HSA's Let's Go Guides Spin Off As For-Profit Co.

In a move former top officials said was intended to avoid potential violations of state tax codes, Harvard Student Agencies (HSA) this week formed a for-profit subsidiary which includes its most profitable division.

Let's Go Publishing, the financial jewel of HSA, is the core of the new subsidiary, which is wholly owned by the non-profit agency. Let's Go's staff of student writers and editors produce a best-selling series of budget travel guides.

Let's Go, Inc., which will also include the advertising and sales division of HSA, will move out of its Thayer basement headquarters to a location at 1 Story St.

In an interview yesterday, HSA President Brian A. Goler '93 cited the publishing group's desire to expand and the need for more physical space as "the only reasons" behind the move.

But former HSA officials, including a past member of the organization's board of directors, contradicted Goler. They said the move was necessitated by the publishing division's financial success, which was threatening the corporation's not-for-profit status.

In addition to Let's Go: Europe, the "bible of the budget traveler," the publishing group puts out about 20 other guides. Let's Go Europe has been the best-selling travel guide on Europe for years.

Speaking on condition of anonymity, the former HSA board member said the continued expansion of the publishing division's sales and advertising base was in danger of violatingthe student group's not-for-profit charter.

The charter, written when the agency wasfounded in 1957, states that HSA should serve theHarvard community.

Establishing Let's Go Publishing as afor-profit corporation, which will pay taxes, wasseen as a way to head off potential tax problems,the board member said.

The state tax code is very specific about thedifference between for-profit and not-for-profitcorporations, added the board member.

Profits from Let's Go Publishing havetraditionally gone to cover HSA operating expensesand to fund bonuses for student managers, said oneformer official.

Prior to the change, HSA was composed of 11agencies, among them catering, text processing anddirect sales.

Goler and others on the current staff of HSAdeclined to comment on what would be done withprofits from Let's Go, Inc.

And Goler said that Let's Go Travel, astudent-operated travel agency, would remain inThayer and would not be affiliated with Let's Go,Inc.

HSA officials past and present agreed that theincorporation of Let's Go, Inc. was an importantmove for the 35-year-old agency.

"This is the biggest move we've made," saidGoler.

Editors of the Let's Go series said yesterdaythey did not know how the move to Story St. willaffect publication of the travel books.

"I don't know what that would mean forproduction," said Blythe N. Grossberg '93,managing editor of Let's Go Publishing. "Wehaven't even hired editors yet [for this year'sversion of the guides]."

HSA officials said they plan to release fulldetails of the move next week

The charter, written when the agency wasfounded in 1957, states that HSA should serve theHarvard community.

Establishing Let's Go Publishing as afor-profit corporation, which will pay taxes, wasseen as a way to head off potential tax problems,the board member said.

The state tax code is very specific about thedifference between for-profit and not-for-profitcorporations, added the board member.

Profits from Let's Go Publishing havetraditionally gone to cover HSA operating expensesand to fund bonuses for student managers, said oneformer official.

Prior to the change, HSA was composed of 11agencies, among them catering, text processing anddirect sales.

Goler and others on the current staff of HSAdeclined to comment on what would be done withprofits from Let's Go, Inc.

And Goler said that Let's Go Travel, astudent-operated travel agency, would remain inThayer and would not be affiliated with Let's Go,Inc.

HSA officials past and present agreed that theincorporation of Let's Go, Inc. was an importantmove for the 35-year-old agency.

"This is the biggest move we've made," saidGoler.

Editors of the Let's Go series said yesterdaythey did not know how the move to Story St. willaffect publication of the travel books.

"I don't know what that would mean forproduction," said Blythe N. Grossberg '93,managing editor of Let's Go Publishing. "Wehaven't even hired editors yet [for this year'sversion of the guides]."

HSA officials said they plan to release fulldetails of the move next week