DOCSLIB.ORG

How Public Is Private Philanthropy? Separating Reality from Myth

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
How Public Is Private Philanthropy? Separating Reality from Myth H O W P U B L I C I How Public Is S P R I V Private Philanthropy? A T E How Public Is Separating Reality from Myth P H I SECOND EDITION L A N Private Philanthropy? T H In recent years, some public officials and advocacy groups have urged that R O Separating Reality from Myth P private philanthropies be subject to more uniform standards and stricter Y ? SECOND EDITION government regulation—ranging from board composition to grant distribution to philanthropies' charitable purposes. A major justification cited by advocates of these proposals is the claim that the charitable tax exemption and deduction Evelyn Brody and John Tyler are government subsidies, and thus philanthropic funds are "public money" and should be publicly controlled. Some advocates also claim that philan - thropic assets are public money because philanthropies operate under state charters and are subject to state oversight. In the second edition of this mono - graph, legal scholars Evelyn Brody and John Tyler evaluate the legal basis of the "public money" claim. They conclude that it is not well founded in legal authority. State oversight of philanthropies is not based on an assertion that philanthropies are subject to state direction or that their assets belong to the public, they write. Similarly, the fact that philanthropies have state charters does not make them state agencies or subject them to the constraints that B R apply to public bodies. Finally, the philanthropies and their donors receive their O D Y federal tax benefits in return for the obligation to pursue public rather than A private purposes and to comply with the laws designed to ensure the pursuit N D of such purposes. There is no evidence, Brody and Tyler find, that these benefits T Y were m eant to give government other types of control over philanthropies. L E R Evelyn Brody is a professor at Chicago-Kent College of Law, Illinois Institute of Technology. John Tyler is vice president and corporate secretary at the Ewing Marion Kauffman Foundation. PhilanthropyRoundtable.org (202) 822-8333 Free copies of this book are available to qualified donors. An e-book version is available from major online booksellers. PRINCIPLES OF PHILANTHROPY How Public Is Private Philanthropy? Separating Reality from Myth Second Edition How Public Is Private Philanthropy? Separating Reality from Myth Second Edition Evelyn Brody and John Tyler First edition copYright © 2009; second edition copYright © 2012, The PhilanthropY Roundtable. All rights reserVed. Published bY The PhilanthropY Roundtable, 1730 M Street NW, Suite 601, Washington, DC, 20036. This monograph and a separate, related laW reVieW article Were suggested and supported bY funding from The PhilanthropY Roundtable. The opinions eXpressed in these pieces are those of the authors alone. This monograph Was edited bY SuZanne Garment. Free copies of this book are aVailable to qualified donors. To learn more, or to order more copies, call (202) 822-8333, email [email protected], or Visit philanthropYroundtable.org. An e-book Version is aVailable from major online booksellers. A PDF maY be doWnloaded at no charge at philanthropYroundtable.org. No part of this publication maY be reproduced, stored in a retrieVal sYstem, or transmitted in anY form or bY anY means, electronic, mechanical, photocopYing, recording, scanning, or otherWise, eXcept as permit - ted under Section 107 or 108 of the 1976 U.S. CopYright Act, Without the Written permission of The Phi - lanthropY Roundtable. Requests for permission to reprint or otherWise duplicate should be sent to [email protected]. ISBN 978-0-9851265-1-3 LCCN 2012932752 First printing, March 2012 . Table of Contents 9 Foreword to the Second Edition 11 Acknowledgements 12 Preface 17 Introduction: The Semantics of the Public-Money Debate A. The Roots of Confusion B. The Modern Public-MoneY Claim 26 Chapter I: The Parens Patriae Claim. Neither the fact that foundations and other charities haVe public purposes nor the fact that theY are subject to the AttorneY Gen - eral’s parens patriae poWer supports a claim that these organiZa - tions must serVe the same ends as those of goVernment or that goVernment maY undulY intrude in their goVernance and other de - cision-making. A. PriVate parties haVe the authoritY to determine the charitable purposes that particular foundations and other charities pursue. B. The state’s authoritY to regulate and superVise charities does not grant the state directiVe poWer oVer foundations or other charities or transform their assets into propertY of the state or the general public. How Public is Private Philanthropy? 