# Charging Non Profit Orgs

#### jyenish

##### Member
I have a question to pose to the community this morning.

My presence has been requested by my college to run an event being sponsored by an outside non profit group. The college has negotiated that I will be paid for my time, but the amount I am to be paid is to be worked out between me and the event organisers. The commitment is aproximately two days of four hours of work on each day. The job is pretty simple set up lighting and sound for a variety show fund raiser and be there to operate the event and act as a liason between the college and the non profit group.

The question is what should I charge this group? What would be appropriate to ask for my time and services while taking into acounnt this groups non profit status and understanding that they are holding this event in order to raise funds.

Any insight would be appreciated since this event will more than likely set the presedent for future scenarios of the like.

#### Mayhem

##### Senior Team Emeritus
Interesting position that you find yourself in and one that you actually may wish to ask the organization that you will be working for.

My company donates a show every year for a charity that approached some time ago to do its Christmas Party. When I accepted the job, I was fully aware that I was donating my companies services, thus no money would change hands.

What I was provided with however, was a certificate that acknowledged that we had donated services worth . I then submit this certificate with my income tax and receive a tax refund for the full amount, as it was a donation.

Now I don’t know about US laws, or even if you would be doing a tax return and therefore in a position to benefit from this.

The other option is that you give up your time and ensure that you get some written acknowledgement for your time and services. You may even be able to get repeat work and whilst FREE it does build up your hours and you get that warm fuzzy feeling of doing good.

Others may have a better idea of the US climate and protocol for such things but I suggest doing what you feel is right.

#### Mayhem

##### Senior Team Emeritus
Good point boomboom and one that I overlooked as I imagined that Jayke had already considered this point and were asking for alternatives.

However, what do they say about assumptions? (no this is not a question for discussion)

#### jonhirsh

##### Active Member
Hey i will agree with boomboom on the idea of charging full rate. When you charge a lesser rate for your work you undermine everyone else in the buisness because this is not there hobby this is there life blood.

allot of guys i know do work for non for profits and what they do is charge the day rate say $500 a day then they donate it all back to the charity and get a$400 tax break. But this should never be asked of you its your choice to say no.

If your still learning and need hours your best to do the job for free. as this repersents your self as someone who is new in the profession. but to discount your rate even slightly sets a standard that they will look to the next time they book a show.

Help out your self and others in the buisness charge your full rate and then affter the event determine if you feel the cause is worthy to donate in full your pay for the two days.

JH

#### SuperCow

##### Active Member
Also, bear in mind what the organization is. I mean, if it's Greenpeace, they're rolling in money; and your fee won't really put a dent in their budget. But if it's Save the Three-Toed Sloths of Madagascar; money might be more of an issue. But ultimately, it's up to you. I donlt think that there is any set protocol in these situations.

#### Sombra2

##### Active Member
From any event you should charge full-rate. Or at least quote the full price rate. You should sit down with whoever is to negotiate your fee and if you like their cause, then simply tell the guy that you'll be willing to give them a discount (say a reason you want them to know so anyone else doesn't expect a discount also). That way nobody expects a cheaper price and get angery at you for charging more.

Also keep in mind that maybe later on the group might call you up and ask if you might want to do a gig for them but you want to charge more later on.

#### Mayhem

##### Senior Team Emeritus
Now don’t get me wrong, as I am certainly not recommending that Jake goes in and does it for free or even prostitute himself just for the sake of undercutting the market.

What I was suggesting was that if he is unsure of what to charge, he should discuss it with the client or look at other alternatives that may still benefit him and not leave him out of pocket.

When talking to the client, he should state his costs but also ask if the client has a budget for the production. If it has been budgeted for, fine, Jake get his full allocation of funds and the NPO is happy because they came in within their budget.

This happened to me last week. I was approached to quote on a large corporate function for a client that holds several events per year. As such, I was willing to price match or even beat the price they were being charged by their previous DJ. When asked what I charge, I gave them our current costing and then asked if they had a specific budget, as I was happy to work in with their pricing structure if possible. I was told that their budget could cover our costs and so the paperwork was done.

Now – I could have possibly asked for more, as it would appear that their budget was greater than my price. However, I was entering this quite prepared to discount the price so this was a win – win situation.

My suggestions for discounting or even donating were based upon my experiences and business practices. For me to donate my services to a charity that provides me with a certificate of currency, allows me to claim that as a donation, which here, is covered 100% come tax time. So what if I have to wait six months before I see the money.

Also, repeat clients are worth the discounts that you offer to them in keeping them happy that you are looking after them and do so in keeping them as repeat clients. The level of service is also crucial but that is another topic.

Answer me this question – is it worth discounting your usual price by 10% or even 20% if that client comes back for repeated shows? For me, the answer is yes. In a competitive market where it is difficult to get clients I am more than happy to have long term bookings with several repeat customers.

