CarShare runs on empty
Mired in an 18-month struggle to win nonprofit status with the Internal Revenue Service, the pioneering but donation-starved Ashland CarShare is about to hold its first birthday party while wondering if it has to close shop.
The organization has been approved for a $10,000 state Business Energy Tax Credit, based on its energy-saving goal, but the money won't arrive till June — and, said Executive Director Becky Brown, CarShare is broke and needs help to make it till then.
"Members are happy and car-sharing is catching on, but we're in a financially precarious situation," Brown said. "We need $2,000 by April 15. Without the federal tax-exemption status, we're not able to seek outside help.
"The startup grant of $30,000 from the Oregon Department of Transportation is exhausted," she added, "and the IRS tells us they see no difference between us and (for profit) Hertz Car Rental. It's a total misunderstanding. We're absolutely not that. We feel we're a community service, improving the quality of life."
CarShare was born last April amid much ballyhoo that it would help get cars off the road, reduce carbon and toxins in the atmosphere and offer drivers an alternative to the average $8,000 a year cost of a private car, according to the group's Web site, www.ashlandcarshare.com.
Nonprofits often face a long slog to win tax-exempt status, greatly hindering fundraising efforts, said accountant and stock broker Laura Joyce, a CarShare member.
"It's totally bureaucratic and ridiculous," said Joyce, who gave up her car four years ago, chose a home near to work and shopping and calls car-sharing "so sweet, and the kids love it."
In addition to the tax-exemption hangup, CarShare has encountered an unforeseen glitch — that many potential members happen to live on Ashland's steep hills, so it's hard to walk or bike to and from the car sites on Siskiyou Boulevard, at Safeway or near Faith Avenue, said board member Darren Campbell.
CarShare has reached 74 members who drive one of three leased hybrid Toyota Priuses, paying $3.95 an hour and 30 cents a mile, plus $25 a month for membership. Those driving less often pay $7.95 an hour and 30 cents a mile, with no membership fee.
The goal in the first year was 150 members, with 82 being enough to bring it into the black.
As CarShare attempts to cross the chasm to solvency, it's seeking a "pass-through partner" — companies or individuals — who have a state tax liability and can advance CarShare the $10,000 BETC grant, then deduct if from their taxes and receive the grant when it's issued, said Brown.
The organization is also seeking "fiscal sponsorship" from an established nonprofit so it can accept tax-deductible donations from foundations, corporations and individuals, handing them over to CarShare, minus a 5 to 7 percent administrative fee, said Campbell.
Both strategies are legal and acceptable, said Brown, but until they're in place, nondeductible donations may be made, using credit card or PayPal at the donation Web site, supportashlandcarshare.chipin.com/ashland-carshare.
Brown said it's "a distinct possibility" CarShare will fold if it can't meet its financial obligations by the middle of April. If it can't find funding, it would either reduce the three-car fleet, Brown said, which would "significantly impact the quality of service," or close shop.
CarShare is entirely run by volunteers and has no office; staff members work from their homes, she said.
"If people agree with our mission in this community and want to see us here next year," said board member James Dills, "it's time for them to step up and put their money where their intention is. There's the chance we will dissolve if we don't get community donations to get over this hump."
Ashland Mayor John Stromberg, the first member of CarShare, has asked the staff of U.S. Sen. Jeff Merkley, D-Ore., to work on the problem with the IRS, said Brown.
Ashland CarShare is having its one-year birthday party at 8:30 p.m. on Thursday at Standing Stone Brewing Co. in Ashland.