 Okay. Good morning and welcome to this week's edition of Encompass Live. I am your host, Krista Porter, here at the Nebraska Library Commission. Encompass Live is the Nebraska Library Commission's weekly webinar series where we cover a variety of topics that may be of interest to libraries. We broadcast the show live every Wednesday morning at 10 a.m. central time. If you are unable to join us on Wednesdays, that's fine. We do record the show every week, as we are doing right now. And it is then posted onto our Encompass Live website. And I'll show you at the end of today's show where you can access those archives. Both the live show and the archive recordings are free and open to anyone to watch. So please do share with your friends, family, neighbors, colleagues, anyone who you think might be interested in any of the topics we have on the show. The Nebraska Library Commission is the state agency for libraries in Nebraska. And that is for all types of libraries in the state. So public, academic, K-12 schools, correction facilities, museums, anything that's got a library to it, we are the state agency for them. So you will find sessions on our upcoming shows and in our archives that will cover really the whole gamut of anything libraries. We do a mixture of things on the show here. Book reviews, interviews, mini-training sessions, demos of services and products. Anything, cool things we think libraries could be doing, cool things libraries are doing. So our only real criteria is that it's library, something to do with libraries. We do have a Nebraska Library Commission staff sometimes do presentations and sessions for things that are very specific to here in Nebraska, but we bring in guest speakers sometimes. And that's what we have this morning with me today. Today we're talking about non-profit basics for libraries. And Trevor Peterson is here with me. Good morning, Trevor. Thank you for joining us. And he is from right here in Lincoln, the law firm right here in, based in Lincoln, correct? Right, I'm from the Knudsen Burkheimer, Richardson and Endicott law firm here in Lincoln. Am I ready to roll? Yeah, and this is a session that was actually suggested by some libraries asking and our regional library systems, one of our regional library system directors. For those of you not in Nebraska, we have four regional library systems that are kind of the consultants in different areas of the state on behalf of the commission. And Eric Jones, who is the system director for our three rivers library system in the northeast corner of the state set up this session for us. He had a lot of questions from library directors about what do I do with taxes and fundraising and foundations and statutes. And there's a lot to it, of course. And he arranged for Trev to come here and join us. And Eric was on the line just a little while ago. The place he's gotten disconnected is hopefully he'll join us back again and be able to participate as well if anything he has to say about anything. But yeah, I'll just hand it over to you, Trev, to go ahead and take it away and tell us the basics of what we might be talking about today. Well, thank you. I appreciate the opportunity to be here. The topic area is very broad, sort of like libraries. Tell me what you know. So I tried to pick a few areas that I wanted to talk about specifically and sort of by way of introduction, I do practice law in Lincoln. My practice is primarily it's exclusively civil law. I don't do any criminal law. Don't do any family law. Do some business organization work, real estate and contract work have worked with a number of the regional groups here a couple three years ago when we consolidated, I think there were six and we went to four. There was, yeah, we originally had six regions and we made them a little more easier to deal with the four. So I had a chance to work with a number of your members and I just wanted to do a couple disclosure things. First one is I'm not a government lawyer, never have been. So if the questions relate specifically to government, I will try to answer them as best I can. But the person who really knows the answer to the question is your local county attorney or your local city attorney. They are available to talk to and if they don't know the answer, they can certainly direct you to someone who does. Second thing I wanted to point out is I decided that today would be officially pick on Wisconsin Day. So if any of you are from Wisconsin and are offended by anything I say about Wisconsin, that's too bad. There are examples. There are examples. So one of the issues that we run into a lot in dealing with nonprofit corporations is the, well, other nonprofits do it. And I'll tell them, I'm going to tell a nonprofit that what you're doing is not legally correct and, well, somebody else doesn't. Well, I'm sorry, but, you know, that hasn't worked since kindergarten and we all know it, all right? And it didn't work with my mom and I'm sure it didn't work with your mom and it doesn't work with your kid. So the fact that others do it is not an indication that they are doing it correctly, especially when we're dealing with fundraising. The other issue a lot of times is, well, the church down the street does it. Well, there's a difference between the church down the street and the library. Oh, yes. And it's a huge difference. And you'll see that when we get to the sales tax exemptions and some of the bingo lottery things that there's special rules that apply for churches. And you can't assume that because a church can do something that all nonprofits can do something. Then we always get the, well, this is the way we've always done it. Comment and the problem with that issue may be doing it wrong. So we have to kind of break through that. And now we come to my favorite part where we have to pick on Wisconsin. I'm from Wisconsin and we did it in Wisconsin. If you look at a map, you'll find that we're in Nebraska and the laws do vary from state to state. So what may be legal in one state may not be legal in another. So you have to be very, very careful, especially the, I'm from Wisconsin and that's the way we did it here. Or my other favorite one is I met a person at a conference from Wisconsin and this is what they, and that's how they do it there. Well, you know, again, this isn't Wisconsin. It's Nebraska. So we do have to be careful about that. I'm going to put a plug in for all of your local lawyers. We are not the heartless snakes that most people think we are. Well, most of us. Well, some of us are not heartless. Generally, there is a lawyer in your community who if asked would be willing to advise your board usually for free. Now you do need to respect their time. So if you're planning a massive lottery operation to call a lawyer on a Thursday and say, hey, we're starting tomorrow, that's, please, as a volunteer, my rule of thumb is if you call me the day before an event, my answer is almost always no, because you've known about the event for a long time and it's really disrespectful for your volunteers to ask them to show up on short notice unless it's an emergency and everything isn't an emergency. So with those kind of general comments, let