5 ms·

Is Stanford still a university? You're missing the point of the question. The real question is, is stanford legitimately a non-profit institution? That's not a

by 001sky 13y ago

Is Stanford still a university? You're missing the point of the question. The real question is, is stanford legitimately a non-profit institution? That's not a 'silly' question, and it has material implications.

dekhn 13y ago
American universities are for profit entities (corporations). http://en.wikipedia.org/wiki/Bayh%E2%80%93Dole_Act http://en.wikipedia.org/wiki/Bayh%E2%80%93Dole_Act Before the Bayh–Dole Act, federal research funding contracts and grants obligated inventors (where ever they worked) to assign inventions they made using federal funding to the federal government.[3] Bayh-Dole permits a university, small business, or non-profit institution to elect to pursue ownership of an invention in preference to the government.[4] Stanford, further, is a private institution. See, for example, their investment company: http://www.smc.stanford.edu/ http://www.smc.stanford.edu/ which is part of the university and is overseen by the Board. They certainly don't qualify (nor do public universities like UC) as non-profits; they don't reinvest all their earnings into their operating budget. Investors in Stanford receive a return on the growth of the endowment.
- 001sky 13y ago
  The University is a tax-exempt institution under section 501(c)(3) of the Internal Revenue Code. https://ogc.stanford.edu/stanford-legal-facts#q1 https://ogc.stanford.edu/stanford-legal-facts#q1 A 501(c) organization, also known colloquially as a... "nonprofit", is an American tax-exempt nonprofit organization.
  - aetherson 13y ago
    Yes, following on to 001sky, for-profit American universities do exist -- they're things like University of Phoenix or DeVry. All of the traditional residential big-name universities that you're probably thinking of, however, are not-for-profits.
    - dekhn 13y ago
      Please see my reply on the other thread. I have demonstrated that the IRS found compliance issues in 503c universities which is clear demonstration of my point.
  - dekhn 13y ago
    Yes, yes, of course they are a 501c3. However, reality demonstrates that Universities are most definitely for profit. This is embedded in their operating principles. Have you worked with the Office of Technology Licensing? This includes that you would call "nonprofit" according to IRS, but this is actually an issue that has been debated since Bayh Dole by people who understand the subtlety of what I'm talking about. In short, the very definition of nonprofit itself is inadequate the span the nature of corporations which are under 501c3.
    - dragonwriter 13y ago
      > However, reality demonstrates that Universities are most definitely for profit. They certainly don't return profit to investors, which is what 501c3 and several related-but-different "nonprofit" designations refer to. I'm not sure in what other sense you could be meaning that they are "for profit". > Have you worked with the Office of Technology Licensing? Certainly, Universities have parts of their operations devoted to generating revenue; all nonprofits necessarily do, since if they don't generate revenue that meets expenses, they can't continue to operate. Revenue is not the same thing as profits. > people who understand the subtlety of what I'm talking about If you have a coherent idea, perhaps you can explain it rather than making implications that anyone who hasn't read your mind is intellectually defective. > In short, the very definition of nonprofit itself is inadequate the span the nature of corporations which are under 501c3 Since the relevant definition of nonprofit comes from 501c3, it is, necessarily, sufficient to span the entities which fall under 501c3, since anything it doesn't span doesn't, ipso facto, fall under 501c3.
      - dekhn 13y ago
        Universities collect funds. The excess of these funds, which are not required for the costs of maintaining the university, are distributed to professors and students (this is profit returned to investor; the professors invest time and opportunity cost while the students invest labor) in the form of internal grants. These professors and students then use the grants to develop technology, which they then use university funds to develop into companies (while also getting patent royalties from the OTL for having patented the tech and licensed it), which tend to then hire employees and donate funds back to the universities that fostered them. This activity has caused many to question the tax-exempt status of universities. The purpose of tax exemption for universities is to promote education, not prevent universities in acting as for-profit institutions. Some examples: the (complex and unique) example of Cooper Union. Also: http://www.irs.gov/uac/Newsroom/IRS-Releases-Final-Report-on-Tax-Exempt-Colleges-and-Universities-Compliance-Project http://www.irs.gov/uac/Newsroom/IRS-Releases-Final-Report-on... The audits identified some significant compliance issues at the colleges and universities examined,” said Lois Lerner, Director, Exempt Organizations division. “Because these issues may well be present elsewhere across the tax-exempt sector, all exempt organizations need to be aware of the importance of accurately reporting unrelated business income and providing appropriate executive compensation.” Note the discussion of unrelated business income. There is an active lawsuit against Princeton on similar grounds: http://www.nj.com/mercer/index.ssf/2013/06/lawsuit_challenging_princeton_universitys_tax-exempt_status_wont_be_dismissed.html http://www.nj.com/mercer/index.ssf/2013/06/lawsuit_challengi... from article: "The school’s policy of sharing patent royalties with faculty could cost the university an additional $20 to 30 million in taxes a year." Please, do not ever tell somebody they are intellectually defective; it weakens your argument. Further, as I've demonstrated everything to support my case, in showing that there are 501c3 unviersity organizations which have been cited by the IRS for having violating the terms of that.
rpedela 13y ago
Non-profit just means the organization has to use its profits for the operation of the organization or give it to other non-profits not that it cannot make a profit.

