July 5, 2012

New Form 990, Same Old Behavior

In 2009, a wave of low-grade anxiety swept across the association community about the Internal Revenue Service's revisions to the Form 990. For the first time, nonprofits were asked to disclose whether they had policies in place regarding (among other things) conflicts of interest on boards, whistleblowers, and document retention. In an Acronym post at the time, Larry Sloan summed up the general feeling that the IRS was delivering a strong hint about what would happen if associations didn't establish those polices: "associations should answer affirmatively [to those questions] to minimize the chance of the dreaded IRS audit," he wrote.

The ASAE Foundation has been collecting data from the Form 990 for the past few years, and it's now clear that, however anxious those questions made associations at the time, they haven't produced any substantive overall behavioral change in the industry. I could plot all the data in a pretty chart, but that'd be a lot of effort to show you what would essentially be three horizontal lines. Here's what we know:

  • Between the tax years of 2008 and 2010, the percentage of associations* with a written conflict of interest policy increased slightly, from 54 to 57 percent.
  • The percentage of associations with a written whistleblower policy nudged up from 34 to 38 percent.
  • The percentage of associations with a written document-retention policy ticked up from 43 to 45 percent.

What to make of this? I'm eager to read your thoughts in the comments (or in my inbox for a potential future story), but a few interpretations seem safe to make. A polite nudge about best practices from the IRS clearly isn't enough to move the needle---there's nothing illegal about lacking those policies, so associations may just be waiting to see if anybody actually does get audited as a result of ticking "no" on those boxes. Moreover, there may be some anxiety about what these policies should look like. It's one thing to get in hot water over how you filled out a tax form, yet another to get in hot water over some ancillary materials around which no firm best practices exist. You can't screw up the contents of a document you never wrote in the first place.

But I wonder if these horizontal lines also reflect something deeper about the culture of associations---a resistance to say more about themselves, financially speaking, than they absolutely need to. That may be reasonable advice from an accountant's perspective, but is it in the overall best interest of your association? In a roundtable on legal issues that ran last fall in Associations Now, Jerald A. Jacobs argued that associations should think of the 990 as an opportunity for self-promotion. "The next wave is considering and using the Form 990 as a marketing tool for the organization in your legislative and advocacy or regulatory goals, in selling memberships or sponsorships or exhibit booths or the public on what your organization does. It's a wonderful opportunity to tell your story... Within a relatively short time I'm going to be able to sit across a lunch table from you with my PDA, and if you're an association executive I'm going to know if you have an employer-paid cellphone. That's how detailed the information is going to be, and that's how easy it's going to be to access."

If this is the information people will want to instantly access in the coming years, why not get ahead of the curve?

* For the purposes of its 990 analysis, the ASAE Foundation defines an association as a nonprofit organization reporting a minimum of $200 in membership dues and at least one paid employee.


February 23, 2011

Managing Court-ordered Volunteers

There's a fascinating article in this month's about how and whether nonprofits should agree to use "volunteers" that are court-ordered to do a certain number of community service hours as their punishment. These folks are often first-time offenders for things like driving under the influence or petty theft.

I've never read an article about this before, so leave it to the always-terrific Susan Ellis, president of the volunteer management consulting and training firm Energize, to take on this thorny issue.

Especially helpful is the way she frames the conversation needed by any nonprofit considering a court-ordered volunteer policy. Ellis lists questions such as whether "mandatory volunteers" should be assigned the same type of service as traditional volunteers, how volunteer management systems may need adapting for this particular population (for instance, nonprofits generally must complete a weekly report about the volunteer), and the attitudes of staff about working with court-ordered volunteers.

She also is clear about potential biases and benefits, such as data showing that many of these volunteers end up serving their organizations far longer than legally required because they enjoy the work and/or believe in the mission. And who doesn't need passionate volunteers?

For leaders unfamiliar with the 11 types of alternative sentences, Ellis suggests skimming a free online resource that defines them and identifies which ones might apply to nonprofits.

I'd be interested to hear whether and how associations as well as charities are addressing this in our community. Please post your comments here.


February 8, 2010

Quick clicks: Snowy day edition

This is a bit of a catch-up edition of Quick Clicks, so it's a little longer than usual. But if you're in the DC area (or elsewhere) and snowed in, what better time to catch up on your reading?