me let me take you through what I think I'm going to talk about and then we'll answer your questions. And I do recommend that if you have questions, you can either you have two options here. One is you listen to me drone on and I'll also give you a bad pun warning. I'm not going to identify where they are, but somewhere today there will be bad puns. So we're going to start talking about statutes that deal with nonprofit corporations in Nebraska. Then we're going to do a little work on fundraising and sales tax. We have some interlocal agreement questions and then we have a couple of questions that were submitted ahead of time. If you are submitting a question, I would say for our purposes, please try not to identify your city or county if you can get by without doing it. And for the two questions we have, they did identify their counties. I'm going to try to expunge those county references. And if I make a mistake, I apologize ahead of time, the person asking the question that's on me, not on them. And if you do accidentally type in your county or library out of habit just because like into the text questions, I will triage it and read it appropriately and not mention any details to keep all the privacy. Yeah, I should I should also mention that I'm licensed to practice in Nebraska. So if you ask me a Wisconsin law question, the answer is I don't know you have to talk to somebody with the Wisconsin ticket and I do not have one of those. So let's take a look first of all at the Nebraska statutes. Now, as librarians, you should be able to find these. The legislature has a an excellent website where you can go through and look at the entire stat all of the statutes in Nebraska. And they're very easy to find. I'll direct you. Well, Krista here is scanning the Internet for this stuff. We're in section 21 and the nonprofit Corporation Act starts in the 1900s series. So if you just yeah, you do the Nebraska statutes and get a lot of links here, but they do have a search here that you can search the different laws. It looks like so either by a topic or here you can search by keyword if you're not sure what the section is. I'm not sure how good that works or you can search the laws or bills. So let's see if you do the best one to search. Well, let's start with 21 dash 1951. You can also search by section number if you happen to know it and then it will take us down to the Nebraska revised. You just get a click on any one of those if you want to that in the 21 1900 series because that'll get us to the that gets us to the nonprofit Corporation Act. Now a couple of comments when you're looking at the statutes 21 title 21 deals with business organizations. So there will be the limited liability company act. For example is 21 dash 100 the for profit is 21 and I believe that's either 2000 or 1800. It's right around here. So make sure you get on the nonprofit Corporation Act because if you don't, that's not the sections that apply to nonprofits corporations are creatures of statute. So we have to follow the statutes. This is a link to those. You can look at those and I'm just going to highlight a few things that we constantly have questions about the first thing is if you look at any one of these statutes, you're going to see that the act which I believe is a uniform act was adopted in Nebraska in 1996. So let's think for a second about 1996. I was alive in 1996. In fact, my children would say I was live in 1886, but that is not true. But if you think about 1996 in the Peterson household, our internet connection was dial up. So you plunk in the number for at the time America online for us and you wait forever because the telephone lines were always busy. And your internet connection was terrible. It would be so unacceptable today that it's almost unbelievable. But if you think about 1996, people didn't have email addresses as a general rule. They didn't have smartphones. They didn't exist. In fact, I think we were probably still using our bag phone in the car. You know, it's thing was like a huge monster or you know, the guys were really tech savvy had the brick and it cost them an arm and a leg for cell service. So that's 1996. That's where this statute comes from. And it's not been updated since there may have been parts of it that have been amended from time to time, but the parts that we want amended have not been amended since 1996 and that's a that's a huge problem. So if any of you know a state senator, this might be an opportunity for you to say, hey, you know, we're 1996 with the nonprofit Corporation Act, which means that we're probably dealing with technology from the mid 1980s. Can we maybe move it to 2010? We don't need to maybe move it quite to 2019, but at least if we could stay in the 2000s, it might be it might be cool. So what does that mean in terms of meetings? For your annual meeting, there's a provision in section 21 1951 in a subsection C if you're kind of following along and it allows, unless your articles or bylaws provide otherwise, it allows members to participate in annual and regular meetings by conference or by means of communication and the statute says by which all members participating may simultaneously hear each other during the meeting and then further says that a member participating by this means is deemed to be present at the meeting. So and I remember when this came in for the business corporation side and we thought, hey, this is a big deal because now you can have board of director meetings. You can have member meetings by conference call. Yeah. And certainly it doesn't require that it be conference telephone calls. So Skype would work something like this. What were you going to go to webinar? Go to webinar would work as long as everybody can hear each other. You don't even have to be able to see each other. You just have to be able to hear each other. So that's a huge, huge advantage for people in rural Nebraska, particularly where you may have members who might have to drive several hours to come to a meeting that might last 15 minutes. And I know that many of the organizations have their annual meetings at other meetings where librarians would normally be at. So if there was like a public school conference, they'd break out and have a little meeting afterwards. And you know, again, absolutely great idea, but you do have the ability as long as people can hear everything that's said at the meeting, you can participate by car. So we just need a quick vote on something. And you can do that by phone. So that's interesting. You just mentioned that, you know, these 96 and things you'd updating that one was actually written loosely enough that it covers any like anything we're using now. We don't need to that one might not need updating. It's just as long as you can hear as long as you can hear. Now, we moved from the conference telephone call to the next logical step in life, which is email. Can you vote by email? So the answer is maybe and this is where the statute could use a little tweaking. I think section 21 dash 1954 provides for action by written consent. That's action of the members by written consent. And the statute indicates that members can can vote by written consent and the