Friends in High Places: Navigating Friends Group Partnerships

Submitted by Justin Minsker on Mon, 01/04/2021 - 2:48pm

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By Angela Reed, Community Partnerships Coordinator, THC Historic Sites

Do you represent staff for an organization owned by the city, state, or federal government, and are considering a Friends Group? Or, are you a volunteer who wants to start a Friends Group? Maybe you represent a Friends Group that’s been around for many years and you need a refresher. This summary of a December 2020 webinar will assist you with navigating partnerships between publicly owned organizations and their supporting nonprofits.

Defining Terms: What is a Friends Group, exactly?
A Friends Group is an organized group of volunteers, usually with a 501c3 tax-exempt status, which exists to provide assistance to another organization (usually government-owned) through fundraising, volunteer, and/or advocacy support.

Not all are called Friends Groups; some call themselves foundation, association, or a similar name, but we’ll refer to them as Friends Groups here.

It is important that the name of the Friends Group uses the name of and shares a mission statement with the organization they support so it’s clear for donors and stakeholders who and what they are supporting.

A mission statement may read, for example, “The mission of the Friends of Fulton Mansion State Historic Site is to support, promote, and provide resources to Fulton Mansion State Historic Site.”

Why have a Friends Group?
Many of you have probably heard this question: “Why would a publicly owned organization need a Friends Group to raise money—don’t we already pay for this with our taxes?” And most of you will know the short answer: There are limitations to public funding.

Funds earned through taxes can only pay for whatever is allowed by the governing body that sets the budget and spending regulations for that entity. Depending on whether your organization is owned by a city, state, or federal government, then the rules on how, when, how much, and for what purpose funds are used are established by the governance of those entities.

For example, a state legislature may allocate a robust budget for one state-owned site’s restoration, maintenance, and educational programming expenses, based on expected needs of that site for the upcoming year. However, they may not allocate the same type of budget for another site that year.

Furthermore, they may not allow funds to be used at all, at any time, at any state-owned site for activities like outreach events, unexpected maintenance costs, or food and beverages.

In addition, public sector employees are restricted from certain activities such as explicitly asking the public for donated funds, even if there is a mechanism for receiving donations.

Nor are public employees allowed to directly advocate to elected officials on behalf of their organization, even though employees may “educate and inform.”

All of the above that a public entity cannot do, a Friends Group can, if that group is a nonprofit. So, while public funding may provide the lion’s share of an organization’s budget, Friends Group support can go a long way in elevating their partner organization’s outreach to the community.

How do I get started?
Whether you are staff looking to organize a Friends Group, or a volunteer hoping to start one, if you have the time and resources it can be helpful to first form a small steering committee made up of a few stakeholders who have a good idea of the needs of your type of organization and who are familiar with community members.

This committee will not be ongoing but should only need to meet once or twice. This steering committee will not grapple with the details of establishing the Friends Group, but instead will help lay the groundwork by articulating the needs for the organization and how a proposed Friends Group may help. As a result, when members sign on to a new Friends Group they know their purpose from the beginning.

A few topics the steering committee may work with include:

What is working well for the organization, and what are the gaps that a Friends Group can help with?
Should the Friends Group serve as fundraisers, advocates, volunteers, or all of the above?
How many board members are needed, and with what types of skills, experience, and connections?

At this point, the steering committee may propose candidates from the community for staff to invite as founding Friends Group board members (or perhaps members of this committee will want to volunteer themselves).

Establishing the official Friends Group and the first board of directors
Those who have volunteered to be part of the organizing board members, with one or two key staff from their partner organization, will spend time doing the nitty-gritty work of strategic planning: defining the group’s vision and mission (remember the mission statement should include the name of the organization they support, and should be tied to that of the organization), their short- and long-term goals, and the subsequent action items to meet those goals.

This should be led objectively by an outside consultant, allowing both staff and board members to participate as partners.

Then the group will also hold an official organizing meeting (and take minutes) to determine key points in their bylaws and any additional board policies such as a conflict of interest policy, whistleblower, confidentiality, and financial policies.* The group should also write job descriptions for board roles such as the board chair, secretary, vice president, and treasurer, defining who reports to whom, how, when, and how often.

If fundraising is one of the activities needed from a Friends Group, then the founding board should be prepared to file for its 501(c)3 nonprofit tax status with the IRS, and pay the fee (usually around $300, but it depends on the group’s complexity). They will also file the requisite documents with the Secretary of State.

