Member-Funded Societies (Societies Act FAQs) - Revision history

PLEO at 22:48, 12 January 2024

2024-01-12T22:48:11Z

← Older revision		Revision as of 22:48, 12 January 2024
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	{{Societies Act FAQs TOC}}		{{Societies Act FAQs TOC}}
	{{REVIEWED \| reviewer = [[Pacific Legal Education and Outreach Society]] (PLEO) in ~~May 2021~~}}		{{REVIEWED \| reviewer = [[Pacific Legal Education and Outreach Society]] (PLEO) in January 2024}}
	===What is a member-funded society?===		===What is a member-funded society?===
	A member-funded society is a special subset of non-profit societies. Incorporating as member-funded will be unusual for most groups of people who want to get together to do something to benefit the community. A member-funded society exists ''primarily'' for the benefit of its members. Some examples include golf courses or private benevolent organizations. Just because the non-profit is primarily funded by its members does not mean that the non-profit should incorporate as member-funded. ''Only non-profits that are certain they will likely never receive sources of funds from anyone other than their members should consider doing so.''		A member-funded society is a special subset of non-profit societies. Incorporating as member-funded will be unusual for most groups of people who want to get together to do something to benefit the community. A member-funded society exists ''primarily'' for the benefit of its members. Some examples include golf courses or private benevolent organizations. Just because the non-profit is primarily funded by its members does not mean that the non-profit should incorporate as member-funded. ''Only non-profits that are certain they will likely never receive sources of funds from anyone other than their members should consider doing so.''

Desy Wahyuni at 00:28, 29 May 2021

2021-05-29T00:28:17Z

← Older revision		Revision as of 00:28, 29 May 2021
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	{{Societies Act FAQs TOC}}		{{Societies Act FAQs TOC}}
			{{REVIEWED \| reviewer = [[Pacific Legal Education and Outreach Society]] (PLEO) in May 2021}}
	===What is a member-funded society?===		===What is a member-funded society?===
	A member-funded society is a special subset of non-profit societies. Incorporating as member-funded will be unusual for most groups of people who want to get together to do something to benefit the community. A member-funded society exists ''primarily'' for the benefit of its members. Some examples include golf courses or private benevolent organizations. Just because the non-profit is primarily funded by its members does not mean that the non-profit should incorporate as member-funded. ''Only non-profits that are certain they will likely never receive sources of funds from anyone other than their members should consider doing so.''		A member-funded society is a special subset of non-profit societies. Incorporating as member-funded will be unusual for most groups of people who want to get together to do something to benefit the community. A member-funded society exists ''primarily'' for the benefit of its members. Some examples include golf courses or private benevolent organizations. Just because the non-profit is primarily funded by its members does not mean that the non-profit should incorporate as member-funded. ''Only non-profits that are certain they will likely never receive sources of funds from anyone other than their members should consider doing so.''

PLEO: /* How do we decide whether to transition as a member-funded society? */

2021-05-13T17:39:33Z

How do we decide whether to transition as a member-funded society?

PLEO: /* What kinds of non-profits cannot become member-funded societies? */

2021-05-13T17:31:48Z

What kinds of non-profits cannot become member-funded societies?

← Older revision		Revision as of 17:31, 13 May 2021
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	===What kinds of non-profits cannot become member-funded societies?===		===What kinds of non-profits cannot become member-funded societies?===
	Non-profits that cannot become member-funded societies include:		Non-profits that cannot become member-funded societies include:
	*non-profits that have received public donations, government funding, or a combination of the two with a total value greater than $20,000 or 10%, whichever is greater, of the non-profit’s gross income within a period of two financial years immediately preceding the current financial year of the non-profit,		*non-profits that have received public donations, government funding, or a combination of the two with a total value greater than $20,000 or 10%, whichever is greater, of the non-profit’s gross income within a period of two financial years immediately preceding the current financial year of the non-profit;
	*non-profits that are registered charities as defined in the ''Income Tax Act'',		*non-profits that are registered charities as defined in the ''Income Tax Act'';
	*non-profits that are designated recipients of the ''Provincial Sales Tax Act'' or are otherwise entitled to receive taxes, fees, or other revenue received by the government as agents of the non-profit,		*non-profits that are designated recipients of the ''Provincial Sales Tax Act'' or are otherwise entitled to receive taxes, fees, or other revenue received by the government as agents of the non-profit;
	*are student societies as defined in the ''College and Institute Act'' or ''University Act'',		*are student societies as defined in the ''College and Institute Act'' or ''University Act'';
	*are hospitals or manage/operate a community care facility as defined in the ''Hospital Act'', or that are designated as hospital societies~~, or~~		*are hospitals or manage/operate a community care facility as defined in the ''Hospital Act'', or that are designated as hospital societies;
	*are in a class of non-profits that is prohibited under the regulations from having the statement in its constitution		*are in a class of non-profits that is prohibited under the regulations from having the statement in its constitution.