action needs to be signed by those members representing 80% of the voting power. So if you have members, it's probably a one person, one vote scenario. So if you had 80% of your people signing off on a written consent, you know, that's that's acceptable under the statute. Now, what does written consent mean? I would say in 1996, it means that you get a pen and you get a piece of paper and you sign your name to it. You mail the piece of paper back to the committee and in fact, or to the nonprofit. And in fact, I think we were doing some of the merger deals back about four or five years ago, however long ago that was. We had some that did written consent and they they solicited their members by and and received written consent for the merger. Others, I think another group had a meeting. So we were we were kind of all over the place on how we were doing this, but there is some flexibility there. I would say it doesn't say it has to be on paper. I would say that an email is most likely written consent, as long as it has your electronic signature, if you will on it, that that would be written consent. It would comply with the statute. There are some requirements that the secretary needs to put copies of those written consents in with the minutes. And as I think it's a general rule for a member meeting, I would probably say that you probably should ratify that at your next at your next members meeting. This is one where we could certainly use some help from the legislature. Yeah, the director side is worse and that's where we need help more. But this there's at least there's at least something here that would allow us to actually you know be in 2019 for a change. And then there's also under section 21 1958, the nonprofit can take the members can take action by written ballots. You can send a ballot out and they can sign the send sign the ballot and send it back. So there are ways to do that. You know, in my opinion, email should qualify as a written ballot as well. Sure. But I am I'm certainly willing to concede that there would be other lawyers who have other opinions on that. Yeah, because these things you're saying, you know, signing something like an actual signature. That's the one part that I wonder how strict is that with actually having to sign your name as opposed to replying to an email and saying, yes, I vote on this or I agree or whatever. But there's no like actual here's my scribbled signature. That's the when you're doing using email unless you have which we did here for some things and we have to sign multiple like letters for people. We have an electronic signature scanned and we can stick it into like brand sending out like a hundred letters to libraries. But yeah, they're and that's where the statue needs some help because they need to there are services that are kind of pricey like you know, DocuSign or Verisign. Oh, yeah. And the realtors certainly if any of your board members are realtors, they're going to be familiar with those because a lot of home contracts now are signed digitally and electronically. You know, is there an opportunity that you know, your board member, you know, Sally Jones is a little four year old daughter. You know, Mary Jones is on mom's computer and then votes in favor of something using her. Yeah, you know, that's that's out there. Yeah, I would tell you that I think that the while they work the library commission and the libraries do is important, you know, you're not a high hacker priority and I and I'm not so worried about a three or four year old accidentally voting in favor of a particular story time. Yeah, more story time, but I mean the opportunities are there certainly as somebody wanted to be nefarious about it. They could get on your computer vote, then go back in and delete both the email and the voting email and then you wouldn't know that you'd voted in favor of something, but things we do in libraries don't really, you know, Robert Ludlum probably just not write thrillers about librarians. So I don't I don't think that that's a very different discussion. Well, yeah, let's see. Is he dead? I'm going to say we could have I think he may still be alive, but maybe he'll write a library thriller for you. So that this is one area though where we could use a little updating on that and we'll look mostly at the director's one. The director statutes, which is in twenty one nineteen eighty allows director meetings to be done by again, we call it conference telephone call, but it is any kind of a connection where you can hear everybody else. And the purpose for that is that they that the directors can then hear the positions that other people are taking. And like I said, this is this is a huge deal, especially if you have to have an emergency meeting, you can have your director phone in Skype in FaceTime in or whatever and a director again, participating in this manner is deemed to be present in person at the meeting. So you can count them for a quorum and their votes are going to be, you know, valid. So the next question then is, well, what happens if we want to send out a email and say, Hey, we want you as the directors of the association. We have an opportunity to buy a dozen computers for the libraries in our area and the opportunity is going to pass unless we take immediate action and we don't want to, for whatever reason, have a telephone call, which would be permitted under the statute clearly and the action taken there would be valid and binding on the on the association. We're going to do it by email because after all, that's easiest and the statute doesn't really permit that, but it kind of does. That's that's the frustrating thing about this. Again, back in 1996, nobody had email. So if we look at the directors and officers in section 1981, it's action without a meeting and the directors can't act without a meeting. But if the action, the action has to be taken by all members of the board and it can be evidenced by one or more written consents describing the action that's taken signed by each director and then those are included in the minutes and then the action is effective when it's signed by the last director. Now the problem with this is that it says all the members of the board. So if we're out on email, for example, and you email Trev and I do not respond, then everything's held up. Everything's held up until the last person responds. So it would be nice to have the ability to vote by email, even if it had to be an extraordinary majority of responses by email, it would be nice to be able to have that in the statute to clarify that you can do it. Now, if all your members reply back and say, yes, everything's fine because I think at that point you have a written vote, their email response email is probably their signature and I think there's enough law around there that we could argue that point. But email is a huge issue. I know it's been an issue in our church for a while. We take action based on email and what we should really do then procedurally is after you take the action is go ahead at the next board meeting and ratify those decisions. That makes it official. Right. And I know it's after the fact and if you've already spent the money and bought