Enzweiler Building Institute 501c3 Formation

HBA Awards

The BIA of Northern Kentucky spun off its construction trades training program, Enzweiler Building Institute into a 501(c)3 non-profit. The HBA sold its assets to the Institute for $1. As a result, the association no longer owns any property other than its office equipment, which has reduced the cost of real estate and property taxes by over $30,000 annually.

There were several purposes for spinning off the Enzweiler Building Institute into its own entity. The 501(c)3 as a nonprofit is not subject to real estate or property taxes and is open to a wider array of grant opportunities. Additionally, the separate entity creates a corporate veil that lessens the risk of the association as they are two separate incorporated entities. Last, the Institute has grown large enough to put the association’s not-for-profit status at risk with the IRS.

Operating a trade school is a very specific skill. To address this, the HBA set up the 501(c)3 governance with the Association’s EO as the President and the Director of Finance as the Treasurer. There are three members from the Association on the 501(c)3’s management Board, but the bylaws require a two-thirds vote. This ensures the Association controls the direction of the non-profit most efficiently. The association is the only member of the non-profit and therefore is very manageable.