The Friends Group and the partner organization will also devise their all-important memorandum of understanding (or “MOU,” and some organizations prefer “Memorandum of Agreement/MOA”).** This document codifies communication between the organization and its Friends Group, as well as establishes any documentation and other assurances that are needed by both parties. Some clarifications you may want to include in your MOU:

How frequently should staff report to the board?
Is there an ex-officio role for staff on the board?
When and how should staff present their “wish list” of support?
Are an annual plan and budget required by a certain date?
What happens to funds in the case of board dissolution?
How much transparency does the organization require of the board to demonstrate that 501(c)3 legal obligations are met (proof of IRS filing receipt, copies of meeting minutes, etc.)

What a Friends Group Does and Does Not: The Thin Line between Friends Board and Staff
When it comes to Friends Group board members and the staff they most frequently work with, it is important to keep in mind that the line delineating who is accountable to whom can start to blur over time, especially if their partnership terms are not clearly defined. It is therefore very important that the leadership of the group and the organization’s staff communicate consistently. Below are a few points to consider as the two determine their working relationship:

The Friends Group should be responsible for its own governance, donated funds, advocacy, and membership, and may have some support from its partner organization’s staff.

While Friends Group correspondence and activities should be jointly coordinated between the group and their partner organization, and some duties will fall to the organization’s staff out of necessity, it should not be expected that staff of the organization will spend the majority of their time administrating Friends Group duties. Remember that staff is publicly funded, and their responsibility is to the organization for which they work. Additionally, they are limited in activities such as soliciting donations or advocating to elected officials. So, while they may have some support role to the Friends Group, it will be important that their communications to the public do not involve any of those activities they’re prohibited from, even if on behalf of the Friends Group. Furthermore, if donor confidentiality is a concern, communication between staff and donors to the Friends Group could be subject to open records laws, whereas communication between the nonprofit Friends Group and donors can remain confidential. Therefore, while cooperation and coordination between the Friends Group and the organization will be key to each entity’s success, it is important to make a clear distinction of job duties so that nonprofit versus public duties are respected.

The organization’s staff is not ultimately accountable to Friends Group leadership nor bound by projects Friends Groups want to initiate; rather, staff is ultimately accountable to their organization’s leadership, programs and projects, and industry standards.

It is important for Friends Groups to remember that the staff they work with will be obligated by duties set forth by their organization’s leadership, and in doing so, they must meet their industry’s best practice standards, regardless of programs and projects the Friends Group may be prepared to fund. In the historic preservation field, for example, professionals must adhere to very specific best practice standards—the Secretary of the Interior's Standards—when restoring or reconstructing structures on or near a historic site. Conservation and museum fields have similar best-practice standards. Friends Groups and the organizations they support can come into conflict when standards for an organization haven’t been communicated, and a Friends Group embarks on fundraising, advocating for, or promoting an activity without that knowledge. This is yet another reason why keeping consistent communication between the two entities is critical.

Friends Group board members are volunteers, whose work is mission-driven.

Friends Group members give of their time, treasure, and talent willingly and without obligation, and their motivation is often driven by their passion for the organization’s mission. They want to know that what they do, whether big or small, contributes to that mission. Staff who work with the Friends Group should find ways to help inspire Friends Group board members with the overall vision of the organization, to engage them with the work of the organization, and to offer opportunities to be informed about the organization’s impact. Again, the key here is communication. If board members are treated as partners with opportunities to engage with programs first-hand, then they are more likely to lend a hand with even small tasks, because they can understand the impact of their work to the mission.

The Final Word: Communication is Fundamental
The essential ingredient to forming a strong Friends Group and maintaining a good relationship is communication. Communication is not a one-way street nor a one-time occurrence, but should be “baked” deeply into the governance of a Friends Group partnership, and revisited from time to time. To do that, here are a few suggestions:

Develop a strong set of bylaws, board policies, and, together with staff from the organization, an MOU that reflects agreed-upon rules of engagement between board and staff.
Every three to five years, review the board’s governance documents, and work on a strategic plan with the partner organization.
Once a year, or more if there are new members, hold an orientation to the bylaws, policies, and the MOU.
Staff may offer training opportunities for board members to learn the organization’s industry standards by inviting them to conferences, seminars, or educational programs.
The board should adopt policies that allow for staff to inform board decisions on a regular basis (ex-officio membership, staff presentations, regular visits between board and staff leadership).
Staff and board members should find ways to get to know each other to learn each other’s expertise and motivations.

Teamwork, trust, engagement, partnership, respect, and communication: These are the key ingredients to bake into your board’s governance to achieve a successful and sustainable partnership. Remember that you’re all in the room for the same reason—your common mission.

Webinar attendees Q&A with Angela Reed, THC Historic Sites' Community Partnerships Coordinator

Are your ex-officio staff board members voting members of that board? No, ex-officio members are non-voting members of the board and are invited to participate in discussions to provide information about the organization, its projects, programs, and impact on constituents.