the computers and then, you know, your ratification fails, you're kind of running a risk there. But presumably, if it's controversial, you're probably not going to want to do it by email. You probably want to have a meeting anyway. And always remember you can do that conference telephone call and that's clearly allowed under the statute and action taken at that conference telephone call is binding on the directors and if you have a quorum, you don't have to have all the directors either. You can just have a quorum for that. Yeah. So keep that in mind and I apologize for the statues, but I'm not a legislator and I don't know what the reaction would be down there. If we try to make some modifications, I will tell you, I do believe this is a uniform act. And while the uniform acts are not the 10 Commandments, the commissioners to come up with these uniform acts, which are basically law professors and lawyers, some judges in a number of states treat the uniform act as though they're just absolutely sacred. So getting a state specific amendment, it's not impossible, but the first thing you're going to run into is the uniform commissioners are going to say, well, your act's not going to be uniform. And the response is, yeah, well, so what? This is Nebraska, not Wisconsin. We're doing it here, yes. Okay. Now I wanted to move on to the library law issues on some fundraising and I have a memo that was done by Stephanie Otto who is a law clerk in our office. She's a second year law student. We will have that available. I should have sent it to Krista already, but when I get back to the office, I will email it to her. Krista will be more than happy to send it to anybody who wants it. Just go ahead and send her an email and we'll get it out to you and we'll try to get that out. Well, I'll get it to Krista today and then she can get it out. Yeah. I do want to put Stephanie, put the by Stephanie on there because she deserves credit. She did all the work. And it's got all the links to the different things I'm going to show you are in this document. So don't worry about trying to scribble down the URLs we go to or anything. We'll have this out to you for you to be able to solve. Right. You should be able to hyperlink to them or if you can, you can copy the link into your browser and if all else fails, you can go to the Nebraska Department of Revenue's website and you can use the search function and the search function works pretty well. It's a little clunky, but it works pretty well. So it happens by typing nonprofits. And then you get to the tax issue and then regulations about donation. So a couple of things about fundraising. Number one, the typical fundraising, let's say for example, and we have one question here where they're talking about raising money to build a addition to their library. That's traditional fundraising. There are no sales tax implications of that at all. If you come to me on the street and say, Trev, I know that you know you're kind of a library rat. So we need to expand the library which you contribute and I can write you a check. That's perfectly fine. If you're saying, Trev, we need new computers at the library and I'll say, well, I've got a computer I can donate. I mean, I could do that. That's perfectly fine. There's no sales tax issue there. There's all you need to do. Give me a receipt so I can deduct it on my federal income taxes. That kind of fundraising, very, very traditional. Something that most nonprofits do quite regularly. Now where nonprofits start to get into a little bit of trouble here is when we try to be a little bit more esoteric and we do a few other things, which are legal, it's just that you have to pay attention to the rules. And Stephanie went through and found a guidebook that Christa brought up here for us. So this is nice. Now, I will tell you as a lawyer that this is the Department of Revenue's view of the law. The Department of Revenue is, of course, going to say that everything is taxable. They may be right most of the time. They want all the money. But they may not be entirely correct. So, you know, if you're dealing with something where you want to be on the edge, you know, I would say check with that volunteer local lawyer and just see what their thoughts are. Or your accountant, you probably have one either for the foundation or the tax preparer. You know, they may be able to look at some of these things online and say, yeah, you know, I think the department's right. That is taxable or not. That department's wrong. I will say they're pretty fair about this, but so I would say probably 90% of the time or 99% of the time, they're going to be pretty close to being accurate. But remember, they're raising taxes and our job, of course, is not to pay taxes. Well, we bought a revolution over that. So, what the department will tell us is, what about collecting sales tax? So for items purchased and resold, you have to collect sales tax. So let's take a quick step back and say, gee, what does that mean? Well, that means that you have to fill out the application for a sales tax per med. I believe that's the form 20, if I remember correctly, and you then have to, you get a certificate from the Department of Revenue that has your sales tax number on it and you're supposed to display that in connection with your sales. So if you have Is that in restaurants all the time? Yeah, you see in restaurants, it should be, it's supposed to be displayed somewhere. I don't know where we find it at Target, but it should be displayed somewhere. So then you need, you do need to collect sales tax on items that are purchased and resold. I specifically asked Stephanie about book sales. Yes, those are, you have to collect sales tax there. If an item is donated to you and you sell it, you're selling it good. So you have to collect sales tax. Pancake feeds, yes, but I think that that answer may be more, maybe, and let's maybe take a quick stop here and think about this. If you're, if you're selling a ticket for a pancake feed, you're selling something, right? So if it's 10 bucks to come to my pancake feed, I know I'm selling you a service just like if we went to Village Inn. And to buy and get dinner there. Yeah, and bought dinner there. It's the same deal. Now, if it's a free will offering, I'm not selling you anything. So it seems to me that if it's a free will offering, there ought to be an exception there. And so you want to keep that in mind. So if it's, and I think you can have a suggested donation, I don't think that's a problem because if the suggested donation is let's say $10, but my free will offering is $5. If I can silly pancakes for $5 and live with the grief that that's going to cause me, then that's fine. And it should not be taxable at that point. Like car washes, for example, they say they're taxable unless it's a free will donation. So if you're doing a car wash, which I think would be kind of unusual for a library. I usually usually it's high school cheerleaders. Yeah, and you know, they make, they make the money that way. Now there is no sales tax on things like raffles and bingo. We'll talk about that later because there are some special raffle and bingo requirements. So any kind of