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Meta branch - What sort of Federal Legal Entity should we become

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Hey all, here are some loose notes from this evenings discussion of 
federal incorporation.  Just a reminder for background - we're 
registered with mn as a non-profit, but we still havent yet register 
with the government.  The current plan is to further research our 
options, and give a rundown to the next congress along with a request 
for funds to pay a lawyer for consultation.

Cass thinks we have about a year to make a decision (approx 27 months 
after our first collective action

Cass & Scott will touch base with Cass's lawyer contact - get quote on 
rates.

- What should be make cyberia as a whole?  Co-Operative business, vs 
501c10 (non-profit) vs 501c10 (fraternal org) vs 501c4 (Political org)

- is there one of these options which will make it easier to "break off" 
capsul into another legal entity, while still keeping it integrated in 
our org?


Agenda from meeting:

Prelim Agenda:

  *

    Cyberia Computer Club Non prof Status

  *

    Nonprofit?
    _https://www.irs.gov/charities-non-profits/types-of-tax-exempt-organizations_

  *

    501(c)3 tradicional charitable org

  *

    _https://www.irs.gov/charities-non-profits/charitable-organizations/exemption-requirements-501c3-organizations_

  *

    Pro: lots of grant moniez availible

  *

    Pro: Prestige

  *

    Pro: Cheaper stuff

  *

    Con: we would be limited in how much political stuff we can do (must
    be less then 50% or activity, no endorsing candidates, some other
    restrictions. Keep in mind, EFF and ACLU are 501(c)3s, so its not
    *that* much of a restriciton)

  *

    Con: paying members of congress/board really hard (doable but we
    would probably need to hire a lawyer or accountant)

  *

    501(c)4 social welfate org

  *

    _https://www.irs.gov/charities-non-profits/other-non-profits/social-clubs_

  *

    Pro: less political restrictions

  *

    Pro: easier to get “dark” money

  *

    Con: less regular grant monies

  *

    Con: paying members of congress/board really hard (doable but we
    would probably need to hire a lawyer or accountant)

  *

    501(c)7 social club

  *

    _https://www.irs.gov/charities-non-profits/other-non-profits/social-clubs_

  *

    more research needed about pros-cons

  *

    501(c)10 domestic fraternal society

  *

    _https://www.irs.gov/charities-non-profits/other-non-profits/fraternal-societies_

  *

    probably most accurate description of what we are right now?

  *

    more research needed about pros-cons

  *

    Coperative / Collective?

  *

    Pros: virtually no restrictions on income, can pay congress
    members/board members

  *

    Pros: virtually no restrictions on political activity

  *

    Cons: no grant monies

  *

    Cons: less prestige

  *

    Capsul.org, seperate entity?

  *

    Pros: we can paying members of congress/board

  *

    Cons: by incorperating Capsul or other branches as a seperate legal
    entity, as an LLC or a co-op or whatever we want.

  *

    it would not need to be a subsideary or subordinate

  *

    cons: paperwork

Things to answer:

  *

    Further cooperative pros/cons

  *

    Full list of 501c3 restrictions/laws to abide by

  *

    Should Capsul be separate?

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These notes lot great, Scott, thanks a ton for sending out the write up.

Looking forward to the additional info next congress.

If we've accidentally made an internet frat house, I am both terrified and delighted.

Starless
jes
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> If we've accidentally made an internet frat house, I am both terrified and delighted.

New members need to do keg stands, but instead of a keg it's a commodore 
64, and instead of drinking beer they're playing bubble bobble.


Some more notes:

Near the end of the meeting, it seemed there were two options that were 
going to be explored more thoroughly:

1. 501c3

gives us access to grant money and tax exemption at the cost of a forced 
partial removal from explicit politics and some mandatory bylaws.

2. Cooperative

seems to be the "do whatever you want" option, with seemingly no 
mandatory profit motive. More freedom, less grant money.


