Starting a business can be a challenge, and getting a non-profit organization off the ground can also be daunting. But it isn’t impossible: The Center for Non-Profits at 3575 Quakerbridge Road can help you make sense of the rules, regulations, and red tape that accompany lift-off.
People start non-profits for the best of reasons. Often these organizations are borne of tragedy: founders want to memorialize a loved one who left too soon, or they just can’t stomach the suffering after a natural disaster. People don’t like sitting on the sidelines; we want to be part of the solution.
However, Linda Czipo, executive director of the Center for Non-Profits, says the field is crowded. “Redundancy is very common. Sometimes it’s better if you partner, pool talent, volunteer with an established group,” she says. “There’s a lot of great work you can enhance.”
It’s not that Czipo’s organization wants to discourage people from starting non-profits; the group wants to see all that hard work and passion pay off. Sustaining viable non-profits is more of a hurdle than the start-up efforts, and the Center for Non-Profits website, www.njnonprofits.org, offers answers in the form of “guided self-help,” Czipo says.
“We encourage people to have strong plans to sustain the entity,” Czipo says. A non-profit group needs a board of trustees, bylaws, marketing plans, approval from the IRS for tax exempt status, good accounting, and appropriate means to generate revenue. “Non-profits are not owned,” Czipo says, “they serve the public. If you want to control something, this is not the deal for you.”
Most non-profit organizations fall under the IRS’s 501(c)(3) designation. These groups are generally religious, scientific, charitable, or literary. They also include groups that work to prevent cruelty to children and animals; or work to protect public safety. All 501(c)(3) organizations are either private foundations, or public charities.
The IRS requirements can often be off-putting to people looking to start a non-profit, but the New Jersey Division of Treasury offers step-by-step details on the process (www.state.nj.us/treasury/taxation/rsb100.shtml), and Czipo’s Center for Non-Profits offers even more assistance, for a fee plus membership dues. The center has helped more than 1,000 New Jersey organizations obtain tax exempt, non-profit status. It offers a comprehensive toolkit that includes sample bylaws, which are required by the IRS, and also legal assistance and review of the various documents that are needed to file.
Because of the relationship between the public and non-profit groups — especially in a bad economy, and when so many charitable organizations are in the need of donations — non-profits come under scrutiny. Donors want to know how their money is spent. “There’s a school of thought,” Czipo says, “that any money spent on administration and overhead is bad. But there needs to be some level of investment.”
The Center for Non-Profits recently participated in a campaign to educate the public about “the overhead myth,” which happens when people judge a charity based on the percentage of expenses that go to administration. Yet, Czipo argues, non-profit organizations need to pay their bills and invest in themselves. She urges the public to watch other areas of non-profit performance: transparency, governance, leadership, and results. High performance in those areas is key. (For more on the overhead myth visit www.overheadmyth.com.)
“Donors want to know what kind of impact an organization has, so when they’re debating whether to give to Organization A or Organization B, the money goes to the group that does the best job,” Czipo says. There are approximately 30,000 501(c)(3) organizations in New Jersey alone, all vying for donations.
And because of the economic downturn, Czipo has seen some non-profits struggle to stay afloat: “There has been lots of merging, consolidation, space sharing. And some close,” Czipo says.
The Center for Non-Profits hosted a conference on December 4 called “Generations of Impact,” at the Crowne Plaza in Monroe. Topics included pointers for fundraising and how non-profits can build their social networks and ensure smooth leadership transitions. Keynote speakers were Ami Dar, founder and executive director of idealist.org, and Drew Dudley, founder of Nuance Leadership.
Czipo grew up in West Caldwell and graduated from Rutgers in 1984 with a degree in political science. Her interest and skills in public policy bloomed into a desire to work with non-profits. Czipo has worked in the non-profit realm for over 25 years, and her experience includes expertise in public policy, compliance, and management issues. She has successfully galvanized various coalitions of non-profits around advocacy issues. She is a current public policy committeewoman and former board treasurer of the National Council of Nonprofits.
Czipo says that the Center for Non-Profits has a long list of accomplishments among its large, diverse membership. “We have lots of success stories,” says Czipo, who adds that seeing the Liberty Science Center start up was one of her most satisfying moments.
“Some people just want to do good,” Czipo says, “and we have a lot of tools to help them.”