free will donation, I think you're probably okay. And then if you're a government entity, you're still required to collect sales tax and there's a guide that the Department of Revenue also puts out for governmental entities to tell you whether your activity requires you to collect sales tax or not. And there are a number of exceptions to the sales tax collections. You know, again, those are provided in the regulations that you can get on the website. And Stephanie has included those hyperlinks in this memo that we will have available for you. I think the basic rule is if you're buying something like admission to an event or something, if you're buying it for a stated price, it's probably have to collect the sales tax. If it's totally free well, then I don't think there would be any sales tax issues. That's kind of your cutoff there. I think that's the cutoff because you're selling a good versus, you know, not selling a good. There's information here on how you collect the tax often you have to file the returns and things like that form 20. Yes. Yeah. Form 20 will get you the permit. And then the one thing about it when the Department of Revenue sends these quarterly forms out, if you don't, if you don't send it back, then that raises the question of, well, do you have, have you had any sales and you're just not reporting? So what I do and what I recommend for people is if you don't have any sales, you can take that form and you can take your pan and you can make a zero real easy. You know, it's just like you draw a circle and you put a zero sale and you go down to the bottom where it says tax collected zero and then you sign it and send it back in. What does that do? You know, the the department then knows that you haven't collected anything. Now do read the instructions because it's been a long time since I filled out a sales tax form and I know I had a small business at one time that had sales about once a year and we get the quarterly statements over and over and over again and finally I got on the annual reporting cycle and and that worked out pretty good and it just depends on how much tax liability. It's less than $900 of collected sales tax. You have an annual reporting requirement. I think I had set it up quarterly and I never, I never got above $900. So finally we got it to annual but do read the instructions. My advice is the same with if if you have employees, I don't know that many of our nonprofits would well, they could have employees if you've got withholding taxes or unemployment taxes and you get those returns to come out and you have no employees or maybe you have seasonal employees, you have an employee during the summer, maybe, but not the rest of the time. Don't not don't just not send the form back. I think you're better off to put zeros in and send it back. It has to be true. It has to be true, but put zeros in it, send it back because then they're going to be happy because then they have a form. You're doing the paper. Yes, if they have a form that checks that checks the checks the box for them. So they're happy with that. And again, the memo has a bunch of hyperlinks to information Stephanie did a really, really good job with this. So now we're going to talk about bingo, B-I-N-G-O. Nebraska has some requirements on bingo and I think what I'm going to do is just kind of do this from 80,000 feet because I don't know how many of you are going to be interested in the bingo license and it depends a little bit on how how large the prices are and there's some specific requirements. So I'm going to assume that in terms of the kind of bingo games we're going to be running would be more of a special event type bingo permit because you're probably not going to be running bingo on a regular basis you know if you are then look into the full fledged licensing. There's some limitations. There's called small stakes bingo games and I would never have thought that I'd be talking to librarians about bingo. Anything to raise money funds. I mean libraries are always looking at you know that's why a lot of the questions were about fundraising and how do we do it and how do we do it legally there's only so much in budgets in our cities and counties for them and things like raffles and bingos and like it's selling anything selling so yes how they need to you know sometimes support some of their basic services and I know the volunteer fireman my wife is is from a farm in Greeley County and the volunteer fire department has an annual pancake feed it's a free well donation so they don't have a sales tax issue there for them. It's their big fundraiser and it's a big community event everybody comes and supports that and that's cool. That's really great doesn't work very well in Lincoln but it works well in those small communities. The special event bingo they say two special events but must not exceed a total of 14 days so I think they must be looking for two really long special events. Okay the bingo cannot be the primary function of your event so they have to have some other draw. The cards can't cost more than a quarter each and no single price can exceed $25 in value and then there's some requirements on the bingo workers cannot be paid and they have to be at least 18 years old so your six year old cannot run the bingo game for you to me some of these requirements are just as far I don't know where this comes and oh yeah here the event must be held in the county where the organization has its principal office. So if your principal office is let's say in Dodge County Fremont you can't go to Columbus to have an event. You know if you're doing bingo so here's my tip on bingo like I said before this is one of those deals where if you're thinking about it you ought to start by looking at what the legal requirements are to determine whether or not it makes any sense for you to do it and if it does then go ahead and get the get the license and you can conduct your bingo games. Lottery raffles that again is covered pretty well I want to try to get to questions here and we can always come back to this again it's covered very well in Stephanie's memo. Let me kind of see if I can do this now without explaining why I can't the Boy Scouts Cornusker Council at one time raffled off a commemorative rifle that was created for the 100th anniversary of the founding of Boy Scouts in the United States and the rifle itself was donated and I mean it's a cool piece it's a collector's piece and they decided well hey let's do this online. So they would sell tickets to you in the normal way and then they stopped online process because they ran a file not of the state bingo law but of the federal firearms laws because you're soliciting now for the sale of firearms across the state line and nobody thinks about that but if you put anything out on the internet it's for everyone yes everyone is worldwide. So you know so if you're going to have a rifle raffle and try to say that three times you want to you want to think about those kind of requirements or prohibitions in addition to so be careful of what you're raffling what your prize is going to be is awesome is going to matter yeah and they could be the same thing if it was a box of wine