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Establishing an Association Foundation

In many cases, an association may find that it has been chartered for years as a 50l(c)(6) organization, and in such an instance knows that it is not authorized to solicit charitable contributions, either from its membership or from outside groups. An apparent solution is to set up a qualified 501(c)(3) foundation. Although the formation process is relatively simple to execute with competent legal counsel, there are other implications that require careful planning by the organization's leadership.

Chartering a foundation is one thing. Capitalizing it is another, whether through transfers of funds from the central treasury or through solicitations of the association membership. Often a professional association may find that it has an appropriately chartered foundation, but during the first two or five or ten years, no one has made any contributions. However, without a deliberate strategy to attract gifts, grants and bequests, this is not too surprising. We can show you some approaches that might turn things around. Issues to consider might include:

  • Testing the feasibility of an association foundation
  • Essential steps in forming an association foundation
  • Planning for adequate foundation capitalization
  • Developing a foundation marketing plan for donor gifts
  • Developing the right Board of Trustees
  • Developing a Board management plan and policy manual
  • Marketing the foundation and PAC as simultaneous strategies
  • Managing investments for security and maximum dollar return.