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<div class="moz-cite-prefix">Hi Everyone,<br>
<br>
I want to say kudos to Daniel for all his work here.<br>
<br>
Board, know that LocationTech is supportive in any case.<br>
<br>
The Eclipse Foundation provides services to working groups which
includes accounting, legal, marketing, IT, etc. The result is a
lot like a Foundation within a Foundation without the pain of the
overhead of running a legal entity.<br>
<br>
That said, a decision on what's best will come before it's clear
if there's any need or value to explore if Eclipse Foundation
staff can help. <br>
<br>
We're here if you need us.<br>
<br>
Andrew<br>
<br>
On 11/13/2012 03:04 PM, Cameron Shorter wrote:<br>
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<div class="moz-cite-prefix">Andrew,<br>
I hope that you can monitor this email thread we are having, and
potentially suggest options with regards to LocationTech.<br>
<br>
On 14/11/2012 3:03 AM, Peter Batty wrote:<br>
</div>
<blockquote
cite="mid:CAPJXf1U1J6za3fa-huDp7dDyRpLphaZoRjz+rJNPyX_2ww3fAA@mail.gmail.com"
type="cite">I have the same question as Jachym - could someone
provide a summary with more information on what we have been
doing with our sponsorship program? During my year on the board
I don't recall much if any discussion, or activity on this that
I've been aware of. If someone could explain a bit more
background and history on the program that would be helpful to
me, and I suspect to some others.
<div> <br>
</div>
<div>I'd also agree with Cameron's observation that *perhaps*
some of this discussion may tie in with the discussions on how
we relate to Eclipse LocationTech. It could be that if we
decide not to set up a for profit subsidiary at this time,
maybe there is some way to collaborate with Eclipse on
sponsorship programs. I'm sure there will be some strong views
on that and I'm not advocating for or against it, just saying
that I think it may be worth thinking about as we consider
various options here. Would there be a way we could designate
an "OSGeo sponsorship program" but have Eclipse run the
finances of that for us? Or is that giving up too much that we
want to "own"? Or on the other hand is it too much overhead to
set up and manage a for profit subsidiary, when we have very
little focus on fund-raising or appetite for it during the
time I've been on the board.</div>
<div><br>
</div>
<div>These are very fundamental questions about what we want
OSGeo to be in the future, and I think it's quite hard to make
progress on these (and especially hard to reach conclusions)
via email or IRC. Where do we stand on having a face to face
board meeting, which is something we said a while ago we would
organize once the new board was in place? It seems to me as
though a face to face meeting of most of us at least might be
the best way to try to reach some conclusions, if we can get
together reasonably soon.</div>
<div class="gmail_extra"><br>
<br>
<div class="gmail_quote">On Tue, Nov 13, 2012 at 1:14 AM,
Jachym Cepicky <span dir="ltr"><<a
moz-do-not-send="true"
href="mailto:jachym.cepicky@gmail.com" target="_blank">jachym.cepicky@gmail.com</a>></span>
wrote:<br>
<blockquote class="gmail_quote" style="margin:0 0 0
.8ex;border-left:1px #ccc solid;padding-left:1ex">Daniel,<br>
<br>
thank you very much for taking care of this. The
explanation you<br>
provided seems to be quite clear even to me (European,
with as much as<br>
no-tax law knowledge).<br>
<br>
One question from my side: how active as or is at the
moment our project<br>
sponsorship program?<br>
<br>
Thanks<br>
<br>
Jachym<br>
<br>
Dne 9.11.2012 05:51, Daniel Morissette napsal(a):<br>
<div class="HOEnZb">
<div class="h5">> Hi Board,<br>
><br>
> I spoke to our attorney last week and got some
answers to Frank's<br>
> questions below which I also had:<br>
><br>
><br>
> On 12-10-30 1:23 PM, Frank Warmerdam wrote:<br>
>><br>
>> It would be helpful to have some sense of:<br>
>> - the cost/complexity of setting up a "for
profit" subsiduary.<br>
><br>
> The cost of setting up a corporation is low. It
is the accounting and<br>
> whatever professional support we use in managing
it that is the main<br>
> cost (expect 5k$ to 10k$ per year?). My advice
for the future will be to<br>
> use a book keeper and accountant to manage OSGeo
stuff instead of trying<br>
> to do things ourselves as we have in the past.<br>
><br>
> I know we've discussed and agreed to this before,
but the problem is<br>
> that being canadian I do not know any book keeper
and CPA that knows the<br>
> US law (I can point you at several canadian ones
though), and the quote<br>
> we got earlier this year from an organization
specialising in this kind<br>
> of admin services was way too high. More research
will be required on<br>
> that front.<br>
><br>
><br>
>> - the practicality and implications of us
opting instead of 501(c)6<br>
>> status.<br>
><br>
> Sounds like c6 is not an option for us either.
