response 77 of 115:

Apr 11 14:59 UTC 1997

Bmoran, the sales tax should *only* be charged on the "goods" part of
a mixed transaction.  For example, I have in front of me a service 
station statement for replacing ignition wires chewed apart by squirrels.
The labor was $75 and not taxed; the parts were $11.60 and were taxed.
        Since I am in business for myself as a lawyer, I am certain that
"services" such as the ones I perform are not subject to sales tax.
        Oh--here is another service station bill.  I paid $15 for the
diagnosis of a problem.  It was not taxed.
        Rcurl and I don't disagree with the theory of nonprofits here,
just the application of the theory.  Internet services are things of
value, hence not tax-deductible.  But this doesn't concern Grex anyway.

response 79 of 115:

Apr 12 06:08 UTC 1997

Meanwhile, if grex finds a good reason to keep one human from having more than
one internet-active account (they'd probably alwasys have to pay for it
anyway), then the person just gets his/her friend to register as the account's
owner, a different human being, then proceeds to use the account anyway.  That
is something grex can never prevent...

response 81 of 115:

Apr 12 19:55 UTC 1997

Re #68:  I think Rane's and my disagreement about defining the word "member" 
comes down to a fundamental difference of perspective on Grex's structure. 

I think Rane sees Grex as being an object, which is owned by a corporation 
(Cyberspace Communications), which is an instance of the class of Michigan 
Corporations.  Michigan corporations are an entity understood by the State of 
Michigan, other governments, and other corporations.  They are subjected to 
and protected by a large body of laws.

Rane's perspective:
         
/---------------------------------\
| Michigan Corporations           |
|                                 |
|   /---------------------------\ |          /--------------------\
|   | Cyberspace Communications | |          | State of Michigan  |
|   |                           | |  <---->  | Other governments  |
|   |  +------+                 | |          | Other corporations |
|   |  | Grex |                 | |          \--------------------/
|   |  +------+                 | |
|   \---------------------------/ |
\---------------------------------/

I, on the other hand, think of Grex as a Community of people which would exist 
whether or not there was a Cyberspace Communications, or a concept of 
corporation, or anything else, really.  Cyberspace Communications was created 
because it was a convenient way for Grex to do business, and it was made a 
Michigan Corporation because that was a convenient way to interface with the 
rest of the world (and get the protections to which corporations are 
entitled).

Mark's perspective:
                                         /-----\
/-----------------\                      |M C I|
|                 |    /------------\    |i o n|        /--------------------\
|                 |    | Cyberspace |    |c r t|        | State of Michigan  |
|      Grex       |<-->| Comms      |<-->|h p e| <----> | Other Governments  |
|                 |    \------------/    |i o r|        | Other Corporations |
|                 |                      |g r f|        \--------------------/
\-----------------/                      |a a a|
                                         |n t c|
                                         |  e e|
                                         \-----/

I'm not going to argue about which perspective is *right* - they both are 
valid descriptions of the situation.  I suggest we use the one which is most 
useful at any given time. 

Now as far as the definition of the word "member" goes:  Rane says in #68 that 
we *must* define "member" in such a way that it agrees with the way state law 
uses the word "member".  Well, I disagree, and I think the source of our 
disagreement is our perspectives.  From Rane's point of view, the state law is 
our *foundation*, that which we should base all else on.  (In object-oriented 
programming terms, "Michigan Corporation" is the base class and "Cyberspace 
Communications" is an instance of a derived class.)  Therefore obviously our 
terminology should conform to what the state expects it to be. 

From my point of view, the fact that Cyberspace Communications is a Michigan 
Corporation is by no means the heart of the matter.  It is merely a 
convenience.  Mind you, I am in no way saying that we should do anything 
illegal - let me make that perfectly clear.  I have no desire to get into that 
kind of trouble.  What I *am* saying, though, is that the internal business of 
Cyberspace Communications is a separate entity from the interface that it 
exposes to the rest of the world.  Therefore I see no problem whatsoever with 
Cyberspace Communications using the term "member" differently than the State 
of Michigan uses it, *as long as we define the interface between the two*.  So 
if we say that "Grex Memberships" are a set of logins, and the State of 
Michigan says that "Corporation Memberships" must be a set of people, that's 
fine, there's no conflict there, as long as we define "Cyberspace 
Communications Memberships" to be a set of people and expose it in our 
interface.

