chima ikoro

The Downside of Doing Good

Mutual aid projects that start in a rush of urgent optimism may soon run up against bureaucratic barriers.

BY CHIMA IKORO

Although the long-term impacts of the COVID-19 shutdown on Chicagoans are still unfolding, one thing has been clear to many from the start: the government wasn’t going to save them.

In 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act distributed stimulus checks of $1,200, on average, to Americans to last from April to December/January or nine months. The second stimulus check, issued in December, was for just $600, which isn’t enough to cover rent in most cities.

On a larger scale, the CARES Act also provided cities with emergency funding, which was left to lawmakers to distribute. In Chicago, Mayor Lori Lightfoot allocated over $280 million dollars of that money to the Chicago Police Department.

Meanwhile, Chicagoans struggled to make ends meet.

As a direct response to the needs of our communities, many organizers, including myself, put together mutual aid initiatives last year. Mutual aid differs from traditional charity work in that it creates a symbiotic relationship between members of a community, enabling folks to pool resources to share collectively. These resources could be food, clothes, money, or virtually anything that can be shared.

A longstanding practice in anarchist circles, as well as in labor and fraternal organizations, mutual aid is one way the community can bridge the gap between folks who need assistance and those who are willing to help. It’s beautiful and sad at the same time; I can’t help but ask myself, why are we doing this work while our tax dollars are funneled into institutions that harm us? Nevertheless, the community’s ability to lift each other up in dark times is inspiring.

On its face, mutual aid would seem to have no downside, but as organizers have learned, there are hidden roadblocks that make the work hard. In some cases, groups that have provided free assistance to community members have even been criminalized by the police. In one example, police and City inspectors served the Chicago Freedom School (CFS) with a cease-and-desist order last year for providing food to protestors after they became trapped downtown following the George Floyd protests in the Loop on May 30, 2020. Inspectors claimed that by distributing food, CFS was in violation of their business license.

Although the City settled and eventually agreed to rescind the ceaseand-desist order, this act was still a violent and egregious effort to stop community members from simply helping each other.

In 2019, the National Law Center on Homelessness and Poverty released an annual report that detailed, among other things, changes in restrictions on food sharing. This report stated that although homelessness is on the rise, more and more cities are creating laws that discourage food sharing.

In 2018, twelve people were charged with misdemeanors for distributing food to houseless people in El Cajon, California. A municipal code in El Cajon prohibits food sharing in public places. The year prior, seven people were arrested in Tampa, Florida for similar charges, and a woman was ticketed for feeding houseless persons in Atlanta later that year.

If criminalizing the sharing of food didn’t pose a high-enough hurdle for organizers, redistributing funds has its own set of complications as well. If an ad hoc mutual aid group is not registered as a 501(c)(3) nonprofit through the IRS the individual(s) of record receiving the funds (through Venmo, Paypal, or some other means) are liable to be taxed for money received as donations. The process to complete the paperwork and meet the requirements can be tedious and riddled with caveats.

According to the IRS, an organization that is tax-exempt as a 501(c)(3) cannot be an “action organization.” In other words, supporting or influencing policy changes and legislation, as well as supporting or rejecting political candidates, cannot be a part of such an organization's work. This would seem to pose a potential problem for many politically engaged mutual aid projects. But the process of obtaining 501(c)(3) status can be more laborious than upholding its rules. Femdot, a rapper from north Chicago and the south suburbs, is the founder and director of operations for Delacreme Scholars, a

ILLUSTRATION BY HALEY TWEEDELL

“It’s beautiful and sad at the same time; I can’t help but ask myself,

why are we doing this work while our tax dollars are funneled into institutions that harm us?

Nevertheless, the community’s ability to lift each other up in dark times is inspiring.”

nonprofi t organization.

Femdot started the Scholars in 2018 as a scholarship fund for students at DePaul, his alma mater. Since then, the group has expanded to become a scholarship fund for students at other schools as well as servicing the community through mutual aid actions.