First, I'd like to welcome to several new association blogs:

- Aaron Wolowiec, a former Acronym blogger, has launched his own blog at An early standout post: Exposing the silo effect.

- Karen Tucker Thomas recently began the CEO Solutions blog. Early standout: Board orientation or board development.

- Management Solutions Plus brings us The Common Thread blog, featuring a number of staff, including well-known association blogger Jamie Notter. Early standout: Enquiring minds want to know how and why, by Angela Pike.

- If you follow any of the ASAE & The Center listservers, you're surely familiar with Vinay Kumar; he now has a blog of his own, too. Early standout: The Ferrari, the race, the pit-stop.

- If you have an interest in legal issues related to associations, check out Mark Alcon's new Association Law Blog. An early standout post: top 10 signs of a dysfunctional board.

Several existing blogs and bloggers are putting together interesting new series:

- The Vanguard Technology blog has begun a new "5 Questions" series, where they'll be asking five questions of an association professional doing innovative things with technology. This first interview (presented primarily in podcast form) focuses on why email marketing matters more than ever.

- DelCor has begun a weekly "Social Media Sweet Spot" show on Ustream, hosted by KiKi L'Italien.

- The SocialFish blog is hosting a series of interviews with association social media managers.

Many other association bloggers have had interesting things to say in recent weeks:

- Maddie Grant shared a thought-provoking post from Bruce Butterfield on lessons associations can learn from the struggles of the newspaper industry. Kevin Holland responded with his thoughts on what is missing from that comparison. Both posts inspired very interesting comment discussions.

- Elsewhere, Kevin Holland had a great discussion with Matt Baehr about aggregation as a value proposition for associations.

- Shelly Alcorn shares her take on the Supreme Court's ruling in the Citizens United case.

- Joe Gerstandt has a thoughtful post on opportunities he sees for local SHRM chapters to advance the cause of diversity and inclusion. I think his ideas could be applicable to a lot of other associations, too.

- Jeff Hurt shares a meeting planner's perspective on conference housing and attrition.

- Jeff De Cagna shares his five key words for 2010.

- Ellen Behrens argues that many of our current work practices are unhealthy for both ourselves and our organizations.

- Judith Lindenau shares her "A list" advice for association membership recruitment and retention.

- Maggie McGary is starting a list of association and nonprofit community managers.

- Eric Lanke at the Hourglass Blog shares a first draft of principles of innovation for the association community.

- Sue Pelletier responds to one possible model for the future of work and speculates on how associations might fit in.

- Tony Rossell has a simple method you can use to calculate where your membership numbers are headed.

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July 2, 2009

When Codes of Conduct Clash with Legal Fears

I had an interesting conversation about marketing new professional codes of conduct or professional principles Wednesday with Carol Smolenski, executive director of ECPAT-USA, a New York-based nonprofit that protects children from sex tourism. It was one more time in which I felt that America’s propensity to sue everyone in sight – or live in fear of that—was holding back good-minded organizations from doing the right and obvious thing.

In this case, I’m talking about ECPAT’s Code of Conduct for the Protection of Children from Sexual Exploitation in Travel and Tourism. This is a concisely written code with six anti-“sexploitation” criteria and more than 1,000 signatories from 30 countries to date.

How many of those 1,000 signatory organizations—ranging from hotel chains to hospitality and travel associations--are U.S.-based? Four.

Why so shockingly low? Lawyers, grimaces Carol. Apparently, although this view “is not generally shared” outside of the States, many lawyers here believe that displaying support for the code would put a company/association at greater risk should a sexually exploited child decide to hire a lawyer and target, not so much the individual committing the heinous crime, but the facility in which it occurred because “it is likely more profitable.”

Fortunately, not everyone in America agrees. The American Society of Travel Agents is to be commended for adding its considerable clout to the effort to stem sex trade of minors, as is longtime hospitality industry leader Marilyn Carlson Nelson, who immediately signed up her powerful Carlson Companies in 2004 despite internal advice to the contrary. Today, she remains an ardent champion for the code and cause.