Also – there are months where things are quiet for one reason or another. If a client comes to you with a budget smaller that your initial quote, do you consider taking the work or simply pass on it. You don’t make any money if you or your equipment are sitting idle.

Now I am not saying that you need to go out and undercut everyone else and get all the show for a minimal profit. You have to draw a line in the sand somewhere but what I am suggesting is that this line does have the ability to be stretched in some directions.

Now I can see the point that if you discount now you always have to discount for that person but I would disagree. If you need to, you tell them that you have increased your fees because of increasing running costs but you would still be willing to offer them a discount. They don’t need to know that your price has increased enough to cover the discount.

Remember that there are times when you will ask for an individual or a company to either offer you a discount or even donate goods or services. It is a two way street and part of running a business or simply contracting your services.

At the end of the day – you have to do what you feel is the right thing.

#### Mayhem

##### Senior Team Emeritus
And now for something a little lighter!

SuperCow said:
Also, bear in mind what the organization is. I mean, if it's Greenpeace, they're rolling in money; and your fee won't really put a dent in their budget. But if it's Save the Three-Toed Sloths of Madagascar; money might be more of an issue. But ultimately, it's up to you. I donlt think that there is any set protocol in these situations.

I don’t know – I think the “Save the Three-Toed Sloths of Madagascar” organisation is a scam or a front for money laundering (or worse). Don't give them your money (or time or services) until you thoroughly check them out.

My suspicions are based upon the fact that both Two-toed and Three-toed Sloths are native to the Americas:

Family: Megalonychidae/Choloepidae
Genus: Choloepus (Two-toed Sloth)
Species:
1. True Two-toed Sloth or Unau (Choloepus didactylus) . Located in the forests of northern South America.
2. Hoffman's Two-toed sloth (choloepus hoffmanni) . Lives in areas from Nicaragua to Peru and Brazil.

Genus: Bradypus (Three-toed Sloth)
Species:
1. True three-toed sloths or ai or (bradypus tridactylus) . Lives in areas from Central America to Northern Argentina.
2. Brown throated three-toed sloth (Bradypus variegatus) . Lives in areas from Guatemala to Honduras.
3. Maned Sloth (Bradypus torquatus) . Only found in Eastern Brazil. The most rare of the five species.

Source: Grzimek's Encyclopedia of Mammals, Volume 2, McGraw-Hill Publishing Company, 1990, Sybil P. Parker, Editor.

#### jyenish

##### Member
Well I appreciate all the advice that has thus far been given, and I believe I have come to a decision, but first let me give a little more information about the NPO.

This NPO is thus far nameless, they are a new NPO based in the town where I live. What has happened is that several of the community theater groups, The Local Ballet, Community Theater, and Musical Orgs have been using various facilities within the town to hold their productions (i.e. local highschools and the colleges) while in the past this has been fine, recently the colleges have increased their productions which puts a strain on the events calander. In response to this the Comminity groups are seeking funds to create an actual community center with the facilities to house their productions along with other needs of the community.

In the past, as a student of the college I have beed asked to set up our theater space to accomodate these groups, therefore they already know me and know my work, although being that at the time I had been a student the work was gratis, on my part. However now that I am no longer a student the college has been so gracious to allow me to set my own price for these such events.

That being said the actual work involved is hanging and focusing a general wash with a special or two, and running both a lights up sound up and lights down sound down show. Pretty simple for me, most of my time will be devoted to hand holding the event organisers and putting their crazy requests into perspective (one time they asked me, the day of an event, if I could create a similar lighting scene and effect as I had for a mainstage show I had designed the same year, a show where I had three months to plan and implement the scene and effect).

So all the explianations aside I will charge them \$10 and hour and record all they hours I actually spend on the event, even before they come into the house (I'm not one to leave things to the last minute) and the same rate for any addition individuals they might need (i.e. spot ops).

Thanks again for the words of wisdom, and feel free to comment on my decision.

#### AVGuyAndy

##### Active Member
Someone got bored today...

#### jonhirsh

##### Active Member
Hey i see your point mayhem and i think the differnce is that with a product such as a DJ there are many things that you have to factor in you have your equipment, personal, transport, storage etc.....

Mostly i do design/ programing work and this has no overhead. i am basicaly pedeling my self. i dont know about where your from but here in toronto there are allot of dj's not all of them are the best there may be 40 to 50 really good ones but there are literaly 100s of them here. But with lighting designers for theatre there are a few of us and none of us are really competing for work we try to work together because all of the designers have unique skills no one designer is alike. so if we started discounting our rates it would be like saying forget if im the best fit for your show, and more like to i fit your budget and if not will i bend to fit it.

i think that this is not a question of where to draw the line in the sand its wether or not to draw the line. and to me even giving a 1% discount is wrong.

now about repeat coustomers i think that having repat coustomers is awsome but, if the only reason they came back was because i was cheeper the the other guy then i didnt do my job right.

