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Revisions to AAPT's Governance

 

Introduction


Although AAPT's executive office is currently located in College Park, MD, the Association has been incorporated in the state of New York since 1957.  Recently, the New York state legislature passed the Nonprofit Revitalization Act of 2013.  Most of that act became effective on July 1, 2014 and several parts of the act directly affect AAPT governance procedures.  The major features that are required by the new law include having a Whistle Blower Policy and a Conflict of Interest Policy, specific audit procedures and financial reporting requirements, Board independence, and a disclosure of related party transactions.  In addition, the new act allows nonprofits to use modern methods of communication including conducting videoconferencing of board meetings and allowing email to be the official form of communication with members. These changes modernize nonprofit governance and reporting and require nonprofit organization to follow best practices for their governance.

Much of AAPT's governance is in compliance with parts of the new act.  However, there are some important changes that AAPT needs to make in order to be compliant with the new act as well as with previous New York nonprofit laws.  This document describes the major issues that AAPT needs to address in order to be compliant with New York law and to follow modern best practices for nonprofit governance.  For those interested in the specific details of the 2013 New York Nonprofit Revitalization Act, please see http://www.venable.com/new-york-nonprofit-revitalization-act-signed-into-law-12-19-2013/ or http://www.venable.com/new-york-legislature-passes-nonprofit-revitalization-act-comprehensive-significant-changes-to-new-york-nonprofit-corporation-law-on-horizon-07-30-2013/.

Addtional Information

Issues

Summary:

  1. Quorum of membership specification. RESOLVED
  2. Revise Whistle Blower and Conflict of Interest Policies. RESOLVED.
  3. Revise Audit Committee Policy. RESOLVED.
  4. Amend Certificate of Incorporation to allow electronic balloting. RESOLVED
  5. Revise Constitution and By Laws format to reflect best practices.
  6. Revise portions of the Constitution regarding Council.

Issue 1: No quorum for elections by members was in the AAPT Constitution or By Laws.  New York state law then assumes the quorum is a majority of all members eligible to vote (approximately half of our 6,500 voting members).  In the past, approximately 15% or about 1,000 AAPT members have participated in elections.  So expecting 3,000+ to vote is unrealistic.
Action Taken: At the November Executive Board meeting, the Board approved an addition to the current By Laws that specifies the quorum for votes taken by the membership.  The new By Laws language that was approved by the Board is as follows.

    New Section 3 under "Article I. Membership":
    3. Quorum of Members: Members entitled to cast 100 votes or one-tenth of the total number of votes entitled to be cast thereat, whichever is less, present in person or by proxy, shall constitute a quorum at a meeting of members for the transaction of any business. A majority of the members present at any meeting may adjourn the meeting despite the absence of a quorum.

Issue 2: The previous AAPT Whistle Blower Policy and Conflict of Interest Policy were not fully in compliance with New York state law. 
Action Taken: The Board approved a new Whistle Blower Policy and Conflict of Interest Policy at the November 2014 Board meeting. 

Issue 3: The previous Audit Committee membership and charge did not conform to New York state law.  
Action Taken: The Executive Board approved the new Audit Committee membership and charge at the November 2014 Board meeting. All members of the Audit Committee must be members of the Executive Board. Additional oversight responsibilities were added to the charge.

Issue 4: Since the Certificate of Incorporation does not state otherwise, Association elections or motions conducted electronically require unanimous votes according to New York state law.  Therefore, the Certificate of Incorporation will need to be revised to allow non-unanimous electronic voting by the membership or Executive Board.  Note that there may be other changes to the Certificate of Incorporate recommended by the attorney after the Winter Meeting.
Action Taken: Changes to the Certificate of Incorporation must be approved by the membership.  To approve this change in voting, we will conduct a special vote at the Annual Meeting of the Association to be held at 8:30 pm on Sunday, January 4th, immediately before the Council Meeting at the 2015 Winter Meeting.  This procedure will require at least 100 members eligible to vote to be present in order for a quorum to be met. One hundred affirmative votes are required to approve this change.

Issue 5: Revise and update the AAPT Constitution and By Laws to conform to best practices and combine the Constitution and By Laws into one document (titled "By Laws"), as is the current standard for nonprofits.
Proposed Action: Bring the proposed changes to the Executive Board for approval no later than Summer 2015 and to the membership for approval in Fall 2015 as part of the general election.  Note, the AAPT Constitution states that it may be amended by a two-thirds majority of those voting in a ballot of the Association for amendments recommended by the Board.

Issue 6: Currently Council's power to resolve a tie in an election and to remove an elected member of the Executive Board is in conflict with New York law.  New York law states that only the Executive Board may have these powers.
Proposed Action: Dissolve Council and replace with meeting of the members. 

Timetable

November 2014
  • Executive Board amended the By-Laws to establish rules for quorums for membership votes.
  • Board approved a new Whistle Blower Policy and a Conflict of Interest Policy
  • Board changed the membership and charge for the Audit Committee
  • Winter Meeting 2015 The membership voted on changes to the Certificate of Incorporation to allow for the adoption of motions and elections by less than unanimous votes when the votes are carried out electronically.
    Summer Meeting 2015 The Board forwarded changes in the By-Laws to the membership.

    Fall 2015
    General Election

    The membership votes on the Board recommendations described in the previous box as part of the general election.