PLEO: /* What is a member-funded society? */

2021-05-13T17:30:55Z

What is a member-funded society?

← Older revision		Revision as of 17:30, 13 May 2021
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	===What is a member-funded society?===		===What is a member-funded society?===
	A member-funded society is a special subset of non-profit societies. Incorporating as member-funded will be unusual for most groups of people who want to get together to do something to benefit the community. A member-funded society exists ''primarily'' for the benefit of its members. Some examples include golf courses or private benevolent organizations. Just because the non-profit is primarily funded by its members does not mean that the non-profit should incorporate as member-funded. ''Only ~~those~~ non-profits certain they will likely never receive sources of funds from anyone other than their members should consider doing so.''		A member-funded society is a special subset of non-profit societies. Incorporating as member-funded will be unusual for most groups of people who want to get together to do something to benefit the community. A member-funded society exists ''primarily'' for the benefit of its members. Some examples include golf courses or private benevolent organizations. Just because the non-profit is primarily funded by its members does not mean that the non-profit should incorporate as member-funded. ''Only non-profits that are certain they will likely never receive sources of funds from anyone other than their members should consider doing so.''

	In its constitution, the member-funded society must declare: “This society is a member-funded society. It is funded primarily by its members to carry on activities for the benefit of its members. On its liquidation or dissolution, this society may distribute its money and other property to its members.”		In its constitution, the member-funded society must declare: “This society is a member-funded society. It is funded primarily by its members to carry on activities for the benefit of its members. On its liquidation or dissolution, this society may distribute its money and other property to its members.”

PLEO: /* What is a member-funded society? */

2021-05-13T17:30:25Z

What is a member-funded society?

← Older revision		Revision as of 17:30, 13 May 2021
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	===What is a member-funded society?===		===What is a member-funded society?===
	A member-funded society is a special subset of non-profit societies. Incorporating as member-funded will be unusual for most groups of people who want to get together to do something to benefit the community. A member-funded society exists ''primarily'' for the benefit of its members. Some examples include golf courses or private benevolent organizations. Just because the non-profit is primarily funded by its members does not mean that the non-profit should incorporate as member-funded. ''Only those non-profits ~~that are~~ certain it will likely never receive sources of funds from anyone other than ~~its~~ members should consider doing so.''		A member-funded society is a special subset of non-profit societies. Incorporating as member-funded will be unusual for most groups of people who want to get together to do something to benefit the community. A member-funded society exists ''primarily'' for the benefit of its members. Some examples include golf courses or private benevolent organizations. Just because the non-profit is primarily funded by its members does not mean that the non-profit should incorporate as member-funded. ''Only those non-profits certain they will likely never receive sources of funds from anyone other than their members should consider doing so.''

	In its constitution, the member-funded society must declare: “This society is a member-funded society. It is funded primarily by its members to carry on activities for the benefit of its members. On its liquidation or dissolution, this society may distribute its money and other property to its members.”		In its constitution, the member-funded society must declare: “This society is a member-funded society. It is funded primarily by its members to carry on activities for the benefit of its members. On its liquidation or dissolution, this society may distribute its money and other property to its members.”

PLEO: /* What is a member-funded society? */

2021-05-13T17:29:53Z

What is a member-funded society?

