Fiscal Sponsorship
What is Fiscal Sponsorship?
“Fiscal sponsorship is a formal arrangement in which a 501(c)(3) public charity sponsors a project that may lack exempt status. This alternative to starting your own nonprofit allows you to seek grants and solicit tax-deductible donations under your sponsor’s exempt status.”
There are many places to find more information about fiscal sponsorship, here are a few we recommend from trusted experts in the field:
How Fiscal Sponsorship Works at with SJC
Steps to Become a Sponsored Project
Step 1: Project Proposal
Interested groups must send a proposal with the following information:
- Description of the project
- Project purpose, goals, and beneficiaries
- Expected timeline and life span of project
- Fundraising plans and methods
- Project budget
- Capacity to achieve the purpose
- How the project is aligned with the mission, values and work of SJC
- Project Supervisor/point of contact
The SJC may wish to meet to discuss this further prior to bringing it to the board of directors especially if there is any information missing or questions. Because of this, submitting a proposal does not guarantee that the project will be voted on at the next board of directors meeting. In order to be eligible to be added to the agenda for board approval, the proposal must be received at the latest one week prior to the board meeting.
Step 2: Board Approval
The SJC board of directors will vote to approve or deny the project based on the following criteria:
- Alignment with mission and values
- Project location
- Current capacity and amount of work required by SJC staff, board and bookkeepers
- Impact on SJC annual budget
- Evaluation of Project Supervisor
- Other risks
Step 3: Fiscal Sponsorship Agreements
If approved, the project and SJC will sign a Fiscal Sponsorship Agreement and if appropriate, a Memorandum of Understanding (MOU) detailing all the terms and conditions of the Fiscal Sponsorship. This will include a description of the specific work to be performed by each party and how the project’s funds will be spent. The agreement must be signed before SJC sponsored fundraising or applying for/accepting grants can occur