Selma Cafe Secures Nonprofit Status

Selma Cafe has received a 501(c)3 nonprofit designation from the IRS, a final step needed to secure financial autonomy for the Ann Arbor breakfast fundraiser that supports local farming efforts.

According to co-founder Lisa Gottlieb, the IRS approval of Selma’s 501(c)3 application came late last week. Artrain, an Ann Arbor nonprofit that took on fiscal sponsorship of the cafe in early June, will transfer about $43,000 in cash assets back to a Selma Cafe account at University Bank as soon as a new account is set up. That’s likely to happen later this week, Gottlieb wrote in an email to The Chronicle. Artrain will take a 5% fee for their fiscal support in the transition to Selma’s 501(c)3 status.

Selma Cafe began as a weekly breakfast salon in 2009, held on Friday mornings at the home of Gottlieb and Jeff McCabe in Ann Arbor’s Eberwhite neighborhood. Operations were suspended in mid-April of 2013, after the city notified the group that the breakfasts were violating local zoning ordinances. At roughly the same time, Selma’s previous fiscal sponsor – the nonprofit Food System Economic Partnership (FSEP) – froze funds it held on behalf of Selma Cafe, citing violations of a memorandum of understanding between the two entities. FSEP set a May 31 deadline for organizers to find a new fiscal sponsor, or receive a 501(c)3 nonprofit designation from the IRS. Artrain agreed to take on the sponsorship responsibilities, and the IRS expedited Selma’s application for nonprofit status.

The volunteer-supported fundraising breakfasts resumed in June at a new location – in the common house dining room at Sunward Cohousing, 424 Little Lake Drive. The cohousing community is located off of Jackson Road, west of Ann Arbor in Scio Township. The events shifted to a Saturday brunch, and are being held on a less regular basis. A second breakfast was held on Aug. 3, and others are set for Sept. 14, Oct. 12, Nov. 9, Dec. 14, and Jan. 11. All brunches run from 9 a.m. until noon, with suggested donations of $12-$15.

Of the transition, Gottlieb wrote in an email: “The Sunward Cohousing community has been extremely warm and welcoming, and many of the cohousing residents have been volunteering, which is generous of them and really fun. Selma Cafe guests and volunteers are sharing that they love the new digs. It’s a beautiful setting, with a great kitchen and spacious dining room. The first two breakfast events there were successful and everyone had a great time. Everyone is happy that Selma Cafe didn’t miss a beat in getting things going again.”

Selma’s nonprofit board members are Susie Baity, Kyoko Yamamoto, Nathan Lada, Nick Roumel and Jeff McCabe, with Gottlieb serving as board president and operations/general manager. Gottlieb stated that the board is reviewing projects and events it might pursue, in light of its new independence as a nonprofit.

She also addressed previous concerns that had been raised regarding a possible conflict of interest by McCabe. He owns Nifty Hoops, a business that sells kits to make hoop houses to extend the growing season. “Selma Cafe hasn’t purchased any kits from Jeff, ever, and does not intend to do so,” Gottlieb wrote in an email. “All the hoop houses Selma loaned farmers money to purchase happened before Jeff started Nifty Hoops.” Kits that were purchased using Selma loans were bought from a hoop house company in Ohio, she stated.

For additional background, see Chronicle coverage: “Selma Cafe Finds New Fiscal Sponsor: Artrain” and “City Notifies Selma Cafe of Zoning Violation.”