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| Author |
Message |
| 25 new of 138 responses total. |
aruba
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response 75 of 138:
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Apr 4 12:21 UTC 1998 |
I basically agree with Marcus. I wouldn't mind getting grants for one-time
purchases, but I don't want to become dependent on grants for operating
expenses. Part of the problem is that once users hear that we are getting
money from some seemingly bottomless source, they will be less inclined to
give themselves.
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mta
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response 76 of 138:
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Apr 4 15:30 UTC 1998 |
I don't really like the idea of grants -- people who give away money in
the form of grants generally have an agenda and I don't want to see Grex
mired in pressure to meet someone elses agenda.
Also, I *like* the idea that Grex is user supported. I think it makes a
real difference in our sense of ownership -- and therefore the entire
tenor of the community.
On the other hand, I too have been privy to offers of corporate
donations of hardware that never manifested because Grex wasn't 501c3
certified.
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rcurl
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response 77 of 138:
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Apr 4 20:32 UTC 1998 |
Most granting agencies specifically refuse to give grants for operating
expenses. You are supposed to raise those from public donations.
Re #76: there is a large business of grant-making, based in foundations
created by people with lots of money wanting to do good works. Grants are
always given *for a purpose*, but I would not call it a matter that
they have an "agenda". The purposes for which foundations give grants are
spelled out up-front, and the application process if clear and legal. You
go where there is a "match" between your purposes and the grant giver.
Then, their "agenda" is your "agenda".
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valerie
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response 78 of 138:
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Apr 5 15:32 UTC 1998 |
This response has been erased.
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remmers
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response 79 of 138:
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Apr 5 19:57 UTC 1998 |
It is possible to get grants to support writing grant proposals.
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rcurl
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response 80 of 138:
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Apr 5 21:03 UTC 1998 |
Grants are also given for start-up of new ventures, which include salary
and overhead, but the expectation that after a couple-four years, the
organization will be on its own.
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jep
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response 81 of 138:
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Apr 6 03:15 UTC 1998 |
According to Aaron Larson (aaron), who wrote about it on M-Net years
ago -- but please don't hold Aaron responsible for my memory of what he
said -- a 501(c)(3) organization *must* depend on gifts for 30% of it's
income. M-Net's patronships are not gift income, and so, of course,
neither would be Grex's membership monies. Grants are gift income.
This is the sort of rule that Bruce Price was warning you about, I
think, and which no one at Arbornet has ever understood very well.
Aaron harangued the Arbornet Board for years about these sorts of
things, and in my opinion he confused us all enormously. I don't think
the rules are really hard to understand, hard to meet, or that the
consequences are dire if you don't know exactly what you are doing and
have to make corrections, but a lot of people ran away from the Arbornet
because of them.
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rcurl
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response 82 of 138:
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Apr 6 06:22 UTC 1998 |
Correction: membership dues in a 501(c)3 organization *are* exempt. Look
it up. The recent revisions of the code spell this out more precisely.
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mta
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response 83 of 138:
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Apr 6 13:04 UTC 1998 |
Also, m-net and Grex handle memberships differently. There are no member
lines here and very few perks of any kind. Most of those are not so much
"perqs" so much as resource management and good net citizenship. That may
also influence any differences in how the IRS percieves things.
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jep
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response 84 of 138:
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Apr 6 15:10 UTC 1998 |
Rane, I think membership dues are exempt to the extent they are
donations, like if you buy a $500/year membership to an art museum that
carries very little benefit, that's a tax exempt donation. If the
membership is mostly to get you benefits, then it's a purchase.
I don't know what the differences would be in how the IRS regards
M-Net's patron and member charges, and how they regard Grex's member
charges. I don't know if either would be considered donations that
would count toward the 30% rule that Aaron used to bring up. Sounds
like Rane has a better handle on this than I do.
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rcurl
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response 85 of 138:
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Apr 6 15:43 UTC 1998 |
The IRS literature explains it pretty well. Membership dues are deductible
unless one receives "substantial benefits" therefrom (not received as part
of the charitable activities of the organization). A newsletter to members
only is not considered a "special benefit". Consult
http://www.mayolawfirm.com/Philanthropy/Substantiation.html and read the
link to Membership Benefits. Here is a brief selection:
"Also disregarded for purposes of the substantiation and disclosure rules
are certain membership benefits provided in return for an annual payment
of $75 or less. The membership benefits may include frequently
exercisable rights and privileges and admission to members-only events.
When a donor pays for two or more memberships at one time and the amount
paid is $250 or more, an acknowledgment is required, but the membership
benefit exception applies to each separate membership."
