Cyberspace Communications 501(c)3 Application

This page contains a representation of Cyberspace Communications Inc's application for federal 501(c)3 tax-exempt status. The IRS granted Cyberspace Communications this status on July 13, 1998. Though the author has done his best to accurately reproduce the actual form submitted, this version should not be treated as authoritive.

On the actual form, most of the narrative portions appear as attachments at the end of the form. In this version, all attachments have been inserted into the appropriate places in the form.

The real IRS 1023 form and its instructions, as well as publication 557, are available from IRS Forms and Publications.

- Jan Wolter
5/21/98

Cyberspace Communications has never been required to file form 990 because its gross annual receipts have always been well below $25,000.

11 Check the box for the type of organization. ATTACH A CONFORMED COPY OF THE CORRESPONDING ORGANIZING DOCUMENTS TO THE APPLICATION BEFORE MAILING. (See Specific Instructions for Part I, Line 11, on page 3.) Get Pub 557, Tax-Exempt Status for Your Organization, for examples of organizational documents.)

If the organization is a corporation or an unincorporated association that has not yet adopted bylaws, check here   [ ]

I declare under the penalties of perjury that I am authorized to sign this appication on behalf of the above organization and that I have examined this application, including the accompanying schedules and attachements, and that to the best of my knowledge it is true, correct, and complete.

Part II: Activities and Operational Information

1 Provide a detailed narrative description of all the activities of the organization--past, present, and planned. Do not merely refer to or repeat the language in the organizational document. List each activity separately in the order of importance based on the relative time and other resources devoted to the activity. Indicate the percentage of time for each activity. Each description should include, as a minimum, the following: (a) a detailed description of the activity including its purpose and how each activity furthers your exempt purpose; (b) when the activity was or will be initiated; (c) where and by whom the activity will be conducted.

Cyberspace Communications has activities in the following four areas:

A. Maintaining and developing Grex. The primary activity of Cyberspace Communications, occupying about 95% of our organization's time, is the operation of a public-access computer system called "Grex" (after the Latin word for "group"). This computer system is currently housed in a rented room at [a location] in Ann Arbor and has been in continuous operation since June of 1991. It is operated by a volunteer staff under the direction of the Cyberspace Communications board of directors and currently has about 18,000 registered users. Grex provides a wide range of services to the community that further the mission of Cyberspace Communications:

1. A bank of dial-in modem lines in Ann Arbor (at 734-761-3000) and an Internet connection (at grex.cyberspace.org) are available.

   These allow people in the Ann Arbor area to easily access our service (through the dial-in lines), but also allows access by people all over the world (through the Internet connection). Maintaining our own direct dial-in service means that even people with only "obsolete" computers (readily available for less than $40) can easily use all our services.

2. A simple registration process enables users coming in from either the dial-in lines or the Internet to create Grex accounts for themselves. This process is designed to be as barrier-free as possible, encouraging the widest possible range of users to access our system. Users are not required to pay any fees, nor are they required to give any information about themselves. Accounts are created immediately and there is no delay in gaining access.

   This registration process is the key to our charitable mission. It enables a wide variety of people who could not otherwise afford Internet services to use our system. We serve many poor people as well as other users who could not justify paying commercial rates for services they only use occasionally. People from all over the world connect over the Internet to access services that are prohibitively expensive or completely unavailable in their own countries.

   Our open registration policy also supports our educational mission. Our free and anonymous access means we have a very large population of young users, as well as many older users who want to experiment with the Internet without paying to do so.

3. We produce a variety of instructional materials, both printed and electronic, designed to help people learn to use Grex. We answer hundreds of user questions a week through E-mail and our on-line live help facility.

   Educating users in the use of Grex is a necessary component of both our educational and charitable mission.

4. Grex hosts electronic conferences on more than 100 topics, all of which are open to all of our users. Typical conference topics include music, the arts, writing, consumer information, housing, finance, small business, philosophy, living with disabilities, men's and women's issues, parenting, pets, computers hardware and software, nature, cyberpunk, and role playing games. There are also rather non-topical "creative" conferences, and a general discussion area called "agora". All Cyberspace Communications policies are discussed and developed in a public conference called "coop".

   These discussion forums are the key to our educational mission. The only direct teaching done by Cyberspace Communications is focused on how to use our system. Our broader educational mission is served by providing and maintaining these discussion forums where the content is entirely generated by the users. The wide range of users attracted by our open access policy ensures a wide range of knowledge and opinion. On-line forums are very effective in drawing people with diverse backgrounds into shared discussions.

   Cyberspace Communications does not attempt to limit discussion to "serious" topics. We believe that simply socializing on line can greatly aid the personal development of many of our young users. On-line forums can be a very non-threatening environment in which to learn social skills, up to and including those needed to democratically run a community service, and to gain proficiency in written communications.

