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Junior Intern Program September 14, 2013.  What is a nonprofit?  What do they do?  Who owns nonprofits?  How big is the sector?  What are the advantages.

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Presentation on theme: "Junior Intern Program September 14, 2013.  What is a nonprofit?  What do they do?  Who owns nonprofits?  How big is the sector?  What are the advantages."— Presentation transcript:

1 Junior Intern Program September 14, 2013

2  What is a nonprofit?  What do they do?  Who owns nonprofits?  How big is the sector?  What are the advantages and disadvantages of being a nonprofit?  How are they funded?  How do you get information about them?  What does a Board of Directors do?

3  Wikipedia says: an organization that uses surplus revenues to achieve its goals rather than using them as profit or dividends.  A nonprofit corporation is formed to carry out a public purpose, whether that be religious, educational, charitable, scientific etc. It is prohibited from acting in a manner that results in private inurement (profit) to individuals.

4  501(c)(3) organizations, which are defined in U.S. tax law as "charitable, religious, educational, scientific, literary," and related organizations such as: private, not-for-profit hospitals, clinics, colleges, universities, elementary, schools, social service agencies, child care centers, orchestras, museums, theaters, environmental organizations, homeless shelters, soup kitchens, etc.

5 The nonprofit organization is not “owned” by the person who started it. It is a public organization that belongs to the public at- large, or the community. Those responsible to operate the organization on behalf of the community are the members of the board of directors.

6  235,113, plus another 130,000 volunteers  Makes it Virginia’s 3 rd largest employment sector, behind retail and professional services  3x as many as the state’s finance and insurance industries!

7  1.6 million in the United States  12,679 in Virginia  68% of Virginia nonprofits have budgets less than $1,000,000. CMoR’s budget $3.4 million. But some are bigger

8  St. Mary's Hospital of Richmond Inc. Richmond Hospitals $608,747,034  University of Virginia Physicians Group Charlottesville Ambulatory health $309,500,733  Bon Secours Memorial Regional Medical Center Inc. Richmond Hospitals $296,325,732  Martha Jefferson Hospital Charlottesville Hospitals $233,558,064  Childfund International USA Richmond Civic associations $215,772,220

9  Hospitals 17 $1,865,789,677  Civic associations 1,056 $1,198,535,626  Ambulatory health 127 $902,568,931  Social assistance 316 $397,834,781  Nursing homes 69 $353,356,218  Schools 76 $207,962,261  Arts and recreation 337 $174,598,045  Universities 8 $154,314,720

10  File bylaws and articles of incorporation (the written rules of the company) with the state In Virginia, that is the State Corporation Commission  This creates a “legal entity”, like a person or corporation, that can enter into contracts, own property, etc.  Form a Board of Directors  Apply for IRS tax-exempt status  Apply to the state for permission to fundraise within the state, update annually In Virginia, that is with the Department of Agriculture and Consumer Affairs

11 Tax exemption! It’s a double whammy:  Its income is not taxed  Donations made to it may be tax deductible for the donors

12  Because it is a public organization, everything is public, such as salaries, expenses etc.  Typically have to fundraise – all the time!  Can’t get “capital” money from the stock market, have to fundraise for it.  Decisions are public and open to scrutiny – Board controlled, management replaceable, mission secured

13  Earned Income  Contributed Income  Investment Income  Government Income

14  Not quite!  Form 990 – where all the good information is!  What do they do?  Who is on their Board of Trustees?  Who gives to them?  How much do they pay their top staff people?  On what do they spend money?

15 Where 990’s live!

16 1. Ultimately responsible for the organization, set the mission 2. Hire and regularly evaluate a CEO to run the day-to-day operations, suggest strategy, implement policy, etc. 3. Ensure resources are available  Lead/Help fundraise  Make sure investments are safe


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