Here's a thought we've been kicking around behind the scenes amongst the site managers. Our very own webhosting and publishing company organized as a non-profit corporation (NPC).
There are advantages.
Many of the sites could be hosted for less than people are paying now with possible improvements in service. Publishing contracts for books could be written that did not depend on just goodwill between author and publisher. Donations to an NPC can be tax deductible. An NPC can own things that will survive the death or disappearance of actual human beings.
Revenues from donations and activities of the non-profit would just go to maintenance of equipment and perhaps payments to people doing work as contracts or even employees. NPC can have employees.
Between the four or five people who have already indicated interest we have an impressive array of credentials, skills and experience. We can do this.
We're actually discussing nuts and bolts of how it would work and what we need to do and how much it would cost. Anyone here want to make comments?
Hugs,
Erin
Comments
New Deal!
Erin; I think your finally doing what should be done, Good Luck! Richard
Richard
I'm happy that you found
I'm happy that you found this information and think that a straw vote among the members should be taken to see what percentage is in agreement. Erin; this is your baby, if you want to make it NPC than do what your heart tells you. I'm with you all the way.
Jill Micayla
Be kinder than necessary,Because everyone you meet
Is fighting some kind of battle.
Jill Micayla
Be kinder than necessary,Because everyone you meet
Is fighting some kind of battle.
I agree...
It's a logical move.
PB
Do what you think is best
I don't know an awful lot about NPC's but it sounds as if it has advantages for you and others who put in a lot of time and effort into running this site. The publishing side of things being on a more formal basis would probably be a big benefit for authors here wanting to publish or e-publish.
If you think it's a good idea and could work then I'd support it.
"Just once I want my life to be like an 80's movie, preferably one with a really awesome musical number for no apparent reason. But no, no, John Hughes did not direct my life."
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Great idea
It's a lot of work getting set up. Lots of legal and government hurdles.
That said, it's a great idea and I think that it could work.
For a while I was treasurer for a 501.c.3 corp in Arizona, so I have some modest experience with operations. Not really anything on setup, though.
Another benefit as a non-profit is that you could apply for grants and other monies. Again, it's a pain to get started, but they are another source of funding.
My tuppence for their value,
Janet
Mistress of the Guild of Evil [Strawberry] Blonde Proofreaders
To be or not to be... ask Schrodinger's cat.
Janet
Mistress of the Guild of Evil [Strawberry] Blonde Proofreaders
To be or not to be... ask Schrodinger's cat.
Interesting Proposal
Are you considering a 501(c) or a non-exempt structure? Either way I would encourage you to get some advice from someone with experience in such matters (yeah, that probably means a lawyer). Based on my very limited understanding I see no reason such a thing would not be doable, and it sounds like a very cool idea to me.
Scott
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Bree
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Interesting thought
It is interesting and doable with a bit of persistence and some legal aid. Going non-profit would put some limits on what you could do for expanding or changing certain services on top of giving you additional financial benefits though. Accountability on equipment and service would go way up compared to what you can do as a personal 'hobbyist.'
Here's a good reference if your research hasn't turned it up already: http://foundationcenter.org/getstarted/tutorials/establish/i...
Yeah :)
Having written tax preparation software for nine years, I'm familiar with the concepts at least of depreciation and capital investment. Thanks for the link.
Hugs,
Erin
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
Good Idea
Having a structure in place that allows for staff turnover would be very good; Bob did an excellent job for many years, but when he died someone walked in and turned off the power, and that was all she wrote. We're very fortunate that his family is being so positive about us and the others Bob was helping.
An umbrella NPC with a governing board representing the interests of the individual sites might be the ticket. Economies of scale could make this less expensive than each site going their own way, and safeguard our heritage by making it less vulnerable to the vagaries of individual's health and financial situations. Funding will be a tricky thing, initially there would be support in the aftermath of Bob's passing, but that would need to be converted into regular, steady, month by month funding to cover expenses. It would be an oligarchy to preserve the semi-autonomy of each site. For longevity, each site needs to establish critical positions backups, people who are familiar with the day to day processing of their site who can step in and take over in case of emergency, what I've heard referred to as "Drop-dead deputies". That's what we're dealing with right now, Bob didn't have a drop dead deputy. We need to learn from this experience, and plan for the future.
yrs,
John Mead
Yours,
John Robert Mead
Good thoughts
We do have contact with a lawyer who has set up such things in the past.
