However, when the organization transfers copies to other organizations or individuals, that is distribution. In particular, providing copies to contractors for use off-site is distribution.
For use off-site. Hiring a programmer off-site to maintain it isn't "use". Giving it to someone to use in
a productive way in furtherance of your business or in exchange for money would be "use".
Distribution matters because it triggers legal consequences--you need a license to distribute. The FSF can't rewrite the law. So they can't say "doing X is distribution" and then claim that doing X requires a license.
So whether the FSF calls something distribution in their own FAQ is irrelevant, unless the FSF is your lawyer and giving you legal advice.