Cass has graciously elected to do some more research on what being a 
cooperative means, so hopefully we can have a more concrete pro/con list 
soon!
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Good sum up jess. I would add:

an additional downside to making cyberia a 501c3 is the inability to
employ/pay members of congress and members of the board

an additional downside to being a cooperative/collective is we wont be
taken as seriously (at first anyways) when we do political stuff.

Both those downsides would be negated by setting up different branches
as separate legal entities to do separate things (and still having them
be part of/attached to cyberia). This is done fairly often by other orgs.

But the First Step is to decide on what we should make the club proper.

Cass

On 5/27/20 3:51 AM, jes wrote:
>> If we've accidentally made an internet frat house, I am both terrified
>> and delighted.
> 
> New members need to do keg stands, but instead of a keg it's a commodore
> 64, and instead of drinking beer they're playing bubble bobble.
> 
> 
> Some more notes:
> 
> Near the end of the meeting, it seemed there were two options that were
> going to be explored more thoroughly:
> 
> 1. 501c3
> 
> gives us access to grant money and tax exemption at the cost of a forced
> partial removal from explicit politics and some mandatory bylaws.
> 
> 2. Cooperative
> 
> seems to be the "do whatever you want" option, with seemingly no
> mandatory profit motive. More freedom, less grant money.
> 
> 
> Cass has graciously elected to do some more research on what being a
> cooperative means, so hopefully we can have a more concrete pro/con list
> soon!
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I will say that from my end I don't see any problem with 501c3.

I don't really care about being "on the board" anyway, nor do I expect
to ever get paid. And if I really did want to get paid I would be fine
with just being a non-voting employee or whatever.

I believe that even though it can't be written into the bylaws or
anything, folks on the board would probably represent my  interests
for me within reason anyway.

And finally, I'm lazy and being responsible for  holding meetings and
voting regularly isn't exactly my favorite thing.

The only issue I can see with 501c3:  it sounds like a significant
investment of time, energy, and money.  I know Cass has said that he
likes paperwork, but if its something that would cost $600 for a
lawyer to do for us, I dunno, I know lawyers are expensive but that
sounds like a lot of work, whats the recurring overhead of doing
501c3?   I have no idea about how charitable donations work, when Cass
talks about how there are lots of grants and people looking to give
money to 501c3s, I believe him but something tells me it's not that
simple. I would expect that a lot of it is based on connections, who
you know, who's willing to promote your group in the right circles,
etc. Personally I don't know any loaded philanthropists so I can't
contribute that way.  I have no idea how to estimate the income
opportunity that would come from 501c3. That donation income
opportunity seems like the main reason to go that route as opposed to
co-op.

Besides creating well paying & ethical jobs or a hackerspace
real-estate investment fund I can't really think of any reason why we
would need LOTS of income. I would be incredibly surprised if we could
get access to that kind of money through donations, but if there was a
chance, it might be worth it to pursue 501c3???  Just thinking out
loud.

Forest

On Wed, May 27, 2020 at 2:45 PM cybertrez <cybertrez@riseup.net> wrote:
>
> Good sum up jess. I would add:
>
> an additional downside to making cyberia a 501c3 is the inability to
> employ/pay members of congress and members of the board
>
> an additional downside to being a cooperative/collective is we wont be
> taken as seriously (at first anyways) when we do political stuff.
>
> Both those downsides would be negated by setting up different branches
> as separate legal entities to do separate things (and still having them
> be part of/attached to cyberia). This is done fairly often by other orgs.
>
> But the First Step is to decide on what we should make the club proper.
>
> Cass
>
> On 5/27/20 3:51 AM, jes wrote:
> >> If we've accidentally made an internet frat house, I am both terrified
> >> and delighted.
> >
> > New members need to do keg stands, but instead of a keg it's a commodore
> > 64, and instead of drinking beer they're playing bubble bobble.
> >
> >
> > Some more notes:
> >
> > Near the end of the meeting, it seemed there were two options that were
> > going to be explored more thoroughly:
> >
> > 1. 501c3
> >
> > gives us access to grant money and tax exemption at the cost of a forced
> > partial removal from explicit politics and some mandatory bylaws.
> >
> > 2. Cooperative
> >
> > seems to be the "do whatever you want" option, with seemingly no
> > mandatory profit motive. More freedom, less grant money.
> >
> >
> > Cass has graciously elected to do some more research on what being a
> > cooperative means, so hopefully we can have a more concrete pro/con list
> > soon!
one
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A good perspective Forrest.