34 Chapter II: The “State Actors” Claim The fact that foundations and other charities haVe state charters does not alone make these organiZations “state actors” or goVern - mental or quasi-goVernmental entities accountable as such to the public. A. The grant of a state charter does not render a nonprofit corpo - ration and its assets subordinate to the state. B. In general, foundations and other charities enjoY constitutional freedoms of association and eXpression, and are not subject to the constitutional constraints imposed on state actors. C. Foundations and other charities generallY are not subject to public access laWs. 53 Chapter III. The Public Money Argument The eXistence of the federal taX eXemption and charitable taX de - duction does not support the public-moneY argument. A. The coVenant underlYing the eXchange of federal taX preferences for charitable actiVitY requires that eXempt charities dedicate their assets to, and use them in furtherance of, charitable purposes and not for priVate benefit. B. IndiViduals and businesses benefit from taX-faVored treatment. Their assets and resources do not therebY become public, and theY are not therebY transformed into goVernmental entities. Founda - tions and other charities should be VieWed no differentlY. Evelyn Brody and John Tyler C. EVen if the taX-faVored treatment of foundations and other char - ities is VieWed as a goVernment subsidY or grant, most charitable assets come not from goVernment but rather from priVate funds. D. Foundations and other charities that are inVolVed With goVern - ment onlY indirectlY, through their taX eXemptions, should not face restrictions or impositions more onerous than the limitations that entities face When theY are inVolVed With goVernment directlY, through grants or contracts. E. The taX-faVored treatment of foundations and other charities, like the taX-faVored treatment of businesses and indiViduals, does not entitle goVernment to impose unconstitutional conditions on recipients. 77 Conclusion 82 Bibliography and Cited Sources 90 About the Authors 93 About The Philanthropy Roundtable Foreword to the Second Edition The PhilanthropY Roundtable is dedicated to helping donors achieVe their charitable objectiVes. The Roundtable offers eXpert adVice and counsel to indiVidual donors and foundations that are its members and brings donors together With others Who share their interest in formu - lating and implementing philanthropic strategies that Work. Part of the mission of the Roundtable is to make its members aWare of the features of the legal and policY climate that maY affect donors’ abilitY to achieVe their charitable aims most effectiVelY. In recent Years, this climate has included increasing pressures from some public officials and adVocacY groups to subject priVate philanthropies to more uniform standards and stricter goVernment regulation. Such changes could sig - nificantlY affect the abilitY of philanthropies to continue to plaY their role in supporting and nourishing American pluralism. A major justification cited bY adVocates of these proposals is the claim that philanthropic assets are “public moneY.” These adVocates argue that the charitable taX eXemption and deduction are goVernment subsidies; thus, philanthropic funds are public moneY and should be publiclY controlled. Some adVocates also claim that philanthropic assets are public moneY because philanthropies operate under state charters and are subject to state oVersight. The Roundtable offered support to tWo noted legal scholars, EVelYn BrodY and John TYler, to prepare a monograph and a longer laW reVieW article eValuating the authorities and precedents applicable to the “pub - lic moneY” claim. This support Was proVided bY the Roundtable With - out anY restrictions on content. The original publication of this 9 How Public is Private Philanthropy? monograph Was in June 2009, When the authors presented the results of their eValuation. The monograph Was Well receiVed and proVided a strong foundation for the position and protection of priVate philan - thropY in the public World. Since the