Self Chartered?

[bobinbako]

I am looking for any info on how other self-chartered (Parents of/Friends of...) units are structured and operate. I've been searching and searching, and, although there appear to be many self-chartered units, I can't seem to find any information. Specifically, who constitutes the Charter Organization and who is considered the "head" of the CO? How is the Chartered Organization Rep chosen and who does he/she answer to? Where does the troop committee fit in?

[koolaidman]

Hey bobinbako,

 

Welcome to the forums. A bit of context here may help others answer your question, as in why do you need this info.

 

If you are looking to charter a new unit, it may be a moot point, as many councils are not accepting charters with Parents of/Friends of organizations.

[SM bob]

So you want to self charter. 1) find a meeting location that is stable. 2) create bylaws and other corp docs 3) form a corporation within the state you live in. Nonprofit or profit. 3) apply for an EIN # with the IRS. 4) create your troop structure. 5) create troop bylaws and docs. You will need 3 corp directors if you are going for IRS 501c3 status. The president of the corp will be the Instituonal Head which owns the troop # and charter. The rest of the positions will depend on how you structure the troop.

[fred johnson]

Having a bricks-n-mortar charter org is useful. Resources include more than just a building. How about an accountant. IRS tax filings. Liability insurance. Plus, having a real organization that is choosing the leaders. And it makes it easier for me to get my name "OFF" the organization when I leave.

 

Plus, the charter org vouches for the leaders. If the leaders create the organization and choose themselves as the leaders, it's circumventing the intent and the structural protections.

 

I'd expect BSA doesn't like them either because it could expose BSA to liability if a court viewed the charter organization as not really existing and then all liability falls back to BSA. Especially if all the "friends of" officers were also BSA registered leaders. It could be argued that the local BSA council knew or should have known that there was no real charter org overseeing the program.

 

With that said ... most charter orgs don't do anything anyway and don't even know their own leaders.

[bobinbako]

Ok. Here's the background. Our troop has been around over 50 years. We were chartered to a civic organization until they went defunct in 2011. They were an "invisible" CO, meaning they had no invovlement with the troop. When we, the parents/troop committee/leaders, discussed what to do we agreed to be self-chartered. The outgoing SM was selected to fill the role of IH and COR. Now some problems are beginning to occur and I have discovered we never formed any formal or legal entity to be the CO. Our charter is held as "Parents of Troop XXX", but there is no legal status. I assume we need to rectify it. SM Bob: We have a stable meeting place, but it looks like all the other steps you explained need to be done.

 

Our current problem is the person listed on the charter paperwork as the Executive Officer/COR recently made a claim that he and he alone owns the troop and we can't remove him until he decides to leave. And he appears to be wanting to change leadership without the consensus of the rest of us.

 

 

What I would really appreciate is an existing self chartered charter orgs bylaws as a template to try to rectify this. Many parents are ready to leave over this.

 

Thanks for any help.

[bobinbako]

Fred: I agree it would be better to have "real" charter organization, and I may try to persuade others to find one. The fears we had was our troop has substantial assets and we worried about an organization seeing a golden opportunity to become the "owner" of those assets.

[SM bob]

Bobinbako. - same thing happens to my old troop. That's why I set up a corporation and self chartered.

[scoutergipper]

If no legal entity was ever created, then no one can claim they "own" the Troop or any of its assets, as it doesn't legally exist. As you go forward with a proper legal filing, be sure and leave anyone who thinks they "own" the Troop and can stay as long as they want off the new entity. You shouldn't have any problem using your current Troop number but should probably go with "Friends of" to avoid any unpleasantness with the current structure.

[bobinbako]

scoutergipper: That's encouraging, but I just spoke to somebody else who said that since a certain individual's name is on the charter paperwork as the Executive Officer that I am out of luck, that he does own the troop number and assets. I guess my next step is to contact the council and get their take on it. Unfortunately our council is sort of in shambles right now with no executive and one brand new DE to cover 4 districts.

