CASA: A Guide to Program Development

Section 1 - Planning a Quality Program (Chapters 1- 9)
Section II - Volunteers (Chapters 10- 12)
Section III - Managing the Program (Chapters - 13-15)

<Manual HomeIntro Chapters1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Section I - Planning a Quality Program
Chapter 3: Organizational Structure

Establishing CASA as a Nonprofit Organization
  - Articles of Incorporation
  - Bylaws
  - IRS Tax Exemption Letter
Establishing CASA Under Another Organization
  - Compatible Missions as a Starting Point
  - Questions for Consideration
  - Factors Supporting Successful Umbrella Arrangements

How your CASA program is to be structured may be a decision that has already been made for you. If the court has initiated the development of the program and has determined that public funds are available to fund its operations, many of the tasks related to setting up an independent corporation would not be necessary. Most CASA programs developing today, however, are established as independent nonprofit organizations or start out under the umbrella of an existing nonprofit agency, so it is likely that your program will be pursuing one of these avenues.

Whether to establish the program as an independent organization or to become part of another organization is a decision that the planning committee should consider very carefully. As you might expect, both structures have pros and cons. Each option is discussed in detail below.

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Establishing CASA as a Nonprofit Organization

Establishing CASA as an independent corporation at the beginning of the program?s existence provides the advantages of assuring that the volunteers can be truly independent without concern for possible negative consequences to the program; allowing the organization to create its own image in the community; and providing autonomy in planning, budgeting, hiring, fundraising and other aspects of program and volunteer management.

On the downside, establishing a nonprofit corporation requires a number of legal steps that can be time-consuming and require specific knowledge of the law and tax regulations. There are a number of excellent resources available that can provide step-by-step instructions on how to form a nonprofit corporation. One good publication available from National CASA is How to Form a Nonprofit Corporation by Anthony Mancuso, published by Nolo Press. It is wise to consult an attorney as you proceed, although the necessary documents can be prepared by a lay person. There are three fundamental documents that serve as the basis for a legal nonprofit corporation:

  • Articles of Incorporation (or "Charter" in some states)
  • Bylaws
  • Tax Exemption Letter from the Internal Revenue Service

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Articles of Incorporation

Corporations are created under the statutory authority of a state, and all states have specific statutory provisions relating to the formation of nonprofit corporations. Typical of the items required to be included in articles of incorporation are:

  • Name of the corporation
  • Duration of the corporation (usually perpetual)
  • Purposes for which the corporation is formed
  • Provisions for conducting the internal affairs of the organization
  • Names and addresses of the incorporators
  • Names and addresses of the initial board of directors
  • Address of the initial registered office and name of the initial registered agent of the corporation
  • Provisions for distribution of the assets of the corporation on dissolution

The statutes of each state are different, however, and your attorney should be consulted to assure that you conform to the requirements in your state. It is important that the articles qualify the organization as a nonprofit corporation by stating the organization?s purpose appropriately.

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Bylaws

The Articles of Incorporation provide only a broad outline of the organization?s form, and the initial board of directors (can be the steering committee for the purposes of incorporation) should quickly develop and approve a set of bylaws which will supplement the articles by prescribing more detailed rules for governing the organization. Bylaws provide the discipline required for orderly operation of the organization, and they should be written with an emphasis on fair treatment.

Bylaws often begin with a restatement of the name and purposes of the organization consistent with the articles of incorporation, but they add basic rules for operating the organization:

  • The frequency, notice, and quorum requirements for organizational meetings
  • Voting qualifications, proxies, and procedures
  • The number and term of the board of directors, scope of authority, method of nomination and election to the board, and provisions for filling vacancies
  • List of officers, method of nomination and election, terms of office, powers, duties, and succession
  • The composition and duties and powers of the executive committee
  • Title and scope of authority of the staff executive
  • Record keeping and financial reporting responsibilities
  • Bylaw amendment procedures and provisions for dissolution of the organization

It is wise to stop short of having too much detail contained in the bylaws so that the organization can retain some flexibility to change its operations without bylaw amendments. Bylaw amendments, although simpler than amendments to the articles of incorporation since the laws of the state are not involved, nevertheless often require a vote of the full membership of the organization, which can hamstring an executive and the officers and board in creating new operating structures to meet changing needs.

