Updating a Corporation Renewal With New Officers

Question: 

When I filed our annual corporation renewal with the Washington Secretary of State’s office in February, I noticed that there was a  place to list the officers.  I updated the information then, but of course now our officers are changing—should I file another renewal? 

Answer: 

Yes.  The law requires that any nonprofit corporation file an annual report during the month of the anniversary of its incorporation.  That report is required regardless of whether anything has changed since the  preceding year’s report.  In addition, however, you should also update the annual report any time during the year that there’s a change in any of the required information, which includes a change in the officers.  The annual report can be filed online or you can download the form and file it by mail—either way there’s a $10.00 fee.  More information and a link to the applicable forms can be found on the Secretary of State’s website.

Can a unit promote a local business that offers a discount to PTA members?

QUESTION:  

A local business is offering a discount to our members as a way for us to attract members and for them to attract new customers.  However I thought that PTA was supposed to be noncommercial and not endorse individual businesses.  Can our PTA agree to promote the discount to our members without violating those requirements?

ANSWER:  

You are correct that Article 2, Section 1(h) of the Uniform Bylaws states that “[t]he organization or members in their official capacities shall not endorse a commercial entity or engage in activities not related to promoting of the purposes of the organization.” 

However in the situation you describe the discount would benefit members and encourage others to join the PTA, so promoting the discount to your members would be “related to promoting the purposes” of your PTA and not be in violation of the Uniform Bylaws. 

Having said that, there are several factors you may want to consider. 

-- First, is the product or service being offered one that is aligned with PTA’s purposes?  For example, promoting a healthy food product or activity for kids clearly would be, while an oil change, probably not so much, and a discount on dangerous or harmful products is probably something that your PTA would not want to be associated with.  These are business judgments that your PTA’s board of directors would have to make weighing the benefit to the PTA and the membership as well as the needs and circumstances served by your PTA. 

-- Second, there may be other businesses – including some  owned by your members –that might welcome a similar opportunity.  While you don’t have to try to contact every business in town, you may want to put the  word out generally before accepting the first opportunity that presents itself.  Finally you may want to include a statement to the effect that the offer is being made available to your members as a convenience to them, but that if they choose to take advantage of it the business relationship is strictly between them and the business.

Collecting Sales Tax on Weekly Cookie/Popcorn Sales

Question:   

Our PTA has a cookie sale every week and sells other snacks (candy and popcorn) during sporting events.  We also sell spirit wear (tee shirts and sweat shirts with the school logo) during the fall.   Should we be collecting sales tax on these sales?

Answer:  

As long as the spirit wear sale is for a defined, limited period, it would be considered a periodic fundraising event, and sales at such events are not subject to the sales tax.  Sales at a “regular place of business” are taxable, but certain food items are themselves exempt from sales tax.  Because the cookie sales occur on a regular schedule, they are considered to be a “regular place of business” but bakery items such as cookies are exempt from the sales tax, so the answer there is also no. 

The sales at sporting events would also probably be considered a “regular place of business” because they occur repeatedly throughout the school year, but some items (such as candy and fresh fruit) are exempt, and other items (such as popped popcorn) are not exempt.   To find out whether specific items are subject to the sales tax, you can contact the Department of Revenue’s Telephone Information Center at 1-800-647-7706.

What consitutes a quorum?

Question:   

Our local unit has thirteen positions on the Board of Directors, but only ten of them are currently filled, with some board members doing double duty until we fill the other two positions.   I know that a majority of the Board must be present at our Board meetings to have a quorum to do business, but I’m not sure whether it’s a majority of the positions or a majority of the actual people currently on the Board. 

Answer: 

You are correct that under Article 5, Section 11(c) of the Uniform Bylaws, “(c) A majority of those currently serving on the board shall constitute a quorum.”  Because there are currently 10 people actually serving on the Board, a majority of six people must be present to constitute a quorum.