I don't foresee any problems 501c3 either. It is a lot more of a time
and energy investment for sure. But I am happy to put in the time, its
fun and I get some good professional experience.

Money... I hope not. I know of several groups that got through the
process just fine without a lawyer, (most notably a group of retired
folks running a "library friends" group haha).

> I would be incredibly surprised if we could get access to that kind of
> money through donations, but if there was a chance, it might be worth
> it to pursue 501c3???  Just thinking out loud.

I think it would be worth it, honestly. The Saint Paul foundation for
example gave an average of $30,000 to 2,699 different orgs in 2019. If
my math is right anyways, I suspect its a lot more variable then that. I
think they are the largest grant giver in the state too.

https://www.spmcf.org/uploads/general/Donors/Files/2019-Donor-Impact-Report-Saint-Paul-Minnesota-Foundation.pdf

The prez of the saint paul foundation even specifically mentioned they
are interested in funding orgs that can help other orgs facilitate
bitcoin in 2020

https://play.publicradio.org/unreplaced_ua/o/minnesota/podcasts/angela-davis/2020/02/05/20200205_eric_jolly_20200205_64.mp3
(jump to minute 47)

I don't know what the odds are of actually getting grant money if we
where to apply for it, but I think we would have a pretty good shot. We
offer something pretty unique and useful.

On 5/27/20 8:06 PM, Forest Johnson wrote:
> I will say that from my end I don't see any problem with 501c3.
> 
> I don't really care about being "on the board" anyway, nor do I expect
> to ever get paid. And if I really did want to get paid I would be fine
> with just being a non-voting employee or whatever.
> 
> I believe that even though it can't be written into the bylaws or
> anything, folks on the board would probably represent my  interests
> for me within reason anyway.
> 
> And finally, I'm lazy and being responsible for  holding meetings and
> voting regularly isn't exactly my favorite thing.
> 
> The only issue I can see with 501c3:  it sounds like a significant
> investment of time, energy, and money.  I know Cass has said that he
> likes paperwork, but if its something that would cost $600 for a
> lawyer to do for us, I dunno, I know lawyers are expensive but that
> sounds like a lot of work, whats the recurring overhead of doing
> 501c3?   I have no idea about how charitable donations work, when Cass
> talks about how there are lots of grants and people looking to give
> money to 501c3s, I believe him but something tells me it's not that
> simple. I would expect that a lot of it is based on connections, who
> you know, who's willing to promote your group in the right circles,
> etc. Personally I don't know any loaded philanthropists so I can't
> contribute that way.  I have no idea how to estimate the income
> opportunity that would come from 501c3. That donation income
> opportunity seems like the main reason to go that route as opposed to
> co-op.
> 
> Besides creating well paying & ethical jobs or a hackerspace
> real-estate investment fund I can't really think of any reason why we
> would need LOTS of income. I would be incredibly surprised if we could
> get access to that kind of money through donations, but if there was a
> chance, it might be worth it to pursue 501c3???  Just thinking out
> loud.
> 
> Forest
> 
> On Wed, May 27, 2020 at 2:45 PM cybertrez <cybertrez@riseup.net> wrote:
>>
>> Good sum up jess. I would add:
>>
>> an additional downside to making cyberia a 501c3 is the inability to
>> employ/pay members of congress and members of the board
>>
>> an additional downside to being a cooperative/collective is we wont be
>> taken as seriously (at first anyways) when we do political stuff.
>>
>> Both those downsides would be negated by setting up different branches
>> as separate legal entities to do separate things (and still having them
>> be part of/attached to cyberia). This is done fairly often by other orgs.
>>
>> But the First Step is to decide on what we should make the club proper.
>>
>> Cass
>>
>> On 5/27/20 3:51 AM, jes wrote:
>>>> If we've accidentally made an internet frat house, I am both terrified
>>>> and delighted.
>>>
>>> New members need to do keg stands, but instead of a keg it's a commodore
>>> 64, and instead of drinking beer they're playing bubble bobble.
>>>
>>>
>>> Some more notes:
>>>
>>> Near the end of the meeting, it seemed there were two options that were
>>> going to be explored more thoroughly:
>>>
>>> 1. 501c3
>>>
>>> gives us access to grant money and tax exemption at the cost of a forced
>>> partial removal from explicit politics and some mandatory bylaws.
>>>
>>> 2. Cooperative
>>>
>>> seems to be the "do whatever you want" option, with seemingly no
>>> mandatory profit motive. More freedom, less grant money.
>>>
>>>
>>> Cass has graciously elected to do some more research on what being a
>>> cooperative means, so hopefully we can have a more concrete pro/con list
>>> soon!
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dis is cass btw. messed up sending email

