We provide a full range of legal services to nonprofit organizations, including social enterprises that are organized as nonprofits and nonprofits that operate as private foundations. While the core of our nonprofit clients focus on clean energy, energy efficiency, climate change, farming, and impact investing, we represent a range of mission-based nonprofit clients working in other fields. Our clients have included organizations that foster financial literacy in low-income populations, promote children’s health in Armenia, preserve neighborhoods and historic properties, and strengthen worker’s rights and standards of living. We have special expertise and interest in representing nonprofit ventures that sell goods or services, raise and deploy capital, or otherwise use market-based strategies to further environmental or other social goals.
At the start-up phase, we help founders incorporate the organization, adopt articles of incorporation, by-laws and conflict of interest policies suitable for a nonprofit, and obtain permission from regulatory authorities to solicit charitable donations. We also help organizations obtain a ruling from the IRS on the entity’s exempt status under Section 501(c)(3) (or other applicable subsections) of the Internal Revenue Code. While an exemption application is pending, we may assist an organization negotiate and document a “fiscal sponsorship” agreement with an existing 501(c)(3) organization to facilitate receipt of tax-deductible donations in the interim period. Once the organization is formed, we often serve as ongoing outside counsel to the entity.
We have experience with a wide range of operating issues relating to nonprofit organizations and private foundations, including:
- corporate governance and annual regulatory filings
- qualification of a nonprofit organization as a “public charity” to avoid involuntary private foundation status
- payment of appropriate compensation to avoid “intermediate sanctions” liability
- undertaking joint ventures and other strategic transactions with for-profit entities in ways that do not create impermissible “private benefit”
- compliance with limitations on lobbying and political activity
- appropriate structuring, documentation and management of grants and mission-related investments (MRIs)
- dissolution of nonprofit entities and appropriate disposition of remaining charitable assets
We also have significant experience in helping nonprofits raise capital from “socially responsible investors” or “impact investors” by leveraging special exemptions for nonprofit securities offerings under federal and state securities laws.