Carol, too, remains committed, although she now focuses on marketing the code primarily beyond American borders, where interest and support are much higher. In Mexico and Belize, for instance, the code has firm backing from a variety of travel associations, which also help get EPCAT supporters and staff into the door of local hotels. There, Carol finds that facility managers are often eager to sign the code, despite hesitations from corporate headquarters.

To help bolster these potential grassroots supporters, her organization is trying something new: on-the-street surveys asking whether people would prefer to stay in a place supportive of responsible tourism-related policies. Although early yet, to date around 60% of several hundred surveyed in New York City say yes.

But it’s a bit of a shame both that this is the question EPCAT has chosen to ask first, and that its initial query is to the general public. To me, it’s asking the wrong people. I’d rather target travel and hospitality professionals, owners, managers, promoters and maybe even their lawyers with the question, “How would you feel about staying in a place that does not support responsible tourism practices and policies?”

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May 13, 2009

Antitrust back in the spotlight

It took three weeks for the newly confirmed Assistant Attorney General for the Antitrust Division Christine Varney to note a major federal policy shift. In remarks on Monday and Tuesday, she left little doubt that the Obama Administration will actively pursue possible antitrust violations. As if right on cue, the European Union on Tuesday smacked Intel with a record antitrust fine, all of which presents the perfect opportunity for associations to take a look at their own antitrust risks and practices. I talked with Pillsbury Winthrop Shaw Pittman attorney Jeff Glassie about what this means for associations.

"I think you have to look at the new assistant district attorney's remarks and you have to look at the consent order the FTC issued to settle charges against the National Association of Music Manufacturers issued in March as evidence of how this administration is going to focus on antitrust issues," says Glassie.

The NAMM case is notable because there was not an allegation of an anticompetitive agreement being reached by means of NAMM, only that NAMM facilitated an exchange of information. Agreements can be per se antitrust violations, information exchanges by themselves are not. Still, the FTC pursued NAMM because it said the way they actively sought to exchange information could lead to anticompetitive practices. (Read the FTC's take.)

Varney's remarks, on the other hand, were aimed more at monopolisitic parts of antitrust law, which are not an area where associations face a great deal of risk. Still, Glassie warns that her remarks are not insignificant to associations.

In a poor economy, there might be some expectation of deference to business to ensure that they remain or regain profitability and avoid bankruptcy or closure. But "she pretty clearly laid out that protecting consumer welfare cannot take a backseat in a challenging economy," he says. "She didn't use the word 'associations,' but she did say that there is no adequate substitute for a competitive market, particularly in times of economic stress. In terms of antitrust enforcement, the administration has signaled it intends to play a vigorous roles, which is a sharp contrast to the last eight years."

So what should associations do about it?

First, "Don't look at this as some kind of black cloud," says Glassie. "When I make presentations to associations on antitrust, I'm sure to say that our country is founded on a free market system. What keeps it a free market and not one subject to collusion or to the dominance of a very few, very large players, is antitrust law."

As for due diligence, this is what Glassie recommends:

- Dust off the antitrust policy and make sure that it's updated and applied. It should be part of board books and any relevant committee meetings as part of the agenda and minutes.

- Be especially diligent that any surveys or research on prices, fees, salaries, or other sensitive areas are performed and released appropriately. (See Statement 5 in "Statements of Antitrust Enforcement Policy in Health Care.")

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February 12, 2009

Resources Regarding Closure of a 501(c)3 Foundation

We received a recent request to our Knowledge Center about the ramifications of dissolving an association’s 501(c)3 subsidiary such as a foundation. It coincided with a discussion I’d had recently with two fundraisers who said they were struggling to generate revenues for their associations and had “all but given up” on raising money for their subsidiary foundation as well.

Obviously, the Internal Revenue Service has a number of guiding documents about closing down a charity, including “Dissolving a 501(c)3”, IRS Rev. Proc. 82-2, "Life Cycle of a Private Foundation," and "Termination of Private Foundation Status."

If you subscribe to The Chronicle of Philanthropy, you can access a June 1, 2006, article called “Engineering a Foundation’s Demise,” or if you receive Trusts & Estates, you can look up the more recent article June 2008 article, “Breaking Up Is (Not So) Hard To Do.”