Now, having said all that, and listened to what Rane and other people have 
said in this item, I have come to the conclusion that it really isn't worth 
complicating the idea of membership as described in the last paragraph.  But I 
wrote this response anyway, to make the point that Rane's perspective is not 
the only one, and when an issue like this comes up next time I hope we will 
consider looking at it in a different way, and keep in mind that Grex is owned 
by a corporation out of convenience, not because of fundamental need or moral 
imperative.

response 83 of 115:

Apr 13 05:08 UTC 1997

That's a nice bit of sophistry, but it doesn't change the facts. I don't
"see" Grex in any way other than defined in its Article and Bylaws, which
are adopted within the framework of state law. When people all full of
community spirit and good fellowship wish to accomplish something in this
world, there are many advantages of incorporation. Doing so does not
change the community, but it *does* entail a set of responsibilities
and obligations, which cannot be evaded except by violating the law.

However I now see you *are* willing to define different classes of
membership - "Grex Membership", and "Corporate Membership". That's fine,
but a person can only be one or the other.

response 85 of 115:

Apr 14 01:10 UTC 1997

Between the two paradigms described in #81 above, "Marks Perspective is 
how I would describe GREX, too.  Just for the record.  It's certainly
what I understood to be happening when GREX was formed and the decision was
made to incorporate Cyberspace Communications.

response 87 of 115:

Apr 14 05:53 UTC 1997

Oh, I almost forgot - Rane, in #68 you said large charitable corporations
are not free to give out perks, and you asked me what examples I was thinking
of.  I was thinking of the way public radio stations and public TV stations
offer gifts (maybe they call them premiums - I can't remember) to people
in order to get them to become members.

response 89 of 115:

Apr 14 06:55 UTC 1997

Re #87: you will find that the value of the "premiums" must be subtracted
from what you donate. This is just about always true if the premium can
also be purchased somewhere, or if it of more than minimal value.

I said in #83 that incorporation need not change the behavior of an
organization except to meet its legal obligations. I wouldn't be here if
it were an unhappy organizations (a reason I am not on m-net). There
are two aspects of an incorporated organization: the legal one, that
defines the relations between those involved, and the way the participants
behave. They must not be in conflict. So I do have to modify my statement
in #83: I do see both facets of the organization.

The "sophistry" was putting forward an "organization" that did not square
with the legal organization, and then drawing conclusions from it.

Did the Kiwanis say how much was deductible? Or was their circus essentially
a free show? That is certainly possible. (This is a counter example to
the claim that we have to 'value' internet access at the going commercial
rate - the Kiwanis do not have to 'value' their circus at the going 
commercial circus rate.)

response 91 of 115:

Apr 14 20:26 UTC 1997

Your proposal would have put them into conflict...but there is *usually* a
way to accomplish some objective in a conforming manner. The conforming
objective I read into #0 is that you want to sell accounts with telnet
access to members in order to raise money. My impression is that not many
here agree with doing that, but there is no legal reason it can't be done,
though it may jeopardize a tax-exempt status for Grex as it gives members
a special benefit. 

The fine lines of how much is allowed aren't so fine. THe "non-profit" 
publication from the IRS (557 I think) addresses these matters, but not
very clearly. The law itself - no one reads 8^{. 

Its amazing how obscure the IRS can be. I recently looked into the
lobbying limits on 501(c)3 orgs. The law says "no substantial part" of
income can be used to influence legislation. The term is not defined, but
what is spent must be reported annual in a 990 filing. The IRS looks very
critically at whether "no substanial part" is exceeded, though. THEN,
there is another IRS regulation *that does not apply* unless the
organization files a form to elect that part of the law, wherein the
*dollar* amounts of allowable lobbying are specified. Go figure. 

response 93 of 115:

Apr 16 05:50 UTC 1997

Which 4? The major one is that donations - which includes dues - are
federally tax exempt. There are other conditions that must be met,
the support test in particular, but that's not hard for Grex.

response 95 of 115:

Apr 16 15:46 UTC 1997

re: 93
        Member donations ala' Tax Exemption - it appears some members
        tried to use the donation as an exemption, and somehow it was
        refused by the IRS (?).

        I don't understand it, but knowing the way the IRS behaves, it
        wouldn't suprise me in the least.

        Maybe it was a onetime "oopsie", but I wouldn't know - other 
        members patrons ever have this problem..?

response 97 of 115:

Apr 17 16:56 UTC 1997

        I'll leave it to dpc, aaron and keats, et al, to explain it all.

        I don't suppose it makes sense to most folks, but it's a 501c3.

response 99 of 115:

Apr 18 18:04 UTC 1997

Of course, the main reason it might be "bad" is if the organization didn't
want to be a charitable non-profit. Some organizations *want* to make
money and enrich their investors.