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dpc
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response 86 of 138:
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Apr 6 20:27 UTC 1998 |
Actually, I read the stuff Aaron sent the Arbornet BoD on 501(c)(3).
As I remember (be advised it's been a couple of years ago) the "30%
rule" does *not* say that the group must get 30% of its revenue
from donations. It says that not more than 30% of the revenue can
come from people giving large amounts. I call this the "anti-fat-
cat" rule. It is perfectly in keeping with the 501(c)(3) rules
to exist solely on revenues from operations and receive no
donations at all.
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rcurl
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response 87 of 138:
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Apr 6 20:56 UTC 1998 |
Only if the "revenues from operations" are donations from the public.
The support test, to which you refer, concerns the required support of
the organization from donations from the public. To meet the Public
Support Test the organization must normally receive at least 1/3 of its
total support from government agencies and the general public. "Support"
means grants from government agences and other public charities, and
contributions from individuals and nonexempt organizations.
David has it backwards with respect to donations from single sources.
There is a further provision that if 1/3 does not come from public sources,
only more than 10% need do so if the rest contains public "like" support,
for example from endowment interest from a publically supported foundation
(it gets murky between 10% and 1/3, so it is best to meet the 1/3 rule for
operating income). There is also an exception for "unusual grants" from
"disinterested parties". Revenue Procedure 81-7, 1981-1 C.B.621 lists
the factors taken into account by the IRS in qualifying grants as "unusual".
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aruba
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response 88 of 138:
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Apr 6 22:00 UTC 1998 |
More than half our income certainly comes from membership dues.
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rcurl
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response 89 of 138:
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Apr 7 05:19 UTC 1998 |
We (mkc) had to learn about this because a couple of major donors came
our way. We *barely* satisfied the 1/3 rule for a while.
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mdw
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response 90 of 138:
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Apr 7 09:35 UTC 1998 |
Some of the freenet stories I recall involved freenet's that got nice
large startup donations to cover operating expenses. In the case I
recall the most about, the operating expenses included a t1 connection,
1 or 2 full-time operators, and a bunch of phone lines. Only problem is
they really didn't have another funding sources to cover those expenses
when the initial grant ran out. There was a sort of basic
incompatibility between the initial definitions of what freenet's were
"supposed" to be, and the funding models defined by most grants.
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janc
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response 91 of 138:
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Apr 7 13:57 UTC 1998 |
Our 501(c)3 application will include a detailed description of where we
get our money, and what benefits people get in return for the money they
donate. If the IRS doesn't like it, they will let us know. My belief
is that the IRS will like it.
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other
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response 92 of 138:
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Apr 7 17:03 UTC 1998 |
then a real concern might be being locked into the current model of funding.
however, if after consideration and much conjecture about what the future
holds, it is concluded that this is the model we really do want, then no
problem.
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mta
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response 93 of 138:
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Apr 7 18:00 UTC 1998 |
Grex was initially conceived as a member supported, member run conferencing
system. I don't see it changing without the very fundamentals of what makes us
Grex being undermined.
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mary
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response 94 of 138:
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Apr 7 22:04 UTC 1998 |
In the past I had concerns over what would happen to Grex
if we applied for and got 501(c)3. Now, I'm starting to
feel somewhat uneasy over where our evolution will take us
if we don't.
I'm very pleased it's Jan who will be stating our case.
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aruba
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response 95 of 138:
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Apr 8 01:30 UTC 1998 |
By the way, if you'd like to see the financial information we'll be sending in
with the application, it's in ~aruba/reports/501c3. It's basically a summary
of our credits and debits over the last 3 years, and a list of all our
miscellaneous financial activity.
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bru
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response 96 of 138:
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Apr 8 13:51 UTC 1998 |
And how are you coming on the payment of your city owed taxes? Or are you
just going to ignore the city? Am I starting to sound like arron?
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janc
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response 97 of 138:
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Apr 8 14:36 UTC 1998 |
We need to investigate the issue of city taxes and discuss that at the next
board meeting.
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aruba
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response 98 of 138:
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Apr 27 02:44 UTC 1998 |
I have revised the numbers in the 501(c)3 report, and included a list of
people who have contributed over 2% of Grex's donations in the past 3.25
years. You can find all the financial data in ~aruba/reports/501c3 .
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davel
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response 99 of 138:
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Apr 27 12:26 UTC 1998 |
Thanks, Mark. I glanced through it (not really *read*). s/compiter/computer/
somewhere in there ... The data was interesting.
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