Suspension/Dissolution Policy

VVA Board of Directors’ Policy Reference Guide (pp. 15-21)

VVA Board of Directors (BOD) Chapter Charter Revocation Policy (Approved 10/10/09)(Amended Motion # 22 - 4/21/12)(Amended Motion # 26 – 1/17/17) 

The purpose of this VVA Membership policy is and establish a consistent process by which State Councils may address the possible revocation of a Chapter Charter: 1) A Chapter is placed in a suspended status by the National Corporation for failure to submit an annual Chapter financial report and/or an annual or biennial Chapter election report; 2) A Chapter has become inactive; and 3) A Chapter has decided to voluntarily dissolve. 

A.  Chapters Suspended for Failure to Submit Required Reports to the VVA 

Financial Report: A Chapter is placed in a suspended status by the National Corporation for failure to submit an annual Chapter financial report to both its State Council and with the VVA Finance Department by July 15 of each year as required in Article IV, Section 1.A of the VVA Constitution

Election Report: A Chapter is placed in a suspended status by the National Corporation for failure to submit an annual or biennial Chapter election report to both its State Council and the VVA Membership Department not later than July 15 of the year in which the elections take place. As required in Article III, Section 9 of the VVA Constitution. Chapter elections are to be held in April. Officers shall hold office for a term of one or two years as specified in the chapter bylaws. Chapters may choose to stagger terms of office for continuity purposes. 

1. When a Chapter does not file an election or financial report by the deadline, the National Corporation will notify the Chapter of its suspension and inform them that charges will be filed to revoke the Chapter’s charter under provisions of VVA National Disciplinary Policy if the delinquent reports are not filed with its State Council and the VVA Membership Department. The appropriate State Council President and Regional Director will receive copies of this notice. 

2. While suspended, a Chapter may continue to use the VVA name and logo and continue to receive unsolicited tax-deductible contributions. The Chapter may not engage in fund- raising activities, regardless of contractual arrangements; receive revenues generated by VVA, to include member dues rebates or Household Goods Solicitation Program funds; send delegates to the National Convention; or send delegates to State Council Conventions. (VVA National Disciplinary Policy) State Council bylaws may also restrict suspended Chapters from participating in certain State Council activities. 

While suspended under the provisions of this policy, Chapters may conduct Chapter business only for the purposes of calling meetings for disbursing funds previously raised in VVA’s name to pay Chapter obligations unless specifically exempt from this restriction by the National Board of Directors. Such exemptions shall not be granted when suspensions are due to filing of charges or imposition of sanctions under the VVA National Disciplinary Policy. When such exemptions are granted by the National Board of Directors, Chapters may hold business and informational meetings, hold elections, and otherwise engage in organized Chapter activities. 

3. Upon notification by the National Corporation that a Chapter has been suspended, the State Council President or designee is responsible for contacting the Chapter Officers/Board of Directors for the purpose of determining the reason the report(s) was not filed as required, and to assist the Chapter in meeting any delinquent reporting requirements. 

4. If the State Council President believes circumstances justify it, he/she may petition the National Board of Directors to relieve the Chapter of the responsibility for filing the report(s) in question. 

5. If the State Council President determines that the Chapter has become inactive (no longer holds meetings, is unable to establish a quorum to conduct business, the terms of elected officers have expired, etc.), he/she will initiate the procedures in Section B of this policy. 

6. If the Chapter fails to provide the delinquent report(s) after being suspended, the State Council and the Regional Director will be notified by the VVA Membership Department, and the State Council or Regional Director may file charges under the provisions of VVA National Disciplinary Policy which addresses the process to be used. 

The charge would be GROSS NEGLECT under the Code: 

a. The chapter failed to comply with the duty to submit annual financial report or election report. 

b. The charge(s) are sustained by the evidence consisting of a copy of the VVA Membership Department notice of non-compliance and suspension which has been verified to be true and accurate and any correspondence between the State Council and the Chapter (including e-mails). 

