Monday, May 23, 2011

How Conservation Non-Profits Really Work - Part I

Lots of non-profit groups working with some government funding on a trout
project in Vermont.  Great photo from Southwestern Vermont
Trout Unlimited.
Wow.  I have been putting off writing this post for over two years.  I've been writing it for over three months.  Most folks who read this blog support outdoor or environmental non-profits ranging as far politically from the NRA to the Sierra Club, with thousands of non-profit groups falling inbetween them on the political spectrum.  These groups were formed and still exist today because they do "good works" that are not required by government agencies, but are voluntary efforts.

In the conservation realm, most non-profit groups focus on one of three main goals: 1) to improve or protect natural resources, 2) to engage the public in the outdoors or conservation, and/or 3) to advocate for legislation that will positively impact species or habitat conservation.  Many groups do all three, but there is usually a strong primary focus on one of those . These efforts are supported by the priorities of each group's members and donors.  Sounds good, right?

As non-profit groups have grown in power over the last few decades, their "good works" - specifically, their ability to raise funding and efficiently get work accomplished - have been noticed, and as a result, state and Federal agencies have rewarded them  with funding through various processes to keep up "the good works," as ambiguous as they might be.  So what is a not-for-profit 501(c)3 organization, or "non-profit," anyway?

In the United States, a non-profit organization is a corporation (that's right) that technically has no owner, only a board of directors or trustees.  Because there is no owner and no stockholders, any earned profit (called a surplus) cannot be sold or traded to anyone.  As a result, these organizations can be (but aren't automatically) granted tax-exempt status by the Federal government (under IRS Code 501(c)3) and by individual states.   How does this all happen, and why does it matter?

The business of legally assembling a non-profit is pretty simple.  The group first files a basic articles of incorporation document in the state where they plan to focus their operations. Once incorporated within the state, the organization then files Federal (IRS) papers to incorprate Federally, which in the case of 501(c)3 groups, includes a request for exemption from taxes.

It's important to note right off the bat that nonprofit groups like the NRA who actively campaign for or against specific parties or politicians are not 501(c)3 groups, and thus, are not tax-empt, even though they are non-profit organizations.  Thus, your NRA donation (for example) is not a tax write-off - they are a 501(c)4 organiztion.  Interestingly, 501(c)3 groups can and do actively lobby for or against specific legislation or budget items......just not individual politicians or parties.

The backbone of every non-profit organization is its set of bylaws, which are often drafted during the incorporation process.  The bylaws not only define the mission of the organization (important), but how the organization is allowed to conduct business based on its articles of incorporation (even more important). If you contribute significant funds (in my opinion, over $2,500/year) to a non-profit group, you should absolutely have access to the bylaws.  Just to know what's in there.

Over the course of a few posts, I'll examine how conservation-focused non-profit organizations:

1. Raise and spend money (June 6)
2. Utilize and manage volunteers and staff (June 13)
3. Set goals for the future (June 20)

4. Continue to pursue their primary mission in good times and bad (June 27)

This QDMA event is focusing on landowner outreach.
Along the way, I'll provide examples of how certain conservation non-profits have struggled and subsequently succeeded or failed at dealing with these issues.  In most cases, these examples will be of groups that many of you support.  In some cases, the same organization may be trotted out as a case of failure, and then as a case of success.

Join me, and learn about how your money is used, what different conservation organizations are actually trying to achieve, and how effective they are working toward those goals.  The news is mostly good, rarely bad, but occasionally ugly. I look forward (I think) to your comments!

4 comments:

Jamie Cameron said...

Great. I'm really looking forward to this series.

Stephanie and Dustin said...

Intriguing. I'm definitely anticipating these posts!

-stephanie

Mel said...

Definitely a series of posts that should be interesting to read/follow along on. I will be back.

Map Monkey said...

Excellent! Having worked for a few non-profits myself (albeit environmental justice organizations, as opposed to environmental conservation, etc.) I will be interested in your take on things.