Moving Day

The class blog has a new address:  http://www.ngopedia.net .  One advantage of this is that you’ll be able to register directly, without having to sign up for a wordpress.com blog; as soon as I see you’re on the site, I’ll give you editor privileges so you can post & add links to the blog roll, should you so desire.  Everything else will look pretty familiar.

Clash of the titans

The governor of Missouri wants to sell the state’s nonprofit student loan agency in order to fund a 350 million building program.  The AG warns the board that to do so would violate their fiduciary duties.  More here, here and here.

Keeping Pace

Board approves salary increase for President

Pace Press op-ed on salary increase

University anticipates enrollment decline

Class time change for 9/27

Class will start at 7:00 p.m. on 9/27. 

Assignment 9/27

Your eyes and ears did not deceive you–no new reading for this Wednesday!  Re-read chapter four, focusing on fiduciary duties.   Re the investment standards (UMIFA, etc.):  focus on pulling out the most important points; don’t worry about all the small details.

Class 2 Assignment Reminder

Skim chapters 1-2, read chapter 3. 

When Baptists go bad

They go to jail.

Once again, though, it is not simply the case that the leaders of this foundation were crooks.  Nonprofit managers engaged in bad behavior all too often, like people generally, see themselves as doing good or what is necessary.  This makes your job harder–and important.  

Accountant jailed; nonprofit formed

A couple interesting stories from today’s news:

• From South Carolina, a group of alumni decide to create a nonprofit to fund a book about their school, as well as a scholarship program.
• Accountant sentenced for stealing from nonprofit.

Are all nonprofits 501(c)(3)s?

One key point from class 1: 

Not all nonprofits are 501(c)(3)s. 

In the U.S., nonprofit status is typically defined under state law.  New York, for example, defines a nonprofit corporation as a corporation . . .

(1) formed under this chapter, or existing on its effective date and theretofore formed under any other general statute or by any special act of this state, exclusively for a purpose or purposes, not for pecuniary profit or financial gain, for which a corporation may be formed under this chapter, and (2) no part of the assets, income or profit of which is distributable to, or enures to the benefit of, its members, directors or officers except to the extent permitted under this statute.

“501(c)(3),” however, refers to a section of the federal International Revenue Code.  Section 501(c)(3) is part of a longer set of sections defining entities exempt from federal income tax.  Organizations that meet the standards established under Section 501(c)(3) are commonly referred to as a charities. Here is section 501(c)(3):

(3) Corporations, and any community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or to foster national or international amateur sports competition (but only if no part of its activities involve the provision of athletic facilities or equipment), or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual, no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation (except as otherwise provided in subsection (h)), and
which does not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office.

Once again we need to be careful.  It is possible that an entity recognized as a charity elsewhere (for example, under state or foreign law) may not be exempt under Section 501(c)(3).  Likewise, it is not necessarily the case that an entity exempt from federal income taxes under Section 501(c)(3) will be tax exempt in other contexts. 

First class +1

I enjoyed meeting everyone in the first class–what an interesting group!  On both this site & 4nonprofits.org, I’ll be posting items related to the themes of the course throughout the week, from news stories to recaps of things discussed in class. 

Also, you may want to check back early next week for outline guides to week’s required reading, which you can fill out