are suffering economically and being forced to lay off staff. Nearly one-third of nonprofits have had to cut services below 50%, and 14% have already shut down completely,” wrote Masaoka last October.

Losing them not only means California is missing out on their services, but creates a void that either won’t be filled or will have to be filled by government (at taxpayer expense). A shrinking nonprofit sector will also deprive many Californians who seek employment in the nonprofit sector from job opportunities.

For example, The Cicero Institute is one of the many organizations that could no longer last in California. The institute is committed to “fight for transparency and accountability in government and open markets.” However, they could not serve their community as much as they wanted, given the current state of affairs in our state.

Entrepreneur Joe Lonsdale, who started the organization, noted in an op-ed for the Wall Street Journal that “our investments follow the talent.” He bets “that the future of America is going to be built in the middle of the country, in places with good government and a reasonable cost of living.”

In his eyes, Texas is the promised land for his organization, so that’s where the institute is going.

The Cicero Institute is not the only organization that had packed their stuff, their expertise, and all the good they could do for their community to leave California. Unfortunately, they won’t be the last.

Even nonprofit colleges are leaving the state. Horizon University, a nonprofit college based in San Diego and operating since 1993 said it would relocate out of state, too, to Indianapolis.

You can’t change the world when you can’t pay rent. Masaoka indicates nonprofits facing eviction because they can’t afford their rent any longer in California. Additionally, those who have worked with nonprofits know that many operate on tight budgets and pay in the sector isn’t very high.

Meanwhile, the price of rent and taxes keep increasing in major cities like Los Angeles and San Francisco. Nonprofits no longer see this place as an ideal location for their headquarters when their staff cannot afford a decent life. The restrictive zoning laws that disallowed land development have caused massive housing shortages in the major cities, forcing many middle-income and low-income workers to live far away from their workplace and commute long hours in traffic. In Texas, affordable housing and low cost of living allow workers to live close to their workplace and commute less.

Enormous taxes and expensive housing are not the only issues that discourage nonprofits, businesses and families from staying in California. Some of the biggest cities in the state that usually attracted talent, capital and have high needs for nonprofit services have also seen increases in crime.  As Lonsdale wrote, “Three of my colleagues’ wives have been harassed and chased by derelicts in San Francisco’s streets, which are littered with needles and human waste. My wife is afraid to walk around the city with our young daughters.”  Unfortunately, the police in large counties such as San Francisco — which has the nation’s highest property-crime rate — often don’t respond to such crimes, as Lonsdale mentioned.



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