I am glad you have chosen to charge a by the hour rate that atleast will cover your parking. i hope that next time you will feel comfertable charging your normal rate. but its a good start. flat rates are never a good idea.

JH

#### Mayhem

##### Senior Team Emeritus
You are correct in your assessment of the DJ market and there are too many crap ones or those that offer a 'cheap' service. In some cases, these are almost half of what I charge.

I also agree with you on the repeat customers as well and sometimes it is necessary to offer the discount to get the original contract. The level of service is what should keep you getting the return work. I will continue to disagree with you on the discount question though but then again, each to their own.

My impression was that Jake is just starting out on his own and I think that it is that initial foot in the door that really matters and from there you build up your name and portfolio and your price tag. You do want to be able to put money in your pocket but you also have to start of and be competitive. If you wish to buy gear as well, this is also something that you need to look at. How many shows at your price would you need to land to pick up the extra piece of gear? I have done shows in the past and made no money for myself but used it to purchase new equipment. Then again, as pointed out, if you don't need your own equipment then this will not be a major consideration.

People will always look at the dollar value and unless you have a name that is recognized, or a good portfolio, the price may be your downfall. If you have to sacrifice a few dollars to get the ball rolling then I think that is a wise decision. With this case, you also have the ability to state that is was for a NPO if someone else does pick you up on the price when quoting future shows. On this note, you should talk to the NPO and ensure that they do not state your rate as you are doing them a good deal.

I think that charging them an hourly rate is a good idea and whilst it will probably cover your lunch and travel costs, at least you have made a decision that you are comfortable on. Just make sure that they understand that they are getting a substantial discount. One thing I will say, is that no job should cost you money.

#### SuperCow

##### Active Member
Touché. That was a completely random example I made up. How about for the New England Patriot's farm team, then? Or is it Patriots'?

#### jonhirsh

##### Active Member
True words. its a case by case basis i guess.

JH

#### Mayhem

##### Senior Team Emeritus
SuperCow said:
Touché. That was a completely random example I made up. How about for the New England Patriot's farm team, then? Or is it Patriots'?

How about the Patriotses?

Mate - I just didn't want to see you put your hard earned dollars (and Canadian dollars are worth about as much as Australian ones) in a scam.

#### SuperCow

##### Active Member
Oh, I'm not much of an animal rights activist myself. Though I do have a soft spot for cows; as you could guess.

#### ship

##### Senior Team Emeritus
As a tech person involved with the show, unless you are a member of the non-for profit by intent, it's work just as for profit. Undercutting your pay unless in need of rent and work is a choice you should be making not as per the tax status of the company you do the job for but as per the work available. I'm not aware of any tax write off's that will do you any good in taking a pay cut when you don't have enough to claim already in profits. Your tax accountant you pay for might find some profit in this for you, but you get what you pay for in breaking even thus with such work.

In other words, a tax letter stating how much pay you loose is a donation might or might not work to your advantage. This given you make rent in working the show and passing up for real pay gigs. Work is work and take pay for what is offered when in need, but the tax status of the company you do the job for should not be a part of your own for profit and paying taxes on work you do negotiations. Either they are going to hire you for your skills or hire someone less skilled willing to take a pay cut. Hopefully they will be safe. If in the position that you need work, in negotiations be clear that you are taking that pay cut, get the tax letter noting your loss of pay, but ensure they know you expect X amount of pay normally and next year expect that much should you wish to work for less.

Working for less tax letter or not is your choice and little to do with tax status when it comes to actual pay or you needing rent money. A few hundred dollars less is still a few hundred dollars less. Is your value as an employee worth your rate, or in finding work do you as a private contractor need to de-rate your pay scale in general so as to get work?

Nothing wrong with either choice, but note that it's less a question of profit or non in getting work, more just for this X amount of time what work you sign a contract to work at for pay. You are for profit and a individual contractor. If you as a contractor had to pay for overhead, parts, labor, insurance, etc. for a show as per a company, would you accept less a cost and loosing money?

Doesn't matter if private individual or company in the end in renting or providing services. They can afford you or not, you can take a profit cut or not to get the job. Realize that you are a private one person company and in no way associated with this non-for profit as a part of your consideration. Pay cut and question of value of tax write off as extra compensation but pay cut in the end still. Non-for profit or not, you as a private contractor either make your rate they can afford or they can't afford you. Do not associate yourself as a hired gun contractor with the production you are not a part of in reality. All you are is an indipendant contractor or private business they hire.

Do you think they negotiate with the gas or power company for their Edison power a lesser rate for them given Non-For Profit? Did the contractor who installed the power in their office negotiate a lesser rate for it given their status? You are in the end a contractor. You are not saving animals by working the show just as you are not selling cars by working on a auto show. All you are doing is contracting on a production.

Hope it helps.