Community Development Project Assistance
Limited Pro Bono Representation for 501(c)(3) in NYS Supreme Court
The Legal Aid Society was assigned in Criminal Court to represent the president of a 501(c)(3). The organization provided a platform for persons making charitable donations to distribute those donations to specific charities. Having run the organization successfully for 10 years, the client began failing to make the distributions/donations as a result of suffering from increasing mental health issues. The criminal matter is pending in New York County but the client has not yet been indicted. The ADA from the Major Economic Crime Bureau has indicated that once they receive documentation of the mental health issue, they will withdraw the case. We are not looking for pro bono assistance on the criminal matter.
However, the client has also been sued by the NYS Attorney General in State Supreme Court in Manhattan. Because of her deteriorating mental health, co-conservators have been appointed on behalf of the client and Legal Aid has identified pro bono counsel to represent her. The firm has been working with the AG to try and resolve the matter but in order to do so, a second firm is needed to represent the entity itself, which has also been named as a Defendant, in the Supreme Court litigation. Specifically, the organization needs to authorize the release of documents and obtain credit card information stored on behalf of the company. Although we anticipate agreement on the resolution, it is important that the organization have independent counsel.
We are seeking pro bono counsel to consult with the Chairman of the Board in expectation of representing the 501(c)(3) in Supreme Court.
The Catholic Worker Movement Seeks Assistance with Forming an Entity to Address Increased Tax Burden
The Catholic Worker was founded in NYC in 1933 by Dorothy Day and Peter Maurin. Their movement is committed to nonviolence, voluntary poverty, and Works of Mercy as a way of life. Day and Maurin opened a “house of hospitality” where members serve meals, and offer clothing, showers, and housing to individuals in need. The Catholic Worker receives charitable donations and bequests to fund its charitable mission. But it does not give donors an exemption.
Central to the philosophy of The Catholic Worker is submission to God as the ultimate authority (i.e. “Christian Anarchism). Consequently, members eschew any notion that governmental units can grant or deny them authority to perform Works of Mercy. As a matter of principle, The Catholic Worker is an unincorporated association. It does not have an EIN or a charitable exemption. It is also not registered with NYS Attorney General’s Office. But, it does file voluntary CHAR 500s
It is our understanding, from speaking with current members, including Dorothy Day’s granddaughter, that in the 60s after a pitched battle with the IRS, agents from Washington DC came to New York and worked out a compromise with Dorothy Day. The organization does not pay federal income tax as a result of this agreement, but it is subject to property tax. In 1967, members of the organization created a holding company to hold in trust the property that The Catholic Worker owns, including two properties in the Lower East Side and a farm upstate. This company is the entity that is liable for property taxes. Because the downstate properties are in a rapidly gentrifying neighborhood, the property tax burden has grown considerably. While The Catholic Worker is not in tax arrears, members are concerned that increasing property taxes may force them to leave the Lower East Side. The members have inquired as to whether a different structure would lessen their tax burden.
The following assistance is requested:
- Advice and Counsel on reduction of property tax burden; and,
- Representation on entity formation that provides more favorable tax treatment