Folding Unit

[evmori]

" If the unit is owned by the CO all assets of the unit are property of the CO then any funds being raised by the unit for it's own use are in actuality being raised for the CO which under item 7 of the money earning application is considered a third party. "

 

I think that this is open to interpretation. If a unit folds, the unit's assets do not revert to the CO, if the CO has no plans to start a new unit in short order, the assets go to council.

 

No interpretation necessary. If a unit folds, all unit gear & funds revert to the CO. The CO can do what they want with it then.

 

Ed Mori

1 Peter 4:10

[Gold Winger]

"No interpretation necessary. If a unit folds, all unit gear & funds revert to the CO. The CO can do what they want with it then."

 

I don't think so. That's what the DE said when my old pack folded. There's something in the charter agreement about funds raised and equipment bought in the name of Scouting reverting to Council.

 

Of course there is a chance that the DE was wrong.

 

I'm sure that Bob White has a definitive answer.

 

[emb021]

Check the charter agreement, but the unit is 'owned' by the charter organization, and all equipment and money remains with the unit.

 

This has come up in the past when units have 'moved' to other charter organizations. Unless the old charter org allowed the equipment to go to the new charter org, it stayed. (I recalled once instance when the entire unit folded and moved to another charter org, but the original charter org won't allow them to take the equipment with them, because they figured they 'start another unit sometime in the future'.)

 

[Gold Winger]

"http://www.scouter.com/forums/viewThread.asp?threadID=114341#id_114518"

 

Sctlder said, " If they intend to reform a unit in the future, the CO can retain the assets "in trust" for that future unit. If they have no such intention, the assets revert to the Council for use as they see fit. That's the terms of the Charter agreement that they signed when your unit was formed."

 

Rules and Regulations, Article XI, Section 1, Local Council and Unit Finance Clause 2, Disposition of Unit Funds Upon Termination of Local Council or Unit

 

(b) Unit Obligations. In the event of the dissolution of a unit or the revocation or lapse of its charter, the unit committee shall apply unit funds and property to the payment of unit obligations and shall turn over the surplus, if any, to the local council, if there is one, or if there is no local council, dispose of the same in accordance with the direction of the Executive Board of the Boy Scouts of America. In the case of a chartered organization, any funds or equipment which may have been secured as property of the unit shall be held in trust by the chartering organizaiton or the chartered local council, as may be agreed upon, pending reorganization of the unit or for the promotion of the program of the Boy Scouts of America.

 

As I said, it goes to council unless the CO intends to start up a new unit and Council agrees to let them hang onto it.

 

 

 

 

[evmori]

(b) Unit Obligations. In the event of the dissolution of a unit or the revocation or lapse of its charter, the unit committee shall apply unit funds and property to the payment of unit obligations and shall turn over the surplus, if any, to the local council, if there is one, or if there is no local council, dispose of the same in accordance with the direction of the Executive Board of the Boy Scouts of America. In the case of a chartered organization, any funds or equipment which may have been secured as property of the unit shall be held in trust by the chartering organizaiton or the chartered local council, as may be agreed upon, pending reorganization of the unit or for the promotion of the program of the Boy Scouts of America.

 

Well, it states to turn it over to the council then it states the CO can holds the funds in trust! Well, duh!

[Beavah]

Yah, another masterpiece of BSA policy writin', eh? IMO unenforceable as written, should it be contested.

 

General point is that yes, the funds and equipment are the property of the CO. Secondary point is that to the extent the funds/gear were donated/raised for specifically for Scouting, using the BSA's name, they should be kept for that purpose (or transferred to another entity like the council to be used for Scouting).

 

Mostly the amounts and equipment are immaterial, eh? Can't imagine the "Executive Board of the Boy Scouts of America" spendin' any time on disposition of a unit's assets. And most of the time the CO's and BSA are very reasonable in terms of honoring common sense.

 

Was there a "situation" behind this question, or was it just one of those generic queries, Ed?

 

Beavah

 

[Herms]

Had a Pack a few years ago that some parents got angry and decided to start their own Pack. They demanded the amount of the money raised by their sons from popcorn. The DE found that the money stays with the Charter Organization, not the Pack.

[LongHaul]

Has been contested. This is another National attempt to baffle the unknowing. If when something goes wrong National assumes no liability, when dept is incurred National assumes no liability, when maleficence occurs National assumes no liability, National has no claim to any assets. When units build up funds that the CO decides are better used elsewhere in the CO's program and disbands the unit Council can't do a thing about it. But then I'm from Chicago and even the courts do things different here.

