Our dojo is run as a 501c3 federal non-profit educational organization (quite a mouthful). We decided that this was the best way to go from the ground up. Our Sensei is a very dedicated individual, but he is not the only one running the dojo, instead he is like the principal or dean of a school. We strive very hard to keep the "business" and "dojo" sides seperate. We have a president, vice-president, treasurer, and secretary, that handle the day-to-day business side of the organization, and a teaching staff (of which Sensei is the head) that handles the dojo side of things. There is also a board that oversees both sides of the organization. This arrangemet has worked well for us, but I don't think it is appropriate for every situation.
Sensei has a day job, so do the rest of us, and he doesn't keep track of all the business stuff (of which there is a lot) nor does he teach Aikido full time or run the dojo as his own full time business. There are other people in the dojo who do just as much (in some cases even more) work than he does to keep the doors of the school open and everything running smoothly (this is not a complaint, just the way things are). Because of this he isn't in charge of everything, and is not allowed to run financial side of things. Instead he handles the teaching side only (what we learn, who tests, who instructs, etiquette, etc) again, much like the principal of a school. This is a fair distrubution of both the authority and responsibilities of our organization. He is very cognizant of this and very appreciative of the work everyone does to allow the school to continue to operate, and on the other side, all the members are aware of the gift of Sensei's time, experience, and guaidance that he contributes.
It is a very good situation and has worked very well for everyone involved and really allowed our dojo to grow. In a way, it helps get more people deeply involved in the dojo and organization's progress...for the members, by the members...if we don't all pitch in, there wont be a place to train. It has created a very strong community.
On the other hand...if a dojo was started as a private enterprise by one person, and is their private business, then the students have no right to expect that they get to run the business side of the show. I think that this could be entirely appropriate given the following:
-the sensei is of sufficient skill and rank to be a quality instructor, in other words the "product" he/she offers is worth the "cost of admission"
-the sensei takes care of all the business issues him/herself, and does not put these responsibilities on students...its his/her business, and if he/she is making the money then the responsibility lies on him/her to take care of things OR fairly compensate those who help with these things
For the most part, I think it is very difficult to run an Aikido dojo as a for-profit business. I think it takes a very dedicated and highly experienced/ranked sensei to run a school professionally. It isn't impossible, and there is certainly no ethical problem with making your living at it (as long as the principles of the art and proper business ethics are followed).
The problem is when principles have to be compromised, or too many expectations get put on "senior" students to run a place that the teacher is making money from, or has full authority/responsibility over. This sounds like the situation that anon has posted. I agree with Janet, in that there should be an open meeting about the dojo's situation. Its all very easy to say, just have someone take over the finances...but who? and would that actually solve the problem. The impression I get is that the instructor in this case runs the dojo as a private business. So does he/she wants to give up the financial control? Perhaps things would change if the sensei was just made aware of the problem. When it comes down to brass tacks, if something doesn't change and everybody is unhappy with the financial situation, then change would be necessary in the leadership/organizational model of the dojo...but maybe just communicating the problem would solve it.
Oh yeah, starting a non-profit is not all that difficult, and state laws really don't matter that much in the case of non-profits if you incorporate as a federal 501c3 non-profit. Any federally designated 501c3 non-profit entity is allowed to pay salaries, but no one in the organization can benefit from "profits" made by the organization (a salary is not considered a profit). All that is required financailly is that the organization can show that all monies made over and above operating expenses, go back into the organization for its stated purpose and don't benefit only select members. For example universities and school districts are non-profits that pay all kinds of employees (Board members, teachers, principals, janitors, on and on) Goodwill, United Way, most Churches also all have paid employees. What does vary by state and locality is what taxes you must pay. Some places recognize a 501c3 as completely tax exempt, while others don't. You also don't need an accountant or lawyer to start a 501c3...suprisingly the IRS is very helpful in regard to this and the paperwork, though somewhat involved, is step by step and readily available.
Any idiot is capable of doing it...well at least this one was