2011-06-07

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Contents

June 7th, 2011

Agenda

  1. Approve draft minutes of the last meeting
  2. Consent Agenda
  3. Officer Reports
    1. President
    2. Vice-President
    3. Treasurer
    4. Secretary
    5. Public Relations
  4. New Business
  5. Old Business
  6. Member Reports
  7. Adjournment

Minutes

Attendance:

Initialization

Consent Agenda

After a small fire drill around the payment (or lack thereof) of taxes this year, I believe that we will greatly benefit from pursuing 501(c)3 status, and I am seeking consensus to move forward with that. (Any volunteers to help are also welcome! It involves a number of annoying administrivial tasks that have to be done in a certain order, and Drew has already offered to assist since he's currently going through this process for another purpose and will know how best to get through it.)

Splat Space is currently registered as a nonprofit in NC, but is not federally tax-exempt, and will not be until we are approved as a non-profit. We have 15 months from the month in which we were incorporated to submit our application, which means we need to get this done by February 2012, and I hope to get it done sooner so we aren't pushing the deadline if we run into issues.

Once we are approved as a 501(c)3 tax-exempt organization, our sole responsibility to the federal government will be to fill out an online e-Postcard tax filing once a year. If we do not get approval, then we will need to file federal tax returns as a corporation and do all the associated accounting, which will require someone with a clue acting as treasurer, because I tried to figure it out once already and ended up with my brain smeared across the IRS website's windshield. :( So I think the benefits of 501(c)3 status outweigh the annoyance of jumping through all the hoops required to apply for it...

(Regarding taxes, see the Treasurer's report.)

Officer Reports

President
  • Nothing to report
Vice-President
  • Nothing to report
Treasurer

PayPal balance as of 6/5: $1513.48 (initiated $1500 transfer to BB&T account on 6/5, after which balance will be $13.48)

BB&T balance as of 6/5: $1532.44 (once $1500 transfer clears, balance will be $3032.44)

Automatic (free) money transfers from BB&T to CREH-Snow for rent are finally working properly! Insurance can also be paid online, so we're completely electronic (which may not be exciting to anyone other than the treasurer, but it certainly makes my life easier :) ).

We're currently past the break-even point for membership! We have just under a thousand dollars in monthly recurring fixed costs ($895 in rent + $86.53 in insurance = $981.53 in monthly payments). Twenty full members generate just under a thousand dollars in revenue (20 x $50 = $1000 - PayPal transaction fees = $975). We currently have 21 full members who are paying regularly (and another three whose status is uncertain) plus five associate or student members.

That plus donations and the $900 grant for the hackerspace challenge mean that we're comfortably in the black. Speaking of hackerspace challenges, if anyone has made purchases towards those projects and would like to be reimbursed, please send an email to treasurer@splatspace.org with the date / cost of purchase you'd like reimbursed and provide me with a receipt for whatever-it-was, and I'll be happy to reimburse you!

(As members purchase things for the space and our projects, we need to stick to a receipt-and-reimbursement process, rather than a "so-and-so paid for such-and-such so we're giving them a break on their dues next month" or "we'll just take it out of the donation box" or similar ad hoc arrangements. I don't think this needs to go on the consent agenda, since it's just good accounting practice, but I'm happy to explain the problems we're avoiding, this way, to anyone who's interested in why.)

Regarding taxes: in April, Ashley pointed out to me that since we are incorporated, we have to pay taxes. Agh! This hadn't occurred to me because none of the previous SIGs for which I've been treasurer / been an officer have been incorporated. I checked with my personal tax accountant, and he informed me that the deadline for non-profits to file taxes was May 15th and that we could file online. In early May, I went to file on the IRS website and discovered that this only applies to federally tax-exempt non-profits such as 501(c)3. After some panic and painful digging through IRS publications, here is what I have concluded:

According to IRS publication 557, Tax-Exempt Status for your Organization, it looks like 501(c)3 status is retroactive to the formation of the organization if we get our application in within 15 months of incorporating. (See [1] and [2]) In anticipation of us doing so, I did not file any tax return for Splat Space this year; assuming we qualify for exempt status, we will file our e-Postcard in May 2012 and have missed our e-Postcard filing for 2011. There is no penalty for missing one year of e-Postcard filing; if we miss three years in a row, our tax-exempt status will be revoked. [3])

Secretary
  • Nothing to report
Public Relations
  • Nothing to report

New Business

  • No new business

Old Business

Dwolla

TABLED FOR NEXT MEETING I (Lisa) propose that we add Dwolla (http://www.dwolla.com/) as an additional payment option / alternative to PayPal. Dwolla allows direct payments from a member's bank account (checking or savings) to a SplatSpace Dwolla account and direct transfers from a Dwolla account to our BB&T account. Members would need to create a Dwolla account, associate a bank account (verification similar to the PayPal credit card verification process), and then set up payments from their Dwolla account to the SplatSpace Dwolla account.

Dwolla's biggest advantage is their fees (or lack thereof). The only fee is $.25 per transaction. So where PayPal charges a transaction fee and a percentage (SplatSpace gets $48.75 of every $50 payment), Dwolla charges only a $.25 transaction fee (SplatSpace gets $49.75 of every $50 payment). Dwolla also supports multi-payment schedules (i.e. recurring payments) and automatic funds withdrawal (i.e. it automatically sweeps the Dwolla funds into our bank account so we never hold a balance in Dwolla). Paypal doesn't offer the latter, so the treasurer would no longer have to transfer funds manually (not that manual transfers are big deal, but it'd be nice not to have to remember to do it!) The non-profit transaction limit is $5,000 - I would love for us to hit that limit :) but don't see it as a big constraint any time soon.

Dwolla's biggest disadvantage is that they require associating a bank account, rather than a credit card, to users' Dwolla accounts. Some members may be comfortable with this (especially credit union members, since credit unions tend to offer the same fraud protection to their bank accounts that credit card companies do to credit card accounts); others may not (especially regular-bank customers, since regular banks are not required to extend the same fraud protection to checking accounts, so whether they do or not may vary).

I took an unofficial verbal poll, at one of the recent SplatSpace meetings, to see who would / would not be comfortable with using Dwolla to make payments; about half the people in the room were okay with it, about half were uncomfortable with attaching a bank account rather than a credit card. So my current proposal is that we add Dwolla as an optional alternative for members that are comfortable with the concept, based on the advantages above, and keep accepting PayPal payments from members who are not comfortable with Dwolla. (I will continue to investigate alternatives to PayPal, such as Google Checkout or Amazon Payments, for credit card dues payments.)

Member Reports

Adjournment