GNH Community

nonprofits,local leaders & Grt.New Haven business sharing information

Nonprofit Board Lending: Why Counsel Matters

The case of a New York City minister, his wife and the executive director have agreed to pay-back loans with interest and penalties they borrowed from their church and two related nonprofits. I am scratching my head a bit over the "must pay back clause" because the Wall Street Journal doesn't really indicate there was any intention not to pay back their loan (which they used to buy a house and property. Some of the loan was also used to buy a car (yes, a BMW). Alas, additional monies were used to purchase trips for the couple to visit their sons in college.

So, we have here a few issues. According to the Attorney General, it is state law that directors and officers may not be the beneficiary of a nonprofit's loans. I will admit that this was new to me. Over the years I have known of a number of instances where boards have indeed made financial loans to their execs particularly for a house to live-in.

This particular case came to the forefront of the news because these loans were viewed externally as diverting nonprofit money away from their intended purpose. But the couple did actually conduct related transactions that were less than legally or even morally acceptable and indeed, action should be taken, I think, beyond just getting the money with penalties paid.

And indeed, this is likely the reason boards should be cautious about lending. That there were legal prohibitions agains these transactions was news to me so I poked around the web and found that such transactions are not actually prohibited in every state in the US. And, when their are sanctions, their are circumstances. The lesson: boards should seek legal counsel should the subject arise and their is not already a board-developed policy in place recognizing that federal and state laws always trump a nonprofit's laws when there is a difference between the two.

But, to wrap this story up, the Journal article also notes that: Three former members of the Glad Tidings' board agreed to pay $50,000 in penalties for neglecting their oversight duties. Whoa -- gotta hand it to the AG who took all of this very seriously. And nonprofit boards everywhere should do the same. Ignorance is not blissful.

Views: 12

Comment

You need to be a member of GNH Community to add comments!

Join GNH Community

Now available in multiple languages

Welcome (Bienvenido, Benvenuto, Powitanie, Bonjour! Willkomme,歡迎, ברוךהבא أهلا وسهلا, Bonvenon) to GNH Community

traducción, traduzione, tłumaczenie, traduction, Übersetzung, 翻译, תרגום أهلا ترجمة, traduko

                    

Imagine. Inform. Invest. Inspire.

Working together to build a stronger community - now and forever

Neighborhoods: What is Working

Open Street Project

An Open Streets Family Reunion: Reflections from the 2018 Open Streets Summit

By Ryan O’Connor, Director of Programs, 8 80 Cities Recently 8 80 Cities wrote a blog post about open streets being a labour of love. That being the case, the 2018 Open Streets Summit in New Orleans felt like a family reunion of sorts. It was rejuvenating to see old and new friends who share our passion for open streets and are working tirelessly to create healthier, happier, and more connected communities across the world. The event, which took place on September 15-16, brought together more than 50 leaders who currently organize open streets programs or are interested in bringing the...

The post An Open Streets Family Reunion: Reflections from the 2018 Open Streets Summit appeared first on Open Streets Project.

Open Streets Summit Draft Agenda

We hope you are getting ready and feel excited about the Open Streets Summit in Gretna/New Orleans! Taking place from September 15-16, 2018, the Summit will feature tours, presentations and networking opportunities with open streets champions and organizers from across the continent. Attendees will learn about the nuts and bolts of starting or scaling up open streets programs, including: Route design and planning Partnerships with business and officials Social inclusion Safety and logistics Marketing and promotion Program evaluation through measurable goals and metrics If you haven’t done it yet, click here to register for the Open Streets Summit only or...

The post Open Streets Summit Draft Agenda appeared first on Open Streets Project.

Open Streets Summit Speakers Announced!

The Open Streets Project is proud to announce that Ed Solis from Viva Calle (San Jose, CA), Romel Pascual from CicLAvia (Los Angeles, CA), Jaymie Santiago and Charles Brown from New Brunswick Ciclovia will join us as speakers for the 2018 Open Streets Summit in New Orleans and Gretna! Taking place from September 15-16 2018, the Summit will feature: Behind the scenes tour of the City of Gretna’s inaugural open streets program. Workshops, presentations, and networking opportunities with open streets champions and organizers from across the continent. Training and inspiration for both -novice and experienced- open streets organizers and supporters...

The post Open Streets Summit Speakers Announced! appeared first on Open Streets Project.

Local Initiatives Support Corporation

A Model Worth Copying: Joint Ownership Structures for CDCs

In an in-depth article for The Journal of Affordable Housing and Community Development Law, attorneys David Goldstein and Jason Labate offer a case study of the Joint Operating Entity NYC (JOE NYC), which LISC has supported from its inception. The JOE NYC, a consortium of CDCs that have pooled their portfolios and expertise, is a blueprint that can help CDCs in other cities and regions shore up their stability in challenging markets and gain ground against the national affordability crisis.

Minnesota Governor Celebrates LISC Duluth’s 21 Years of Investment and Partnership

This week, LISC Duluth marked its 21st year of investing in the city and the key work of local partners at its annual Building Healthy Community Awards. Governor Tim Walz gave the keynote address, stressing how innovative collaboration between local government and community leaders can make the city a safe and prosperous place for all residents. The LISC partnership model, he added, “is what smart government should do…what smart communities should do.”

Reclaiming Charm City

A powerful new documentary offers an unvarnished portrait of residents and police in Baltimore working to stem violence in their beloved city. LISC is a proud national partner of the PBS film, helping to spark attention to its life-and-death message: through collaboration between neighbors and law enforcement, and imperative investment in underserved communities, we can make communities safer and better. It’s the very work LISC supports across the country.

© 2019   Created by Lee Cruz.   Powered by

Badges  |  Report an Issue  |  Terms of Service