On 5/27/20 10:53 PM, one wrote:
> A good perspective Forrest.
> 
> I don't foresee any problems 501c3 either. It is a lot more of a time
> and energy investment for sure. But I am happy to put in the time, its
> fun and I get some good professional experience.
> 
> Money... I hope not. I know of several groups that got through the
> process just fine without a lawyer, (most notably a group of retired
> folks running a "library friends" group haha).
> 
>> I would be incredibly surprised if we could get access to that kind of
>> money through donations, but if there was a chance, it might be worth
>> it to pursue 501c3???  Just thinking out loud.
> 
> I think it would be worth it, honestly. The Saint Paul foundation for
> example gave an average of $30,000 to 2,699 different orgs in 2019. If
> my math is right anyways, I suspect its a lot more variable then that. I
> think they are the largest grant giver in the state too.
> 
> https://www.spmcf.org/uploads/general/Donors/Files/2019-Donor-Impact-Report-Saint-Paul-Minnesota-Foundation.pdf
> 
> The prez of the saint paul foundation even specifically mentioned they
> are interested in funding orgs that can help other orgs facilitate
> bitcoin in 2020
> 
> https://play.publicradio.org/unreplaced_ua/o/minnesota/podcasts/angela-davis/2020/02/05/20200205_eric_jolly_20200205_64.mp3
> (jump to minute 47)
> 
> I don't know what the odds are of actually getting grant money if we
> where to apply for it, but I think we would have a pretty good shot. We
> offer something pretty unique and useful.
> 
> On 5/27/20 8:06 PM, Forest Johnson wrote:
>> I will say that from my end I don't see any problem with 501c3.
>>
>> I don't really care about being "on the board" anyway, nor do I expect
>> to ever get paid. And if I really did want to get paid I would be fine
>> with just being a non-voting employee or whatever.
>>
>> I believe that even though it can't be written into the bylaws or
>> anything, folks on the board would probably represent my  interests
>> for me within reason anyway.
>>
>> And finally, I'm lazy and being responsible for  holding meetings and
>> voting regularly isn't exactly my favorite thing.
>>
>> The only issue I can see with 501c3:  it sounds like a significant
>> investment of time, energy, and money.  I know Cass has said that he
>> likes paperwork, but if its something that would cost $600 for a
>> lawyer to do for us, I dunno, I know lawyers are expensive but that
>> sounds like a lot of work, whats the recurring overhead of doing
>> 501c3?   I have no idea about how charitable donations work, when Cass
>> talks about how there are lots of grants and people looking to give
>> money to 501c3s, I believe him but something tells me it's not that
>> simple. I would expect that a lot of it is based on connections, who
>> you know, who's willing to promote your group in the right circles,
>> etc. Personally I don't know any loaded philanthropists so I can't
>> contribute that way.  I have no idea how to estimate the income
>> opportunity that would come from 501c3. That donation income
>> opportunity seems like the main reason to go that route as opposed to
>> co-op.
>>
>> Besides creating well paying & ethical jobs or a hackerspace
>> real-estate investment fund I can't really think of any reason why we
>> would need LOTS of income. I would be incredibly surprised if we could
>> get access to that kind of money through donations, but if there was a
>> chance, it might be worth it to pursue 501c3???  Just thinking out
>> loud.
>>
>> Forest
>>
>> On Wed, May 27, 2020 at 2:45 PM cybertrez <cybertrez@riseup.net> wrote:
>>>
>>> Good sum up jess. I would add:
>>>
>>> an additional downside to making cyberia a 501c3 is the inability to
>>> employ/pay members of congress and members of the board
>>>
>>> an additional downside to being a cooperative/collective is we wont be
>>> taken as seriously (at first anyways) when we do political stuff.
>>>
>>> Both those downsides would be negated by setting up different branches
>>> as separate legal entities to do separate things (and still having them
>>> be part of/attached to cyberia). This is done fairly often by other orgs.
>>>
>>> But the First Step is to decide on what we should make the club proper.
>>>
>>> Cass
>>>
>>> On 5/27/20 3:51 AM, jes wrote:
>>>>> If we've accidentally made an internet frat house, I am both terrified
>>>>> and delighted.
>>>>
>>>> New members need to do keg stands, but instead of a keg it's a commodore
>>>> 64, and instead of drinking beer they're playing bubble bobble.
>>>>
>>>>
>>>> Some more notes:
>>>>
>>>> Near the end of the meeting, it seemed there were two options that were
>>>> going to be explored more thoroughly:
>>>>
>>>> 1. 501c3
>>>>
>>>> gives us access to grant money and tax exemption at the cost of a forced
>>>> partial removal from explicit politics and some mandatory bylaws.
>>>>
>>>> 2. Cooperative
>>>>
>>>> seems to be the "do whatever you want" option, with seemingly no
>>>> mandatory profit motive. More freedom, less grant money.
>>>>
>>>>
>>>> Cass has graciously elected to do some more research on what being a
>>>> cooperative means, so hopefully we can have a more concrete pro/con list
>>>> soon!
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I do want us to at least put research into the 501c10.  I dont know if 
its worth the trouble, but it does seem like it could track closest to 
what we had in mind when were thinking about what we wanted to be when 
we started.  That in and of itself isnt a particularly goo reason in 
incorporate as a c10, but there might be relevant benefits or advantages 
which we're still unaware of.

