[NBLUG/talk] dues collections and 501c3 nonprofit status clarifications

[Brad Morrison]

Hi all,

Rick: thanks for sharing some stories of your various adventures in LUGs 
over many years - I'm sure that there are plenty more interesting tales 
to be told!

Regarding the topic of dues and 501c3 nonprofit status, I thought I went 
into much more detail in my previous response than what you copied 
below. Regardless, my main point was that it probably does NOT make 
sense for any individual local LUG to incorporate as a 501c3 nonprofit 
nor collect dues. However, I believe that if there were a 
national/international umbrella organization that coordinated and 
promoted the various local LUGs, in a similar way to the national 
Electric Vehicle Association (https://www.myeva.org/)/North Bay Electric 
Auto Association (https://nbeaa.org/) example I have given several times 
before, then it would make sense for the larger, umbrella organization 
to collect dues (even if voluntary) and maintain a 501c3 nonprofit 
status. Organizational structures have big advantages when it comes to 
coordinating various activities whether those activities are 
marketing/outreach related or legally required or financially oriented 
AKA fundraising.

Looking forward to the monthly meeting on Tuesday evening!

Brad


On 7/24/22 12:00, talk-request at nblug.org wrote:
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> Today's Topics:
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>     1. Re: LUGs, venue, advocacy, dues/incorporation, and other
>        thoughts (Rick Moen)
>     2. Re: NBLUG participants (Rick Moen)
>
>
> ----------------------------------------------------------------------
>
> Message: 1
> Date: Sat, 23 Jul 2022 15:10:08 -0700
> From: Rick Moen<rick at linuxmafia.com>
> To:talk at nblug.org
> Subject: Re: [NBLUG/talk] LUGs, venue, advocacy, dues/incorporation,
> 	and other thoughts
> Message-ID:<20220723221008.GF13985 at linuxmafia.com>
> Content-Type: text/plain; charset=utf-8
>
> Quoting Brad Morrison (bradmorrison at sonic.net):
>
>> Rick: I also emailed the Pritchards from on July 16 and on July 18 I
>> heard back from Steven. I will include you on my response to them, I
>> just haven't gotten to it yet. I'll save all of that conversation
>> for between the 4 of us and then we can report back here anything
>> that might be particularly interesting or useful to the larger
>> audience.
> Great!  I hope the communication from both of us helps them a little,
> rather than just piling work onto them.  (I certainly know from
> experience that the problem with documentation for the Web is less
> the time and effort to initially create it than the maintenance.)
>
>> On a separate note, thank you for all of your work over the years
>> maintaining LUGs and the various associated documentation! That's a
>> lot of thankless tasks and even though I've just barely scratched
>> the surface of what you have done, it is pretty cool to have you
>> share your stories and knowledge with us.
> Appreciate your kind words, sir.
>
> Some good news about TLDP:  The guy now in charge good-naturedly
> accepted my update to the Linux User Group HOWTO, checked the SGML into
> GitHub, and in theory will propagate that out to the site HTML, some
> time soon.
>
>> Derek: social, technical, advocacy = sure, that makes sense. I
>> assume that you have observed this about me already, but I do not
>> have a computer science degree, nor nearly as much experience with
>> technology as most of the NBLUG participants that I have met so far.
>> So I can't keep up on the technical conversations, but it is still
>> interesting to learn (sort of). I tend to be more interested in our
>> discussions on various differences between Linux distros and package
>> management systems and why some packages are capable of being
>> updated more frequently than others based on which libraries a
>> particular distro may ship with or whatever.
> I'm still hoping to angle back to that thread, time permitting.
>
>> Advocacy: I am more interested in this aspect, in large part because
>> I can't contribute much to the technical development of open source
>> software. Part of my advocacy work involves more communication about
>> open source software, even if just to the NBLUG list. Even if we
>> doubled attendance at the monthly meetings (to the mighty number of
>> 15!), we would still only have a small fraction of the people on the
>> NBLUG talk/announce email lists (236/454 people).
> You know, I suspect this is within expectation for the current state of
> things, particularly at the height of the Omicron BA.5 surge.
>
> It's not even all the new a phenomenon.  Back when LUGs were at the
> height of their historic popularity, around 2000, many of us noticed
> that the LUGs' online communities were vastly larger than the group that
> met in-person, and (at that time) we also observed that many of the more
> vocal online participants literally never, or almost never, came to
> in-person events, such that there was a near-disjoint _pair_ of sets of
> active members, the in-real-life leaders and the mailing list crowd.
>
> Also -- and it would take a long conversation to give examples -- the
> experience with LUGs down here in Silicon Valley taught us that it's
> wisest to allow LUG planning and governance be primarily in the hands of
> the members who're willing to put in the time to meet interactively in