LongHaul

[BrentAllen]

When I read that policy statement, I see two different types of funds mentioned. The first is "unit funds" that could mean dues or money raised through fund raisers.

The second part of the statement, "In the case of a chartered organization, any funds ... which may have been secured as property of the unit" sounds like funding the unit received directly from the chartered organization. That would make sense - any funds the CO put into the unit, they would like to get back. I'm not an attorney and I didn't sleep in a Holiday Inn Express last night, so I'm probably wrong.

[FScouter]

"This is another National attempt to baffle the unknowing."

 

It's a non-issue. One must wonder the purpose in starting such a topic. Surely it was not to get an answer.

[Bob White]

What section (b) is saying that when the unit folds two things happen. First ythe committee must pay any outstanding debts owed by the unit before they can dissole. Their debts are their responsibility. They may use the unit funds or the sale or trade of unit assets to pay those debts.

 

THEN after the debts are paid, the surplus revenues and assets revert to the the CO and the local council. The two will work out an agreement as to how the money and assets will be used.

 

Historically here is what happens. If the CO has other youth programs the Council will not interfere with the money going to serve youth. If the CO would like to start another scout unit the BSa will support the money and assets going to the new unit.

 

If the CO does not have another youth group and they do not intent to bahe another scout unit then the BSA will work in cooperation with the CO to find a scout unit or units that are in need of the money or assets and donate them to those units.

 

As a commissioner I have been involved in this process a few times in different councils and it was always handlled in this manner.

[LongHaul]

>>As a commissioner I have been involved in this process a few times in different councils and it was always handled in this manner.<<  Handled by you in your area maybe.

 There once was a Scouter, here I use the term in it's loosest and broadest sense, that convinced the District Commissioner and Council Commissioner that making said Scouter the unit commissioner for all the Cub Packs in one local community was a great idea. This Scouter then went to each CO in turn and read them the rules, informing them of their responsibility to provide meeting places, support, and all the things the Utopian CO provides. Several CORs took offense and Packs were forced to seek sponsorship else where. One CO however was in the midst of a financial crisis due to under insured damage to the church. When informed that the church did in fact "own" the Pack they immediately dissolved it just as they had all other programs formerly supported by the church. They seized the bank account which was a considerable sum as this was a very old Pack. Council tried to stop the seizure but lost in the early rounds in court for the reasons I already mentioned. The judge pretty much said National can not deny liability but assume ownership.

In another case a group of adults within a unit physically took the bank account and the equipment and formed a separate unit with a different CO.  When the adults not included in the "defection" cried foul they were told by Council that the only course was for the CO to file criminal charges of theft against those involved.  They were told that Council has no legal recourse because the unit is "owned" by the CO.  Council then went ahead and chartered the renegade unit.

 LongHaul

[Gold Winger]

" Council tried to stop the seizure but lost in the early rounds in court for the reasons I already mentioned. The judge pretty much said National can not deny liability but assume ownership."

 

I'm not a lawyer and I've never slept in a Holiday Inn Express but that doesn't make sense. National and Council are two different beasts. Council is a seperate organization chartered by National, just like a troop.

[BadenP]

Long Haul is essentially correct, local courts in our area have ruled in favor of the CO's and have denied council claims to obtain a units funds during dissolution of several units. The CO's took the money for their own purposes since the court ruled they were the responsible party. In one case the adult leaders and the CO were having difficulties so the unit leaders closed the bank account, took the equipment and restarted elsewhere. The CO and council were told they would have to sue those leaders and that only the CO had a legal right to those assets. The council withdrew as did the CO to pursue the matter further.

 

In the four cases in our council the CO's were the only recognized legal authority by the courts, no matter what the council believed their rights were the court ruled against them.

 

Another point, the councils are seperate entities but are under the umbrella of National. In other words if a SE or DE screws up big time National can be named as a secondary party, much like an affiliate company of a large corporation. When I was working as a scouting professional my council was involved in two cases like this, and the staff was trained in great detail about how the system really works in the state of California.

[eagle90]

I guess the moral is if you are on the verge of folding your unit, go out and throw the biggest party imaginable, and leave the CO with $1.00! Then graciously present it to them!