← Older revision		Revision as of 17:29, 13 May 2021
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	===What is a member-funded society?===		===What is a member-funded society?===
	A member-funded society is a special subset of non-profit societies. Incorporating as member-funded will be unusual for most groups of people who want to get together to do something to benefit the community. A member-funded society exists ''primarily'' for the benefit of its members. Some examples include golf courses or private benevolent organizations. Just because the non-profit is primarily funded by its members does not mean that the non-profit should incorporate as member-funded. ''Only those non-profits that are certain ~~they~~ will likely never receive sources of funds from anyone other than ~~their~~ members should consider doing so.''		A member-funded society is a special subset of non-profit societies. Incorporating as member-funded will be unusual for most groups of people who want to get together to do something to benefit the community. A member-funded society exists ''primarily'' for the benefit of its members. Some examples include golf courses or private benevolent organizations. Just because the non-profit is primarily funded by its members does not mean that the non-profit should incorporate as member-funded. ''Only those non-profits that are certain it will likely never receive sources of funds from anyone other than its members should consider doing so.''

	In its constitution, the member-funded society must declare: “This society is a member-funded society. It is funded primarily by its members to carry on activities for the benefit of its members. On its liquidation or dissolution, this society may distribute its money and other property to its members.”		In its constitution, the member-funded society must declare: “This society is a member-funded society. It is funded primarily by its members to carry on activities for the benefit of its members. On its liquidation or dissolution, this society may distribute its money and other property to its members.”

PLEO: /* What is a member-funded society? */

2021-05-13T17:29:07Z

What is a member-funded society?

← Older revision		Revision as of 17:29, 13 May 2021
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	===What is a member-funded society?===		===What is a member-funded society?===
	A member-funded society is a special subset of non-~~profits~~. Incorporating as member-funded will be unusual for most groups of people who want to get together to do something to benefit the community. A member-funded society exists ''primarily'' for the benefit of its members. Some examples include golf courses or private benevolent organizations. Just because the non-profit is primarily funded by its members does not mean that the non-profit should incorporate as member-funded. ''Only those non-profits that are certain they will likely never receive sources of funds from anyone other than their members should consider doing so.''		A member-funded society is a special subset of non-profit societies. Incorporating as member-funded will be unusual for most groups of people who want to get together to do something to benefit the community. A member-funded society exists ''primarily'' for the benefit of its members. Some examples include golf courses or private benevolent organizations. Just because the non-profit is primarily funded by its members does not mean that the non-profit should incorporate as member-funded. ''Only those non-profits that are certain they will likely never receive sources of funds from anyone other than their members should consider doing so.''

	In its constitution, the member-funded society must declare: “This society is a member-funded society. It is funded primarily by its members to carry on activities for the benefit of its members. On its liquidation or dissolution, this society may distribute its money and other property to its members.”		In its constitution, the member-funded society must declare: “This society is a member-funded society. It is funded primarily by its members to carry on activities for the benefit of its members. On its liquidation or dissolution, this society may distribute its money and other property to its members.”

PLEO: /* What kinds of non-profits cannot become member-funded societies? */

2021-05-10T22:31:49Z

What kinds of non-profits cannot become member-funded societies?

← Older revision		Revision as of 22:31, 10 May 2021
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	Non-profits that cannot become member-funded societies include:		Non-profits that cannot become member-funded societies include:
	*non-profits that have received public donations, government funding, or a combination of the two with a total value greater than $20,000 or 10%, whichever is greater, of the non-profit’s gross income within a period of two financial years immediately preceding the current financial year of the non-profit,		*non-profits that have received public donations, government funding, or a combination of the two with a total value greater than $20,000 or 10%, whichever is greater, of the non-profit’s gross income within a period of two financial years immediately preceding the current financial year of the non-profit,
	*non-profits that are registered charities as defined in the Income Tax Act,		*non-profits that are registered charities as defined in the ''Income Tax Act'',
	*non-profits that are designated recipients of the Provincial Sales Tax Act or are otherwise entitled to receive taxes, fees, or other revenue received by the government as agents of the non-profit,		*non-profits that are designated recipients of the ''Provincial Sales Tax Act'' or are otherwise entitled to receive taxes, fees, or other revenue received by the government as agents of the non-profit,
	*are student societies as defined in the College and Institute Act or University Act,		*are student societies as defined in the ''College and Institute Act'' or ''University Act'',
	*are hospitals or manage/operate a community care facility as defined in the Hospital Act, or that are designated as hospital societies, or		*are hospitals or manage/operate a community care facility as defined in the ''Hospital Act'', or that are designated as hospital societies, or
	*are in a class of non-profits that is prohibited under the regulations from having the statement in its constitution		*are in a class of non-profits that is prohibited under the regulations from having the statement in its constitution