original publication, there haVe been some keY legal deVelopments, including an important Supreme Court case ( Arizona Christian School Tuition Organization v. Winn ) that bolsters the authors’ original conclusions. The authors conclude the “public moneY” claim is not Well founded in legal authoritY. TheY find that state oVersight of philanthropies is based on the need to ensure that philanthropies pursue charitable rather than priVate purposes, not on an assertion that philanthropies are sub - ject to state direction or that their assets belong to the public. SimilarlY, the authors find, the fact that philanthropies haVe state charters does not make them state agencies or generallY subject them to the con - straints that applY to public bodies. FinallY, the authors find that philanthropies and their donors receiVe
Load more

Recommended publications
  • Staying Legal: General Guidelines for Operating a §501(C)(3)
    Staying Legal: General Guidelines for Operating a §501(c)(3) Nonprofit Corporation in Georgia Originally Prepared By: Tax Subcommittee of Pro Bono Partnership of Atlanta, chaired by Ed Manigault (formerly of Jones Day) and Tim Phillips of American Cancer Society © Copyright 2015. All rights reserved. Pro Bono Partnership of Atlanta The information contained herein is intended as general guidance for the operation of a Georgia nonprofit corporation with IRS recognition as a Section 501(c)(3) public charity. The specific facts involved in a particular situation could raise other issues and call for different analysis. Please consult periodically with an accountant (especially since compliance matters are the subject of frequent changes), and seek legal counsel if there are specific questions. Table of Contents | i Table of Contents 1 CORPORATE GOVERNANCE .............................................. 1 A. Basic Practices .................................................1 • Read and be familiar with articles and bylaws .................1 • Know and understand fiduciary duties........................1 • Plan for leadership succession . .2 • Have regular and well-planned meetings – and keep minutes....2 • Keep good records .........................................2 • Implement financial controls ................................2 • Obtain insurance ..........................................2 2 COMPLIANCE ......................................................... 3 A. Code § 501(c)(3) Exemption – Maintaining the Organization’s Most Valuable Asset
    [Show full text]
  • For-Profit Philanthropy
    Brooklyn Law School BrooklynWorks Faculty Scholarship 2009 For-Profit hiP lanthropy Dana Brakman Reiser Brooklyn Law School, [email protected] Follow this and additional works at: https://brooklynworks.brooklaw.edu/faculty Part of the Organizations Law Commons, and the Other Law Commons Recommended Citation 77 Fordham Law Review 2437 (2009) This Article is brought to you for free and open access by BrooklynWorks. It has been accepted for inclusion in Faculty Scholarship by an authorized administrator of BrooklynWorks. ESSAY FOR-PROFIT PHILANTHROPY Dana Brakman Reiser* This Essay examines Google's adoption of the novel and unorthodoxfor- profit philanthropy model. Google created a division of its for-profit company that is tasked with pursuingphilanthropic activities. Specifically, this division is responsible for addressing the global issues of climate change, poverty, and emerging diseases. Of course, companies have long blended philanthropic and business objectives. They make contributions, commit to corporate social responsibility, or even form as social enterprises. For-profit philanthropy, though, differs from these familiar techniques in both structure and scale. Likewise, for-profit philanthropy stands in stark contrast to the nonprofit, tax-exempt form of organization typically used by those pursuing exclusively philanthropicendeavors. This Essay investigates the for-profit philanthropy model, drawing out these distinctions as well as the reasons why Google chose to adopt it. These reasons reveal a fascinating mismatch between Google's philanthropic vision and that of nonprofit law. Exploring this divergence exposes the fundamental policy choices underlying the legal structures for philanthropic activity, as well as the undertheorized boundary between nonprofits andfor-profits. INTRODUCTION Google is known for its innovative search methodology, pricing structure, even employee benefits.
