Michael Kraft
When we think of nonprofits, most of us immediately consider social service agencies, churches, foundations and environmental NGOs. These 501c3 charities represent 109,000 organizations in California.
But the federal tax code also provides for 501c4 entities (mostly politically oriented social welfare agencies), 501c5 organizations (labor), and 501c6 groups (bodies like trade associations and chambers of commerce). Some distinctions feel esoteric, but the biggest ones are the nature of the work that is allowed, and whether donations to the organization are tax deductible for the donor, which generally only applies to 501c3’s.
Today, we’re going to get familiar with 501c6’s, examining three Humboldt-based examples.
Humboldt County Farm Bureau (https://www.humboldtcountyfarmbureau.com/)
Executive Director Jeannie Fulton takes her share of at-risk cow calls. Someone sees a cow alone in the pasture and worries. (Does the animal have water? She looks lonely.) These inquiries add interest to her day, but they’re not really what the Farm Bureau is about. The purpose of the Farm Bureau is to help farmers and ranchers do what they do, to protect the rural lifestyle and the rights of people living it, and to ensure that food is safe, affordable and locally available.
To accomplish that, working lands need protection. The Farm Bureau espouses a net-zero-loss policy when it comes to farmland. The threats they see to that locally include solar and residential development.
And why be a 501c6, rather than some other form of nonprofit? The bureau wants to be able to make formal endorsement in elections, something they generally avoid in local elections but have embraced in some statewide races. (Except for a recent decision allowing some exceptions for churches, 501c3 charities are specifically prohibited from endorsing candidates.)
The organization teams up with a long list of partners, including UC Cooperative Extension, the Natural Resources Conservations Services agency (NRCS), the Farm Services Agency, the Resource Conservation District, Humboldt County, and neighboring counties and farm bureaus. The bureau sits in a structure that includes the California Farm Bureau and the American Farm Bureau.
Jeannie described some of her current concerns. They include advocating for resilience with respect to food in an area that can be cut off from the outside world, promoting local
food production capacity and food sovereignty, and avoiding the potential impact of port development on Humboldt Bay’s magnificent oyster farms. (Oyster farmers turn out to be, um, farmers.)
Jeannie says that “the power is that we are the grassroots.” That means the bureau relies on people living in rural areas, all of them and not just farmers and ranchers, to engage and help the bureau stay informed. “We seek to be big impact; we’re not Big Ag.”
Greater Eureka Chamber of Commerce (https://eurekachamber.com/)
The Eureka Chamber serves its members through its 501c6 status, providing a wide array of services and support to local businesses. The Chamber operates independently of government agencies, though it maintains ongoing communication with them. While the Chamber has not endorsed political candidates for years, it weighs in on regulations and ballot propositions.
With around 450 members, including small makers and large corporations, approximately 70% of whom have 10 or fewer employees, the Chamber is actively seeking to increase its membership.
Nancy Olson, CEO, estimates that the organization has tripled its services in recent years. This includes offerings from the allied 501c3 Redwood Coast Chamber Foundation, which Nancy describes as a means to increase services and access funding not available to 501c6 organizations, such as most government and foundation grants. Much of the programming is now housed in the 501c3 arm.
Nancy considers job one to listen to members on what they want to see. An example would be the upcoming Home in Humboldt program, designed to address challenges of recruiting professionals to the area, especially in health care.
When you think about chambers of commerce, mixers pop to mind, and networking remains a top benefit. A newer approach: the family mixer designed specifically to allow people to participate without taking time away from their families. This year, 1500 members and their family members and employees registered for this mixer.
But the Chamber’s activities go well beyond mixers. Several committees work on issues important to area businesses. The Conversations with Leaders series occurs about quarterly; the most recent session was a briefing on the Humboldt Economy. Only members can attend the live sessions, but they are posted to YouTube. The annual awards gala recognizes people and organizations for their contributions to the community. The directory lists member services, extending their promotional reach. Members can ask for letters of endorsement for projects. The Chamber offers coworking space, with members paying half the rate offered to the public.
As it has for decades, the Eureka Chamber represents an important voice for local business, providing a platform for connection and growth.
California Fishermen’s Resiliency Association (CFRA / https://www.californiafishermensresiliencyassociation.com/)
The CFRA exists to help California commercial fishermen to coexist with industrial development offshore and in ports. It seeks to avoid, minimize & mitigate—in that order—the negative impacts of these developments on fishermen and coastal communities.
To accomplish this, the CFRA represents members’ interests; provides support at local, state and federal governmental levels; and negotiates agreements with other industries concerning challenges to fishing ground access, non-fishing offshore developments, navigation and marine safety, and ecological and environmental concerns impacting fisheries.
As most lobbying nonprofit organizations are, the organization is specific to one general interest or trade group. The nature of activities, as described above, is typical.
The CFRA has a board of directors who represent various California port associations. Their immediate task: to help California fishermen navigate and survive offshore wind development. Their longer-term concerns: all industrial development on the ocean which shrinks or damages fishing grounds, be that mining, cable landings, or oil & gas exploration.
To wrap up, 501c6 nonprofits differ in both subtle and important ways from the better-known 501c3s. But, like them, they seek to serve a population. They accomplish this through advocacy, networking, collaboration, professional development and promotion of a group or industry.
Michael Kraft writes the Good Work series, volunteering on behalf of the Northern California Association of Nonprofits (NorCAN). NorCAN supports connections between people and organizations that work every day to keep our communities healthy and strong by offering professional development, board support, networking connections and more. Learn more at https://norcal-nonprofits.org/.To nominate a deserving nonprofit organization to be profiled, email michael@kraftconsultants.com.
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