Proposed DCI Reorganization

[danielray]

Drum Corps certainly can be sustained by donations if the directors and the governing body just scaled back on the massive expenditures. However, most directors are currently making expenditure decisions as if they were existing in the world of "Major League" status in which funding outside of donations cannot be sustained in the charitable world (unless you really make it a true Major League like the PGA with professional adults competing, major sponsorships, huge prize money).

You do understand that you have absolutely no idea what you are talking about, right?

The total amount of donations that the even top world class corps that get the greatest amount in donations is not enough to run most open class corps. It helps, don't get me wrong, but it is not near enough to run a corps... and it is very expensive money.

I have no interest in drum corps spending less money... in fact... I want them to spend more, much more... I want to see the great things they can do with greater financial resources.

(Spending that money in a smarter way is another discussion... but... I want them spending more).

Those running most junior drum corps today also have lost sight of the fact that within 501c3 status for youth the focus should be on the watchful benefit of the mission to help the youth first and foremost, then utilize competition as a teaching tool. I am not against competition, and I love to compete, but what has occurred today is a reversal where the Major League status now comes first and the watchful charity for the youth has been thrown in the back seat if not the trunk. Therein lies the "real" problem because while Major Leagues (true Major League like the PGA) can raise a huge amount of capital outside of donations, Charitable Youth Organizations (like DCI) must budget according to most capital being garnered through donations. The drum corps push toward Major League is fine; but for that to occur without financial collapse the goal needs to be similar to the adult professional PGA system, or DCI should move into the for-profit world like the NFL, MLB, NASCAR, NBA, etc... However, as long as DCI is registered as a 501c3 youth charity organization directors should focus on the charity toward the youth first and foremost and budget according to what can be raised in that environment.

Tax status is simply tax status.

Non-profit is the wrong term... it is not-for-profit... in that the organization has a specific goal in addition to their goal to be profitable.

Being profitable should be an essential goal of these organizations... this is why so many drum corps start up, do well and collapse. They are thinking that they are a charity, an organization that needs to spend every last dime, rather than be PROFITABLE organizations.

This is a whole other discussion entirely... but... back to the point... corps and DCI need to explore revenue generation opportunities that have absolutely nothing to do with drum corps or bands... and reach a completely different audience. B2B opportunities have much greater potential than anything else.

[Stu]

...Drum corps today is more geared towards the benefit of music major and those heading that way. It stopped being the inner-city youth organization long, long ago.... You only need to see the number of MMs who FLY to auditions and camps to see this fact. Many kids, inner city and otherwise, have myriad programs available to take up their time; DCI as the savior of kids with nothing to do is no longer necessary or, even, effective because of marching costs....

I agree with your assessment that DCI and the various corps are no longer functioning as 501c3 youth charitable organizations. The huge glaring (problem) is that DCI and the various corps are still "registered" within that designation; and by not following the true mission of a charitable youth organization they are perverting that registration and doing a grave disservice to that charitable youth designation. If DCI wants to become something other than youth charities and push toward Major League I am on board with that notion!!! However, if that is the function, and not youth charity, the DCI organization and the various corps should reorganize and register as a different type of non-profit (i.e. like the Major League PGA or Major Symphonies). Otherwise they should revert back to the true mission of a charitable youth organization. I do not care which route they choose, but it ticks me off to no end that they are "registered" as charitable youth organizations but want to act as if they are a Major League. Now do you understand my position better?

[Stu]

You do understand that you have absolutely no idea what you are talking about, right?

Thanks for the condescending statement on my intellect!!! And yes I do know what I am talking about. DCI and the various corps are registered as charitable youth organizations not as a professional organization like the PGA; both are not-for-profits but vastly different in their designations, scope, and stated mission goals. The problem is that DCI and the various corps are now way outside their registered mission and in way over their heads by attempting to financially run as a Major League while maintaining their registration status as charitable youth organizations. They are continuously increasing their expenditures in the name of Major League yet failing to budget within their youth-charitable means. THAT is the problem. And THAT is why I maintain if DCI and the various corps would honor their registered charitable youth status, get rid of the Major League idea, and budget according to their means, they certainly can exist quite well within that environment.

[garfield]

Non-profit is the wrong term... it is not-for-profit... in that the organization has a specific goal in addition to their goal to be profitable.

Nit-pick: there is no difference between non-profit and not-for-profit.

It makes no difference to the discussion at hand, but state and federal statutes (nor the IRS) makes a distinction between the two.

A more important definition is the one clarifying how much profit an organization can "retain" before it's no longer a non-profit organization.

This is the problem we WANT to have, right?

[danielray]

Thanks for the condescending statement on my intellect!!! And yes I do know what I am talking about. DCI and the various corps are registered as charitable youth organizations not as a professional organization like the PGA; both are not-for-profits but vastly different in their designations, scope, and stated mission goals. The problem is that DCI and the various corps are now way outside their registered mission and in way over their heads by attempting to financially run as a Major League while maintaining their registration status as charitable youth organizations. They are continuously increasing their expenditures in the name of Major League yet failing to budget within their youth-charitable means. THAT is the problem. And THAT is why I maintain if DCI and the various corps would honor their registered charitable youth status, get rid of the Major League idea, and budget according to their means, they certainly can exist quite well within that environment.

Again, you have absolutely no idea what you are talking about.

Very few organizations out there sponsoring drum corps are registered as a youth development organization, but almost all of those that are registered as such have dual designation in performing arts, same as the rest of others (there are a few mutant exceptions).