PLEO at 22:30, 10 May 2021

2021-05-10T22:30:07Z

Show changes

← Older revision		Revision as of 17:39, 13 May 2021
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	''source: BC Registry Services, "Preparing for B.C.'s New Societies Act: A Guide to the Transition Process"''		''source: BC Registry Services, "Preparing for B.C.'s New Societies Act: A Guide to the Transition Process"''

	===How do we decide whether to ~~transition as~~ a member-funded society?===		===How do we decide whether to become a member-funded society?===

	'''Member-Funded Society – A Challenging Choice''' (by Paul Wood)		'''Member-Funded Society – A Challenging Choice''' (by Paul Wood)

	As Chair of the Governance Committee of a non-profit serving a reasonably sophisticated community, working our way through ~~the new Societies Act, the~~ Constitution and Bylaw review ~~necessary for all non-profits in BC at this time, and the key considerations~~, thoughts turned to Part 12, Division 1, which provides for ~~Member~~-~~Funded Societies~~.		As Chair of the Governance Committee of a non-profit serving a reasonably sophisticated community, working our way through a Constitution and Bylaw review, thoughts turned to Part 12, Division 1 of the ''Societies Act'', which provides for member-funded societies.

	Preparing for B.C.’s New Societies Act: A Guide to the Transition Process, tells us: On transition, each pre-existing non-profit will be asked whether it wishes to designate itself as a “member-funded society” by including a statement to that effect in its constitution. A member-funded society is a non-profit that is funded primarily by its members to carry on activities for the benefit of its members. Common examples might include some sports clubs, golf courses and professional associations.		A member-funded society is a non-profit that is funded primarily by its members to carry on activities for the benefit of its members. Common examples might include some sports clubs, golf courses and professional associations.

	This seemed a perfect fit. Although a non-profit cannot be a member-funded society if it receives public donations or government funding beyond specific thresholds, there was a high degree of confidence that this fit our circumstances, until we spoke with a lawyer. Working through the language of the Act and the due diligence necessary to come to a confident conclusion, doubts crept in. Shifting the focus from the due diligence of an historic review of financials, decisions and minutes over at least the past two years, to a view looking forward, and the potential constraints selecting member-funded status might impose on future directions and decision-making, doubts were no longer merely creeping, they were striding confidently.		This seemed a perfect fit. Although a non-profit cannot be a member-funded society if it receives public donations or government funding beyond specific thresholds, there was a high degree of confidence that this fit our circumstances, until we spoke with a lawyer. Working through the language of the Act and the due diligence necessary to come to a confident conclusion, doubts crept in. Shifting the focus from the due diligence of an historic review of financials, decisions and minutes over at least the past two years, to a view looking forward, and the potential constraints selecting member-funded status might impose on future directions and decision-making, doubts were no longer merely creeping, they were striding confidently.
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	**Is this likely to ever be the case?		**Is this likely to ever be the case?

	In the end, in our circumstances, the decision was one of balancing the “real” benefits of member-funded status against the need for proper due diligence in ensuring our non-profit met the detailed tests set up in the ~~new Act~~, and the constraints that it would impose on the non-profit in terms of receiving public donations or government funding in the future.		In the end, in our circumstances, the decision was one of balancing the “real” benefits of member-funded status against the need for proper due diligence in ensuring our non-profit met the detailed tests set up in the act, and the constraints that it would impose on the non-profit in terms of receiving public donations or government funding in the future.

	====Cautions====		====Cautions====
	Becoming a member-funded society is a significant choice that needs to be authorized by a special resolution of the members … If you have any doubt about whether your non-profit can or should become a member-funded society, you should seek legal advice before transitioning.		Becoming a member-funded society is a significant choice that needs to be authorized by a special resolution of the members. If you have any doubt about whether your non-profit can or should become a member-funded society, you should seek legal advice before transitioning.
	Member-funded designation is a choice that must be made ~~on transition~~, otherwise a court order is needed. It is one of the most challenging areas of the ''Societies Act''.		Member-funded designation is a choice that must be made at incorporation, otherwise a court order is needed. It is one of the most challenging areas of the ''Societies Act''.


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