Policy Statement - Crowdfunding
This policy is in regard to the use of any form of crowdfunding service or website-based platform for the financial benefit or gain of any level of Little League (i.e., Local, District, State, Provincial, District, National or International). Crowdfunding can be defined as, the use of small amounts of capital from a large number of individuals to finance a project, business venture, or to fundraise for a specific cause or charity. Through the use of personal networking, social media platforms, and other internet based resources, funds can be raised to support these different campaigns or efforts from a grassroots level, such as a local Little League.
Per the Little League Operating Manual, charitable funding and contributions can be collected through web-based crowdfunding platforms, so long as standard Little League policies are followed when utilizing this means of charitable fundraising. Current policies state that in no manner should there be any solicitation by a third party or individual in the name of or on behalf of a local league; solicitation of funds is to be done by the league itself. In addition, the use of any Little League registered logos and trademarks must be used in connection with the local league name, and should not be misrepresented or altered in any way, without first contacting Little League International.
Donations that are collected through this method should not be for any personal or business gain, but strictly to assist youth and make the community a better place for them to live.
When looking into different options related to crowdfunding, it is important to consider all drawbacks that may impact the league or district’s ability to collect needed operating funds.
Please note that while this is a way to potentially run a fundraiser for a local league, it may not always be the most cost-effective method of generating funding for local league programs. Fees are often associated with crowdfunding and there is an applied fee per donation (typically around 5%) along with the credit card/payment processing company adding an additional 2-4% fee depending on company. For example, if a $100 donation was received, only approximately $91 would reach your 501c3 based organization. Because of the ease of creation of one of these crowdfunding campaigns, local leagues should closely monitor for individuals fraudulently misrepresenting themselves as a local league in order to solicit funds for their own personal gain, since only the league itself should manage campaigns of this nature.
Also, when evaluating if crowdfunding is a viable fundraising option for your league or district, be sure to read through the site’s policies on “campaigns”, as some do not provide funds to the project unless the “goal” of the campaign is met. Each crowdfunding site is different, as some do not have goal requirements, and other sites have timelines for the lengths that a fundraising campaign can be active. If a campaign is not funded at the end of a said timeline, refunds are often made to the potential donors as the campaign did not come to fruition. Again, each crowdfunding platform is different, it is important that a league or district understand the full scope of the crowdfunding site before participating.
In conclusion, crowdfunding may be a current means to raise funds but may not be the best solution for your league or district. A simple donation option on the league or district website may be a better means to collect donations.
For more information regarding fundraising and the solicitation of donations, as it relates to Little League, please consult the Little League Rulebook and other areas of the website.
Leagues and Districts should keep in mind that many states maintain specific requirements for charitable solicitations among non-profits. Additional steps may be required of leagues or districts before you are permitted to solicit funds in the name of the league in your local community. Such guidelines also may pertain to games of chance, raffles, crowdfunding and other contest that are used as fundraisers.
Be sure to check your individual state laws or other requirements regarding fundraising and be sure that you adhering to these guidelines with all activities. A helpful resource can be found here: https://www.councilofnonprofits.org/tools-resources/charitable-solicitation-registration
Source credit: National Council of Nonprofits; www.councilofnonprofits.org