Local Impact Fund Accounts (formerly LLEF)

Local Impact Fund Accounts (formerly LLEF)

Overview

The Local Impact Fund is designed to allow local Leagues or MAS units that are not exempt from federal income tax under section 501(c)(3) to solicit tax-deductible donations designated for the League of Women Voters of California Education Fund. These donations can be used to reimburse expenses for 501(c)(3)-permissible charitable and educational activities that the participating League carries out in compliance with League policies. This program provides Leagues with 501(c)(4) status with an additional method to raise funds for important local mission work that may have been unavailable to them otherwise. The program is administered by the LWVC Education Fund (LWVCEF) at the State Office. The LWVCEF provides balance statements on a quarterly basis. 

IRS Criteria Summary

The following is a summary of the types of activities that constitute  501(c)(3)-permissible charitable or educational activity that could be supported through Local Impact Fund. This is not intended to provide comprehensive guidance on the permissible 501(c)(3) activities. LWVCEF encourages all participating Leagues to fully familiarize themselves with 501(c)(3) permissible spending guidelines by reviewing the IRS publication, IRS Compliance Guide for Public Charities (Publication 4221).

The project must be educational in nature and designed to inform the public in a fair and objective manner. It cannot advocate for a position or urge action to affect a piece of legislation at the local, state or federal level. It cannot involve work with political parties or candidates for office, other than nonpartisan voter service activities, and it cannot influence the outcome of an election.  Permissible activities include:

    • Nonpartisan Candidate Forums conducted in compliance with all applicable laws and LWVCEF policies

    • Voter guides (Not Vote with the League)

    • VOTE411 Support

    • Voter Registration Events

    • Get Out the Vote Activities

    • Local Observer Corps

    • Civics Education Initiatives

    • Community Education Projects on Specific Issues (provided there is no advocacy for a particular bill or ballot measure)

The project must serve the public, not League members exclusively. Internal membership materials would not qualify for funding under this program.

Education Fund resources cannot be used to promote League membership or support League membership activities. Thus, the funding provided by the LWVC Education Fund under this program cannot be used to support the membership recruitment or membership maintenance activities of your League.

Any request for reimbursement of operating costs that can reasonably be seen as supporting 501(c)(3) activitiesmust clearly outline:

    • The 501(c)(3) permissible activities that the operating costs are supporting

    • The methods and justification for methods used to determine the allocation of operating expenses between permissible and non-permissible activities

    • Documentation that clearly shows that the requested amount is being used in support of stated 501(c)(3) activities

LWVCEF Criteria Summary

In addition to the IRS requirements described above, the use of funds provided by the Education Fund must comply with the following LWVC Education Fund rules.

  • The LWVCEF shall have the final discretion in determining whether a project meets IRS guidelines.

  • The project must fully comply with the League’s Diversity, Equity, and Inclusion Policy.

  • The project cannot involve the development of a League position by consensus or other form of agreement nor can it promote a League position.

  • The project must not give direct grants to outside organizations.

  • If the project generates income, the income must be used only for educational purposes with the same requirements and restrictions on use imposed under this policy for donated funds, and Leagues must keep adequate documentation to show income and its appropriate use and make that documentation available for review by LWVCEF upon request.

Collecting and Sending Funds for Deposit

Local Leagues should instruct donors to make contributions to the LWVC Education Fund or LWVCEF. Do not deposit these checks into your League’s bank account.

Donations to the Education Fund for the Local Impact Fund cannot be taken online at this time, unless the local League has an individual agreement with the LWVCEF to have an online donation page set up for their local League.  This is an optional service available to local Leagues participating in the Impact Fund program with a one time set-up cost of $150 and a $50 annual fee.  Please contact Sharon Stone to learn more if you are interested.

Once your League is ready to deposit donation checks, please complete the deposit form available here in its entirety. Completed forms should be sent to:

League of Women Voters of CA Education Fund
500 Capitol Mall, Suite 2350 #5001
Sacramento, CA 95814 

Once the form and checks are received, the LWVCEF will send an acknowledgment of receipt to the League contact included on the deposit form.

 The LWVCEF will send IRS required tax receipts to donors of gifts of $250 or more on a rolling, monthly basis. 

Withdrawal of Funds

To manage administrative costs, each reimbursement request must be for a minimum of $100. The LWVCEF may waive this requirement if it determines that there are special and unpredictable circumstances that warrant an exception.

Requested reimbursements may not exceed available Local League Impact funds (i.e. the amounts you have sent to the LWVCEF for deposit under the program, less the amounts you have used for 501(c)(3)-permissible purposes under the program).

When your League has completed a project or event, you may request reimbursement using funds your league has collected and deposited with the LWVCEF to reimburse some or all of the cost associated with the project or event. League Treasurers should determine what expenses are allowable to be reimbursed under IRS guidelines and Impact Fund rules, and request that amount using the reimbursement request form.

Please include a detailed description of the scope of the project and why the requested amount is permissible to be reimbursed.

Because the LWVCEF is acting as a fiscal sponsor of Leagues participating in this program, it is required to ensure that all requests meet IRS guidelines and Impact Fund rules before disbursing any funds. To ensure expedient processing and disbursement of funds please make sure to include all applicable receipts, invoices, copies of products, and any other documentation that support that the request complies with IRS guidelines and Local Impact Fund rules. The LWVCEF will not disburse funding until it is satisfied through documentation that IRS guidelines and Local Impact Fund rules have been met.

Per Member Payments (PMP)

LWVC permits up to 25% of a local League’s PMP obligation to be offset by a contribution to the LWVCEF in-lieu of PMP payment in the same amount.  LWVUS permits up to 50% of a state or local League’s PMP obligation to be offset by a contribution to LWVEF in-lieu of PMP payment of the same amount.

To use Impact Fund monies to make a contribution to the LWVCEF  in-lieu of payment to the LWVC please complete your request using the fund request form.

To use Impact Funds to pay PMP for the LWVUS, please use the fund request form and remit a copy of your LWVUS PMP Invoice, along with the dollar amount to be submitted to the LWVUS Education fund.  The LWVCEF will directly pay the invoice to the LWVUS Education Fund on your behalf.

In order to use Local Impact funds to make such contributions to offset PMP that would otherwise be due to LWVUS or a state League, the local League must advise potential donors solicited for contributions to the LWVCEF under the Local Impact program that the funds raised may be used to make contributions to the LWVCEF or the national LWVEF, and not merely in support of local 501(c)(3)-permissible activities.

Example:The funds you contribute to the League of Women Voters Education Fund under this program may be used to support the charitable and educational activities of our League and to make contributions to League of Women Voters of California and the national League of Women Voters Education Fund.

Final Items

  • Keep copies of all transactions and financial documents for reconciling with LWVCEF records if requested, and to satisfy IRS financial document retention rules requiring documentation be kept for 7 years.

  • Please thank your donors. The LWVCEF will acknowledge donations of $250 or more in accordance with IRS requirements, but making sure your donors are thanked is important for future fundraising.

  • Do not request more than your available local Impact Funds (i.e. the amounts you sent for deposit less the amounts you have used). If you are unsure of your balance, please send a request for an updated balance statement to billing [at] lwvc.org () 

  • Any reimbursement for indirect cost items (operating expenses, rent, employee payment, etc.) must have associated support documentation such as invoices, timesheets, etc.

  • Sending requests with complete backup documentation is essential.