Donation Certificates or NonProfit Bonds

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Donation Certificatesor Non-Profit Bonds

• By Chad LupkesDemocracy for Wall Street

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Problem 1Low National Savings Rate

• Lowest since 1932
• People are pulling out of their equity to fund
  their lifestyles

http//www.bea.gov/briefrm/saving.htm
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Problem 2Low Funding for Charities

• I get calls, letters or emails every single day
• The claim that people will donate is a lie, in my
  estimation.
  
• Those that can afford it dont, unless it serves
  their interests
  
• Those that cant afford it cant
• Right now, Charities focus on large donors, and
  have trouble getting significant donations from
  the population. Most dont even try.
  
• We need a long term solution.

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Problem 3Ownership of the US

• Current events show that the people of the US do
  not have controlling ownership over our own
  infrastructure
  
• Port deals
• Trade Deficit at record high
• National Debt at record high
• Perpetual Deficits as far as we can predict
• I think we can change this.

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Bring it all together
Wheres the
connection?
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New idea

• Donation Certificates
• Sell like Bonds
• Provide a funding source for charities
• Gives a sense of ownership to individuals

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Where to start?

• Schools
• Foundations Institutes
• Churches Charities

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Example Schools

• The PTA is a 501(c)3 organization
• Parents want to save for their kids future
• Kids need to learn about money
• The PTA needs operational funds to provide to
  school programs of their choice

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PTA How it might work

• When children start school, each child gets an
  account within the larger PTA account. Parents
  buy certificates, and the money goes into that
  account.
• The account earns interest at the bank.
• Each interest payment is split in half
• Half goes back into the account for next month
• Half goes to the PTA General Fund for use in the
  school.

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PTA How it might work (2)

• During the school year, the parents have the
  opportunity to purchase more certificates and add
  money at any time. The student can also do
  this.
• At the end of the school year, the certificates
  can be cashed in or held over for the next school
  year. The value will be based on the
  certificates purchased and interest earned.
• Accounts could be transferred between schools and
  PTA groups.

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PTA How it might work (3)

• Upon graduation, the student has the ability to
  cash in the bonds as a down payment on a house, a
  car, to start a business or their future
  education needs. Its their money.
• The PTA fund will constantly be in flux as
  students come into the school system, but it will
  be something they can count as an asset, not just
  for the money they get, but for the future they
  are building.

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Example Foundations

• A Foundation opens a Trust account with a bank.
  Lets say they negotiate a 4 return.
  
• The Foundation sells bonds to the public,
  offering a 2 return on investment.
  
• 2 goes to build the account balance.
• 2 goes to fund whatever charity or project the
  Trust account is designated for.

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Foundations Its our money

• Its our money when we buy the bond
• Its our money when we cash in the bond
• Were saving for our own future while providing a
  funding stream to the project or charity

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Example Churches

• The Church sets up a Savings Trust, and
  negotiates a return on the trust from the bank.
  Lets say 4.
  
• The Church sells the bonds to their members and
  supporters, offering a 2 return.
  
• 2 goes to build the account balance.
• 2 goes to fund the operations, programs and
  activities of the Church.

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Churches Its our money

• Its our money when we buy the bond.
• Its our money when we cash in the bond.
• Were saving for our own future at the same time
  we are providing a funding stream to the Church
  that we support.

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Other Potential Examples

• Any other 501(c)3 organization
• 501(c)4 political organizations
• Municipal Governments
• For-profit companies
• Just redefine profits a bit

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Why not just invest or donate?

• People are of course able to invest or donate,
  but these are the ends of a spectrum. This idea
  fills in the middle and lets people do both at
  the same time.
• This creates the notion of Return on Investment
  that can be applied much further in the creation
  of a civil society.

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Disadvantages Solutions

• Starts small, requires large account balances to
  produce significant funding stream
  
• Encourages more people to get involved
• Encourages Angel Investors to get things
  started
  
• Interest Rates are currently low
• Can be negotiated with the bank as the account
  balance goes up.
  
• Encourages exploration of more investment
  opportunities. Stocks pay dividends that could
  be split in the same manner as interest from
  savings accounts.

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Whats the next step?

• Non-profits are not currently set up to sell
  Bonds. This might require a change in Tax Law.
  
  
• There is a way around this, which would require
  an organization to be established that would be a
  coordinating agency for tracking the sale of the
  bonds and the distribution of the
  interest/dividends to the charities.
• Im looking at creating one of these
  organizations.

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Questions

• This is a list of questions and notes from
  conversations I have had with people
  
• How is this different from a normal savings
  account?
  
• Who has Fiduciary Responsibility?
• What is the Federal Government component that
  might need legislation?
  
• What other questions are important?

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They Say

• Its your money and they are focused on
  taking it away from us.
  
• I Say
• Its our money and we should be building our
  civilization on a foundation of wealth, instead
  of a foundation of debt.

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Summary

• We can increase the national savings rate
• We can provide a funding stream for charities
  other needs
  
• We can teach our children (our future citizens)
  that ownership of their country is ownership of
  their future
  
• This is the progressive answer to the ownership
  society

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Questions?

• Please contact me. Im still fleshing out the
  idea, and Id love to get more input.
  
• Chad Lupkes11401 Roosevelt Way NE 12Seattle,
  WA 98125206-440-1592chadlupkes_at_gmail.com