East Lansing Info (ELi) is a nonprofit, nonpartisan, public service news organization. We are recognized as a 501c3 nonprofit by the IRS, which means donations to our organization are tax-deductible.
Although the IRS has only required us to file a short-form nonprofit tax report (990) while our annual fiscal-year income has not exceeded $50,000, it’s important to us to be transparent with you about ELi’s finances, because ELi exists for you. So, here’s an update, along with our thanks to those who have supported this unique community project.
What’s the basic financial structure of ELi?
East Lansing Info (ELi) operates as a nonprofit public service organization whose mission is to provide the people of East Lansing with timely, accurate, nonpartisan news and information. We were recognized by the IRS in July 2014 and we started regular publishing in September 2014.
No one owns ELi. ELi exists specifically to be a public service charity organization. ELi’s fiduciary responsibility is managed by a volunteer Board of Directors. Our accountants are Layton & Richardson, P.C., and we pay them to manage our payroll, review our books, and file our tax forms.
Our fiscal year runs from July 1 through June 30, so this is the report on our third complete fiscal year (July 1, 2016-June 30, 2017). You are invited also to read the reports on our first fiscal year and second fiscal year.
What is the source of ELi’s income?
To date, we have operated entirely on donated money and donated labor. In our first fiscal year, we obtained $30,842 in financial donations, in our second, we obtained $47,526, and in our third, $47,884. This has included one corporate sponsorship, from LightSpeed, and one grant from the Lansing Area Community Trust.
How do ELi’s expenses break down?
Our expenses in our third fiscal year came to $51,280.27. That compared to $41,265 in our second fiscal year and $25,979 in our first fiscal year. (We never went into “the red” because we always kept enough funds in the bank to meet expenses.)
Here is how ELi’s expenses broke down in our third fiscal year:
As you can see, the great majority (82%) of donations to ELi continue to go to paying local people to edit, report, manage, and upkeep ELi’s services. That means that it continues to be the case that the great majority of the funds donated to ELi stay in the community. The exceptions to that are fees we pay to large-scale assistive online technologies, including PayPal, Patreon, and Facebook.
As a nonprofit, ELi has extremely low corporate administrative costs. (This is true mostly because I donate all my administrative services, in addition to donating my reporting and editing services.) What ELi does have to pay in administrative costs mostly comes down to what we have to pay to manage money—for example, to PayPal, Patreon, and our accountants. This year that came to only 4%, which is very good for a nonprofit organization.
What’s different this fiscal year from the last fiscal year?
Facebook has made it harder and more expensive for us to push news alerts out to our readers who interact with us that way. So, we are paying hundreds of dollars more per month to Facebook than we did last year. We also held several “open office hours” with our readers this year for the first time, which added a few hundred dollars in promotional expenses. This was also the fiscal year we joined LION (Local Independent Online News) Publishers and attended their conference, and that added professional development fees that we did not have the year before.
But, all in all, this fiscal year looked largely like last fiscal year in terms of expenses, even though our quality output went way up. That’s why this coming year, we are asking readers to provide more funds to make our work sustainable. We need more funds to meet our readers’ needs.
We also need to get ELi to the point of being financially sustainable without substantial donated labor, so that we can secure its future for years to come.
Who gets paid to work for ELi?
When we started ELi, about half of our reporters donated their labor and about half were paid. Today, about four-fifths of our reporters opt to be paid. In general, reporters are paid $50-100 for a published article if they ask to be paid. (We let reporters decide if they will be paid, and all youth reporters are paid at the same scale as all other reporters; there are no “unpaid internships” at ELi.)
We also pay for tech and editing work, two absolutely critical components of running an online news site. As noted, we also pay local accountants Layton & Richardson to handle our payroll and tax filings (and they do a great job).
Obviously, given that our expenses are about $50,000 per year in total, no one at ELi gets paid very much. People participate because they believe in the mission. We pay them a little something out of respect for their work.
Why do people donate to ELi?
The people who donate to support ELi’s work tell us they do so:
- because they cannot imagine having to live without the news, information, and calendar that ELi has been steadily providing to people concerned about East Lansing;
- because they appreciate our hard work and dedication to the community;
- because someone they love works for ELi;
- because they are doing well enough economically to donate generously to this local public service effort;
- because they want the tax deduction;
- because they believe local news functions as a critical check on local government.
Have a question about any of this?
Want to help us keep this service going in 2018?