After Guardian readers posted dozens of comments expressing outrage  that PayPal froze the account of Burning Man's Temple of Flux crew, the company today agreed to release the funds, according to PayPal spokesperson Anuj Nayar, who just responded to a Guardian inquiry from yesterday.
“It seems the power of the Interwebs still works,” Catie Magee, one of the Temple project managers, told us, saying the company contacted the crew this morning. “They agreed to release our funds and said they were doing us a big favor.”
“I'm happy we were able to get this addressed,” Nayar told us, although he says he can't explain why the Flux Foundation's funds were frozen or released: “Because of PayPal's privacy policies, we can't go into more detail on that.” But speaking generally about their policies toward groups with pending nonprofit status, he said, “We encourage nonprofits to get 501c3 certification because we are under certain regulations and we have to report that back, but I can't go into more details than that.”
Magee said the group submitted nonprofit paperwork to the necessary state and federal agencies back in April and heard back from state officials on July 22 asking for revisions to their articles of incorporation, which they promptly returned. The Internal Revenue Service won't grant 501c3 status until the state approves those articles, and even then it can take months longer, according sources in the nonprofit world.
Despite releasing the funds, Magee said PayPal won't let the group continue using the account, so the Temple crew has set up alternative ways to donate to the project, which has so far fallen short of its ambitious fundraising goals. Details for donating are on the Temple's website .
I've been journalistically embedded with the Temple project since its inception for a Guardian cover story that comes out Sept. 1, as well as for my upcoming book: “The Tribes of Burning Man: How an Experimental City in the Desert is Shaping the New American Counterculture ,” due out in December from CCC Publishing .