Non-profit
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Kevin Stout
Oct 26, 2018, 7:56:24 PM10/26/18
to soupa...@googlegroups.com
Hey folks,
I’ve been traveling and wanted to give my feedback on the non-profit status of SOUPA. Please do not represent to anybody that SOUPA is a non-profit corporation until Articles of Incorporation have been filed with the Oregon Secretary of State, By-laws have been approved by the members, and a Board of Directors has been elected. Registering an Assumed Business Name is absolutely not the same as incorporating a non-profit.
It’s fine to have an informal organization that has a Board to make decisions, but under state and federal law this is distinct from a non-profit. If you decide to incorporate and formalize SOUPA as a 501(c)(3) non-profit then you have to play by the rules.
Most importantly that means the organization and Board members have legal liability. If hypothetically someone is injured during SOUPA league play, or on fields rented by SOUPA, or even at a SOUPA affiliated party the organization and Board members could be sued.
It’s not unforeseeable that an injured plaintiff could allege that a Board member recklessly or intentionally allowed someone to participate under the influence of drugs or alcohol and therefore is liable for damages.
Some homeowner’s insurance policies cover board member liability, but anyone who rents and serves on a board has their ass hanging out unless the organization purchases separate insurance. I am on the board of three non-profits and they all have coverage, and it’s expensive.
There are certainly advantages to incorporating, however, it means way more formality, paperwork, and legal liability.
I’m not sure how it stands now but if folks are volunteering and assuming responsibility I can assure you there are lawyers who will sue whoever has the deepest pockets if something bad happens. Even an accident with a terrible outcome could bring serious trouble for SOUPA leaders. Damages for a severe head or neck injury are probably more than your house and 401(k) are worth. It’s probably something you should discuss with your spouse before you expose yourself to that kind of risk. If an insurance company isn’t going to pay for your legal defense and damages you should take a hard look at whether it’s worth it.
In my opinion no formal organization at all has the least risk. Just like in everyday life each individual is responsible and liable for his or her conduct. The drawbacks are obvious: hard to rent fields, get insurance, etc.
Non-profits need at least a nominal budget and Board members can decide how to collect funds and how to spend the money on behalf of the members. More formality usually means higher dues from membership or other revenue from sponsorship, etc.
I don’t really have a dog in this fight so I don’t have an opinion either way. I do enjoy coming out a couple times a year and playing on the nice fields and I am thrilled to see youngsters get stoked on the game.
If you want help with the paperwork my office can do that pro bono. We can do the incorporating, help draft governing documents, waivers, etc. Just let me know what y’all decide.
Cheers,
Kevin
Sent from my iPhone
I’ve been traveling and wanted to give my feedback on the non-profit status of SOUPA. Please do not represent to anybody that SOUPA is a non-profit corporation until Articles of Incorporation have been filed with the Oregon Secretary of State, By-laws have been approved by the members, and a Board of Directors has been elected. Registering an Assumed Business Name is absolutely not the same as incorporating a non-profit.
It’s fine to have an informal organization that has a Board to make decisions, but under state and federal law this is distinct from a non-profit. If you decide to incorporate and formalize SOUPA as a 501(c)(3) non-profit then you have to play by the rules.
Most importantly that means the organization and Board members have legal liability. If hypothetically someone is injured during SOUPA league play, or on fields rented by SOUPA, or even at a SOUPA affiliated party the organization and Board members could be sued.
It’s not unforeseeable that an injured plaintiff could allege that a Board member recklessly or intentionally allowed someone to participate under the influence of drugs or alcohol and therefore is liable for damages.
Some homeowner’s insurance policies cover board member liability, but anyone who rents and serves on a board has their ass hanging out unless the organization purchases separate insurance. I am on the board of three non-profits and they all have coverage, and it’s expensive.
There are certainly advantages to incorporating, however, it means way more formality, paperwork, and legal liability.
I’m not sure how it stands now but if folks are volunteering and assuming responsibility I can assure you there are lawyers who will sue whoever has the deepest pockets if something bad happens. Even an accident with a terrible outcome could bring serious trouble for SOUPA leaders. Damages for a severe head or neck injury are probably more than your house and 401(k) are worth. It’s probably something you should discuss with your spouse before you expose yourself to that kind of risk. If an insurance company isn’t going to pay for your legal defense and damages you should take a hard look at whether it’s worth it.
In my opinion no formal organization at all has the least risk. Just like in everyday life each individual is responsible and liable for his or her conduct. The drawbacks are obvious: hard to rent fields, get insurance, etc.
Non-profits need at least a nominal budget and Board members can decide how to collect funds and how to spend the money on behalf of the members. More formality usually means higher dues from membership or other revenue from sponsorship, etc.
I don’t really have a dog in this fight so I don’t have an opinion either way. I do enjoy coming out a couple times a year and playing on the nice fields and I am thrilled to see youngsters get stoked on the game.
If you want help with the paperwork my office can do that pro bono. We can do the incorporating, help draft governing documents, waivers, etc. Just let me know what y’all decide.
Cheers,
Kevin
Sent from my iPhone
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