> real time, rather than just do asynchronous e-mail discussions.  There's
> something about interactivity plus time-investment that better grounds
> such discussions in realism and avoids getting lost down conversational
> rabbit-holes, personal hobbyhorses/obsessions/peeves/vendettas, and
> irrelevancies.  (I imagine that in 2022, having such interactivity via
> Jitsi Meet, Zoom, etc. gives you almost all the same benefits as
> meeting in-person around a table.)
>
>> So at this point, it feels a bit like inside sales, rather than the
>> community organization equivalent of cold calling - tabling at events.
> I _think_ I understand your point.  But, is that regrettable?
>
> Please pardon while I tap my cane a bit as a LUG old-timer, and relate
> some more history.
>
> Going through the 1990s, we of course were all about public outreach
> (along with having fun and scratching our own itches).  I was part of a
> group of San Francisco and Silicon Valley Linux people who not only ran
> LUGs but also "installfests".  Those were held in a number of places,
> and the most prominent were at Saturday computing flea-markets held in
> San Francisco, Oakland, and Pleasanton by the now-vanished Robert Austin
> Computer Show company, who invited us to hold Linux-oriented events
> at a free-to-us set of vendor tables they gave us at their
> "computer shows".  We knew that some substantial fraction of 6,000 or so
> end-users would be dropping in at our tables on a given Saturday,
> curious and asking "What's Linux?", so we made sure we had good answers,
> eye-catching things to see and play with, literature to hand out, and
> pre-burned distro CDRs to give out for free.
>
> And then things changed.  It was obvious why and when.  Two things
> happened:
>
> Netscape Communications made the world-famous Mozilla announcement, that
> their browser would be going open source on April 1, 1998.  (This got
> hastily moved forward a day to March 31st, when lots of people told
> Netscape that it'd be assumed an April Fool's joke.)  This wasn't
> _directly_ about Linux (though Netscape had Linux releases), but because
> Linux was the most-famous open source OS, it got Linux a lot of sudden
> attention.
>
> Then the other shoe dropped a few months later:  Informix, the SQL
> database firm, out of the blue announced imminent release of a full
> Linux production kit.  This was _huge_, because all of the dozen-ish
> major SQL database firms kept being pestered for years:  "When are you
> going to release for Linux?"  Every one of them had a practiced
> response, like:  "We have extensively studied this question, and
> management has concluded that there is no market for a Linux version."
> This was, of course, absurd, because if you lined up everyone asking
> "When are you going to release for Linux?", those alone were enough to
> support a proprietary commercial database.  But now, Sept. 1998, one of
> the majors had broken ranks.  Hilariously, Oracle Corporation panicked
> and tried to break all possible spead record _beating_ Informix in
> getting a suddenly-produced Linux version to customer hands, and then
> within a week, every other proprietary SQL company other than Microsoft
> (SQL Server) hastily coughed up competing Linux releases.
>
> One of us-lot had the inspired idea (can't remember who did this) of
> seeking out and getting a confidential remark from a member of the
> technical staff at one of these big companies:
>
> Q:  Was it difficult to do a Linux port?
> A:  Difficult?  Hardly.  We've been running on Linux
>      internally for at least five years.  All we had to
>      do was type ./configure; make; make install, and
>      it worked perfectly.
>
> We noticed the difference starting at the very next Robert Austin
> Computer Show.  _Nobody_ visiting our tables needed to ask what
> Linux is.  It was all over the magazines, and everyone knew.  Now,
> the questions were all about _details_, of how to most effectively
> make it work for them.  And the reality that Linux was now
> _infrastructure_ and not any kind of utopian mad-science project started
> to sink in with... everyone.
>
> That was the week that we realised the work analogous to "cold calling"
> simply wasn't necessary, any more.  We kept coming to Robert Austin
> shows for a couple more years, but more for fun and out of habit than
> out of any need.
>
> The _descendant_ of our installfest events persist in 2022 as a
> side-specialty of the Linux group CABAL, which meets 2nd Saturdays at my
> house in West Menlo Park (north of Stanford U.)
> http://linuxmafia.com/cabal/installfest/
>
> There are of course always new people encountering Linux for the first
> time, but the general nature of the conversation changed that month in
> 1998, and IMO needed to.
>
>> Dues: I totally agree that it doesn't make sense for NBLUG to
>> incorporate as a nonprofit or collect dues/donations, unless there
>> was a very specific goal in mind.
> I don't want to overly beat my own drum on this, but will mention just
> once again that I've voiced my own views on this at
> http://linuxmafia.com/lug/User-Group-HOWTO-7.html  .
>
> Experience suggests that among the disadvantages of collecting dues and
> having a collective pot of (small) money is that there is a long-term
> temptation for someone to fight (verbally) over that pot of money.  The
> smaller the pot, the more vicious and destructive the fighting can
> become.
>