7. The National Secretary under a special exception authorized by Section VIII of the National Disciplinary Policy shall file an SOC against a Chapter or a State Council that has already been suspended for twelve (12) consecutive months for failing to file the annual financial report and/or the election report. 

B.  Chapters That Have Become Inactive 

If the State Council determines that a Chapter has become inactive (no longer holds meetings, unable to establish a quorum to conduct business, the terms of elected officers have expired, etc.), the State Council will: 

1. Send a letter to all members of the Chapter calling a special meeting to determine if the membership of the Chapter wishes to continue as a Chapter or decide to dissolve. In accordance with the VVA Constitution, Article III, Section 4.E, notice to the members will be at least ten (10) days prior to the meeting date. 

2. If the Chapter members decide to reactivate the Chapter, the State Council will assist
the Chapter in meeting any delinquent reporting requirements (VVA; State , Commonwealth, or Territory, hereafter referred to as “State”; or “Federal”), and in completing any other activities required to resume functioning as a Chapter. This assistance may involve assigning a duly elected or appointed member of the State Council as a temporary mentor, obtaining Chapter records and/or Chapter property from previous Chapter officers, or other assistance warranted by the situation. 

3. If the Chapter members decide to disband, the State Council will initiate the procedures in Sections D and E of this policy to dissolve the Chapter, to revoke the Chapter’s VVA Charter, and to dissolve the Chapter’s incorporation within the State. 

C.  Chapters That Decide to Voluntarily Dissolve 

1. A Chapter may initiate voluntary dissolution by a majority vote of members at any regular, annual, or special meeting where a quorum is present.
Although not required by the VVA Constitution, if the decision is to be made at a regularly scheduled meeting, the Chapter Board of Directors should consider sending a notice at least ten (10) days of advance of the meeting to inform all members that such action is being considered and will be voted on. 

If the decision is to be made at an annual or special meeting, notice of the meeting, specifying the purposes for which such meeting is called, the date, time, and place it is to 

be held, shall be delivered either personally or by mail to each member entitled to vote at such meeting, at least ten (10) days before any special meeting, and not less than thirty (30) days nor more than fifty (50) days before any annual meeting. 

If after proper notification has been made by the Chapter for a regularly scheduled, annual or special meeting to discuss voluntarily dissolving the Chapter and the actual meeting fails to obtain a quorum, the Chapter be deemed inactive. 

2. The Chapter will notify the State Council by letter of the action determined by the Chapter or the fact the meeting failed to obtain a quorum. Documentation may be requested by the State Council to verify appropriate notice was given and attendance at the meeting. 

3. If the Chapter has voted to dissolve or the State Council President has determined the Chapter to be inactive, the State Council will assist the Chapter officers in following the procedures in Sections D and E of this policy to dissolve the Chapter, to revoke the Chapter’s VVA Charter, and to dissolve the Chapter’s incorporation within the State. 

D.  Revocation of a VVA Chapter Charter 

The National Corporation can revoke only a Chapter’s VVA Charter. Because each Chapter is an independently incorporated entity, un-incorporation is under the purview of State laws and regulations. Chapters voluntarily dissolving and State Councils needing to dissolve inactive Chapters or Chapters whose Charter has been revoked must consult with the State office which issues incorporations, and any other State offices which govern non-profit organizations or charitable fund-raising. 

The following applies to all Chapters being dissolved, whether as a result of disciplinary action, voluntary action by the Chapter, or when a Chapter is determined by the State Council to be inactive. 

