Nonprofit buys store

The Charles P. and Margaret E. Polk Foundation, Millersburg, spent $80,000 to purchase a former Uni-Marts Inc. convenience store at 449 Race St. in the borough, according to Dauphin County records.

Closing the deal in mid-March, the nonprofit organization plans to run the outlet for the benefit

"This is right in the center of our operations," said Shaffer, who likened the venture to a hospital gift shop or thrift store. The store will be known as the Race Street Handy Market.

But one foundation watcher saw the purchase as reflecting a potentially disturbing trend: nonprofits branching out into forprofit operations.

Recent local activity includes a partnership between Turkey Hill Minit Markets Inc. and Bethel African Methodist Episcopal Church in Lancaster. As part of a downtown revitalization plan, the pair plans to refurbish a Turkey Hill store on South Duke Street.

In addition, the YMCA of York and York County has been buying rental properties surrounding its renovated downtown facilities. The group hopes to create more affordable housing in the center of York.

"I feel very, very strongly that this is going to be a huge issue within the next couple of years," said Jamie Nikoloff, president and CEO of Philanthropy Matters, a Harrisburg consulting firm that promotes accountability for nonprofit organizations.

Nikoloff said nonprofits can do good by investing in properties that for-profit concerns are reluctant to buy. "It may give a community a spark," she pointed out.

But she warned that holding nonprofits accountable for their decisions can be difficult, particularly when it comes to managing assets like convenience stores.

Nonprofits, Nikoloff said, often forego the sort of analysis common in the business world before embarking on new projects. For example, she said, few nonprofits perform feasibility studies or hold focus groups.

"In some cases, it's that an organization is so small ... and they really don't think about things like that," she said. "Some are very business savvy," she added, citing Boys and Girls clubs, which benefit from a national network.

The Polk Foundation provides housing for the elderly and holds $3.4 million in assets, according to the Internal Revenue Service. Its annual income is $563,296.

Playing down the significance of the purchase in Millersburg, Shaffer noted the former owners failed to stock the convenience store to meet the needs of elderly neighbors and weren't making a profit, anyway.

In fact, the former owners, Satish Khatana of Ontario, Canada, and Rattan and Suraksha Devi Sharma of Harrisburg, sold the shop at a loss after running it for less than a year as a Sun-Mart convenience store. They purchased the store in July 1999 for $90,000 from Delaware-based Uni-Marts, according to county records.

The Sharmas did not return a phone call seeking comment.