January 30, 2009

Super Bowl Is Super Time for Associations to Show They’ve Got Game

Only days away, the Super Bowl match-up between the Pittsburgh Steelers and Arizona Cardinals has provided a welcome chance for an eclectic assortment of associations and nonprofits to rack up some big points with the public. You wouldn’t think a football game would have impact much beyond sports associations and maybe some snack-food, pizza-making, beer-selling trade organizations, but here are just a few of the creative activities and news related to Super Sunday that I’ve seen, starting with the most obvious:

--It’s all about the ads, really, isn’t it? You’ve probably heard, read, and laughed about the big PepsiCo commercial, which has garnered rave reviews from countless associations involved in representing people with disabilities, such as the National Association of the Deaf. For those few who don’t know what I’m talking about despite extensive press coverage, PepsiCo has created a funny 60-second ad called “Bob’s House” that is based on a longtime joke amongst the hearing-impaired. I won’t ruin the punch line, but you can already watch it on Pepsi’s “Ads” section on its Web site. Apparently, while most companies keep Bowl ads top secret, Pepsi—whose employee network EnAble created the silent, captioned ad—decided a pre-release was well worth the fabulous publicity. Look for the ad to air in the pre-game coverage.

--And who will be critiquing these $2-million pitches? Aside from you, of course. The San Francisco Chapter of the American Marketing Association continues its tradition of hosting an animated panel session of ad experts for a post-game thumbs up-down session to determine “which ads made an impact on our national psyche.” This year’s melee is titled “Super Bowl XLIII—Buzz or Bust in a Down Economy.”

--And what about the food? Myriad trade associations are tying in their products and services, ranging from the National Pasta Association with its Game Day manicotti enchilada recipe to the National Retailers Association, whose annual survey determines the estimated viewership (167 million adults or 73.3% this year) and its impressive monetary outlay ($57.27 each on food, merchandise, team apparel, electronics, and even furniture).

--And don’t forget the halftime possibility of getting off that couch and actually tossing a ball. The National Football League and the American Heart Association have teamed up for “NFL Play 60,” a “Super Bowl Challenge to inspire Tampa Bay students to get the recommended 60 minutes of daily physical activity — in school and at home — and help middle schools become places that encourage physically active lifestyles year-round.” The campaign provided curriculum resources and materials to teachers to promote the program during the pre-game hysteria. You also might recall that AHA ran an amusing 30-second Super Bowl ad in 2007 called “You Gotta Have Heart”. The ad is running online now as part of Spike TV’s “Top 25 Super Bowl Ads” feature.

--But did ya have to bring in the lawyers? Apparently. Members of the Christian Law Association were involved in that messy business of the past few years in which the NFL threatened to prosecute churches that used the event for fellowship purposes by showing the big game in their facilities, rather than in a personal home. This year, though, the NFL relented and created special regulations around such events, which are shared in a video on the CLA site.

Now let’s kick off!


April 7, 2008

Form 990 instructions comment period opens

The IRS just released the draft instructions for Form 990. Here's ASAE & The Center's notice about it:

The IRS this afternoon released draft instructions for the redesigned Form 990 that tax-exempt organizations will file beginning with the 2008 tax year (returns filed in 2009). The draft instructions can be downloaded from the IRS website here:,,id=181091,00.html .

While the new Form 990 was finalized in late December 2007, the IRS is seeking comments on the 2008 Form 990 instructions to ensure they address the needs of filing organizations. Comments are due by June 1, 2008.

The IRS is requesting comments on all aspects of the draft instructions, including suggestions for further reducing the complexity of the form and the burden on filing organizations. At the beginning of the instructions for the core form and each schedule, the IRS has highlighted specific areas where comments might help. The agency indicated it's particularly interested in comments on the definitions in its glossary, and the instructions for significantly revised or new areas of the form such as compensation, governance, foreign activities, disregarded entities and joint ventures and hospitals. As it did with the Form 990 last summer, the IRS plans to post all comments on the instructions on its website (

According to the IRS, the draft instructions are intended to provide specific and clear guidance for completing the core form and each schedule. This approach has increased the length of the instructions, but the IRS believes the new content will make it easier for organizations to complete the form. The IRS has included a number of new tools to enhance compliance and promote more uniform reporting, including a comprehensive glossary of terms; a sequencing list to help organizations determine the order in which to complete sections of the form; and a compensation table to help organizations determine how and where to report compensation data.