Hugs,
Erin
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
Legal setup for sites.
In Victoria, Australia a club can adopt a standard format which costs $30 pa. No lawyer is necessary. My assistance is available.
Good news, Erin
I so wish I could help out. I think it's a brilliant idea, but with all that's going on at the moment, I would hate to make a promise I later couldn't fulfil.
Good luck and know that I'm always here to help out if and when I can. Just PM or email me.
I don't just look it, I'm totally into this
Possible concern
Disclaimer: I'm from the UK, and have only had superficial exposure to the US legal system, but
Would a NPC, hosting a large number of TG friendly sites, not be an obvious target to the 'fundamentalist tendency'?
'Our' sites have already been subject to 'technical' attacks, such as DOS. However technical attacks only have effects for comparatively short periods of time, and can be addressed reasonably quickly. Creating a 'TG server company' might offer the fundamentalists another route to attack us - the 'legal' attack. A legal attack, whether ultimately successful or not, tends to have long lasting effects, as lawyers have a financial interest in dragging proceedings out. Could a NPC expose us to a disaster scenario of our sites being shutdown for weeks or months by an intolerant judge, or legal costs draining the NPC's assets until it had to be closed?
This might be no problem, but as a Briton, whose main exposure to the US legal system is news reports of the system's idiocies, this seems to be a concern that should be addressed
Not that likely
I understand the concern but none of the sites actually involved have anything defined in the US as pornography. We might be in worse trouble if our servers were in Canada or Germany.
Hugs,
Erin
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
This Should Be Considered More
I've been involved with several non-profit boards. The red-tape and governmental involvement is seemingly whimsical. The forms are vague and extensive. Even with the help of white-shoe lawyers we had problems.
Why go the route of non-profit? What are the advantages over a simple C corp? The prospect of paying huge amounts in taxes seems almost non-existent. A corporation with a board of several people and numerous shareholders would provide the kind of perpetuation you're seeking without the chance of governmental religious zealots ruining everything. A C corporation can be relatively cheap to create.
Angela Rasch (Jill M I)
Angela Rasch (Jill M I)
Why a non-profit?
This is the kind of discussion I wanted.
A non-profit has numerous advantages including being able to offer tax deductions to donors and being treated differently by online payment gateways like Google, Amazon and Paypal. You can't give gifts to a for profit corporation, only a person, so gifts would simply be income for a C corporation or LLC and could get taxed at both ends.
Also, there is the matter of clear intent. A non-profit clearly does not intend to make a profit and donors are reassured in this regard. And by donors, I mean people who give not only cash but intellectual property rights and bequests of websites and the like. The purpose of a non-profit is service.
I've worked in the tax business for a number of years and I am not aware of a significantly higher burden of paperwork and sheer hassle on non-profits as opposed to for-profit. Your mileage may have varied.
There is also the idea of a trust. Revocable trusts with the non-profit as trustee, beneficiary and administrator can avoid the hassle of probate and some lawyers fees. That could be done with a C-corp, too, or even another sort of entity.
For a for profit corporation, I would hesitate to ask for donations to set things up or buy equipment without giving shareholder positions to everyone who donated. It would feel like a scam on my end.
What do other people think about the questions Angela has raised?
Hugs,
Erin
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
Threat or paranoia?
I don't know US law, so comparing a 'For-Profit" and a "Non-Profit" option, what are the real chances of these gov't types trying to run things? I may be wrong, but in Canada, I don't think the gov't has any say in 'the running of or the activities of', a non-profit oraganization unless there's a legitament question of it operating outside the law.
PB
Sounds Great!
I don't have much cash (though I do plan to donate, unless Obama holds my check-grrrr!), but what I do have is time. If I can be of any help, you know where I am!
Wren
Devil's advocate
I quite like the idea, in principle, but I'm watching some folks struggle through the setup at the moment, and so there are some questions that I think I'll ask, as a sort of devil's advocate, if I may.