    [Show full text]
  • Farm Animal Sanctuary Table of Contents
    HOW TO START, OPERATE, AND DEVELOP A FARM ANIMAL SANCTUARY TABLE OF CONTENTS ESTABLISHING A SANCTUARY..………….……...………..…………….......…………....…......…..……1 Choosing Your Site..………………………...........…………………………………...……………......…..……1 Your Big-Picture Plan..……………………………………………………………................................1 Zoning...…………………………………………………………………………………………....…..….1 Physical Features..………………………………………………………………………….....…..……..1 Sanctuary Registration & Incorporation..…..…….....………………………………………...................…...3 Public vs. Private..………………………………………………………………………......…..………..3 State Nonprofit Incorporation...……………………………….........................................………..…3 Federal Nonprofit Status...…………………………………………………………….…….…...………4 Choosing the Board of Directors...………….……………………………………..........…….......….…….......4 Nonprofit Management Resources…..………...……………………………………………….......….……….5 Other Resources….…………………………………………………………………………………............…….5 OPERATING A SANCTUARY………………………....…………………………………..……...…………...6 Animal Care and Shelter Operations……….…………...……………………………………..……………..…6 Feeding and Watering………………………………………………………………...………………….6 Medical and Health Care………………………………………………………………..………………..6 Housing…………………………………………………………………………………………………….7 Incoming Animals………………………………………………………………………..………………..8 Outgoing Animals………………………………………………………………………..………………..9 Record Keeping …………….………………………………………………..……….………………..10 Shelter Regulations………………..................……......……………………………………………….………11 Licenses and Permits…………..…………………………………………………………………….…11 State Veterinary
    [Show full text]
  • Charitable Organizations in Hawaii V.07022013
    Charitable Organizations in Hawaii prepared for HANO by Josh Levinson, Principal, 3Point Consulting, June 2013 INTRODUCTION This paper provides an overview of nonprofit organizations in Hawaii, distinguishes Acknowledgments charitable organizations from other types of This paper was prepared with support nonprofits, and describes the tax treatment from the Harold K.L. Castle Foundation, and reviewed by Trever Asam of Cades that charitable organizations are provided by Schutte LLP. the federal, state, and county governments. In doing so, we hope to increase understanding of charitable organizations, which are so essential to the well- being of our communities. Snapshot of a Typical Charitable Organization FOR-PROFIT VS. NONPROFIT • Incorporated as a nonprofit corporation in the State of Hawaii While there are several different • 501(c)(3) tax exemption from IRS, organized types of corporations, a basic exclusively for charitable purposes distinction is whether a business will be for-profit or nonprofit. The • Exempt from federal and state corporate income taxes incorporation of a business is done at the state level, not the federal • Exempt from some--but not all--General Excise level.1 Tax payments • Exempt from county real property tax on land Nonprofit corporations are generally used exclusively for charitable purposes organized to advance a public or • NOT exempt from (1) paying taxes when community interest instead of purchasing goods and services, (2) State use individual or personal gain. taxes, (3) unrelated business income taxes, and Nonprofits can make a surplus or (4) employment taxes profit, but that money must be put back into the mission of the organization. Whereas nonprofits are not allowed to distribute their earnings or pay dividends, for-profit corporations are generally operated with the goal of making money to distribute to owners or shareholders.
    [Show full text]
  • Guiding Principles + Practices for Nonprofit Excellence in Maine, Black and White Version
    Principles Practices Guiding Nonprofit Excellence in Maine Our sincere thanks to Healey and Associates for their generous sponsorship of this fourth edition of the Guiding Principles + Practices for Nonprofit Excellence in Maine. Copyright © December, 2012 by the Maine Association of Nonprofits. This work is made available under the terms of the Creative Commons Attribution-NonCommercial-NoDerivs 3.0 License, http://creativecommons.org/licenses/by-nc-nd/3.0/. 1 Guiding Principles + Practices for Nonprofit Excellence in Maine © 2012 Table of Contents Introduction page 3 Purpose Applicability History What’s New Definitions Related Programs + Tools How to Use this Guide Legal Accountability Closing Thoughts Overview of Guiding Principles page 7 Public Benefit + Accountability page 9 Governance + Leadership page 11 Public Policy + Advocacy page 15 Evaluation page 17 Strategic + Operational Planning page 19 Strategic Alliances page 21 Financial Management page 23 Staff + Volunteer Management page 27 Resource + Fund Development page 29 Marketing + Communications page 31 Technology page 33 If You Suspect Fraud or Misconduct page 35 Index page 37 About MANP page 44 2 www.NonprofitMaine.org Introduction Purpose Nonprofit Excellence in Maine This is the most provides a planning The nonprofit sector is and assessment continually challenged to be framework that raises comprehensive more transparent, efficient the bar for nonprofit and effective. Guiding performance. It is intended as a tool for nonprofits to list of nonprofit “best Principles + Practices live up to the challenge for Nonprofit posed by Stephen Covey and practices” that you will Excellence in Maine is other thought leaders: “Begin with the end in a tool to help mind.” find anywhere in the nonprofits evaluate country.
