Requirements

1. By-Laws and Mission Statement

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By-Laws

When forming a 501(c)(3) as a neighborhood association, it is important to create clear and comprehensive by-laws. Bylaws are a set of rules that govern the internal operations of the association. They outline the purpose of the association, the roles and responsibilities of members and leaders, how meetings will be conducted, and procedures for making decisions. Bylaws should be tailored to the specific needs and goals of the neighborhood association, ensuring that all members are on the same page.

When applying to be a 501(c)(3), you must has a dissolution clause in your bylaws. This clause must specify that upon dissolution, all remaining assets of the association will be distributed exclusively to other qualified 501(c)(3) organizations with similar charitable purposes. Example clause:

Mission Statement

Another important aspect of establishing a 501(c)(3) is developing a strong mission statement. A mission statement is a concise description of the purpose and goals of the association. It should be inspiring, clear, and reflective of the values and objectives of the neighborhood association. A well-crafted mission statement will guide the association's activities and help communicate its purpose to the community, donors, and other stakeholders.

By carefully drafting bylaws and a mission statement, a neighborhood association can establish a strong foundation for its 501(c)(3) status. These essential documents will provide structure, clarity, and direction for the organization, helping to ensure its long-term success and sustainability.

1. Internal Revenue Service, “Does the Organizing Document Contain the Dissolution Provision Required under Section 501(c)(3) or Does State Law (in the State Where the Organization Is Legally Formed) Satisfy the Requirement?,” IRS, January 15, 2025, https://www.irs.gov/charities-non-profits/does-the-organizing-document-contain-the-dissolution-provision-required-under-section-501c3-or-does-state-law-in-the-state-where-the-organization-is-legally-formed-satisfy-the-requirement, 1.

2. Basic Requirements

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1) Not-For-Profit, Charitable Organization

• In order to become a 501(c)(3), your Neighborhood Association must be considered a not-for-profit, charitable organization. According to IRS standards, your Neighborhood Association qualifies if you work toward "lessening the burdens of government; lessening neighborhood tensions...and combating community deterioration and juvenile delinquency".¹
• If your Neighborhood Association does not have an established mission statement, this is a great opportunity to create one.

2) Application

• There are two forms which must be filled out in order to apply, the SS-4 Form and 1023 Form (which will be discussed later)

3. Example By-Laws and Mission Statement

Sample Mission Statement¹

We, the resident and property-owning members of the Village Neighborhood Organization, sharing a love for the area that we call ‘home’, will work to improve the aesthetic qualities and the overall quality of life in our neighborhood.

Sample By-Laws²

VILLAGE NEIGHBORHOOD ORGANIZATION
Amended October 10, 2023

Article I: Purpose
The Village Neighborhood Organization is organized to improve the aesthetic qualities and the overall quality of life within the Village Neighborhood. The specific functions of the neighborhood organization will include, but will not be limited to, crime prevention, improvement of property maintenance, residential unit rehabilitation, business development, increased tree density, and streetscape improvements.

Article II: Boundaries
The Village Neighborhood Organization will cover all land contained within the following boundaries: St. John Street on the north, the back property line of all businesses on the east side Randall Avenue on the east, Holmes River on the south, and Carolina Avenue on the west.

Article III: Members
General membership in the Village Neighborhood Organization shall be open to all residents, business owners, and property owners within the Village Neighborhood. General members who are eighteen (18) years and older may become voting members of the Organization through the payment of annual dues of $15.00. Each paying member will be entitled to one vote on any given issue.

Article IV: Meetings
General meetings of the Organization will be held on the second Tuesday of every month at 6:30 p.m. in the Holmes Elementary School Gymnasium. Special meetings may be called when necessary. These must be announced at the meeting immediately preceding the special meeting. Twenty-five percent (25%) of the voting membership must be present to constitute a quorum and conduct official business.

Article V: Board of Directors
The Board of Directors of the Village Neighborhood Organization shall consist of seven (7) members who are elected by the Organization. The Board shall consist of four (4) zone members, who are elected by their respective zone to a one-year term. The zones shall conform to the quadrant created by the intersection of Chapel Avenue and Hill Street. The remaining three members of the Board shall be elected to two-year terms by the general voting membership of the entire Organization.

Article VI: Officers
The officers of the Village Neighborhood Organization shall consist of the following: President, Vice-President, Secretary, and Treasurer. Each position shall be filled by a vote of the Board of Directors/membership. The President shall be the chief operating officer of the Organization and shall preside over meetings of the general membership. The Vice-President will serve the same purpose in the absence of the President. This individual will also be the liaison between the Board of Directors and all active committees. The Secretary shall record minutes of each meeting and shall develop the agenda for each upcoming meeting as well. The Treasurer shall have the responsibility of overseeing the financial matters of the Organization. Each officer shall be elected to a one-year term.

Article VII: Elections
Elections of the Board of Directors shall take place at the first meeting of each calendar year. Candidates will be chosen by the popular vote of the voting membership. In case of a vacancy, an election will be held at the meeting following the meeting of announcement of the vacancy. Officers will be elected by the Board of Directors at the first meeting following the first general meeting of each calendar year.

Article VIII: Committees
Committees may be formed to pursue particular issues and to solve individual problems. Each committee must have at least one member of the Board of Directors and one officer in its membership. The committee meetings shall be open to the general public, and they shall be recorded and reported in minutes just as a regular meeting of the membership.

Article IX: Dissolution
Upon the dissolution of this organization, assets shall be distributed for one or more exempt purposes within the meaning of IRC Section 501(c)(3), or corresponding section of any future federal tax code, or shall be distributed to the federal government, or to a state or local government, for a public purpose.

Article X: Amendments
These by-laws may be amended or repealed by a popular vote of the entire voting membership.

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1. Planning and Neighborhoods and City of Springfield, "Success Through Neighborhood Organization: A Neighborhood Resource Guide" § (2024), 21.

2. Planning and Neighborhoods and City of Springfield, 21-22.

4. Endorsements

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As a 501(c)(3), you must refrain from endorsing candidates for political office.

As a 501(c)(3), you must not devote a "substantial part" of your activities to attempting to influence legislation. This includes advocacy and grassroots movements.¹

1. Internal Revenue Service, “Restriction of Political Campaign Intervention by Section 501(c)(3) Tax-Exempt Organizations,” IRS, August 20, 2024, https://www.irs.gov/charities-non-profits/charitable-organizations/restriction-of-political-campaign-intervention-by-section-501c3-tax-exempt-organizations, 1.