What is the service provided by the non-profit? Access to ... fiction? It seems that defining the 'service' charter is going to be critical. Make it "support for transgendered folk" and you fall down one hole; make it "provision of entertainment" and there's another. How do you define a charter that expresses the "friendly place for tg authors" (BC/TS) and also supports the 'mission' of the other sites? Would there be other sites, like Stardust?
If it's supporting authors, would (some?) authors be paid? If the service is described as educational ... well, a bit tricky with fiction, I think, but it fits the 'pattern' for non-profits, an educational npc ... then the hardware, hosting, and bandwidth are clearly covered. Would administrators receive salaries, or remuneration? If the 'service' isn't education, then potentially a lot of the ongoing costs (hardware, hosting, bandwidth) might be characterized as administrative overhead, and that would almost certainly push the organization over the 50% trust mark (when over 50% of an npc's money goes for administration, it's considered a sign not to contribute).
"I'm gonna take my toys and go home!" is a fairly common occurrence in the general collection of tg fiction websites. That either becomes impossible, or it becomes a serious problem for the non-profit that's been counting those 'toys' as part of its collection. For that matter ... would authors be considered to be donating works? Would this then mean that they might be restricted in *their* ability to take their toys (stories) and go home?
Short version, I guess, is the same as others have suggested: seek lawyerly advice.
Amy!
Some answers
Actually, "literary" is one of the checkboxes on the form for setting up a non-profit, so that takes care of that.
The non-profit would not own stories except in the case of something left to it through trust or bequest or something assigned to it by a living author. What it would own would be servers which it would provide access to to support websites that fell into its charter. The website owners would still own their websites and could use the non-profit as a means to pass control to someone else, either the non-profit or someone else but the NPO would be a caretaker during such a transition, perhaps through a trust.
Currently, through Doppler Press, some authors are being paid for stories made available. Well, three are, on a 50% or less share. :) But the rest of the proceeds of book and e-book sales is distributed to me and through me to the upkeep of BigCloset and other sites. The NPO would take this role from me and make it more clear that this is being done not-for-profit.
Websites would still be run by their owners and would still operate much the same. Authors could donate works or just offer them for display.
The whole idea of the non-profit is to provide a framework to pass control or ownership when someone dies or leaves the community, if they desire to be part of this system.
As far as publishing books, I think this needs plenty of thought but I see it as the NPO paying authors either one-time or via royalties, if the author wants to be paid. Also, the NPO could pay editors one-time fees to prepare the books. On that note, I do editing on the side and I charge between $200 and $400 dollars to edit a book for publication.
Costs of providing the services the NPO was chartered for are NOT administrative costs. That's like saying that the Red Cross spending money on refrigeration of blood is an administrative cost.
And yes, we will involve a lawyer. But talking this out before hand will help to know what questions to put to the lawyer.
Hugs,
Erin
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
Followup, with more questions. :-)
Good! Y'all've obviously thought about this a bit. I didn't know, for instance, that there was a 'literary' form of non-profit (is NPO common? I've seen NGO and nonprofit, but not NPO).
So ... if you'll permit further pushing, let me lay out some thoughts. It seems clear (with condolences to the Arnold family) that Bob's recent death brought this to the forefront. When a random collection of friendly (and perhaps not so friendly) individuals collaborate to provide a sort of forum for those who express the interests important to them, how can the community that develops be safeguarded against the loss of one of those who has stepped forward to take on responsibility?
A nonprofit is one answer, but as Angela Rasch pointed out, it's not the only one. In order to preserve continuity, one needs an organization; it need not be a 501(c)3 in American jurisprudence. At the least-formal end, an organization might be established with (verbal/electronic) agreement among the participants, and a vaguely expressed determination to bring in new blood to keep things going. At the most-formal end, a nonprofit. Between the two, perhaps a contract-based not-for-profit (every participant agreeing to sign the charter as a condition of entry), or even a for-profit (not every for-profit need necessarily make profit, although that's more or less what not-for-profit is for).
Individuals publishing stories on their own may have less concern (but then, perhaps it *matters*?). My stories will go away if I croak; I don't know anyone who'd be likely to take them on. Other author-specific websites are likely the same. Should this organization reach out to such people? Well, and generally: what does "membership" mean? How are additional members of the directing/executive body found? How are additional worthy projects adopted?