    [Show full text]
  • Respecting Foundation and Charity Autonomy: How Public Is Private Philanthropy?
    Chicago-Kent Law Review Volume 85 Issue 2 Symposium on the Law of Philanthropy Article 5 in the Twenty-First Century, Part I April 2010 Respecting Foundation and Charity Autonomy: How Public is Private Philanthropy? Evelyn Brody IIT Chicago-Kent College of Law John Tyler Follow this and additional works at: https://scholarship.kentlaw.iit.edu/cklawreview Part of the Nonprofit Organizations Law Commons, and the Taxation-Federal Estate and Gift Commons Recommended Citation Evelyn Brody & John Tyler, Respecting Foundation and Charity Autonomy: How Public is Private Philanthropy?, 85 Chi.-Kent L. Rev. 571 (2010). Available at: https://scholarship.kentlaw.iit.edu/cklawreview/vol85/iss2/5 This Article is brought to you for free and open access by Scholarly Commons @ IIT Chicago-Kent College of Law. It has been accepted for inclusion in Chicago-Kent Law Review by an authorized editor of Scholarly Commons @ IIT Chicago-Kent College of Law. For more information, please contact [email protected], [email protected]. RESPECTING FOUNDATION AND CHARITY AUTONOMY: HOW PUBLIC IS PRIVATE PHILANTHROPY?* EVELYN BRODY** AND JOHN TYLER*** FORWARD: GROUNDING THE DEBATE From Colonial times Americans have debated the role of philanthropy and the charitable sector in our social and political economy. These de- bates, while they can never be definitively resolved, are a healthy reflection of the diversity and plurality of views about the relative roles of the gov- ernmental, business, and nonprofit sectors. Recent years, however, have seen a disturbing increase in legal proposals or demands by certain mem- bers of the public and the government to interfere with the governance, missions, strategies, and decision-making of foundations and other chari- ties.
    [Show full text]
  • Governing Law in Church Bankruptcies Aba Chapter
    CHAPTER 11 AND THE CHURCH: GOVERNING LAW IN CHURCH BANKRUPTCIES ABA CHAPTER 11 SUBCOMMITTEE PROGRAM NATIONAL CONFERENCE OF BANKRUPTCY JUDGES MIAMI, FLORIDA SEPTEMBER 27 - 30, 2015 PATRICK A. JACKSON YOUNG CONAWAY STARGATT & TAYLOR, LLP RODNEY SQUARE 1000 NORTH KING STREET WILMINGTON, DELAWARE 19801 302-576-3588 [email protected] 01:17328835.2 GOVERNING LAW IN CHURCH BANKRUPTCIES1 Speaking from experience, the chapter 11 bankruptcy of a church entity is an entirely different animal from a commercial chapter 11 case—so much so that it requires a different mindset when approaching it. What follows is a discussion of some of the legal principles that apply to a religious nonprofit entity that are not ordinarily (if ever) implicated in a commercial bankruptcy proceeding. A. Special Bankruptcy Code Provisions Applicable to Church Debtors Section 303(a) of the Bankruptcy Code provides that an involuntary bankruptcy petition may not be filed against “a corporation that is not a moneyed, business, or commercial corporation.” 11 U.S.C. § 303(a). The legislative history describes this as a continuation of the Bankruptcy Act of 1898’s prohibition on involuntary bankruptcy relief against “eleemosynary [i.e., charitable] institutions” such as “churches, schools, and charitable organizations and foundation[s].”2 In its chapter 11 case, Catholic Diocese of Wilmington, Inc. (“Wilmington”) took the position that the non-consensual substantive consolidation of non-debtor affiliates with Wilmington’s bankruptcy estate (which the creditors’ committee had sought by way of an adversary proceeding) was outside the scope of the bankruptcy court’s equitable powers under § 105(a) of the Bankruptcy Code because it would permit an end-run around § 303(a)’s 1 By Patrick A.
