November 13, 2011 | Read Time: 3 minutes
New York
Occupy Wall Street protesters are proud of their lack of organizational structure. But as the demonstration approaches its third month and donations of cash and goods pour in, the people gathered in Zuccotti Park are now trying to figure out how to sustain momentum without giving up their anti-establishment spirit.
The protest against the disparity in wealth in the United States and corporate greed has, perhaps ironically, become a fund-raising machine, attracting $454,000 from more than 8,000 donors in its first month.
Fund-Raising Success
Those large sums may just be what force the movement down a more structured path.
For now, the protesters decided to accept an offer from the Alliance for Global Justice, a Washington group, to serve as a “fiscal sponsor” to collect the money and provide oversight to ensure it is used in ways that comply with Internal Revenue Service rules for organizations that accept tax-deductible contributions.
But some Occupy Wall Street organizers are considering whether it is time to apply to the IRS for charity status so it can have direct control over all aspects of its operations.
One of the organizations that sprouted in response to Occupy Wall Street— Occupy Las Vegas—has already received nonprofit status at the state level. But it could take some time, and a lot of negotiation, before Occupy Wall Street goes the formal legal route. Many of the people who have joined the protest did so to promote civil disobedience and are distrustful of any form of structure.
“Establishing a nonprofit is complex,” said Jo Robin, a jazz singer in New Orleans who traveled to New York last month from a protest in her hometown “There are a lot of people in the movement that are really resistant to capitalism. In New Orleans, we agreed that we wouldn’t solicit funds. We asked for donations like warm clothes or blankets.”
Lobbying Questions
As the protest continues to spread to other cities, other local groups will probably grapple with their legal structure. Otherwise, they put themselves at risk of investigations by the IRS or a state attorney general’s office, says Greg Colvin, a nonprofit lawyer in San Francisco.
“The very act of soliciting funds for charitable or public-spirited purposes will likely trigger charitable-solicitation registration laws in all the states where the group is soliciting funds,” Mr. Colvin adds. “Those responsible for handling Occupy finances must understand the system under which they are operating, not misrepresent it, and pay faithful attention to the details.”
The legal restrictions that charities face, not just concern about bureaucracy, could be another reason Occupy Wall Street and local protest movements decide to stay away from seeking charity status.
Charities can do only limited amounts of lobbying and cannot endorse political candidates or get involved in partisan campaigns.
Perhaps most important, nonprofits cannot conduct or encourage illegal activity, and that includes civil disobedience, says Mr. Colvin.
‘Not in It for the Money’
Some fund-raising experts say the protesters might not need to put much energy into creating a long-term structure because the movement itself might not be around that long.
Karla Williams, a fund-raising consultant in North Carolina, says the spontaneous donations to Occupy Wall Street are much like the response to a natural disaster. When the immediate need diminishes, so do the donations.
Mark Rovner, chief executive of Sea Change Strategies, a Washington fund-raising consulting company, sees more staying power. He says the protest reminds him of when hundreds of thousands of people signed an e-mail petition asking Congress to censure Bill Clinton, not impeach him, and “move on.” That e-mail petition led to the creation of Moveon.org, a nonprofit advocacy group.
“These are pregnant moments where people are looking for some way to express their anger or concern or rage,” Mr. Rovner said.
The organizers of Occupy Wall Street could raise significant sums if they wanted to create a more institutionalized fund-raising structure, Mr. Rovner adds.
“But they’re not in it for the money, and I kind of respect them for that,” Mr. Rovner says. “It’s extremely bottom-up and organic, and all credit to them for choosing not to prematurely institutionalize themselves.”
