As you may know, the Nonprofit Revitalization Act (NPRA) goes into effect today, July 1, 2014. The NPRA is the first significant change to the New York Not-for-Profit Corporation Law in decades and has profound implications for you and your nonprofit partners. While the NPRA reduces several burdens, it also it creates additional requirements for not-for-profit corporations.
Specifically, the NPRA reduces burdens in several ways, including, but not limited to:
- Simplifying approvals for amending corporate purposes, selling substantially all of the assets of a the corporation, mergers and acquisitions and dissolutions;
- Permitting a simple majority vote of the Board of Directors to authorize non-substantial property transactions; and
- Permitting electronic communication of the Board of Directors for notices, waivers, written consents and meetings.
The NPRA also adds requirements, including, but not limited to, establishing requirements for:
- Related Party Transactions;
- Conflict of Interest Policies;
- Whistleblower Policies;
- Independent Directors; and
- An Audit Committee.
The NPRA also gives the New York State Attorney General new powers of enforcement.
As of today, all nonprofits should be making good faith efforts to comply with NPRA, eitherby undertaking a review of their directors, bylaws, policies, and procedures themselves or by retaining counsel to assist them in such a review. A link to the NPRA is available at:http://open.nysenate.gov/legislation/api/1.0/lrs-print/bill/A8072-2013
Goldstein Hall is currently working with many of its clients to bring them into compliance with the NPRA and would be happy to assist you and your nonprofit partners. If you have any questions regarding the NPRA, please contact Jason Labate at [email protected]