Re: Campaign Letter

From: Alan Dechert <alan_at_openvotingconsortium_dot_org>
Date: Sun Jan 25 2004 - 16:46:01 CST

Just to add a bit to what I said earlier....

Arthur Keller sent me this comparison. I can't vouch for the accuracy, but
it may be a starting point for some of these issues.

Earlier I said 501 (c)(6) "less restrictive" than 501 (c)(3). Maybe "much
less restrictive" would be more accurate. 501 (c)(3)s really have their
hands tied when it comes to promoting business or political interests. 501
(c)(6)s have a pretty free hand in this regard.

Note that it says contributions to 501(c)(6) NOT tax deductible (sorry
Doug). However, members "may" deduct dues as business expense.

The kid from the Wired article the other day (Open Vote Foundation, ) that says he's starting a 501(c)(3) is working with the
wrong model, imo. I'll let him discover that for himself. Even if he is
able to get grants that way (it'll take him a many months and thousands of
dollars to get 501(c)(3) status, and many more months to do the applications
to foundations), it's not clear what he'd be able to do with it. If he
successfully builds good open voting software, about the only thing he can
do is give it away. Who will want it if it's not backed by some businesses
that are able to make it work? As a 501(c)(3), his charter will prohibit
him from serving business interests. He has some serious technology
transfer issues.

Alan D.

> >
> > I know that that the OVC is not yet a Federally tax exempt organizaion,
> > but it probably ought to get into the habit of acting according to the
> > restrictions that constrain such organization. The exact limitations
> > depend on the exact type of exemption obtained. In the meantime it
> > be worthwhile to take a glance at what some other organizations do to
> > themselves away from troublesome questions. Some of the distinctions
> > subtle. This is not an area in which I have expertise (apart from
> > that there are lurking dragons.)
> >
> The word "campaign" in this context means something like "advocacy
> I seriously doubt we're running close to any situtation that would cause
> problems with obtaining tax exempt status. I will run it by our legal
> just the same.
> We will be applying under the 501 (c)(6) code, as most trade associations
> do. This will rule out some grants from foundations that require 501
> status but it's less restrictive. A trade association is expected to
> actively promote the business interests that its members want it to
> promote -- in our case that would be the development and deployment of an
> open voting system.
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Received on Mon Jan 10 00:48:14 2005

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