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Re: non-profit status
Mike Bainum wrote
With regard to the risks and benefits of forming a non-profit, it is
somewhat
difficult to answer in the abstract. The CSA where I am a
member considered
forming a non-profit corporation for the purpose of
acquiring land and raising
money (our thought was that people would rather
donate to an organization than
an individual). After some informal
research, I found few examples in MA in
which a CSA created a non-profit
entity. The example I remember best is
Mahowie
(sp?) Harvest CSA. They formed a non-profit land trust for the
purpose
of holding title to their land. A separate entity was formed,
I
believe, to manage the CSA business.
I am the
grower for Mahaiwe Harvest C.S.A. and have been since '93. Most of the legal
structures of our C.S.A. were put in place prior to my arrival and in the
pioneering phase of the project from '88 to '93. As one of the oldest
C.S.A.'s in the country we have been through many of the possible arrangements,
most of which were born of the necessities of the moment combined with the
agendas of the people involved, most of whom have moved on.
Mahaiwe Harvest Land
Trust is a non profit corp' with tax exempt status. It came into being , as
Mike Bainum correctly stated, in
order to hold title to the land that is the current site of the farm, it is
independent of the grower [me] and the C.S.A.. The
C.S.A. membership were not willing or legally able to take title to the property
title when the C.S.A. moved from Indian line Farm [ Robyn van En's place ] to its present location at Sunways farm.
At that time or shortly after, the C.S.A.
incorporated as Mahaiwe Harvest C.S.A., a not for profit. Two years ago
by mutual agreement we 'de incorporated' as the legal status conferred no
benefits on the group and only obliged us to make annual filings with the state.
The only benefit may have been that when their original grower left [ '92 ]there
was enough cohesiveness in the group to pull through the transition, which could
have been accomplished by a well formed core group. MHCSA did apply for
tax exempt status from the I.R.S., but did not get it, even with the more
ambitious educational goals they had back then. I agree with Sarah Milstein that
the conditions that would be required of the CSA would be distracting to the
core goals of the project. I feel that the activities and scope of the C.S.A.
should be dictated by a process of mutual agreement of the present participants
and not controlled by externalities[ such as tax code] even if the benefits of
being a nfp are great, which they are not. The only benefit
I see to nfp status would be avoidance of property taxes. Call me naive,
but it seems contradictory to me, to be espousing community
ethics at the same time as expecting someone else from your community to be
maintaining and plowing the road systems so that sharers can reach your
farm, without being willing to pay the taxes that make that service possible. As
in all these things I feel it is better to ask "why should we do
that?" rather than have to ask "why did we do
that?'
Yours
David Inglis
Mahaiwe Harvest
C.S.A.