[Second Class]

This sure is a reality check on why those names on the charter are important. One way you can force his hand is by checking into insurance for your gear and trailer. You will soon find out that you can't get it, and your CO is responsible for providing the insurance coverage. In this case, it's your IH/COR. He's on the hook, personally, for any claims. When he discovers this he may change his turn, and help you all find a real Chartered Organization. This is a mess.

[bobinbako]

Yep. Definitely a mess. I'm kind of disappointed that the council didn't educate us on how to do it properly as opposed to just chartering us back when we did all this.

[ScoutNut]

While Chartering Organizations do "own" their units, they can not absorb/use any funds, or property, of those units for ANYTHING other than Scouting.

 

From the Rules and Regulations of the Boy Scouts of America -

 

"All money raised by or received for the benefit of a unit or local council and all property acquired by a unit or local council shall be deemed to be received or acquired solely for the benefit of Scouting as interpreted and promoted by the Boy Scouts of America."

 

"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 organization 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."

[fred johnson]

No legal entity? That's bad. The "parents of" probably had the best of intentions, but the ball was dropped. That's why a bricks-n-mortar charter org is useful. They already exist.

 

Another reason "parents of" organizations are bad is that parents and volunteers turn over through the years. A charter organization is probably going to last longer than any volunteer. As such, you can have better and smoother continuity of charter org infrastructure. Plus doing it yourself is more work than existing under a charter org who already has everything already in place.

 

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---- Checking account? What type of account is it? Is it an old long-standing account (before the new rules - our checking account was opened in the 1970s... it had no SSN or EIN on it until we changed banks)? Or is it a new account that has an SSN/EIN on it. If your troop has substantial assets, someone has those assets. Who? I'm betting the checking account is still under the defunct charter organization. Eventually someone might ask why a defunct non-profit still has money coming in. Banks do send account reports to the government..

 

---- Sales tax. If you are not a non-profit, you owe sales tax on fundraisers. Also, "someone" owes income tax.

 

---- Income tax. If you are not a non-profit, you owe income tax. Or as a corporation, corporate taxes. And state and federal IRS filings.

 

---- Liability. If something happens, the leaders (charter org agreement signer, CC, SM and others) are personally liable for issues that happen. There is not even the smallest shield in this situation. There is no one with deep pockets to protect these "volunteers".

 

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Hire a good business accountant. If you really want to stay as a "parents of" organization, hire an accountant who will do your tax and non-profit filings. It will cost you money, but it is well worth it. I've run businesses before and tried for years to do my own paperwork. Did it good for years, but it only took one screwed up year to realize I wanted someone else to do it. It was way cheaper than my time and my risk.

 

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As for the guy who's name is on the charter org agreement "owning" the troop, you could let him know you are okay with it and just ask for his SSN so that your information is complete when you call the IRS. Name and address are good, but SSN saves a minute.

 

He might decide to be cooperative.

[Gone]

scoutergipper: That's encouraging' date=' but I just spoke to somebody else who said that since a certain individual's name is on the charter paperwork as the Executive Officer that I am out of luck, that he does own the troop number and assets. I guess my next step is to contact the council and get their take on it. Unfortunately our council is sort of in shambles right now with no executive and one brand new DE to cover 4 districts.[/quote']

Or you could contact national. I am sure they would like to talk to the "owner" of the troop and understand why he did not file the paperwork needed to complete the process. I don't see how he can own something that was not done correctly. It is like buying a car, making the minimum down payment but not paying your monthly payment. He does not own anything until he completes the process.

[fred johnson]

Hear's the real question ... is he a signer on the checking account? If not, don't add him. Control of the money means control of the unit. He doesn't like it, work with the council to create a unit under a real charter org. Then write a check transferring the money to that charter org. What is he going to do? Sue? He has no legal standing as the entity does not exist.