1. Revocation of VVA Chapter Charter 

a. Article IV, Section 1, paragraph A of the VVA Constitution allows the revocation of a Chapter Charter upon filing of the charges under the National Disciplinary Policy for failure to file required election or financial reports. In accordance with this provision, the Chair of the National Disciplinary Committee will take action immediately upon receiving charges to determine if the charges are justified under the VVA Constitution and the. See Section 1.C of the VVA National Disciplinary Policy for procedure. 

b. When a Chapter has decided to voluntarily dissolve, the State Council President will forward the notification from the Chapter to the VVA National Secretary requesting revocation of the Chapter’s Charter. 

c. When a Chapter is determined to be inactive, the State Council President will request in writing that the VVA National Secretary revoke the Chapter’s Charter. The letter of request should include the circumstances (period of time during which no meetings have been held, date of expiration of the terms of the last elected officers, etc.) and efforts the State Council has made to contact the Chapter, and whether Chapter property/records/etc. were located and secured. 

d. The VVA National Secretary will notify the State Council and the VVA National Membership Director of the revocation. The National Membership Director will include all documentation in the Chapter file and annotate the file and the database to indicate the date of Charter revocation. 

e. The State Council will notify all Chapter members of their status as VVA members, that the Chapter has been dissolved, and that all members will revert to at-large status unless they wish to transfer to another Chapter. 

E.  Dissolution of a Chapter 

Dissolution of a Chapter requires several steps: 1) review and compliance with any state law/regulation pertaining to Chapter dissolution; 2) notification to the Federal Internal Revenue Service and notification to the VVA Finance Department of Chapter dissolution; 3) the actual disposition of Chapter assets and records; and 4) disposition of Chapter financial accounts. 

1. Chapter Dissolution With the State
As State laws vary, the State office which incorporated the Chapter must be contacted to determine what steps must be taken. If the Chapter is voluntarily dissolving, the Chapter officers should complete this process. If the Chapter is inactive or non-functional, the State Council is responsible for completing the process.

  1. Answers to the following questions should be obtained:       

What is the process to un-incorporate?
What forms/ documents must be filed?
Are there fees?
Does state law/regulation dictate disposition of property/assets and records?
Does the State dictate a process that must be followed (e.g., if monetary assets must be donated to a charitable organization, does state law/regulation dictate how that charity is chosen?
For Chapters numbered 1 through 799, could the assets be donated to the parent organization (i.e., the State Council or VVA National)?
What final reports (annual report, tax returns, etc) need to be filed? 

2. Chapter Dissolution With the Federal Internal Revenue Service 

a. File final return. Forms 990/990E-Z/990PF include a Termination box in the header area on page 1 which should be selected to indicate the organization is ceasing to exist. Form 990 and Form 990-EZ filers must also attach Schedule N, Liquidation, Termination, Dissolution or Significant Disposition of Assets. See www.irs.gov; search “termination of an exempt organization” 

b. Notify the IRS so that it will no longer expect the chapter to file annual returns. To do this, send a letter to: 

EO Determinations
Internal Revenue Service
Exempt Organizations Determinations P.O. Box 2508
Cincinnati, OH 45201 

The following items must be submitted with the request:
1) A list of the last set of officers or trustees and their daytime telephone numbers
2) One of the following:
a) Articles of Dissolution filed with state
  officials
b) Minutes of the meeting where the vote
was taken to dissolve (signed and dated by
an officer) 

c. The VVA Finance Department will be notified so that the Chapter will not be included on the annual list sent to the IRS of which Chapters and State Councils are covered by VVA’s group exemption letter. 

3. Disposition of Chapter Assets and Records 

a. Any such distribution of Chapter assets will be determined by the State Council and/or members and this decision should be recorded in the State Council meeting minutes. 

b. For Chapters numbered 1 through 799, disposition of Chapter assets is by State law/regulation. If not specified by State law/regulation, Chapter assets and records will revert to the State Council. 

c. Disposition of assets should be documented in the Chapter records. 

d. Disposition of Chapter records is up to the State Council unless otherwise prescribed by State law or regulation. 

4. Disposition of Chapter Financial Accounts 

To determine disposition of Chapter financial accounts for Chapters numbered 1 through 799 and Chapters numbered 800 and above, the State Council will initiate the procedures in Section E of this policy. 

a. All financial assets remaining after paying expenses associated with dissolution (e.g., fees to un-incorporate, legal or accountant fees if incurred) of the Chapter is by State law/regulation. 

b. When all obligations have been settled, all financial accounts must be closed and the final statements included in the Chapter financial records. 

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