Can "Friends of [local Scouting]" (i.e., new CO after split from church CO) solicit funds for the CO, which then get donated to units?

[ramblingfam]

Question is in the title.  If a Pack and/or Troop or multiple units come together to form a new "Friends of" corporation to act as a CO for the units, can that organization solicit funds for itself, that it will then use for the units it charters?  How could this work?  Could parents solicit from friends/neighbors/hold events to raise money?  To flip it around, if a church that was the CO for a unit held a "gala to benefit our chartered units" would that run afoul of BSA's solicitation rules?  How could this work or would it not?  What would the counterarguments from Council or National be?

[InquisitiveScouter]

5 minutes ago, ramblingfam said:

to act as a CO for the units

That's the piece that kills it...

If this new organization signs a Charter Agreement with the Council, and acts as the CO, then no.  Well, at least not without some coordination with council.

Para II.A.4. of Chartering Agreement states the CO must "Refrain from soliciting financial support except as authorized for the benefit of the Unit or the Local Council."  https://www.scouting.org/wp-content/uploads/2022/09/Annual-Charter-Agreement-Charter-Organizations_Short-Version_8.26.2022.pdf

So, the "as authorized" part there (I believe) means you'd have to follow all the BSA Unit Money Earning Guidelines... https://filestore.scouting.org/filestore/pdf/34427.pdf  ... and get approval from council before launching the fundraising operation.

Would the council approve this kind of money-raising??  Around here, no... well, not without at least 10% for the big guy 😜 (Probably more than 10%...)

NOTE:  "At no time are units permitted to solicit contributions for unit programs."  So, technically, the "Friends of" might be able to solicit, but certainly no one in the unit could.  (They can ACCEPT donations, but they cannot SOLICIT them.)

 

 

[SNEScouter]

On 8/21/2023 at 8:31 PM, ramblingfam said:

If a Pack and/or Troop or multiple units come together to form a new "Friends of" corporation to act as a CO for the units, can that organization solicit funds for itself, that it will then use for the units it charters? 

BSA policy prohibits units from soliciting donations.

I believe the reason is that many states have licensing or requirements before an org can lawfully solicit contributions.  And also there’s the issue of obtaining tax exempt (501c3) status.  Units generally aren’t set up to deal with the periodic reporting obligations, legal restrictions, and fees associated with this.  Eventually they will stumble.

A “gala” event might be ok depending how it is executed - like if the cost of attendance is a function of the overall event cost, and not an implicit fundraiser.  You’d want the council to sign off on it.

[Jameson76]

Make it a donation for goods, if BSA can do it with the grossly overpriced popcorn, then get some item of nominal value and then "sell" it for the donation.  A dinner is always good, sell "stock" in the group that supports the Scouting program and have a stockholders dinner.

 

Edited Monday at 09:20 PM by Jameson76

[DuctTape]

"The friends of" is the chartering org, it is not the unit itself. As a separate legal entity it may do its own fundraising just like any other CO. 

[SNEScouter]

20 hours ago, DuctTape said:

"The friends of" is the chartering org, it is not the unit itself. As a separate legal entity it may do its own fundraising just like any other CO. 

As InquisitiveScouter already correctly pointed out, a "friends of" organization that is a CO needs to comply with its charter agreement, which directs the CO to "[r]efrain from soliciting financial support except as authorized for the benefit of the Unit or the Local Council."  Even if the CO is a tax exempt org, it can only solicit funds in the name of Scouting with the local council's approval.

On 8/21/2023 at 8:45 PM, InquisitiveScouter said:

Para II.A.4. of Chartering Agreement states the CO must "Refrain from soliciting financial support except as authorized for the benefit of the Unit or the Local Council."  https://www.scouting.org/wp-content/uploads/2022/09/Annual-Charter-Agreement-Charter-Organizations_Short-Version_8.26.2022.pdf

 

 

 

[DuctTape]

2 hours ago, SNEScouter said:

As InquisitiveScouter already correctly pointed out, a "friends of" organization that is a CO needs to comply with its charter agreement, which directs the CO to "[r]efrain from soliciting financial support except as authorized for the benefit of the Unit or the Local Council."  Even if the CO is a tax exempt org, it can only solicit funds in the name of Scouting with the local council's approval.

 

 

 

Right. My point was it is no different than any other CO. 

[InquisitiveScouter]

21 hours ago, DuctTape said:

Right. My point was it is no different than any other CO. 

Yes, and this is why National tries to discourage incorporation of units or their "boosters".  

It is all about the money!

For your average CO, their raison d'être is not Scouting.  Take a church, for example... Your local church "uses" Scouting as a program to enhance their service to youth.  If Scouting units under a CO fold, then the CO continues its other activities.

Your local church may ask for donations for a new steeple, to replace their pews, or put a new coat of paint on everything.  That is different from your local church asking for donations solely to support their Scout units.  When they go down that road, their activity falls under the charter agreement.  And, when they do have any money or property earmarked for Scouting, if the unit folds, the agreement is that they will keep all that money and property for the purposes of Scouting, should they start up a unit again.  (Of course, council wants that money, so they sometimes pursue that purse.)

For the "Friends of Troop XX", their entire purpose for existence (if you didn't yet look up what "raison d'être" means 😜 ) is to support the Scout units, so any and all monies and property they should be used solely for the purposes of Scouting.  If the units fold, then the reason for the existence of the corporation ceases also.

In everything I have read, nowhere does National "prohibit" units (or "Friends of") from incorporating (because they really cannot).  BUT, they do put the threat of revoking your charter out there.  "Units could lose their charter if they tried to get their own tax-exempt status and solicit tax deductible gifts."

Here's an example (page 2, end of first paragraph):  https://www.ciecbsa.org/document/tax-exempt-for-units/25798#:~:text=Units should not incorporate or,approved unit money-earning projects.

And another https://lpcbsa.doubleknot.com/newsfeed/fiscal-policies-and-procedures-for-bsa-units/9007

And another https://michiganscouting.org/unit-resources/unit-finance/

You'll notice the verbiage is exactly the same, which means (to me) this comes out of National...

I never heard of National denying someone's charter for this.  YMMV

I cannot see them doing it, especially these days, unless the money amounts get big, and they get jealous/greedy.