5. Grex provides a range of basic Internet services, allowing all users to send and receive E-mail, surf the web, and publish their own web pages. In all cases, our service is of much lower quality than commercial servers, using older, non-graphical user interfaces and a rather slow Internet connection, but it is nevertheless usable.

   Providing these services for free is an important part of our charitable mission, and helping people learn their use is an important part of our educational mission.

6. Grex runs on a sophisticated Unix system, to which all users are given full access. As a volunteer operation, Cyberspace Communications constantly works to recruit and train new people to help run Grex. For several people, experience using or running Grex has been a vital step in launching or advancing careers in computing.
7. Out of necessity, Grex's staff must be very active in policing the system, ensuring that hostile users do not abuse our service to the detriment of our other users or of other systems on the Internet. However, we recognize that many of the "problem" users are, in fact, young people who need guidance to become good citizens of the net, so we strive to respond to problems in an educational rather than punitive manner. We believe we have had a very good success rate with this.

B. Publicizing the services offered through Grex. Grex is well-established and well-known and word- of-mouth advertising already brings us more users than we can easily handle, so publicity currently accounts for under 2% of our time. We do do some publicity focused on Ann Arbor area users, and we increase our publicity whenever we expand our resources.

C. Fundraising to support Grex. We are primarily funded by donations from our users. We have not been very active in seeking outside funding lest we lose the sense of being a "grass roots" organization, nor do we like to pressure our users for money very much lest we scare off people who cannot afford to pay. Thus our fundraising is very passive, consuming less than 2% of our time.

D. Repair and distribution of used computers. In the past Cyberspace Communications has coordinated the repair and distribution of second-hand computers to people who need them to access Grex and lacked the money or expertise to obtain them. There has been little demand for this to date, so this activity has accounted for less than 1% of our time.

Users of Grex engage in a wide range of off-line social activities, but Cyberspace Communications itself has very little involvement in organizing or funding these activities.

2 What are or will be the organization's sources of financial support? List in order of size.

1. Membership dues.
2. Other individual and corporate donations of money, goods, and services.
3. Special fundraising events (charity auctions, etc.).
4. Sale of promotional items (T-shirts, etc.).

3 Describe the organization's fundraising program, both actual and planned and explain to what extent it has been put into effect. Include details of fundraising activities such as selective mailings, formation of fundraising committees, use of volunteers or professional fund raisers, etc. Attach representative copies of soliticitions for financial support.

Cyberspace Communications is not very active in fundraising. It is primarily supported by voluntary donations from individual users. We encourage users interested in supporting Grex to become members. Various messages on the system encourage users to join, and we occasionally ask users to become members, but solicitations for donations are generally kept low key to avoid making users who cannot pay feel unwelcome. About 100 of our 18,000 users are members.

We also hold occasional on-line fundraisers to help purchase new equipment, and periodically we hold charity auctions where donated goods and services are auctioned off on-line. We also raise some money by selling Grex T-shirts, coffee mugs, mouse pads, and similar items.

Cyberspace Communications has never been very active in seeking government or corporate funding. We have asked local Internet providers to donate net connectivity, and may in the future solicit donations of equipment and services. Though we are less likely to seek monetary support in the form of corporate or government grants, this possibility has not been excluded.

Part II: Activities and Operational Information (Continued)

3 Give the following information about the organization's governing body:

Part II: Activities and Operational Information (Continued)

8 What assets does the organization have that are used in the performance of its exempt function? (Do not include property producing investment income.) If any assets are not fully operation, explain their status, what additional steps remain to be completed, and when such final steps will be taken. If "None," indicate "N/A."

Cyberspace Communications has the following assets:

If either of these questions is answered "Yes" attach a copy of the contracts and explain the relationship between the applicant and the other parties.

Cyberspace Communications rents a small room for its computer equipment at [a location] from Washtenaw Reality. No one associated with Washtenaw Reality has any connection to Cyberspace Communications beyond this rental agreement. A copy of the lease, which is somewhat informal, is on the next page.

Note: I haven't typed the lease into the HTML version of this document yet. - jan

If "Yes," complete the following:

a Describe the organization's membership requirements and attach a schedule of membership fees and dues.

Membership costs $6 a month, or $60 a year. Members are also asked to provide some form of ID, which is not otherwise required from our users.

b Describe the organizations present and proposed efforts to attract members and attach a copy of any descriptive literature or promotional material used for this purpose.

The web pages and login screens on Grex contain notices asking users to consider becoming members. Membership is often mentioned in our public discussion forums, especially those relating to the administration of the system. The following text is displayed to users who ask for more information on-line:

Thanks for asking how to support Grex.  You don't have to pay to use Grex, 
but users' donations pay all the bills.  If users don't support Grex, it 
will go away.  Please support this valuable community resource.

The best way to support Grex is to become a member.  Members get to:
  - vote in Grex elections (if you've paid for three months or more)
  - receive the 'Wizard in Training' manual free (again with 3 months)
  - use our internet link.