    [Show full text]
  • A More Charitable Charity: Administrative Necessity Provides an Opportunity to Promote Altruism in Charities
    University of Tennessee Law Legal Scholarship Repository: A Service of the Joel A. Katz Library UTK Law Faculty Publications 12-2016 A More Charitable Charity: Administrative Necessity Provides an Opportunity to Promote Altruism in Charities Eric Franklin Amarante Follow this and additional works at: https://ir.law.utk.edu/utklaw_facpubs Part of the Law Commons A MORE CHARITABLE CHARITY: ADMINISTRATIVE NECESSITY PROVIDES AN OPPORTUNITY TO PROMOTE ALTRUISM IN CHARITIES Eric Franklin* ABSTRACT The law of charities governs an absurdly wide-ranging field of organizations. A small group of antiquated statutes purport to govern a diversity of entities that range from hospitals worth millions of dollars to purely volunteer-run organizations that provide free childcare. Given the expansive nature of the law of charities, perhaps it is understandable that the law lacks a coherent guiding principle. This alone would not be problematic if not for the fact that most tax-exempt organizations do not comport with the general public’s idea of charity. An intuitive definition of charity relies upon a lack of self-regard. In other words, charity requires some level of altruism. But many charities pay lavish salaries and some are major players in the crass commercialism of the private market; such activities are far from any reasonable definition of altruism. Thus, to the extent that we expect charitable organizations to exhibit some level of altruism, the concept of charity has been stretched to a level that is almost unrecognizable. In addition to diluting the concept of charity, the over-inclusive nature of tax-exempt law resulted in an unreasonable administrative burden for the IRS.
    [Show full text]
  • Starting a Nonprofit” Toolkit Invites You and Your Group to Think About the Difference You Seek to Make and the Structure Best Suited to Move Forward
    ©2018 Washington Nonprofits. All rights reserved. Overview Introduction You and others in your community see a problem that needs to be solved or an opportunity to make things better. You’ve been helping your community and see opportunities to do more. It will require funding to take your work to the next level. You know it will be a lot of work, but you courageously step forward to make a difference. You are in good company. There are 1.5 million nonprofit organizations in the U.S. Washington typically sees 4,000 new nonprofits formed each year. With all of these nonprofits already in existence—and so many struggling to stay in existence — it is important to consider if creating a new organization is the best route to having the impact you want. The “Starting a Nonprofit” Toolkit invites you and your group to think about the difference you seek to make and the structure best suited to move forward. It leads you through key decision-making steps on whether a nonprofit is the best way for you to accomplish your goals. If you decide to move forward with a nonprofit, “Starting a Nonprofit” guides you through the key compliance and good-practice steps to take it towards becoming operational. You may be feeling impatient to get started. Yet to be successful, it’s critical to pause, reflect, imagine, convene interested people in your community, and plan around important questions that will ultimately strengthen the organization’s ability to succeed. This Toolkit represents a distillation of knowledge, experience, and research from nonprofit leaders, founders, and organizations that serve the nonprofit sector.
    [Show full text]
  • What to Do If You Suspect Fraud Or Wrong-Doing by a Maine Nonprofit
    What to Do if You Suspect Fraud or Wrong-Doing by a Maine Nonprofit This white paper is part of a series of MANP documents created to enhance understanding of the rules and regulations governing Maine’s nonprofit organizations. Last updated March 2013 Note: No one may rely on this guide as legal advice, and we encourage you to consult a qualified attorney for advice on any particular situation. Consulting with an attorney will be useful in helping you to understand your rights and the options available to you throughout each of the steps described in this guide. Before You Report Be cautious You may be certain that there has been wrong-doing or may just suspect misconduct, but either way, it is very important to be thoughtful about how you address your concerns. Be very careful about saying anything in public, by email or online that might damage the reputation of the organization or people who work there. You risk both personal and legal challenges if your understanding of a situation is wrong or cannot be substantiated. Understand your protections. Federal and Maine law prohibits all employers, including nonprofits, from retaliating against employees who “blow the whistle” on any suspected violation of law, or on any practices that risk someone’s health or safety. In addition, Maine law provides that employees of a nonprofit corporation may not be terminated for contacting a Board director, and such contact between employees and directors cannot be prohibited. Many organizations have a “whistleblower protection policy” in place that applies to these concerns. If you are a staff or board member, determine whether your organization has a policy in place and what procedures may exist to help you report a concern.