or something like that you know dinner dinner with Trev Peterson which you know you probably wouldn't sell a ticket for but any of those kinds of lotteries and raffles you want to you want to look at what it is you're selling to make sure that whatever it is you're selling you're selling it in a way that it's not illegal. So if it has alcohol you want to make sure that anybody who buys a ticket has to be over 21 you're not going to be able to determine that on the internet and I doubt quite frankly that you're going to probably want to be doing much of your sales online because I don't know that you get anything out of that and the shipping and everything is for some of these things better to keep it local keep it keep it local analog and certain but you can certainly solicit contributions online that's that's not a problem but it's when you're selling stuff you got to be concerned about that so again you're going to want to look at these specific requirements for who can part who can be a participant who can operate it whether you need a special permit all of that is covered in in Stephanie's memo and then she also tossed in donor acknowledgement letters for the IRS so if somebody gives you more than 250 bucks in a single contribution they would need an acknowledgement letter again it could be a form letter it could be a low receipt depending on the size of the gift you and certainly online you can make any kind of a you know certificate or something that you can print out fairly readily and they're pretty readily available so but do acknowledge those receipts people who give money like to have somebody say thank you to them and it's one of those things that your mom taught you when you were kindergarten I think there's a book it says something like everything I needed to know in life I learned in kindergarten and that's certainly true although I don't think at least with people I deal with I'm sure that there are many of us who have not moved beyond the seventh grade so questions we have one question is this has to do with a county that levees tax to support the municipal treasuries of cities in the counties and they are asking a question about the interlocal agreement and there are a couple of questions here I think one of the question is there's some language in the interlocal agreement that says limits the tax to the point zero zero five per hundred dollars of taxable valuation we were talking before we went online I think that's probably the minimum that's set out in the statute for counties to levy tax on for libraries I suspect I don't want to defame you know any of our ninety three fine counties but if they could use the money for bridges and roads instead of libraries they would and so I think that really we owe a debt to the legislature for at least mandating that some of that money goes to libraries it's it's significant but it's not a huge amount and certainly the county could award more but we all know that they won't because you know books are something that people don't use there's some language in there the question is can the levees not to exceed that point zero zero five and that's that's true that's the way I would read that and it says in another paragraph the amount quoted is point oh five I think that's a typo I think they left a zero out there you might want to point that out to the county attorney and I'm sure that the county attorney will fix that so you're going to get that levy amount at the point zero zero five per hundred and then there's another question about you know maybe it's not this one I was I was looking at the side and you know oh it says reviewable on an annual basis that that was the question out of the interlocal agreement the problem you have in dealing with government is trying to commit them to decisions in the future so you have the current county board the current county board can vote yes we're going to do this but then what about the next county board or the next one or the one twenty years from now and that's what this reviewable on an annual basis means which means the county board can commit and look at it but again if that point oh five per thousand is that by state statutes they don't have any option but to go ahead and levy that tax collected and pass it along to the libraries then we have a question about a foundation that was created to fund the building of a new library and I think there were a couple of questions in there the first one is if the if a donor gives money to the municipality the city for for library then can the city spend the money for something else and the answer is probably yes unless the city acknowledges the gift and acknowledges the restriction it would just get dumped into their general budget now it seems to me that I as a donor can control what my money is going to be used for if the city cannot guarantee to me that it's going to be used the way I want it to be used and I'm not going to give them the money if you are a foundation you can certainly point that out to people that if it goes into your build an addition to the library fund it will only be used for that purpose and certainly it's a lot easier for a foundation to do that because when times get tough and like they I think always are tough the cities are going to be scraping for any dime they can find and certainly the donated money where maybe they don't technically have to comply with the donor's request would be available and they may use it they may even intend to put it back but then they kind of forget about that so I would say certainly if you're promoting the building of a new library maybe even have the city say well you know give that money to the foundation because that's what that's what the foundation is there for exactly and that's what in this message that this question we've seen ahead of time they this person explained very clearly that they had a foundation that was rich that looked like it was historically originally created to raise money from the community for the building of the library and they seem to really know exactly what they're talking about as far as what a foundation is for it's exactly what it's for because of exactly what Trump said if you just donate and give money to the city or something I've checked has just cut to the city there is no as you questioned a law that says okay then that has to go on to the library if the city is doing being nice about it they would and they would have a line item for that there would be a line item in the city budget for the library that's not necessarily having to do with donations and things like that and that is exactly why you have a foundation so that you can get the money just that people want to as you said I want to donate to give something that something happened in the library go to the library's foundation not just to the city and that's exactly the whole purpose of why you set up your friend your foundations and the other game that cities are want to play with donated money is let's say I'm gonna donate I'm gonna I'm the city I'm my budget for the library's thousand dollars because we need small numbers and somebody comes in says I want to give you a hundred dollars for the library it's fine