Here are the classifications the IRS uses:

I. Arts, Culture, and Humanities - A

II. Education - B

III. Environment and Animals - C, D

IV. Health - E, F, G, H

V. Human Services - I, J, K, L, M, N, O, P

VI. International, Foreign Affairs - Q

VII. Public, Societal Benefit - R, S, T, U, V, W

VIII. Religion Related -

XIX. Mutual/Membership Benefit - Y

X. Unknown, Unclassified - Z

NCCS - National Taxonomy of Exempt Entities

DCI and most corps are registered as Arts, Culture and Humanities in category A (Performing Arts).

A few corps (YEA and SCV, most notable) are registered as Arts and Culture in category A and also in Human Services in category O (Youth Development). None are registered exclusively in Youth Development.

Mutant exceptions:

- Pioneer is registered only in Human Services in the category of Youth Development

- Revolution is registered in Human Services in the category of Recreation, Sports, Leisure, Athletics

[danielray]

Nit-pick: there is no difference between non-profit and not-for-profit.

It makes no difference to the discussion at hand, but state and federal statutes (nor the IRS) makes a distinction between the two.

A more important definition is the one clarifying how much profit an organization can "retain" before it's no longer a non-profit organization.

This is the problem we WANT to have, right?

Sure. Just means that the primary aim of the activities of the corporation is not exclusively to make a profit. There are non-profit corporations out there that, for one reason or another, do not have tax exempt status.

My point is simple...

If an organization wants to exist, they need to make money.

If an organization wants to continue to exist, they need to make a profit.

Drum corps needs to quickly shift to being more profit driven in the holistic view of their activities (some activities, mainly running a drum corps should lose money.... hopefully A LOT of money... while the organization as a whole should be profitable).

[Stu]

Again, you have absolutely no idea what you are talking about.

Are you that obtuse!!! My point is that DCI and the various corps have a stated "mission" a stated "goal" a stated "obligation" to help youth through charitable means because that is how they are structured within all of those arts, education, humanities, and culture designations; yet they are now attempting to change into functioning as a Major League like the PGA which is creating all of the huge expenditures. DCI can certainly function as-is within its means if it reverts back to that charitable youth mission which they placed on their 1023 applications, or they must move away from the youth-charity mission goals, restructure as a major league entity (like the PGA) and progress toward a professional major league status. However, they cannot continue to dwell in the charitable youth world where capital is always scarce while creating major league expenditures. GET IT NOW?

Edited October 26, 2011 by Stu

[Stu]

Sure. Just means that the primary aim of the activities of the corporation is not exclusively to make a profit. There are non-profit corporations out there that, for one reason or another, do not have tax exempt status.

My point is simple...

If an organization wants to exist, they need to make money.

If an organization wants to continue to exist, they need to make a profit.

Drum corps needs to quickly shift to being more profit driven in the holistic view of their activities (some activities, mainly running a drum corps should lose money.... hopefully A LOT of money... while the organization as a whole should be profitable).

You forgot a few other very important points: Budgeting expenditures according to revenue. Do not allow your organization to go into the red by creating outlays you cannot cover. Always budget within your means....

[garfield]

Thanks for the condescending statement on my intellect!!! And yes I do know what I am talking about. DCI and the various corps are registered as charitable youth organizations not as a professional organization like the PGA; both are not-for-profits but vastly different in their designations, scope, and stated mission goals. The problem is that DCI and the various corps are now way outside their registered mission and in way over their heads by attempting to financially run as a Major League while maintaining their registration status as charitable youth organizations. They are continuously increasing their expenditures in the name of Major League yet failing to budget within their youth-charitable means. THAT is the problem. And THAT is why I maintain if DCI and the various corps would honor their registered charitable youth status, get rid of the Major League idea, and budget according to their means, they certainly can exist quite well within that environment.

Stu, I get what you're trying to say, but it makes no sense in light of the "status" of the various non-profit orgs.

DCI is listed as a A6C (Music Groups, Bands, Ensembles) subcategory (notice that it doesn't say "youth" anywhere), but individual corps have subcategories such as: A68 (music) [Jersey Surf], and A60 (Performing Arts) [blue Devils Parents Association], among others.

In context, DCI was never a "youth" organization. It was an organization put together to serve the interests of youth organizations. Each individual corps could very well be a non-profit and yet DCI could be a for-profit organization.

I understand your angst about DCI no longer having its central mission to help kids with nothing else to keep them off the streets and out of trouble (with today's opportunities, how many of those kids are there actually?), but even DCI no longer refers to themselves in that way. The closest they get (publicly) is: "...a powerful, nonprofit, global youth activity with far-reaching artistic, educational and organizational influence." (source: DCI.org).

Again, I understand you angst, but contending that their IRS designation is contrary to their actions is not a convincing fact that proves why the activity is constantly struggling for money.

Again, about $250,000 comes into DCI in the form of donations. Individual corps can't possibly survive on donations even in a stripped-down version.

[danielray]

Are you that obtuse!!! My point is that DCI and the various corps have a stated "mission" a stated "goal" a stated "obligation" to help youth through charitable means because that is how they are structured within all of those arts, education, humanities, and culture designations; yet they are now attempting to change into functioning as a Major League like the PGA which is creating all of the huge expenditures.

Yes. I am obtuse. Thicker than molasses

$10M, by the way, is not huge expenditures for the scope and scale of what DCI does. That amount of spending is not even a Kardashian wedding.

DCI can certainly function as-is within its means if it reverts back to that charitable youth mission which they placed on their 1023 applications, or they must move away from the youth-charity mission goals, restructure as a major league entity (like the PGA) and progress toward a professional major league status. However, they cannot continue to dwell in the charitable youth world where capital is always scarce while creating major league expenditures. GET IT NOW?

DCI has had exactly the same status since 1974. The classifications were different then, but it was never registered as a youth charity in the initial application or anything similar since. The more detailed current classifications came into effect in the mid-90's.