Organizations may also support Grex and be recognized as Institutional 
members.  Institutional members have the same privileges as regular 
members, except the right to vote.

The minimum membership dues donation - Individual or Institutional - is 
$6/month or $60/year (US currency). Send a personal check or enclose a copy 
of other ID with your dues.  Other donations at any time from members or 
non-members are welcome.  Write to 'aruba' for more info.  Send cash, 
checks or money orders to:

Cyberspace Communications Inc
P.O. Box 4432
Ann Arbor, MI 48106-4432

Cyberspace Communications occasionally circulates fliers and places advertisements in various publications, but these are primarily designed to attract users to the system, not to win new members.

c What benefits do (or will) the members receive in exchange for their payments?

Individual members receive the right to vote in board elections and run for board positions. They may call for and vote in referenda.

Institutional members do not have the right to vote.

All members may receive, if they like, a copy of a 23-page photocopied user manual. This is also available to all users for our cost of one dollar.

Members do not receive any special privileges in connecting to Grex or using any services on Grex itself. However, they do have have expanded privileges in connecting from Grex to other computers on the Internet. The most important Internet services, E-mail and web browsing, are free to all Grex users, but only members can use their Grex accounts to do such things as use a 'telnet' program to log into another system on the net, or use an 'ftp' program to transfer files to and from other systems on the net, or use an 'irc' program to access the Internet Relay Chat. These are services that we cannot offer to thousands of anonymous users because we lack the resources to support them, and, in some cases, because they would enable hackers to use our system as a safe base for attacking other systems on the Internet. Since these services are not of much interest to most people and are provided with much better quality by even the least expensive commercial Internet service providers, they do not seem to be a large incentive for most of our members.

Only as described in the response to item 11c above.

Cyberspace Communications does not and will not attempt to influence legislation as a substantial activity. Legislation is often discussed on our system by our users, but Cyberspace Communications does not limit participation in or otherwise attempt to influence the content of such discussions. Cyberspace Communications may, in the case of legislation in areas that would directly impact our ability to perform our mission (e.g., Internet free speech and privacy), take a public stance on issues, but this would be unusual and never a substantial part of our activities. Our only such action to date was supporting last year's "blue ribbon campaign" against the "Communications Decency Act" by temporarily blacking out our web page. Given the uncertain future of Internet legislation, the possibility that Cyberspace Communications would find it necessary to make more substantial lobbying efforts, as allowed for under section 501(h), cannot be excluded, but our plan and firm expectation is that lobbying will continue to account for less than a hundredth of one percent of our activities.

Although Cyberspace Communications does not and will not support any candidate for any office, any of our users may publish, distribute and discuss campaign materials through our system. Cyberspace Communications does not limit participation in or otherwise attempt to influence the content of such discussions, and people of all views would be welcome to join in.

Part III: Technical Requirements

2 If one of the exceptions to the 15-month filing requirement shown below applies, check the appropriate box and proceed to question 8.

Exceptions-You are not required to file an exemption application within 15 months if the organization:

7 If you answer "Yes" to question 6 above and wish to request recognition of section 501(c)(4) status for the period beginning with the date the organization was formed and ending with the date the Form 1023 application was received (the effective data of the organization's section 501(c)(3) status), check here > [ ] and attach a completed page 1 of Form 1024 to this application.

Part III: Technical Requirements (Continued)

8 Is the organization a private foundation?

9 If you answered "Yes" to question 8, does the organization claim to be a private operating foundation?

10 If you answer "No" to question 8, indeicate the public charity classification the organization is requesting by checking the box below that most appropriatedly applies:

THE ORGANIZATION IS NOT A PRIVATE FOUNDATION BECAUSE IT QUALIFIES:

Part III: Technical Requirements (Continued)

11 If you checked box h, i, or j in question 10, has the organization completed a tax year of at least 8 months?

12 If the organization received any unusual grants during the tax years shown in Part IV-A, attach a list for each year showing the name of the contributor; the date and amount of the grant; and a breif description of the nature of the grant.

N/A

13 If you are requesting a definitive ruling under sections 170(b)(1)(A)(iv) or (vi), check here > [X] and:

    Jan Wolter           $795.18
    Rob Argyropolous     $551.03

14 If you are requesting a definitive ruling under section 509(a)(2), check here > [ ] and:

a For each of the years included on lines 1, 2, and 9 of Part IV-A, attach a list showing the name of and the amount received from each "disqualified person." (For a definition of "disqualified person," see Special Instructions, Part II, Line 4d, on page 3.)

b For each of the years included on line 9 of Part IV-A, attach a list showing the name of and the amount received from each pay (other than a "disqualified person") whose payments to the organization were more than $5,000. For this purpose, "payer" includes, but is not limited to, any organization described in sections 170(b)(1)(A)(i) thorugh (vi) and any government agency or bureau.

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