here's the hundred dollars to the library plus nine hundred dollars from my budget and I've had a hundred dollars left over thank you something else with and the same is true with you so you got to be careful about that and just need to make sure that that's not what's going to happen with your money I think the other question that they had asked had to do with funding some purchases of computers right and whether they had to pay sales tax on that the answer is you probably do have to pay sales tax on the purchase unless purchases by a nonprofit for their nonprofit use are probably exempt from sales tax but you have to file was what call it form 13 with the vendor and you show on your your state tax exemption that your tax exempt and you can avoid some of the sales tax but the other question they asked is well what if the city bought it and we just reimbursed the city that's going to be better because the vendors going to be more likely to think I don't have to charge sales tax to the city and and then you can reimburse the city for it and that's that's fine I don't have there's no issue with doing that you have options way to do it yeah yeah you have options the other thing I would point out if you're looking at things like technology purchases and you have some time to work with it try to work with your local school district because the school districts do aggregate their purchases now aggregation can lead to aggravations there's my mind because it's not going to be real fast so if you want a computer tomorrow that's not going to work for you but if it's a systematic replacement going to your school district and saying hey we'd like to help fund a computer purchase for the the city library can can we aggregate with the school district join with you guys yeah and there may be some possibilities for that I know I sat on the Nebraska Technology Commission for a while and we were working very hard on trying to make it possible for schools to be able to aggregate their purchasing power for things like internet yes and things like computers and other technology so if you're not in a crisis where you have to have the computer today because the core card catalog computer broke down yesterday you may be able to aggregate those and plan ahead and you know sure take advantage of that talk to your talk to your school librarians about that talk to the school district see if you can if you can work in or even if if your city library can work with the school to to aggregate their purchases I don't know whether that's possible or not but it could be on a city by city or time-on-time basis yes I'm gonna be able to and some yeah and it's worth looking at because if if your school district is well yeah you know we're buying 5,000 computers and if you want we'll talk to our vendor and they may say well yeah the city wants a couple what differences yeah so do take that opportunity did we have any other questions did we put everybody to sleep I don't know no people see this everyone still here if anybody had again any of you have any specific questions about situations at your library or with your foundation or city or anything type them into the question section either specific situation trying to figure out or something you're curious about that we haven't mentioned here as he said there is the document that's going to have a lot of links to things that we talked about today and even to other more useful things for you that we'll get to you afterwards the last question here is about what other types of nonprofits would be tax exempt okay I don't know what would apply I mean very kind of mentioned the foundation being part of this library or doing it through the city right the there are a number of other organizations that are tax exempt for example like the Shriners Elks Club the Moose Club the Eagles all of those service organizations are tax exempt depends on which section they're exempt under to be a C3 no significant part of your activities can be directed toward influencing legislation so a group like the NRA for example the National Rifle Association is a nonprofit but I can't recall whether it's a 501 C3 because they certainly do try to influence legislation they may be a 501 C4 organization which means that the contributions may not be deductible for a federal income tax purposes C3 organizations could run the gambit from religious organizations to educational type organizations if you've got somebody the Lincoln Track Club is I'm fairly certain a 501 C3 you could have a local archery club or something that could be could be a 501 C3 as long as they're not influencing legislation they would qualify and they and they file the form to be to get the 501 C3 designation that's the thing I know some of our libraries have had confusion about or unsure and this has to do with just staff turnover director turnover are we a 501 C3 are we not is our foundation who has the paperwork nobody can find it that's been an issue yeah you can check I think on the IRS website look up your like your institution yeah with your institution they'll tell you whether you're a 501 C3 now I will tell you that the IRS is trying to to boot those tax exempt organizations that are really not functioning so if you're not filing returns and I believe I looked at this one time for a 501 C3 and I think there's a special type return you file this is hey yeah we're out here we just didn't generate enough income to file a tax return but we're still exist yeah and you want you want to make sure that that gets filed on an annual basis they want to clean up all the dead so you wait because if you get then would be certified I guess or un un C3 then you have to go back through to the application pay the fee over again so let's try to avoid that and keep doing the regular submissions at least you don't have to start from scratching right yeah right it's a lot easier to already be there and then you don't have to start all over again and hopefully you're you have you know when you're looking for board members that's why you want to try to find an accountant and a lawyer sit on your board or to at least be available to consult and accountants and lawyers generally will provide as long as you know please don't ask us to do 75 hours worth of free legal work for you but an hour here and an hour there not that big of deal most people be happy to do that for you know get it become friends with somebody who does this kind of thing or put put the local banker on your board so the local banker can call their attorney and then the attorney is gonna say oh okay I can help I sure I can help I want to keep in good graces with the bank of course you know we we know where the bread is buttered so you know let's let's follow the money and and and no I will say for for lawyers we get a bad rep on a lot of things but their lawyers out there who'd be more than happy to help you again just be respectful of their time mm-hmm all right so it doesn't look like anybody typed in any other questions while we were chatting here that's okay you either answered everything they ever wanted to know about all of this or they're completely stunned and don't know what to say there's one other thing we