ASAE is in the process of reviewing the draft instructions and welcomes feedback from the association community as we work toward submitting comprehensive comments prior to June 1.
For more information about the new Form 990, please contact ASAE's Public Policy Division at 202-626-2703 or email us at


January 12, 2008

Not Governed by....but acting as if you are

We are surrounded by regulations that we have to operate inside of in order to ensure that we stay on the right side of the law.

How about selecting to be governed by laws that do not actually apply to you? For example the Family and Medical Leave Act (FMLA) applies to employers wth over 50 employees - but my association (5 employees) has chosen to act as if governed by its provisions.

How about SOx - No, not the Red or White ones, but the Sarbanes Oxley Act passed by Congress as a response to scandals such as Enron? while designed primarily for public companies, the act provides outstanding guidance on control documentation for all organizations.

I will cheerfully let a lawyer correct me on this, but I believe that Title VII of the 1964 Civil Rights Act (the bit that precludes discrimination on the basis of on the basis of race, color, religion, sex or national origin) only applies to entities with more than 15 employees.

For all of those associations that are not governed by these provisions (and others) it might be worth investigating whether declaring your intent to act within the regulations might at least show a commitment to fairness and transparency.


October 11, 2007


I just finished reading a shattering novel for young adults called Sold (Hyperion, 2006) about a Nepalese girl who is sold into prostitution. While attending the recent National Book Festival in Washington, DC, I was compelled to buy the story after hearing its best-selling author--investigative journalist Patricia McCormick--share her emotional experiences from a month spent researching the child sex trade in Nepal and India. Bear with me while I explain the relevance to associations and their business partners.

During the Q&A, I asked McCormick both if she still communicated with the girls and women who described their horrific existences to her, and if she had been moved to activism by her findings. She affirmed both, noting that part of her earnings go to nonprofits that fight child trafficking.

More important than money, though, has been the simple fact that, despite post-trip trauma, she managed to write the book at all. Further, it just won the prestigious Quill Award for Best Teen/Young Adult Book, which will raise the visibility of this under-publicized social atrocity even more.

Association executives may not feel particularly connected to child trafficking as a business issue. But some of our sector’s largest industries—such as tourism organizations concerned that this crime is often conducted in hotels--are among the leaders working to stop the abuse. In addition, since associations hold events in many cities and nations that have become major centers for child trafficking—India, Korea, Thailand, San Diego, London, Sydney and New York, for instance—the problem has grown more relevant.

McCormick’s story of Lakshmi, the 13-year-old main character from an impoverished family, depicts a tale similar to that of millions of children ages 10-18 who are trafficked for sex annually in what has become a multi-billion-dollar business. Brazil alone is home to 500,000 child prostitutes ages 10-17, with some as young as six, according to UNICEF.

The author’s Web site links to some association efforts, including an international Code of Conduct for the Protection of Children from Sexual Exploitation in Travel and Tourism” project by the World Tourism Organization and nonprofit End Child Prostitution, Child Pornography and Trafficking of Children for Sexual Purposes (ECPAT).

Created in 1998, the code outlines six conduct criteria based on the United Nations Declaration of Human Rights and the UN Convention on the Rights of Children. It also helpfully includes model language that associations can add to contracts with global suppliers of everything from accommodations to tours.

Members of the Code Steering Committee include the International Hotel and Restaurant Association, Federation of International Youth Travel Organizations and Tour Operators’ Initiative for Sustainable Tourism Development, among others. In August 2007, the group helped gather support for 21 congressional leaders who sent letters to CEOs of the four largest U.S. hotel chains, urging them to sign the code. To date, two of them—Choice Hotels and Starwood—have responded with interest in the code, and Hilton Hotels noted that its soon-to-be-issued Global Code of Conduct “will specifically address issues of child exploitation.” Regent International Hotels and Radisson are among the 50 companies that have already signed.

Here’s hoping that other associations and industry partners “get” Sold.

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May 9, 2007

Legal stuff for association blogs

Via David Gammel, I came across a helpful and wide-ranging look at the major legal issues surrounding blogging today—and what U.S. laws and regulations currently apply. If your association is considering jumping into the blogging pool, “12 Important Laws Every U.S. Blogger Needs to Know” will be a very interesting read.