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New policies for cash assistance, outside accounts & outside entities
Published on May 18, 2021 by Alanna Irving

This is an important message for all initiatives who: 
  1. Provide cash assistance (giving out money, e.g. via Venmo or gift cards); 
  2. Use outside accounts (e.g. Paypal, personal bank accounts, Cashapp, etc.); 
  3. Use related outside entities (incorporated organizations associated with your initiative, besides OCF). 
Please read and understand our policies for these types of activities. Join our upcoming webinar if you have questions or feedback.

First, thank you for all of the great work you are doing during these challenging times. OCF is proud to host initiatives that have come together to help one another, neighbor to neighbor. We are continually amazed by your creativity and commitment.

As OCF continues to grow, we are evolving how we meet our responsibilities as a fiscal host. The mantra for mutual aid is “solidarity, not charity,” but at the same time, legally, we are a charity, and we have to make sure that we are in compliance with laws and IRS regulations.

New policies

We have developed three new policies to clarify rules and processes in these areas, based on the OCF Terms of Fiscal Sponsorship, which all initiatives agree to when they join.
  1. Cash Assistance Policy: Covering disbursements via services like Venmo and Cashapp, gift cards, withdrawing cash from an ATM—any time an initiative distributes money other than through our online platform. If you run such a program, you need to fill out a form, get approved, and be aware of extra requirements.

  2. Outside Accounts Policy: Initiatives are not allowed to hold money in, or distribute money from, accounts not owned/managed by OCF—including Venmo, Cashapp, GoFundMe, Eventbrite, Paypal accounts, cash boxes, personal bank accounts, corporate bank accounts, or cryptocurrency wallets. All money raised for your initiative must be transferred to OCF.

  3. Outside Entities Policy: OCF’s fiscal sponsorship services are designed for initiatives that don’t have an incorporated legal entity. If your initiative is associated with or operates activities through another legal entity, ensure it’s in compliance with this policy.
The goal of these policies is to make the processes and requirements clear, so you know exactly how to proceed and continue supporting your neighbors and positively impacting your communities. We don’t want to make initiatives jump through hoops, but these policies are necessary because of the regulations governing OCF as a 501(c)(3) nonprofit organization. If one initiative doesn’t adhere to the rules, it could impact OCF’s 501(c)(3) status and all initiatives under our umbrella.

We are working hard to continually improve our service and enable the ways you want to work. The platform has some helpful tools, like inviting expenses (where someone fills out most of the expense details and the payee can just confirm and submit), and virtual cards (spend money online directly from your balance instead of via reimbursements). But some gaps are beyond our control (such as the fact that Venmo does not allow nonprofits like OCF to sign up).

If your initiative doesn’t want to be subject to these rules, then fiscal sponsorship with OCF might not be a good fit. In that case, get in touch and we can help you transition. But we hope to make it work, together. 

We’re hosting a webinar for all groups who are affected by these policies, for you to ask questions and give us feedback. 

OCF Policies Q&A Webinar
2pm PST / 5pm EST 
Monday, May 24

So, in summary…
  1. Follow the cash assistance policy—only do cash payments when absolutely necessary and only once you’ve received approval for your program.
  2. Follow the outside accounts policy—send any money your initiative raises to OCF, and spend it through submitting expenses.
  3. Follow the outside entities policy—make sure that any relationships your Initiative has with incorporated legal entities besides OCF are allowed.
Please don’t hesitate to get in touch with any questions ([email protected]), and sign up for the webinar

Finally, again, we are so incredibly inspired by everything you do. We feel privileged to play a small role in making it possible. So many people have given their time, money, Venmo accounts, and hearts to an amazing surge of solidarity and mutual aid across the country. We read all your updates and are blown away by each and every one of you.

With love and in solidarity, 
The Open Collective Foundation team