ought to talk about because sometimes this happens and people are annoyed about it if you are a 501 c3 the public is entitled to see parts of your tax return there's a restriction I think on the donor list I don't think you have to provide the complete donor list but you'll want to check with the IRS website and see for sure I think it's donors under 250 you don't have to show but you do have to provide a copy of your tax return for public inspection if requested I believe it's at the at your office the IRS has a site or on its site has that information so they can get it online but do be mindful of that I know a lot of times people say why don't think I have to show that to them in the answer as well yeah you do because of being a nonprofit yeah because you're a nonprofit and you know that's that's part of the transparency but you do want to protect the donor list to the extent you can I think it's as a matter of self-preservation if nothing else sure so what if someone wanted to be an anonymous donor that's coming is that from the donor that comes from the donor side and I think they could they could ask to be anonymous and I would simply say you want to look at that down there on the IRS site make sure that that's okay to not disclose where the money's coming from here about that usually it's the big ones like an anonymous donation of 1.5 million it's not your usual local yeah and if you're getting a 1.5 million dollar donation I think you could you can certainly you can certainly talk to your your board attorney and figure out a way to try to make that to accommodate the donors request there and the donors attorney may have a solution for that as well or if it's not if you can't keep Trev Peterson out you might be able to say the Lincoln Community Foundation Trust or something like that yeah yeah there are some ways there are some ways to do that and you know certainly talk talk to the board accountant and the board attorney and see if their ways to respect that that donors request yeah so I think the key things here I think a lot of library directors and board presidents are concerned about is they don't know all of this information and the statutes and the rules and things and think the key is find a lawyer to help work with you or an accountant that can who does work with these kind of things daily more so daily than you do who can then be your advisor in some of these areas on the city may have an accountant and attorney as well I've experienced that sometimes they work more for the city than the library sometimes and you might need your own advisor to keep things a little separate there like we're talking about earlier that city just wants to take any money that comes to them and goes to the city general fund and do with what they like you need someone who will help you deal with yours money going to your specifically to the library so you're not alone reach out to people who can help you and give you advice on these things all right no less minute desperate questions were a little after 11 o'clock here that's fine we started a little after 10 so there's a perfect timing and we were concerned about if we're going to do if we're gonna get any yeah we did everything all right well thank you thank you very much for coming here and being with us today this is great there's a lot of really useful information for libraries and I'm sure we have lots of people that come in afterwards and watch our recordings of this not everybody can be here Wednesday mornings and that's fine so I'm hoping we'll get this out there's a lot more libraries with the resources and everything to help them out and certainly send the link to all your friends in Wisconsin yes tell them hey you were on your don't you were featured on this it's okay somebody had to be somebody had to be they was either them or Vermont so there you have it pick one yeah all right so thank you Jeff thank you everyone for being here with us this morning I'm going to switch over to the end compass live website now if you do Google or use your search engine of choice and compass live is the only thing called that on the internet so far yeah don't anybody use this name and you'll find our main website on the library commissions page where we have our upcoming shows but I was going to show you the show has been recorded and right underneath our upcoming shows is a link to our archives and here's most recent one here so this one should be up by the end of the day today on this page here we'll have a link to the recording and the document that Trump's going to email to me or have assistant Christine Stephanie Stephanie Stephanie send it to me later we'll have access to that as well everyone who attended this morning and registered for today's show will get notice of when the recording is available on here we also posted to our various social mailing lists to library commission and Facebook page and Twitter it'll all be out there too but while we're looking at the archives want to show you this is the full archives for the entire run of and compass live this is the 11th year of the show so we do have the show our recordings you're going back to the very first one in January 2009 so do be aware you see we have a search here you can search the full archives are just most recent 12 months we want just recent info and then you type in whatever key term keyword you want but do pay attention when you are looking at a recording they're all dated of when they are were originally broadcast some of the resources on here might not exist anymore some links may be broken some things may have changed in how they services works or programs work and since the time was originally broadcast but just pay attention when you're reading our archives we are librarians this is what we do we archive and save things so we will have the full history always up there even if it becomes outdated information but that's why everything has a date on there for you so that will be for today show I hope you join us next week oh I also mentioned that we do have a Facebook page for Encompass Live so we will post over there I'd mentioned social media here's your reminder to log in for today's show when the recording is available will post on here now I don't want to log in right now thank you Facebook so we remind people of that so if you are big on Facebook do give us a like over there and you'll get notices of when we have new shows coming up when recordings are available so I hope you join us next week when our topic is OER what is OER outstanding extraordinary raw materials sometimes that it is actually open educational resources specifically and Beth Kavish who is from our educational service unit coordinating council here in Nebraska will be here to talk about OER hub that they have set up for schools and in the state and it's out there for anyone to use in the state so join us next week that will be here to talk about OER and please do sign up for any of our other shows we've got our next two months scheduled here we've got new ones will be coming up for the summer so keep an eye on our website so thank you everyone for being here thank you and hope we'll see you next time on Encompass Live bye