- Scott

On 5/27/20 5:55 PM, cybertrez wrote:
> dis is cass btw. messed up sending email
>
> On 5/27/20 10:53 PM, one wrote:
>> A good perspective Forrest.
>>
>> I don't foresee any problems 501c3 either. It is a lot more of a time
>> and energy investment for sure. But I am happy to put in the time, its
>> fun and I get some good professional experience.
>>
>> Money... I hope not. I know of several groups that got through the
>> process just fine without a lawyer, (most notably a group of retired
>> folks running a "library friends" group haha).
>>
>>> I would be incredibly surprised if we could get access to that kind of
>>> money through donations, but if there was a chance, it might be worth
>>> it to pursue 501c3???  Just thinking out loud.
>> I think it would be worth it, honestly. The Saint Paul foundation for
>> example gave an average of $30,000 to 2,699 different orgs in 2019. If
>> my math is right anyways, I suspect its a lot more variable then that. I
>> think they are the largest grant giver in the state too.
>>
>> https://www.spmcf.org/uploads/general/Donors/Files/2019-Donor-Impact-Report-Saint-Paul-Minnesota-Foundation.pdf
>>
>> The prez of the saint paul foundation even specifically mentioned they
>> are interested in funding orgs that can help other orgs facilitate
>> bitcoin in 2020
>>
>> https://play.publicradio.org/unreplaced_ua/o/minnesota/podcasts/angela-davis/2020/02/05/20200205_eric_jolly_20200205_64.mp3
>> (jump to minute 47)
>>
>> I don't know what the odds are of actually getting grant money if we
>> where to apply for it, but I think we would have a pretty good shot. We
>> offer something pretty unique and useful.
>>
>> On 5/27/20 8:06 PM, Forest Johnson wrote:
>>> I will say that from my end I don't see any problem with 501c3.
>>>
>>> I don't really care about being "on the board" anyway, nor do I expect
>>> to ever get paid. And if I really did want to get paid I would be fine
>>> with just being a non-voting employee or whatever.
>>>
>>> I believe that even though it can't be written into the bylaws or
>>> anything, folks on the board would probably represent my  interests
>>> for me within reason anyway.
>>>
>>> And finally, I'm lazy and being responsible for  holding meetings and
>>> voting regularly isn't exactly my favorite thing.
>>>
>>> The only issue I can see with 501c3:  it sounds like a significant
>>> investment of time, energy, and money.  I know Cass has said that he
>>> likes paperwork, but if its something that would cost $600 for a
>>> lawyer to do for us, I dunno, I know lawyers are expensive but that
>>> sounds like a lot of work, whats the recurring overhead of doing
>>> 501c3?   I have no idea about how charitable donations work, when Cass
