FAIRMONT - Fairmont Early Risers Kiwanis recently obtained tax-exempt status. In doing so, it also created a fund to help area youth organizations for years to come.
"I think it's a good deal, because now donations to the Kiwanis are tax-exempt," said club president Harlan Gorath. "It's an opportunity for us to build so we can do even more for our community and our children. We're able to help kids being kids."
According to Mike Katzenmeyer, president-elect of the club, the fund was created within the Southern Minnesota Initiative Foundation.
"We met with representatives from SMIF and put together the final touches last week," Katzenmeyer said." The idea [to apply for tax-exempt status] came about during conversations and interactions with some of the financial people. We talked about service clubs and how few have that 501c3 designation. We started asking, 'Shouldn't we?'"
When Tim Penny of the Foundation gave a presentation to the club, it steered members in that direction.
"We were looking for some way to lend permanently to the efforts in Fairmont," Katzenmeyer said. "The Kiwanis have been doing the Success Academy, Safe Routes to School, the bike fair. To lend some permanency was what led us to start an endowment fund through SMIF."
"It took four to five months by the time the paperwork was done, and we educated the people involved, meaning ourselves," Gorath said about obtaining the 501c3 status.
Once the funds reach a certain point, Kiwanis can draw 4.5 percent on an annual basis to fund approved activities by youth-oriented tax-exempt entities in the area.
While accepting donations year-long, the main fundraisers for Kiwanis each year are fall and spring pancake feeds. The spring feed is usually held for another entity and a percentage is retained by the club, but the majority goes to the featured group, such as the band boosters in 2013. This spring's featured group has yet to be determined.
Katzenmeyer also noted the fund will secure a legacy for Kiwanis.
"Clubs get old and go away," he said. "In the event that the club dissolves and membership wanes or disbands, we've designated the Fairmont Youth Foundation to be the beneficiary, and it would transfer any funds left."