The IUPA, the IUPA Call Center, and Office Space in Sarasota, FL
The IUPA (International Union of Police Associations) is a non-profit, tax-exempt 501 (c) (5) based in Sarasota, Florida. A labor union representing the police, IUPA is also the largest police union in the AFL-CIO with an estimated 23,000 members.
From 2005 to March of 2020, IUPA rented office space in Sarasota to house their employees (about 25 over the past few years). Occupancy costs in recent years (based on the Form 990’s the IUPA submitted to the IRS) ran about $400,000-$450,000 annually.
In November, 2019, IUPA closed on a 17,400 square foot office building in Sarasota they purchased for $2.6 million, putting down about $500,000 and obtaining a mortgage for about $2.1 million. In March of 2020, IUPA moved from their previously rented space (1549 Ringling Boulevard, Sarasota, FL) to the newly acquired and renovated office space at 5632 Bee Ridge Road in Sarasota with the intention to occupy about 10,000 square feet and lease out the remaining 7,400 square feet.
The decision to buy an office space appears to have been prudent. If IUPA obtained a standard 5 year commercial loan based on a 20-year amortization at an adjustable rate of 5.25% (Prime plus 2%), then their monthly carry costs are probably about $18,000 (including real estate taxes and insurance) per month or $216,000 annually. However, the IUPA should have rental income from leasing out 7,400 square feet of office space. With an estimated market rent of $16-20 per square foot, IUPA can expect about $118,000-$148,000 annually if fully leased. Given IUPA’s high occupancy costs in previous years, most people would agree that IUPA made a good financial decision with their recent purchase.
It’s no secret that the IUPA has been under constant criticism for relying on outside telemarketers for years to meet the shortfall between their annual expenses (about $4.5 million most of which is used to pay staff and fundraisers) and membership dues ($2.9-$3.7 million). And, they paid dearly for these dollars because most telemarketers kept about 90% of what they raised, giving only 10% to IUPA. For every $10 million raised by telemarketers, IUPA received about $1 million. Most donors would not want 90% of their donation to go to telemarketers.
Seeing an opportunity, it appears that management at IUPA took matters into their own hands and either started or recruited or were somehow involved in housing a call center in their same office address (and on the same 6th floor) sometime between April 1, 2018 and March 31, 2019. How do I know this? Because the IRS Form 990 (2018) reports on Schedule G, Part I, an entity known as the International Union of Police Associations Call Center” at the same office address as IUPA. And, this organization was not listed in previous years’ Form 990’s.
The International Union of Police Associations Call Center is the largest fundraiser for IUPA, having raised $4,688,590 but retaining $4,152,382 in fees, giving $506,208 to IUPA in 2018-2019. In other words, for every dollar the call center in the IUPA office raised, only 11 cents went to IUPA. This is disturbing on so many levels.
It’s one thing to use a telemarketing firm that raises money for a non-profit but only gives about 10% of donations to the non-profit (reeks of desperation but is supposedly arms length); it’s quite another thing for IUPA to have on-site IUPA’s largest fundraiser – a telemarketer – who actively solicits funds for IUPA with the IUPA knowing that the telemarketer is only going to give IUPA 11% of the revenue they collect. In other words, the telemarketer – the International Union of Police Associations Call Center – is primarily raising money for themselves under the approving eye of the IUPA.
So, who is the International Union of Police Associations Call Center? And, who are the people that own, manage, and benefit from this company? A google search of “call centers” and “International Union of Police Associations Call Center” gives no information. A search at the Florida Tax Collector serving Sarasota County also gives no information. The Sarasota Chamber of Commerce was another dead end.
Every business that operates in Sarasota must pay a tax for operating a business within the city limits of Sarasota (note: this used to be called an occupational license). Licenses are issued by the State of Florida and not the City of Sarasota. Prior to applying for the City of Saratoga Business Tax, the business needs to be registered with the Florida Division of Corporations. Again, a search by name and address yielded no information on an entity that calls itself the International Union of Police Associations Call Center, which probably means the organization has a different name or is going by a dba. But, the real question is: Who made $4,152,382 last year from the call center operating in the IUPA offices last year?
To read the IRS Form 990 (2018) for IUPA, click here.
To read the IRS Form 990 (2017) for IUPA, click here.
To read the IRS Form 990 (2016) for IUPA, click here.