Forming a non-profit for funding trail work- Mtbr.com
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  1. #1
    K&K
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    Forming a non-profit for funding trail work

    I'm considering forming a non-profit so that I have more control and easier access to money for building and maintaining the school training track, as well as bikes, uniforms, repair supplies and tools.

    Anyone here have experience forming or working for a non-profit? Any insight to offer?

  2. #2
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    Quote Originally Posted by ki5ka View Post
    I'm considering forming a non-profit so that I have more control and easier access to money for building and maintaining the school training track, as well as bikes, uniforms, repair supplies and tools.

    Anyone here have experience forming or working for a non-profit? Any insight to offer?
    Yeah, I was a founding director of our local nonprofit. It’s work, and you will want legal advice. You also need to be on top of the bookkeeping and tax filing. Finally, you need to make sure that your activities are in line with your mission and that you aren’t self-dealing. All of that seems obvious, but it’s worth laying out.

    Because of the hurdles related to setting up a 501c3, we’ve become an umbrella organization for a number of other programs, such as the local race team, the NICA chapter, and the bike kitchen. It’s great to be able to facilitate those programs. We also run a regional enduro series and engage in advocacy and trail work. It’s been very rewarding.

    Insurance can be tricky- carriers do not want to cover trail construction or maintenance. We do all of our trail maintenance as volunteers under city or USFS insurance. We have been involved in trail alignment, but with the responsibility for the ultimate decision resting with the contractor and the land manager.

    Things to consider.

  3. #3
    featherweight clydesdale
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    Also a founding director who guided non-profit status. At the moment, your descriptive focus right now, based on post above, could be construed as "I want to do this for access to money and free stuff." Buzzzz thanks for playing. IRS will comb social media and your website looking for reasons do deny.

    Your focus needs to be on why your organization either educates the public or provides a needed community service. If your trail is on private property and/or access limited to a few, another red flag. Is your school public or private? If private, is it non-profit?

    Our website had info on all the local trails, including a for-profit system. We were put through the ringer as to whether our club had provided services to the for-profit entity. Fortunately, our club had done no such thing but it was a hurdle we had to jump.
    Charlottesville Area Mountain Bike Club
    www.cambc.org

  4. #4
    K&K
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    Thanks for the response willy.

    Quote Originally Posted by Fattirewilly View Post
    ... based on post above, could be construed as "I want to do this for access to money and free stuff."
    Sorry, guess my post didn't describe the situation very completely.

    Your focus needs to be on why your organization either educates the public or provides a needed community service.
    The organization is a mountain bike team at a middle school in a high poverty area. The school is 100% free lunch, meaning the majority of families have an income of 130% of the poverty level or less. Very few of my rider's families are financially able to buy their child a bike, so the group provides bikes and gear to the riders. This has been made possible primarily by one generous donor who donated 8 bikes a year and a half ago. We have a couple of other corporate and personal donors.

    The track is on the perimeter of the school's athletic field. I have developed the track as an alternative to training off-campus, which makes practices safer by keeping my riders off the street. It also allows me to run practices with just one adult, as I won't take middle school riders on the street without an adult lead and an adult sweep. I don't have assistant coaches at every practice.

    I have access to money, but it is routed through the school district's after-school program, the PTO, or directly from the school district budget. That is a bit cumbersome and limited. The focus has been raising money through a tax credit that the State of Arizona offers to after-school clubs. While the district makes this very easy, the target families are dubious about the credit and unable to risk $200 out of their budget, so it is difficult to get them to do it. I am looking to expand soliciting donations from additional local businesses and it seems that having a separate non-profit would make that easier.

    If your trail is on private property and/or access limited to a few, another red flag. Is your school public or private? If private, is it non-profit?
    The trail is on property that is co-managed by the City and the School District. The school is a public school. The athletic field is open to the public after school hours and when it is not being used by a school or City function.

    ...We were put through the ringer as to whether our club had provided services to the for-profit entity. ...
    There are no for-profits involved.

  5. #5
    since 4/10/2009
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    Your team is trying to do a lot of different things. That's going to make things pretty complicated.

    The team I help coach is pretty new. We don't have nonprofit status, yet, but we're working towards that. We have a goal of offering scholarships to underprivileged kids, since we're a county composite team and pull from all over.

    We work with the local trail advocacy org when it comes to trails. They set up the trail day, and provide the tools and supervision, and we bring the team out to help.

    One of the teams in town that is linked with a specific school built their own training track on school grounds (they're building a new school on a new piece of property, and put the trail there). I'm not exactly sure how they handled that, honestly.

  6. #6
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    Here’s some good news for you- based on what you want to do, my non-expert opinion is that your group exists “to foster national or international amateur sports competition.”

    See the top of page 7 on IRS form 1023-EZ
    https://www.irs.gov/pub/irs-pdf/i1023ez.pdf

    What this means is that your group may perform a function that has been pre-approved to qualify for tax-expert status. If you qualify for 1023-EZ, the law says the IRS “shall” recognize you as a 501c3 organization. But again, consult an attorney.

    https://www.irs.gov/forms-pubs/about-form-1023-ez

  7. #7
    sonoranbiker
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    Shoot me an email and I can probably answer some of your questions. I run an MTB nonprofit in Tucson. [email protected].

  8. #8
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    Can you find a fiscal sponsor? That's the converse of what the Montana Bicycle Guild has done.
    Perhaps you have a local (or local enough) MTB or larger bike club club? A local group in town (rotary/lions/kiwanis/etc)? Another sports booster org? They handle all the paperwork, typically for a small cut of what money you raise, you are a 'project' of theirs.

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