Where have all the social clubs gone?

When you think of social clubs, you ordinarily think of fraternities and sororities, golf clubs, swimming clubs, tennis clubs and so many more. But the category of social clubs extends to all kinds of organizations that reflect many different interests: hobby clubs, bridge clubs, dog clubs, campground associations, car clubs and flying clubs. The list can go on indefinitely. What binds them together, however, is that they are tax-exempt nonprofit organizations under Section 501 (c)(7) of the Internal Revenue Code. Being a (c)(7) social club is both a blessing and a curse. The good news is that its exemption enables the club to escape paying federal income tax; the downside is its restriction on allowable outside revenue, which for many clubs would otherwise constitute its lifeblood. In other words, the clubs cannot indiscriminately open their doors to nonmembers or the general public without jeopardizing their status. 

Given that restriction and the costs of doing business today, many social clubs have found it too difficult to continue. Think about the need to maintain expensive facilities, cope with shrinking membership, compete against commercial enterprises – and you can see why so many clubs are struggling. In addition, cultural changes have driven the demise of numerous social clubs. Our society today is more diverse – less gender focused or religiously segregated. People are both more and less connected because of technology and more families now depend on two incomes, thereby lessening the amount of discretionary free time. And I would be remiss if I did not mention the dramatic effect of the Pandemic on the social club. Whereas, these clubs traditionally offered opportunities for gathering, fellowship and camaraderie, today’s necessities mandate social distancing and limited gatherings.

So, what is a club to do? Some have declared bankruptcy, others have sole their assets and still others have shifted gears from being “clubs” to shared workspace venues. Still others are holding fast to emptying buildings and “houses” without students. The social club often represented longstanding institutions in their communities; and their demise is not only a loss to their membership but also to their larger communities. It will be interesting to see what new forms of “social clubs” evolve post-Pandemic. I would expect that they will have more flexible formats, more realistic acceptance of current norms and less dependence on bricks and mortar. As always, the nonprofit sector mirrors our society – its values and its problems- as a whole.

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