Incorporate as a non-profit
Establishing a Nonprofit Corporation
To better organize a watershed partnership and establish eligibility for direct funding from governmental agencies, private foundations and individuals, partnerships can organize as nonprofit corporations under Section 501(c)(3) of the U.S. Internal Revenue Code. The benefits of this approach include:
- eligibility for grant funding;
- lower bulk mailing rates;
- limited liability for board members;
- tax exemptions; and,
- the ability to hire staff.
There is some paperwork in creating a nonprofit corporation and reporting income and expenses, but if your partnership has the membership resources to handle these tasks they are not too difficult. Filing fees are usually less than $500.
If an established nonprofit organization (i.e., Resource Conservation and Development Council, river protection organization, etc.) is available to serve as a funding vehicle for your partnership activities, consider working through that organization before creating a new one.
Steps to Incorporation
Identify the incorporator (often an attorney who helps with the legal paperwork for the corporation);
Elect a board of directors and officers;
Draw up the articles of incorporation and by-laws;
File the documents with the secretary of state's office; and
Apply to the IRS for a federal tax exemption.
Do we have to?
Although incorporating has some benefits, many partnerships are able to operate quite successfully without pursuing this option. AMD restoration projects funded by public agencies can often proceed under the jurisdiction of the agency itself. Sometimes partnership member organizations are able to serve as funding conduits for grant funds on behalf of the watershed partnership. It will be up to your group to decide which path is best. The key point is not to get bogged down in organizational detail unless it is essential to the project's success. People want to spend their time cleaning up the creek, not attending endless meetings on bureaucracy and paperwork!