February 2006 ISSUE
FOUNDATIOn update
Defining Our Legal Basis
BY DENNIS BROOKS, P.ENG., P.GEOPH.
Education Foundation Columnist
This is the second last article I plan to write as a columnist in The PEGG. I have said in previous articles that I have been running out of ideas on what to write about, and have even threatened to re-issue old articles to see if anybody notices!
Well, I’m just about to plagiarize my own old articles because I want to
revisit the purpose and legal basis for the creation of the APEGGA Education
Foundation. In my final article, I want to get back
to a vision of what the foundation is about.
APEGGA Council approved a set of bylaws in December 1996, drawn up by its legal counsel in conformance with the requirements of the Societies Act of Alberta. APEGGA wanted to get out of the scholarship business and at the same time take advantage of a provision in the Income Tax Act to be able to issue tax deductible receipts to our members who wish to make a donation.
The foundation is registered as a charitable society and control passes to its board of directors, which is elected by the foundation members from amongst its own members. The only remaining controls by APEGGA are that it must recommend through Council member candidates for the foundation, who must then be approved by a majority of existing foundation members.
APEGGA also is entitled to have at least one director on the board, the APEGGA Executive Director and Registrar or his designate.
The Societies Act requires that there be certain provisions in the bylaws
for transparent and responsible administration and that there be annual filings,
including a list of current directors so the government knows who is responsible.
There are strict requirements for revisions to bylaws.
APEGGA also applied under the Income Tax Act for the foundation to be a registered
charitable organization. Under the Income Tax Act, we technically are not a foundation!
We can issue tax deductible receipts to donors but must then ensure that 80 per cent of those funds goes directly to our charitable purposes (i.e. scholarships); we have a little latitude with some carry-forward provisions.
APEGGA itself has been the single greatest donor to the foundation. Since it is not a taxable organization, its donations fall outside the 80 per cent rule.
These conditions create a rather confusing and uncertain relationship between APEGGA and its offspring foundation. I think at times we eye each other with a certain amount of suspicion!
What really keeps us together is a bond in our common objective of bringing new, talented members into our professions through scholarships. At this point, the foundation could not operate without the contribution and guidance of APEGGA, nor do I think we would want to try to operate alone.
The foundation has been moderately successful in drawing donations from our member professions and creating new and bigger scholarships. At the same time, APEGGA has been largely freed from the worries and administration of awarding scholarships.
In my last article, I would like to talk about a vision for the foundation. What do we want to be? What don’t we want to be?