We have a Friends Group that has a solid core of board members in a small rural area and we struggle to attract new members. Any suggestions? I hear this concern frequently from Friends Groups whether in rural or urban places—it’s always a struggle! One thing I would suggest is that the board form a small ad-hoc nominating committee to first identify the skills, experience, and demographics that are needed in new board members, and then create outreach opportunities. For example, if your board has working committees, such as a program or events committee, this is a good opportunity to invite non-board member volunteers from the community to work with board members, which could allow board members to identify people who may be good board member candidates. Another idea is to hold regular programs, such as a speaker series, or small (manageable) meet-and-greets between board members, along with key organization staff and the public, to get to know people who are interested in the organization who may not have been otherwise involved. Yet another idea is to partner with other allied organizations in the community through mutual programs and events, to broaden and share your volunteer pool.

Can Friends Groups address the growing need for transparency and equity in pay disparities along with issues of diversity? I think it’s a great idea for Friends Groups to grapple with DEI (diversity, equity, and inclusion) through an ad-hoc or standing committee. Typically, a Friends Group would not be formed just to work on DEI issues, but adding such a committee is a good opportunity to help an organization update its policies, expand its outreach, and diversify its staff and board. That said, it will be important that the greater board stays true to its supportive mission to their partner organization.

How often should you update your memorandum of understanding? Every three to five years is typical, depending on the needs of your organization.

Are there examples of MOUs or MOAs that can be shared? MOU or MOA templates can be found easily with an online search, and I am happy to share the one we use at the Texas Historical Commission, by request (feel free to email me).

How do you explain to Friends groups the difference between membership development and fundraising? I co-present development seminars with the Friends of the Texas Historical Commission, which is centered on this topic. In short, we define fundraising as one small piece of development to achieve an overall mission. We explain that it is important to connect your donors’ values to your mission, allowing them to offer support in a way that is meaningful to them and that makes an impact toward a mission you both believe in (rather than asking for a donation to your organization or to solve a single problem). Many donors will want their funds directed toward a program or project that they believe makes a direct impact toward the mission they want to support. And for other donors, they simply want to contribute funds but don’t want to be a member of any organization. And yet for others simply being a member, with member benefits, is sufficient. There should be a variety of ways that a donor can contribute his or her funds that help them match their donation with your mission (this is a complex subject to cover in one paragraph, but I hope that helps).

Is it important to have the support of the site or a museum to form a Friends Group? I believe it is critical, because I know how important ongoing and transparent communication is to the success of both the Friends Group and the organization they support. The Friends Group will need constant input to determine whether their activities truly support that site or museum. If the Friends Group is operating independently and without a strong partnership, then it’s possible to embark on projects that drain the resources of the organization. Likewise, the Friends Group risks fundraising for projects the organization can’t carry through, which would ultimately jeopardize donors’ trust of both the Friends Group and the site/museum.

You mentioned during the webinar that board members and staff should get together informally. Could this be a violation of the Open Meetings Act? Talking about the board or the organization without proper notifications? Informal gatherings would not be held to make decisions outside of the boardroom, and any board decisions should be made per the group’s bylaws (with proper quorum, voting protocols, and minutes). Also, since the Friends Group is an independent 501(c)3, it is not subject to the same rules as the public entity the group supports, such as the Open Meetings Act. The informal gatherings I suggest are simply to help board members and staff get to know each other and their motivations to serve the organization, build cohesion, and ultimately work together more effectively.

If job descriptions are in an addendum attached to the bylaws, is a board vote needed to change the addendum? No, because the addendum is considered a separate document. Board officer positions will generally be referenced in your bylaws (see templates in resources for examples), but often there are details about those positions which are subject to change, and if so, they’re best placed in a separate document so the board is not dealing with the minutiae of bylaws governance too frequently. That said, changes to any board documents should be presented to the board for their information, or for their discussion. Bylaws should contain all the necessary information for your board to operate, and should include anything that’s important for your board to vote on, but not be so detailed that every board meeting is weighed down with details that are not important to the overall organization. I do suggest that the board has a governance committee to review bylaws and policies every 2-3 years, which would then recommend changes to the full board.

Is there an issue with having board meetings or even annual meetings on Zoom rather than in person? Does this have to be laid out in bylaws? During the pandemic, it is important and expected to use any emergency provisions you have available to your board to allow for remote meetings. And, since bylaws dictate where and how meetings and votes are held, if your bylaws are very specific about locations and in-person voting, then they should be changed to account for any necessary new methods, such as on online platforms. I’ve known some boards that incorporated the “raised hand” or chat feature to record votes. Or, members send in email votes during the remote meeting while the secretary takes count. I would also suggest that any changes regarding remote meetings should be general enough that they can account for various virtual platforms and not just Zoom, since there will be new and improved platforms in the future. Due to the ease of using these online platforms, many groups are considering remaining with at least some online meetings even after it is considered safe to meet in-person.

