The acknowledged expert on this question, Joy Skjegstad draws from her speaking and consulting as well as her book (Starting a Nonprofit at Your Church) to offer congregations an 800-word sketch of the key criteria in answering this question: should your church start a nonprofit? Schools and preschools, as well as community ministries like housing, youth programs and health clinics, may be good candidates to be spun off as 501c3 corporations separate from the congregation. Skjegstad’s principle image is that of a caged bird, and she suggests asking, “ has the ministry or program outgrown the congregation’s capacity in funding, volunteers, management expertise, or even facility?” If so, it may be time for the congregation to consider starting a separate nonprofit to allow the ministry to “fly”. The article gives two examples in which forming a nonprofit can be helpful and then outlines some of the disadvantages to be considered - additional reporting and administration, distance between the congregation and the ministry, and a possible loss of ownership on the part of the congregation. This concise and helpful article will be useful to any congregation beginning to think about starting a nonprofit.
Reviewed by Wendy McCormick