“Once I realized how expensive college was, I wanted to do a scholarship,” Femdot said. “I graduated March of 2018 [and] we had a headline show at Lincoln Hall for an album I dropped, and decided to use some of the proceeds to make a scholarship.

“From there, as the community needed more things, we started to [do more]. We started our Scholars SlideBy Program, which is a grocery delivery service that gives free groceries, no questions asked, to families all across Chicago.”

Th e Slide-By was a direct response to the growing need for food amid the pandemic, especially after CPS schools temporarily halted food distribution.

Th e group just obtained its 501(c)(3) status a couple months ago.

“Most people pay someone else to do it, like a lawyer,” he explained. “Me being the headstrong person that I am, I’m like ‘Imma just fi nd the information and do it myself.’”

Th e paperwork took a while to get, he said. “Th e longest part is waiting for them to review it. It could take up to 120 days from when you apply to even get someone to start viewing your application.”

Although the process is long, Femdot does note a silver lining; the tax-exempt status is applied retroactively once it’s approved. Th e tax exemption is valid from whenever the organization was offi cially formed. But what counts as an “offi cial” organization?

“You need to have a board, you need to have members. You have to have roles. You have to have trustees. You need about four, minimum, just to show this is an entity that [...] maps stuff out,” he said. “You need bylaws as well. Your bylaws need to be signed by all your board members. You have to have certain clauses in there, like dissolution clauses”—which detail what will happen to monies raised should the organization disband.

While the task was daunting, he was more than capable of completing it. However, many people do not have the same capacity or resources. And for organizations that cannot aff ord a lawyer or an accountant, it can seem impossible and inaccessible.

Love & Nappyness, a haircare drive initiative created by Matt Muse, a rapper from Avalon Park, was started in November 2019. Th e drive is a Chicagobased community service initiative that uses natural haircare to create a culture of self-love and community wellness.

Th e drive collects donations of hair-care and body-care products, and passes them along to charitable groups. Currently the drive's benefi ciaries are Ignite, which provides assistance to young people facing housing insecurity, and Saint Leonard’s, which provides housing and assistance to formerly incarcerated men and women.

Matt’s original plan was to become a 501(c)(3) when he fi rst created Love & Nappyness.

“Th ere’s a lot of regulations and you gotta make bylaws and stuff like that. I wasn’t trying to do all that, I just wanted to do some community service,” he said.

Muse speaks to an important point: waiting for 501(c)(3) status could put a hold on work that needs to be done sooner than later.

“Last year, I took donations via Cash App and Venmo, but the fi rst drive came completely out of my pocket,” he said. “I only collected funds last year because of the pandemic, just in case people didn’t feel comfortable going to the store.”

Th e hair-care drive is run mostly on physical donations. Community members can purchase their own products and then bring them to drop-off locations around the city, in barbershops and hair salons.

“I think the work of actually becoming a nonprofi t would be diffi cult,” Muse said. “I don’t know how much easier it would make [our work]. I think the only thing that would make it easier is when we’re asking people for money, we would be tax exempt. So there would

be no need for a third party to receive donations and sponsorship. That's the only thing that would make it easier.”

Muse recalls how stressful the act of collecting monetary donations can be, because of all the responsibility that follows. A lot of newer mutual aid projects might struggle with this simply because they don’t have a large enough team.

“I probably won't collect money ever again. I don’t want to be responsible for people's financial donations. That might change because the more [help] I have, the more time there is to disseminate funds, but for me it was just much easier for me to say ‘I have enough money in my bank account to go do it by myself, I’m just going to do it by myself,’” he said. “I don’t want to ever mishandle somebody's funds.”

For a grassroots collective like Blck Rising, the one my friends and I founded, doing tax paperwork is a hill too high to climb right now. What started as collecting funds to pay for protest gear on the front lines turned into thousands of dollars constantly being donated and redistributed.

We created Blck Rising in June 2020, as a direct response to the murders of Breonna Taylor and George Floyd. We were organizing as individuals until two of our founders organized a massive protest in Wrigleyville that they asked me to speak at. A couple days later, we joined forces.

I’d been accepting donations through my personal social media accounts to pay for transportation and protest supplies. The donations quickly exceeded my need. As a result, I began redistributing funds.