And anyway it seems that<br>
> our type of org would not be a good fit for a c6
which is for "Business<br>
> Leagues, Chambers of Commerce, Real Estate
Boards, etc." i.e. a group of<br>
> corporations working on a common goal which is
NOT providing a direct<br>
> business advantage to any of the members. Our
members are not businesses<br>
> so that solves the question.<br>
><br>
> The issue is not one of c3 vs c6, it's about
being a non profit of any<br>
> category. Non profits (c3 or c6) are simply not
allowed to engage in<br>
> activities that would compete with taxable
corporations. Those taxable<br>
> corporations (e.g. proprietary software vendors)
are complaining to the<br>
> government that open source foundations with a c3
status compete with<br>
> them with an unfair advantage... that's the root
of the problem.<br>
><br>
> It seems that our only option if we want to
maintain the project<br>
> sponsorship program is to move it to a taxable
subsidiary (for profit<br>
> corporation) which would be 100% owned by the
501c3 foundation. It could<br>
> even return all of its profits (if it makes any)
as a donation to the c3<br>
> foundation.<br>
><br>
> With respect to the FOSS4G, my interpretation is
that we could possibly<br>
> keep FOSS4G inside the c3 foundation if we treat
the booth and<br>
> advertizing revenues (a small subset of the
FOSS4G sponsorship amounts)<br>
> as "unrelated business income" (UBI). There is a
cap of max 15% of your<br>
> total revenues/donations as a c3 that can come
from UBI. I also believe<br>
> that you need to pay taxes on UBI.<br>
><br>
> e.g. on a 5k$ sponsorship which includes a booth
and a 1/4 page ad, we<br>
> would treat e.g. 500$ for the booth and 500$ for
the ad as UBI, and the<br>
> remaining 4000$ as a donation. It would actually
be even better to avoid<br>
> the ads and just include "thank you" notes in our
program and<br>
> banners/slides. That would leave only the booth
revenues to deal with as<br>
> UBI.<br>
><br>
><br>
>> - the tax implications for us of failing to
achieve any sort of<br>
>> 501(c)x status. (ie. will we have a big back
tax bill)<br>
>><br>
><br>
> I got some hints but no clear answer on this.<br>
><br>
><br>
><br>
> So the question we need to ask ourselves now is:<br>
><br>
> "Do we want to maintain the project sponsorship
program and setup a<br>
> taxable subsidiary for it, or do we drop the
project sponsorship program<br>
> completely?"<br>
><br>
><br>
> I think the taxable subsidiary is manageable, but
to justify it, we'd<br>
> need to put more efforts in the project
sponsorship program since at<br>
> this time it is mostly dormant. (OpenLayers and
GRASS are interested but<br>
> I've kept them on hold, and GDAL is... well,
quiet)<br>
><br>
><br>
<br>
--<br>
</div>
</div>
<span class="HOEnZb"><font color="#888888">Jachym Cepicky<br>
Help Service - Remote Sensing s.r.o.<br>
<a moz-do-not-send="true"
href="mailto:jachym.cepicky@gmail.com">jachym.cepicky@gmail.com</a><br>
HS-RS: <a moz-do-not-send="true"
href="mailto:jachym@hsrs.cz">jachym@hsrs.cz</a> <a
moz-do-not-send="true" href="http://bnhelp.cz"
target="_blank">http://bnhelp.cz</a><br>
<a moz-do-not-send="true" href="http://les-ejk.cz"
target="_blank">http://les-ejk.cz</a><br>
</font></span></blockquote>
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