> Of course, LUGs inevitably end up having a thing or two that _somebody_
> must fork out money for, if only domain renewals.  Some way to share the
> pain is necessary.  I don't have any easy solutions to offer.
>
> Experience also suggests that the urge to incorporate and/or to seek a formal
> IRS determination letter granting recognition as a non-profit (or even
> as a 501(c)(3) charity nonprofit) is _usually_ rooted in computerist
> errors about what problem that solves and what problems are worth
> solving.  Over the years, I've heard computer geeks justify those
> efforts with erroneous claims about legal liability, about tort
> lawsuits, about umbrella insurance, about the IRS and Franchise Tax
> Board pursuing all of the group for income tax, about getting donations,
> about qualifying for meeting space, and probably other inventions that
> I'm not remembering off the top of my head.
>
> Computerists should, in general, not be trusted with tax and legal
> planning for the same reason a programmer should not be trusted with a
> screwdriver.  Yr. humble servant passed the nationwide CPA exam, used
> to work as a tax preparer and staff accountant, and studied a
> significant amount of law including tax law.  And I tried to pour
> my small fund of accumulated wisdom on that subject into section 7.1 of
> the HOWTO's section about USA LUGs' organisational issues.
>
>
> [NBEAA and the national EVA:]
>
>> The national organization also provides the 501c3 nonprofit status to
>> its local, affiliated chapters (as long as they follow some basic
>> rules/bylaws)
> Yes, but... have you paused to figure out what tangible help the
> umbrella group's 501(3)(c) charity recognition provides to NBEAA?
>
> The one significant bit is that NBEAA can then correctly tell people "If
> you donate money to NBEAA, you will be able to deduct that on your
> income tax return as a charitable donation."  501(c)(3) groups are
> extremely privileged in US tax law, in that way; those are the only
> nonprofit groups where donations to them are _categorically_
> tax-deductible.
>
> Donations to other IRS-recognised _or_ non-IRS-recognised non-profits
> _may_ be tax-deductible.  For almost 20 years, I was on the Board of
> Directors of the local sysadmin guild, BayLISA, a 501(c)(6) non-profit
> (incorporated) business league (guild).  If someone were to approach us
> and say "Would my donation be tax-deductible?", our cautious answer
> would be "Donations are tax-deductible as / if provided by law.  Consult
> your tax advisor."  I.e., an IT firm, or other firm that hires system
> administrators, donating money to a non-profit sysadmin guild can almost
> certainly deduct that as a business expense, but we were not prepared to
> guarantee that.
>
> You might ask:  But wait, we need to be a recognised non-profit so that
> IRS doesn't collect income tax from us if we collect dues or hold bake
> sales or something.  But would they?  IRS (and FTB) in _theory_ collects
> income tax on income in all of its forms, but in actuality, seriously
> couldn't possibly care less collecting tax from about any group with
> annual gross revenues less than $25,000.  Seriously.
>
> And that's it for "501(3)(c) nonprofit status".
>
>> IF there were a similar national/international organization of LUGs,
>> then  I would highly encourage NBLUG to consider joining/affiliating.
> The closest thing is that, occasionally over the decades, someone has
> set up a mailing list as a forum for communication among LUG leaders
> across (usually) North America.  If has a little chatter for a few
> years, then it goes away.  Then someone else has that idea.  Lather,
> rinse, repeat.
>
> There are umbrella groups in several countries, e.g., Australia, Canada,
> France, Italy.  Those are in fact noted in my HOWTO.  They seem in
> general to be mostly clearinghouses for the public to look up where in
> (e.g. Australia there is a LUG near them).
>
>
>
> ------------------------------
>
> Message: 2
> Date: Sat, 23 Jul 2022 16:51:07 -0700
> From: Rick Moen<rick at linuxmafia.com>
> To:talk at nblug.org
> Subject: Re: [NBLUG/talk] NBLUG participants
> Message-ID:<20220723235107.GG13985 at linuxmafia.com>
> Content-Type: text/plain; charset=utf-8
>
> Quoting Derek B. Noonburg (derekn at foolabs.com):
>
>> I think of NBLUG as having three overlapping functions: social,
>> technical, and advocacy.  (Rick's HOWTO phrases things a little
>> differently, but I think we're close enough.)  We've been doing pretty
>> much 100% social since we started meeting again at Flagship.
> On a sample of a couple'a dozen, most LUGs have been doing mostly that,
> during the pandemic.  Widespread adoption of Jitsi Meet or Zoom or
> BigBlueButton or one of the other videoconferencing platforms has helped
> many of them.  Some are doing primarily videoconferenced meetings; some
> do "hybrid" meetings where there is one in-person venue that has a
> camera and a microphone/speakers connected across the Web to a
> videoconference room, with local video display set to "gallery" mode.
>
> BTW, Michael Paoli and I have been, during the pandemic, collecting
> information on what LUGs around the world are known to have meetings
> online (either online-only or hybrid) in the English language:
> http://balug.org/covid
>
> (Note section at the bottom about handling the maddening time-zone
> programmatically using GNU date.  I wrote that section!)
>
>
>
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