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Ball society hits tax receipt snag in fundraising

Posted on May 2, 2018 by Taber Times
TIMES FILE PHOTO

By Trevor Busch
Taber Times
tbusch@tabertimes.com

With the Baseball-Softball Enhancement Society anticipating kicking off a fundraising campaign to improve facilities in the community, town administration has advised the strictures of tax law will not make it easy for the municipality to issue receipts on their behalf.

Early in 2018, a group of individuals in the community came together with the purpose of enhancing the baseball and softball facilities in Taber, and is in the process of achieving society status.

Group discussion has focused on potential future development plans for the baseball and softball fields in Taber, and representatives of administration have been in attendance at their meetings and are working collaboratively with the group.

Following a request from the Baseball-Softball Enhancement Society on March 26, town administration has since reviewed protocols about potentially issuing receipts for donations to an organization that is not currently a registered society.

The group is proposing to sell fence-line advertising at Ken McDonald Memorial Sports Complex (KMMSC) as a method to raise additional project funds for the facility’s completion of a fourth diamond, and were seeking council’s approval for the town to provide tax receipts for financial donations. The society is looking at selling 30 signs at $1,500 for a three-year commitment for businesses. The business will provide the sign and be responsible for the maintenance.

According to administration, the Canada Revenue Agency (CRA) does not allow municipalities to accept donations and give out tax receipts on behalf of an organization that is not a registered society, and it is also not permitted to issue a tax receipt for a donation of labour.

Contributions of services (time, skills or efforts) are not property, and therefore do not qualify for issuing a donation receipt, but finance director John Orwa explained that the CRA does accept what’s known as a “gift proper.”

“So the town could in actuality accept cash gifts that are designated specifically for an additional ball diamond, but it would come directly to the town, and then the town would commit those funds towards the development of that fourth diamond,” said Coun. Joe Strojwas at town council’s April 23 regular meeting.

Coun. Garth Bekkering suggested the protocols discussed by Orwa and Strojwas weren’t really the issue at hand.

“It seems to me we’re straying away from the issue at hand here somewhat, because I think the issue is can we, or can we not, issue charitable donation receipts. As Mr. Orwa has explained, we cannot at the present time because there’s not a society that’s been formed. I have a difficult time seeing a group of people going for donations from various businesses and individuals, and not being able to issue a tax receipt. I believe it would put a damper on the donation drive.”

It was noted by administration that if an organization has charitable status, a municipality would not need to be involved, as the organization may issue their own receipts.

“There is another option, and that’s what we did with the skateboard park, is make that committee (Baseball-Softball Enhancement Society) a committee of council and then everybody’s part of it and we work together,” said recreation director Aline Holmen. “That’s how we built the skateboard park — we went out and we fundraised, the town gave the taxable donation (receipts) — but it was really a committee of council as opposed to a separate society, or separate committee. So that’s another option potentially.”

There is currently $250,000 approved in the 2019 capital budget for the development of a fourth ball diamond at KMMSC. On March 26, society representative Rick Popadynetz had indicated he expects the society to be able to raise $150,000 in grants and donations in its first year in existence.

Following discussion, council voted unanimously to accept Canada Revenue Agency’s policy on official donation receipts as information. Mayor Andrew Prokop was absent from the meeting.

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