    [Show full text]
  • Altruism in Nonprofit Organizations Rob Atkinson
    Boston College Law Review Volume 31 Article 1 Issue 3 Number 3 5-1-1990 Altruism in Nonprofit Organizations Rob Atkinson Follow this and additional works at: http://lawdigitalcommons.bc.edu/bclr Part of the Organizations Law Commons Recommended Citation Rob Atkinson, Altruism in Nonprofit Organizations, 31 B.C.L. Rev. 501 (1990), http://lawdigitalcommons.bc.edu/bclr/vol31/iss3/1 This Article is brought to you for free and open access by the Law Journals at Digital Commons @ Boston College Law School. It has been accepted for inclusion in Boston College Law Review by an authorized editor of Digital Commons @ Boston College Law School. For more information, please contact [email protected]. BOSTON COLLEGE LAW REVIEW VOLUME XXXI MAY 1990 NUMBER 3 ALTRUISM IN NONPROFIT ORGANIZATIONS` ROB ATKINSON * I. INTRODUCTION 503 II. THE EMERGING ORTHODOXY—HANSMANN'S THEORY OF THE ROLE OF NONPROFIT ORGANIZATIONS 512 III. A RESPECTFUL HERESY—THE ROLE OF ALTRUISM IN NONPROFITS 519 A. Donative Entrepreneurials—The Easy Case for Altruism 520 1. Type 1 Organizations—Donative Nonprofits Op- erated for the Benefit of Neither Donors nor Controllers 521 2. Type 2 Organizations-,--Donative Entrepreneu- rials Operated For the Benefit of Donors 533 3. Type 3 Organizations—Donee-Controlled Do- native Entrepreneurials 537 B. Donative Mutuals—Equally Clear Cases for Altruism 537 1. Type 4 Organizations—Donor Control for Oth- ers' Benefit 537 t Copyright © 1990 Koh Atkinson *Assistant Professor of Law, Florida State University. B.A, 1979, Washington and Lee University; J.D. 1982, Yale Law School. I am indebted to more people for help with this article than the customary space will accommodate.
    [Show full text]
  • Guide to Starting a Charitable Nonprofit in Wyoming
    Guide to Starting a Charitable Nonprofit in Wyoming 1401 Airport Parkway, Suite 300 Cheyenne, WY 82001 307.772.9050 www.wynonprofit.org Introduction and Disclaimer Every day, individuals like you are inspired to start a nonprofit to positively change lives and improve communities. Creating and sustaining a nonprofit is not easy, we applaud your enthusiasm. This purpose of this guide is to provide you with some initial considerations before forming a nonprofit and to offer some steps and resources in the process of forming a nonprofit. There are multiple hyperlinks throughout this document that will take you to specific websites with more information. It is important to note that a nonprofit is different from a business in that nonprofits do not have owners. They are formed for the benefit of society and are governed by a volunteer board of directors. If you are the founder of a nonprofit, this is an important aspect to understand. The Wyoming Nonprofit Network does not provide one-on-one assistance to start a nonprofit. We do freely provide information and resources in this guide and on our website to help you. As noted in this guide, we encourage you to seek professional guidance from an attorney and/or accountant with specific experience and expertise in nonprofits. The legal information contained in this Guide is intended for general guidance only. While every effort has been made to provide accurate and current information, the application and impact of laws can vary widely based on the specific facts and circumstances of each situation. Given the changing nature of laws, rules, and regulations, there may be certain information contained in this material that cannot be relied upon in specific situations.
    [Show full text]