Profit From Knowledge of Non-profits:
Green is all the rage right now: community
gardens, co-ops, farmer’s markets. But
what about it’s do-gooder predecessor and now compadre, the Non-Profit? With the world’s citizens going the way of eco-conscious,
kale-wielding composters, it’s about time the myths of non-profits are
debunked. Find out how to maximize your
contribution to your community by understanding how the non-profit and other
associated organizations work.
Let’s start with our very own San Antonio
B-cycle:
San
Antonio Bike Share is striving to provide citizens and tourists the ability to
maximize the environmental, economic, cultural, and social benefits of
bicycling. The nonprofit organization provides an efficient, sustainable mode
of transportation, while also promoting health, quality of life, and
preservation of the environment for San Antonio residents, commuters, and visitors.
They
say they’re trying to benefit the environment and people, but is this just
another green-washed program?
No.
As a 501c3, San Antonio B-cycle is legally obligated to operate not for
a profit (hence the name), but for its constituents, meaning you the residents
and visitors of San Antonio. There are
no incentives to non-profits to deceive the public. Non-profits by definition are there to
provide for the community they have professed to serve, upon receiving the
501c3 tax exempt status.
What
does green-washed mean?
Wikipedia’s definition says: Greenwashing, or "green sheen", is a form of spin in which green PR or green marketing is deceptively used to promote the perception that an organization's aims and policies are environmentally friendly. Whether it is to increase profits or gain political support, greenwashing may be used to manipulate popular opinion to support otherwise questionable aims.
Wikipedia’s definition says: Greenwashing, or "green sheen", is a form of spin in which green PR or green marketing is deceptively used to promote the perception that an organization's aims and policies are environmentally friendly. Whether it is to increase profits or gain political support, greenwashing may be used to manipulate popular opinion to support otherwise questionable aims.
What
does 501c3 tax exempt status mean?
A non-profit is a charitable organization. Non-profits are not operated for the benefit
of private interests, private shareholders, or an individual, and they are not
allowed to influence legislation.
Basically they are here to do good and serve the community. Since they are operating for the good of the
community, they are given benefits by the government. This is to offset the fact that without an
aim for income generation, non-profits have to rely on charitable contributions
to keep their doors open. Benefits
non-profit’s receive include being able to incentivize contributions by
offering tax deductions, are exempt from some state and federal taxes, and are
eligible for lower postal rates.
If I
donate to a 501c3 non-profit organization, will I receive a deduction on my
taxes?
Maybe.
When doing your taxes, you either itemize or take the standard
deduction. If you are a freelancer who
can “write things off,” or are someone who makes a lot of donations throughout
the year then most likely you will itemize your taxes and would benefit from
your charitable donation. If you have a
regular wage or salary job, most likely you will take the standard deduction
where the deduction for a charitable donation will not benefit you tax-wise. If you plan to itemize, you must obtain a
receipt from the organization for your donation to show the IRS if you are
audited.
Philanthropy is important, but do your
research before allocating those hard-earned resources. I recommend volunteering for the organization
you are thinking about donating to. Find
a personal connection to a few organizations that touch your life. Be aware that the smaller the organization
and the better you know them, the more impactful your donation will be. Although larger organizations have their
merit, they tend to have more bureaucracy and less transparency as to what your
money is going toward.
San
Antonio B-cycle charges for their services, isn’t this illegal for a non-profit
to do?
No.
Some non-profit’s do not charge for their services, and some do. They always, however, try to make their
services as affordable as possible. San
Antonio based their prices on how much income they need to generate to stay
open, and keep providing their stellar service to you. Non-profits have to pay bills just as
businesses do: rent, utilities, equipment, staff, etc.Where does the money come from to operate a non-profit?
Organizations can generate money in many different ways. They can charge a small fee to those using the services. The most common revenue streams include grants from foundations, individual contributions made by you or a wealthy community member, and fundraisers. Give 501c3’s some props because not only do they have to do the job of a business – provide the service, but also fundraise on the side. Some, but few, organizations qualify for governmental funding, which usually provides more funding stability to organizations than other funding streams. Most likely organizations have all of the above income streams, not just one. Every penny counts.
Do
non-profit’s give money to anyone in need in their community?
Unfortunately not. It takes a lot of alignment to receive
funding for a 501c3. The non-profit has
a mission statement which outlines the aim of their services, but so do
foundations and government grants. So
only if the organization’s own mission statement fits within this mission are
they eligible for funds. If the agency
is lucky enough to receive a grant, they essentially enter into a promise to
only use the funds as they have specified through their mission and services.
What
if after all this, a non-profit does have a profit at the end of the year?
They inject it back into the programs and
make them bigger and better, able to serve more people or make their services
even more affordable.
What
is the difference between a non-profit and a co-op?
A non-profit is not owned by anyone or any
group of people. It is ultimately
governed by its board of directors, and run by an Executive Director +
staff. A co-op is owned by its
members. Let’s use the example of a
grocery store co-op. There are
essentially two types of co-ops: member-owned (the people that shop there for
groceries) and employee-owned. You buy a
share of the co-op to become a part-owner, have voting rights at meetings and
general influence how the co-op is run.
Organic and fair trade products are usually the hallmark of co-ops
because the people shopping also decide what is available through their
ownership, and naturally want the healthiest possible products.
Photo
Credit: Lani Hanson, Let’s all do what we
can to contribute.
And
lastly the most frequently asked question…
Do
people get paid to work at a non-profit?
You’re a volunteer right?
Yes, the staff at non-profits are paid. Non-profits run like a business in this
sense. There is an Executive Director
and other support staff, depending on how large the organization is. Please bear in mind though, usually staff at
non-profits are paid 10-20% less than their business counterparts. The quality of service is not lower, these
staff members have consciously taken a pay cut in order to participate in a
project they believe in and to ensure these services are available to you. Ways that you can contribute to make sure
your community organization stays open include getting on their mailing list
for volunteers, making a donation according to what suits your situation,
bringing your talent to a non-profit staff, or just giving a big smile and a
word of gratitude to those already staffing the organizations in your community. 
Author and guest blogger, Lani Hanson,
worked at 3 social service non-profits in Minnesota, Texas, and
California. She was also a volunteer staff
member at the San Francisco Bike Kitchen non-profit co-op. She now is the Communications Manager for a
start-up in Berlin.
Follow her on
twitter @lanihanson.
*This article brought to you by
Andrew from bikesnbits