by 001sky 13y ago

dekhn 13y ago

American universities are for profit entities (corporations). http://en.wikipedia.org/wiki/Bayh%E2%80%93Dole_Act http://en.wikipedia.org/wiki/Bayh%E2%80%93Dole_Act Before the Bayh–Dole Act, federal research funding contracts and grants obligated inventors (where ever they worked) to assign inventions they made using federal funding to the federal government.[3] Bayh-Dole permits a university, small business, or non-profit institution to elect to pursue ownership of an invention in preference to the government.[4] Stanford, further, is a private institution. See, for example, their investment company: http://www.smc.stanford.edu/ http://www.smc.stanford.edu/ which is part of the university and is overseen by the Board. They certainly don't qualify (nor do public universities like UC) as non-profits; they don't reinvest all their earnings into their operating budget. Investors in Stanford receive a return on the growth of the endowment.

001sky 13y ago
The University is a tax-exempt institution under section 501(c)(3) of the Internal Revenue Code. https://ogc.stanford.edu/stanford-legal-facts#q1 https://ogc.stanford.edu/stanford-legal-facts#q1 A 501(c) organization, also known colloquially as a... "nonprofit", is an American tax-exempt nonprofit organization.
- aetherson 13y ago
  Yes, following on to 001sky, for-profit American universities do exist -- they're things like University of Phoenix or DeVry. All of the traditional residential big-name universities that you're probably thinking of, however, are not-for-profits.
  - dekhn 13y ago
    Please see my reply on the other thread. I have demonstrated that the IRS found compliance issues in 503c universities which is clear demonstration of my point.
- dekhn 13y ago
  Yes, yes, of course they are a 501c3. However, reality demonstrates that Universities are most definitely for profit. This is embedded in their operating principles. Have you worked with the Office of Technology Licensing? This includes that you would call "nonprofit" according to IRS, but this is actually an issue that has been debated since Bayh Dole by people who understand the subtlety of what I'm talking about. In short, the very definition of nonprofit itself is inadequate the span the nature of corporations which are under 501c3.
  - dragonwriter 13y ago
    > However, reality demonstrates that Universities are most definitely for profit. They certainly don't return profit to investors, which is what 501c3 and several related-but-different "nonprofit" designations refer to. I'm not sure in what other sense you could be meaning that they are "for profit". > Have you worked with the Office of Technology Licensing? Certainly, Universities have parts of their operations devoted to generating revenue; all nonprofits necessarily do, since if they don't generate revenue that meets expenses, they can't continue to operate. Revenue is not the same thing as profits. > people who understand the subtlety of what I'm talking about If you have a coherent idea, perhaps you can explain it rather than making implications that anyone who hasn't read your mind is intellectually defective. > In short, the very definition of nonprofit itself is inadequate the span the nature of corporations which are under 501c3 Since the relevant definition of nonprofit comes from 501c3, it is, necessarily, sufficient to span the entities which fall under 501c3, since anything it doesn't span doesn't, ipso facto, fall under 501c3.
    - dekhn 13y ago
      Universities collect funds. The excess of these funds, which are not required for the costs of maintaining the university, are distributed to professors and students (this is profit returned to investor; the professors invest time and opportunity cost while the students invest labor) in the form of internal grants. These professors and students then use the grants to develop technology, which they then use university funds to develop into companies (while also getting patent royalties from the OTL for having patented the tech and licensed it), which tend to then hire employees and donate funds back to the universities that fostered them. This activity has caused many to question the tax-exempt status of universities. The purpose of tax exemption for universities is to promote education, not prevent universities in acting as for-profit institutions. Some examples: the (complex and unique) example of Cooper Union. Also: http://www.irs.gov/uac/Newsroom/IRS-Releases-Final-Report-on-Tax-Exempt-Colleges-and-Universities-Compliance-Project http://www.irs.gov/uac/Newsroom/IRS-Releases-Final-Report-on... The audits identified some significant compliance issues at the colleges and universities examined,” said Lois Lerner, Director, Exempt Organizations division. “Because these issues may well be present elsewhere across the tax-exempt sector, all exempt organizations need to be aware of the importance of accurately reporting unrelated business income and providing appropriate executive compensation.” Note the discussion of unrelated business income. There is an active lawsuit against Princeton on similar grounds: http://www.nj.com/mercer/index.ssf/2013/06/lawsuit_challenging_princeton_universitys_tax-exempt_status_wont_be_dismissed.html http://www.nj.com/mercer/index.ssf/2013/06/lawsuit_challengi... from article: "The school’s policy of sharing patent royalties with faculty could cost the university an additional $20 to 30 million in taxes a year." Please, do not ever tell somebody they are intellectually defective; it weakens your argument. Further, as I've demonstrated everything to support my case, in showing that there are 501c3 unviersity organizations which have been cited by the IRS for having violating the terms of that.

rpedela 13y ago

Non-profit just means the organization has to use its profits for the operation of the organization or give it to other non-profits not that it cannot make a profit.