When we founded Blck Rising, I had a sizable sum of donations already. We later decided to designate a bank account for these funds and continue to use donations to provide transportation and aid to protestors. As donations grew, we started offering community members money to pay for needs outside of protests, such as rent, groceries, bills or any kind, and transportation via Uber or Lyft especially late at night.

The creation of our collective wasn’t planned; we just saw our community needed help and we became a vessel to provide it. We weren’t prepared to distribute more than $30,000 in the span of a year. We were accepting donations largely through my personal Cash App account—until it was shut down and we weren’t allowed to access the $300 that was then in the account.

When we reached out to the company to find out what happened, they replied in an email stating: “After a recent review of your transfer of funds, we detected the use of Cash App for activity in violation of Cash App's Terms of Service.” The email then went on to say that they could not disclose further details for security reasons. This scared us, because there was so much uncertainty that came with handling money without the correct paperwork. We never got the $300 back.

A friend who works for Paypal told us that Paypal owns Venmo, the money sending service we now use to accept donations. She warned us that they have strict rules about accepting donations through the app, and that they could shut our accounts down at any moment.

Our collective comprises four young artists. Last summer we were participating in food distributions or protests almost every day. The truth is, we didn’t have the time or strength to sit down and read through tax paperwork. Even now, as we have returned to work and school while still trying to help our communities, it seems impossible.

However, there is a bright spot: organizations that are already tax exempt are able to help startup mutual aid groups through fiscal sponsorship, which allows nonprofits to act as an umbrella under which other charitable projects can operate through. A mutual aid team could fundraise through a tax-exempt organization that would then pay monies out to them as a grant or donation.

Organizations started by young people that were able to obtain 501(c)(3) status within the past year, like Delacreme Scholars or Free Root Operation (FRO), an organization founded by Eva Maria Lewis that seeks to stop gun violence through the creation and distribution of resources, can now act as fiscal sponsors for other groups that may not have the tools to complete that process.

Market Box is a mutual aid project that crowdfunds to buy food from small farms to distribute for free to South Side neighborhoods. Hannah Nyhart, who’s one of Market Box’s core organizers, recalls how the project began.

“We started out as a group of friends who worked at different organizations in the same building, Experimental Station [where the Weekly is also housed],” Nyhart said. “Market Box was our way of using the resources of our organizations and networks to take care of our community in the pandemic.”

Market Box is pursuing its own 501(c)(3) status. “It makes sense for the kind of long-term impact we want to have,” Nyhart said, but the organization is currently working under the fiscal sponsorship of the Invisible Institute, an independent journalism lab also housed at the Experimental Station that is a taxexempt 501(c)(3) nonprofit.

The biggest worry for many mutual aid groups is maintaining the integrity of their organizations as they become taxexempt. “We’ve had some ambivalence about 501(c)(3) structure because it’s really important to us to retain the mutual aid framework Market Box is built on,” Nyhart said.

“We’ll still be centered on a volunteer, communal structure,” she said, “but nonprofit status means we don’t have to rely on a fiscal sponsor, and we’re hoping it will mean we can eventually sponsor other peoples’ projects to help them get off the ground.”

Her statement speaks volumes to the state of mutual aid in Chicago. As new organizations become more equipped, they lift as they climb. When Delacreme Scholars officially became a nonprofit, Femdot offered to fiscally sponsor Blck Rising. Prior to that conversation, I didn’t know how attainable fiscal sponsorship was. Setting up that sponsorship is still a work in progress.

“When the systems that are set in place fail, then the community has to take care of themselves,” Femdot said. “Which is beautiful because it means we have the ability to take care of ourselves, and we really don’t need a government, but also it’s wild as hell that we have a government and yet here we are having to do their jobs to help sustain the communities we’re a part of. “In order to start dismantling this system,” he said, “we need one of our own.” ¬

“In order to start dismantling this system, we need one of our own.”

Chima Ikoro is the community organizing editor at the Weekly. She last wrote about the recognition of Juneteenth as a federal holiday.