>>> talks about how there are lots of grants and people looking to give
>>> money to 501c3s, I believe him but something tells me it's not that
>>> simple. I would expect that a lot of it is based on connections, who
>>> you know, who's willing to promote your group in the right circles,
>>> etc. Personally I don't know any loaded philanthropists so I can't
>>> contribute that way.  I have no idea how to estimate the income
>>> opportunity that would come from 501c3. That donation income
>>> opportunity seems like the main reason to go that route as opposed to
>>> co-op.
>>>
>>> Besides creating well paying & ethical jobs or a hackerspace
>>> real-estate investment fund I can't really think of any reason why we
>>> would need LOTS of income. I would be incredibly surprised if we could
>>> get access to that kind of money through donations, but if there was a
>>> chance, it might be worth it to pursue 501c3???  Just thinking out
>>> loud.
>>>
>>> Forest
>>>
>>> On Wed, May 27, 2020 at 2:45 PM cybertrez <cybertrez@riseup.net> wrote:
>>>> Good sum up jess. I would add:
>>>>
>>>> an additional downside to making cyberia a 501c3 is the inability to
>>>> employ/pay members of congress and members of the board
>>>>
>>>> an additional downside to being a cooperative/collective is we wont be
>>>> taken as seriously (at first anyways) when we do political stuff.
>>>>
>>>> Both those downsides would be negated by setting up different branches
>>>> as separate legal entities to do separate things (and still having them
>>>> be part of/attached to cyberia). This is done fairly often by other orgs.
>>>>
>>>> But the First Step is to decide on what we should make the club proper.
>>>>
>>>> Cass
>>>>
>>>> On 5/27/20 3:51 AM, jes wrote:
>>>>>> If we've accidentally made an internet frat house, I am both terrified
>>>>>> and delighted.
>>>>> New members need to do keg stands, but instead of a keg it's a commodore
>>>>> 64, and instead of drinking beer they're playing bubble bobble.
>>>>>
>>>>>
>>>>> Some more notes:
>>>>>
>>>>> Near the end of the meeting, it seemed there were two options that were
>>>>> going to be explored more thoroughly:
>>>>>
>>>>> 1. 501c3
>>>>>
>>>>> gives us access to grant money and tax exemption at the cost of a forced
>>>>> partial removal from explicit politics and some mandatory bylaws.
>>>>>
>>>>> 2. Cooperative
>>>>>
>>>>> seems to be the "do whatever you want" option, with seemingly no
>>>>> mandatory profit motive. More freedom, less grant money.
>>>>>
>>>>>
>>>>> Cass has graciously elected to do some more research on what being a
>>>>> cooperative means, so hopefully we can have a more concrete pro/con list
>>>>> soon!
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