Football and associations | THE JOLT NEWS ORGANIZATION, A WASHINGTON NON-PROFIT ORGANIZATION
By Mary Beth Harrington, CVA
It’s a busy week! With the Super Bowl and the Olympics, not to mention the NBA, NHL and NCAA in full force as well as MLB contract talks (which aren’t going well), it’s hard to focus on other things like this column!
Luckily for us, as always, there is a non-profit connection.
Last week, Forbes once again named the Dallas Cowboys the most valuable sports franchise. According to Forbes, Jerry Jones’ team is worth $6.5 billion, which isn’t a bad investment considering Jerry Jones bought the Dallas Cowboys for $140 million in 1989. (Full disclosure: j worked with Jerry Jones in the past, and he’s all you see in the media).
Given the huge revenue generated by sports teams, it’s hard to believe that a sports franchise could be a nonprofit, but at least one exists.
Go pack go! – a non-profit association!
According to the history of the Green Bay Packers, the Packers have been a public, not-for-profit corporation since 1923. Originally founded by Curly Lambeau in 1919 (hence the stadium’s name), after several financially difficult years, the team has was incorporated as a non-profit association. company, with local fans contributing five dollars each for a share in the team.
The Packers are a unique franchise in the National Football League. The team is locally owned and led by a chairman.
The company currently has approximately 361,300 shareholders who collectively hold 5,009,400 shares. (Full disclosure: I am a shareholder of the Green Bay Packers.) There have been six stock sales; the current sale continues until February 22.
According to the Green Bay Packers, if you buy stock in the Packers, the one thing to keep in mind is that your share is essentially worthless. Although you’re technically a co-owner of the team (which is cool to brag about), that’s about all you’ll get from your stock (that and the ability to buy official stockholder merchandise) .
Stocks do not appreciate, cannot be traded and do not pay dividends. In addition, buying a share does not allow you to participate in the decision-making process of the team. (As if they should keep Aaron Rodgers after the 2021 NFL season).
NFL – Not a non-profit organization?
Speaking of the NFL, you might be surprised to learn that until 2015, the NFL was a tax-exempt nonprofit organization. In 2015, the NFL announced that it would voluntarily relinquish its tax-exempt status it had had since 1942.
Like the Packers, the NFL was struggling financially and successfully filed for tax-exempt status with the IRS early on. The IRS ruled that the NFL was a trade association for individual teams and therefore exempt from taxes under section 501(c)(6) of the tax code.
Unsurprisingly, tax-exempt status was good for the NFL, so why voluntarily give up that benefit?
The NFL’s tax-exempt status had become increasingly controversial, and in the end the NFL decided it was no longer worth it, calling the issue a “distraction”. Don’t feel bad for the NFL though; in exchange, they’ll get a few perks, including an end to federal disclosure requirements, meaning the NFL no longer has to disclose its earnings or commissioner’s salary.
While we are talking about sports, it is also good to note that the International Olympic Committee is a non-governmental sports organization or NGO as non-profit organizations are known outside of the United States.)
Credit unions – also non-profit
Are there any other organizations that you might be surprised to learn are non-profit?
The answer is yes, like credit unions. Banks and credit unions have many similarities, they both offer many of the same services, but the main difference is that shareholders own banks while credit unions are still non-profit organizations because their members own them.
Although the structure of a credit union is different from that of a bank, it is also different from most other nonprofit organizations. Unlike other nonprofits that are completely tax-exempt, credit unions pay state, local, property, and payroll taxes.
Additionally, while it is common for employees of non-profit organizations to earn less than those who can perform the same work in a for-profit corporation, credit unions generally pay their employees a higher salary. higher than bank employees.
The good, the bad and the ugly
You might be wondering if all nonprofits aren’t “good” and fulfilling a community need with their mission? The quick answer is not necessarily. I will not list organizations whose stated mission is unethical, immoral, or promotes racism and bigotry, but these organizations exist as non-profit organizations. According to the Washington State Office of the Secretary of State, an organization may be considered a “nonprofit organization” if:
- It is formed under the Washington Nonprofit Act
- It qualifies as a non-profit organization for federal tax exemption purposes
- It is a religious (church, mosque, temple), charitable or voluntary organization. (there is significant wiggle room with this)
Remember that there are 23 different designations for a non-profit organization in addition to 501c3 which specifically designates an organization formed for a “charitable purpose”. A non-profit organization may be created as a corporation, trust, or unincorporated association and may or may not be considered charitable. By forming a non-profit organization, the founders of the organization agree to operate for a purpose other than making a profit.
What can you do?
If you want more information on whether a nonprofit is legitimate, go to Charitynavigator.org for more information.
Solicit your ideas
If you know of a nonprofit that’s doing something great, celebrating a success, needs amazing volunteers, or hosting an event, let me know! This column (aside from a little education) celebrates nonprofits!
Mary Beth Harrington, CVA (Certified Volunteer Administrator) lives in Tumwater. She travels the country speaking at conferences and for individual organizations articulating issues facing nonprofits. Send your ideas to [email protected]