You may have missed it in the lead-up to the holidays, but something big happened in the world of New York's nonprofit law shortly before the end of the year.
On December 18, Governor Cuomo signed the Nonprofit Revitalization Act of 2013. The bill makes major changes to laws governing New York nonprofits, including eliminating "Type A, B, C and D" classifications that exist for charitable organizations, easing the process for nonprofits to merge, consolidate, dispose of substantial assets or dissolve, and increasing the gross revenue threshold triggering the requirement for an independent CPA audit.
The 64-page bill affects countless areas of nonprofit operations, with some of the changes easing the burden on nonprofits and others increasing the State's oversight control. For example, all nonprofits, including foundations, are required to adopt conflict of interest policies and many organizations will need to adopt whistleblower policies.
The Act mandates many aspects of nonprofit best practices that most foundations have followed and encouraged in grantees for many years. Still, there are items in the Act that may impact some foundation operations and also affect foundation grantees.
The Nonprofit Revitalization Act was long in coming. I served on Attorney General Eric Schneiderman's Leadership Committee for Nonprofit Revitalization that produced recommendations in this vein in December 2011. Philanthropy New York put out its very first policy statement in February 2012 supporting the AG's efforts and calling for leadership to produce a stronger, more accountable nonprofit sector in the state. The AG's recommendations eventually lead to the introduction of legislation that became the Nonprofit Revitalization Act, and was passed by the state legislature last Summer.
The Act goes into full effect on July 1, 2014. We are co-sponsoring a program on Thursday, January 30 that will provide key information necessary to understand the basics: "Nonprofit Revitalization Act of 2013: What You Need to Know."
With a lineup that includes Jason Lillien, the former Chief of the NY AG's Charities Bureau and a key architect of the law, The New York Community Trust's Lorie Slutsky, Julie Floch from EisnerAmper LLP, NPCC's Michael Clark, and more (including me), you will hear from a panel positioned to reflect on the implications of this important Act.
Please join us at this program, or one of the many other upcoming PNY events. We look forward to seeing each of you soon.
Best Regards,
Ronna