Supposing a nonprofit, what's the investment guideline should a windfall appear? Imagine a million dollar bequest to the organization (this is not impossible; as our stories indicate, "crossing the line" can be fraught with all sorts of pain and sometimes with violence, and the emotional impact on survivors could conceivably be such that they wish to make such a bequest, if there were an organization there to take it). Granted, of course, that it is *most likely* that the organization will instead be concerned with pinching pennies, but what would be done with a windfall?
Your point about providing services versus administrative costs is taken ... by me. Suppose an auditor with an agenda who wants to revoke (or refuse) certification as nonprofit?
Since I'm being a pest, here, I want to repeat: I like the idea. I really want to see y'all think it through, work it through, plan it out so that it will work for the benefit at least of authors, and ideally of all of us who find ourselves with a knife in one hand and a keyboard in the other, desperately searching for *just one person* that's *like me*, enough like that the knife can be set aside.
The question of copyright is likely to arise, and given that at least some authors in the community have adopted CC licenses, each story needs clarification (which isn't currently showing, at BC/TS, btw). An author might release on a supported site under a particular license, might release for publication on that site reserving copyright, might assign copyright. What the site (and the organization) can do with these things (for fundraising, among other things) depends upon what the author permits--and that gets a little weird on the net, where nothing ever *really* dies (how many people have copies of Ellen Hayes's original, and author-deprecated, Tuck Seasons? It can still be found, last time I looked). Clear description of ownership of Precious Intellectual Property probably ought to be spelled out clearly, submission by submission, to avoid the possibility of random lusers showing up to sue the organization (which is presumed to have deeper pockets than a person).
Amy!
More Q and A
Reaching out to offer services would probably be in the charter of the organization. How else? Wait for people to find you?
Windfalls had not occurred to me. Hmm. Well, we can have a clause that says the board can create trust funds to offer other sorts of services to the TG community, like legal or medical aid. Or education for the general public. Or invest the windfall in making a movie or something.
As for the evil auditor thing, if you move to Kansas, watch out for tornadoes. It's not something a really rational person can spend a whole lot of time worry about. You take precautions and hope for a high pressure zone right over your house.
Copyrights. I tried to provide a way for people to choose their own copyright or copyleft from a menu for BC back in the days of BC Classic and I spent HOURS explaining it and could get nothing else done. I found that I have to leave such things entirely up to the author as to whether they want to make announcements. There is a copyright announcement at the bottom of the page though. For the NPO, for sites the NPO operated (rather than just provided services for) things might have to be different. And for copyrights assigned to the NPO, things would have to be done. I have thought of this stuff.
Good questions.
Hugs,
Erin
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
copyright is not an issue with NP
Keep in mind that most regional theatres in the US are non-profit organizations. We deal with aspects of intellectual property and copyright on a more or less constant basis without any significant difficulty.
Go for it!
From what I gather from earlier comments, you've already analysed the legal implications. The 'literary' status would work well for sites like Stardust and Crystal Hall, but how well would it work for the other sites Bob was hosting - would many of them be eligible to join in?
If so, given the quick success of your server rescue appeal, there's a chance their members might be able to help out with contributing to start-up costs, which would certainly help put the show on the road fairly quickly (well, about as quickly as finding a physical hosting location and the legal process involved in setting up a non-profit allows)
There are 10 kinds of people in the world - those who understand binary and those who don't...
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Lily pads
A BC member has offered a lily pad for sites we can't fit within our continuing focus on the TG community. This would allow them to find long term hosting somewhere else, if possible.
Hugs,
Erin
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
= Give everyone the benefit of the doubt because certainty is a fragile thing that can be shattered by one overlooked fact.
I like it.
It's absolutely a logical next step.
Think long and hard about
Think long and hard about what *kind* of non-profit you are going to incorporate as. The several different kinds have *very* different rules as to what they can and can't do. I'm pretty sure that charitable & religious are right out. Educational has somre hidden "gotchas".
Also, if you ever have to end the corporation the assets *must* be transferred to another non-profit *of the same type*.
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