Nonprofit Strategic Governance: Guest Lecture 2020

Earlier this week, I had the privilege of guest lecturing for Professor Louise Carroll‘s Nonprofit Strategic Governance class at the University of San Francisco. As a former graduate and adjunct faculty member of the Master of Nonprofit Administration (MNA) program, which may have been the first in the country, I’m always honored by an invitation to return. Here are some selected excerpts from my notes and slides:

Common Compliance Issues

  • Failure to timely register, file information returns
  • Fundraising misrepresentations
  • Conduit for donors
  • Preferential treatment to insiders
  • Compensation issues, incl. for past performance
  • Political campaign intervention
  • Failure to identify and pay tax on unrelated business taxable income

501(c)(3) vs. 501(c)(4)

PurposeReligious, charitable, scientific, testing for public safety, literary, or educational purposes, or to foster national or international amateur sports competition (but only if no part of its activities involve the provision of athletic facilities or equipment), or for the prevention of cruelty to children or animalsSocial welfare
LobbyingInsubstantial amounts (but generous limits for 501(h)-electing public charities)Unlimited (in furtherance of purpose)
Political campaign interventionProhibitedLimited (so long as it’s not the primary purpose)
Deductibility of contributionsDeductible (for itemized filers)Generally, not deductible
Excess benefit transactionsYesYes

501(c)(3) Operational Test

501(c)(3) and Lobbying

NRA and the NRA Foundation


  • Purpose Statement – optional, but can serve as guidance for the proper governance of the organization, including with respect to anchoring equity and other core values
  • Membership – including statement if no voting members
  • Directors
    • Number: Fixed or Range – “A board should be large enough to get the board’s work done, yet small enough to work as a single team to communicate, deliberate, and function as a single body.” – Michael Wyland
    • Restriction on Interested Directors
    • Selection – election, designation (appointment), ex officio
    • Terms
    • Removal – with or without cause
  • Board Meetings
    • Annual, Regular, Special
    • Notice
    • Quorum
    • Voting (not by e-mail)
    • Unanimous Written Consent
  • Committees
    • Board Committees
    • Audit Committee (Nonprofit Integrity Act)
    • Other Committees
  • Officers
    • Required: President and/or Chair, Secretary and Treasurer and/or CFO
    • Election
    • Duties
    • Terms
  • Indemnification – default protection or maximum protection of directors, officers, employees, and other agents