Friends groups have general members, but board members but can also serve as volunteers, right? Indeed! This is a good point to discuss with board and staff leadership, because sometimes expectations differ; for example, staff may expect that board members also serve as volunteers, when board members feel their role is simply to serve as a board member. If this point is important to either staff or the Friends Group board members, then it should be expressed in the MOU or a board policy, and revisited during board orientation.

How common is it for a nonprofit that owns a museum and collection to have a Friends Group? In this case, the Friends Group would likely act more as a volunteer group that assists with fundraising and any other volunteer activity the nonprofit needs. Usually the role of a Friends Group is to do those activities that only a 501(c)3 can, and that their partner organization which isn’t a nonprofit, cannot. But if the organization is already a nonprofit, you can have a Friends Group but there’s no need for them to operate with their own tax status (and in fact, it would be very confusing for donors for them to do so).

Should a Friends Group have paid staff? It depends on the group. If a Friends Group has the capacity to pay for even part-time administrative staff or an executive director, while still supporting their partner organization, this is a good use of their funds. Paid staff can help immensely with day-to-day operations of board business, event planning, maintaining donor lists, and other administrative tasks, which often inadvertently fall to the organization’s staff (which can be a drain for staff time). That said, it is important to ensure that there are enough funds to pay for staff while also using funds to carry out the mission of the organization.

If some members of a Friends group are always busy with their external, full-time jobs, how can you encourage them to take more direct roles fundraising for the partner org? There are multiple smaller duties in every stage of the development process beyond just grant writing or asking for donations, and if we can engage our volunteer board members at each of those stages according to their comfort level and time availability, they will likely feel a greater pride and connection with the organization’s mission and over time perhaps will grow in their commitment. Some board members just won’t have that time, and some aren’t interested in direct fundraising. But if those same board members are still valuable to the board and are maintaining their other board duties, I would suggest finding a role that they do have time for, even if it’s minimal: Writing thank-you notes to donors, helping with social media, small event planning duties, for example. While it is reasonable to expect that Friends members spend time as volunteers, we also can’t expect that they will always put in the same amount of time as paid staff.

What can staff do if a Friends Group has gone off book? How would you recommend staff respond when Friends Group projects are creating more work for staff? I would start with calling board leadership and opening a conversation. First see where they’re coming from, and then suggest that you’d like to see board and staff work more closely on projects, and perhaps ask for their help on how to do that. You might suggest some of the ideas mentioned earlier, like having staff attend board meetings to give input, allowing program staff to present to the board, inviting board members to programs and finding ways for them to be engaged in what you’re already doing, and requesting that staff and the board engage in a strategic planning session. When board members make up their own projects it’s often because they’ve grown out of touch with programs and projects that exist for the organization already, and no longer see the impact. Communication has broken down somewhere along the line. Remember that you’re working with volunteers who want to feel engaged and connected with this work they are giving their time to. They want to know that what they do is meaningful. If you can find ways to communicate and bring them along with the goals of the organization, then I believe that over time you will see more effective cooperation.

Are there examples of times when a Friends Group is not necessary? A Friends Group may not be necessary if private fundraising isn’t needed, or if advocacy isn’t needed. If your organization is already a 501(c)3 or simply needs volunteers, then you likely do not need a separate Friends Group.

Are there examples of times when a Friends Group is an impediment to the organization? Unfortunately, yes. This is why setting up and maintaining clear channels of communication is so important. Some of the examples I’ve heard of, when a Friends Group gets “off track,” are 1) chasing a project that can’t ultimately be accomplished by the organization, 2) holding events or activities that serve members of the group rather than the public that the organization exists to serve, and 3) holding events or programs without volunteer support which drains staff time. Having a means of good communication before that happens, or good governance so a group can refocus after getting off track, will be critical.

Do you have tips to revitalize an existing Friends Group? I suggest finding ways to allow them to have personal connections with the organization’s impact. Invite them to observe programs, ask them to make introductory remarks at important events, bring a board member with you when talking with stakeholders, or ask them to write thank-you notes for donations. Ask their advice whenever it’s feasible to do so and let them know their input matters. Remember that Friends Group board members are mission-driven and want to make a difference, just as you do as staff.

*Templates and best practice policies can be found online with the National Council of Nonprofits and the Foundation for Fundraising Professionals, and please see the resources document we’ve provided for this webinar for other helpful links.

**Examples of various MOU’s or MOA’s can be found with an online search. The THC can provide our template by email request to angela.reed@thc.texas.gov.

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