An illustration of the type of operating flexibility, which should be preserved for board action at a later time, is committee structure. The bylaws should prescribe the membership and authority of only one standing committee: an executive committee which is made up of officers who need to make decisions between board meetings. Beyond that, the bylaws should only provide that the board has authority to establish any other committees with whatever jurisdiction it prescribes. By preserving such organizational flexibility, the board is able to form new committees, or perhaps more importantly, eliminate obsolete committees without amending the bylaws. (See example of bylaws in the Tools Section)

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IRS Tax Exemption Letter

Nonprofit organizations must take one more step in establishing their operations. In order for donations received to be tax-deductible and to qualify for reduced postal rates, they must establish their tax-exempt status with the IRS. Section 1.501(a) of IRS regulations provides that there shall be an exemption from income taxation for qualified organizations. Application for exempt status should be filed using IRS Form 1023. Copies of the organization?s articles of incorporation and bylaws must be included with the application, and a full description of the purpose and activities of the organization must be provided. IRS Publication 557 provides detailed information on the filing process. Fees associated with the filing are usually several hundred dollars.

If the IRS determines that an organization has met the test for exemption, it will issue predetermination and final determination letters, which should be kept safely on file with the other fundamental organizational documents. Be aware that issuance by the IRS of tax-exempt status does not eliminate the need for the organization to file annual information returns with the IRS. Tax-exempt organizations other than private foundations must file Form 990, or Form 990 EZ, which is a shortened form designed for use by small organizations. An accountant or financial advisor should be consulted about the filing of this annual return.

There is also the possibility that you will need to obtain tax-exempt status from the state in which the organization is operating or is incorporated. Many states simply replicate the federal tax exemption regulations, and qualification under the Federal regulations automatically qualifies the organization in the state, but some jurisdictions require additional application and annual tax returns.

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Establishing CASA Under Another Organization

The second organizational model that has been used with increasing frequency is the development of new CASA programs under the administrative structure of an established organization. There are a number of advantages to such an arrangement, which make this option appealing to many CASA steering committees. Though the exact nature of the relationship between CASA and the "parent" organization varies somewhat, the benefits of such a collaboration can include:

  • The use of the umbrella organization?s tax-exempt status to raise funds;
  • The use of existing office space and equipment;
  • Availability of services such as bookkeeping, accounting, telephone, clerical support, and grant writing;
  • Reducing administrative time and cost;
  • Reputation and name recognition;
  • Access to funding sources;
  • Guidance in program and policy development from the umbrella organization.

Starting a CASA program under another organization should not be chosen simply because it is a short cut to getting a program started, because this option also has its downsides.

A number of programs established using this model have made the decision after a year or two to become independent for the purpose of gaining more control over their own operations. One CASA program that began as part of another agency was dissolved when the board of that agency decided to guide their organization in another direction. Other programs have not been allowed to expand to the extent necessary to serve more children.

If CASA is part of another agency, its visibility in the community and to a large extent the public?s perception of CASA will be as a "project" of the parent organization. This perception makes it difficult for CASA to develop its own identity and may be an obstacle to recruiting volunteers and raising funds. If the parent agency does not actively publicize and promote CASA, the program may have little exposure in the community and may simply become lost.

Some sponsoring organizations charge the program an administrative fee, usually a percentage of the CASA portion of the budget, for the services it provides to the program. This is certainly a justifiable action and often remains a cost-effective way of doing business. However, some programs under this type of administrative structure have reported that this can become a problem when the percentage of the fee charged by the administering agency is increased each year. Once the fee reaches a certain level, CASA must consider whether or not it could purchase or provide the same services independently at less cost.

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Compatible Missions as a Starting Point

If the CASA program chooses to operate under an umbrella agency, it is vital that the parent agency's mission is compatible with the CASA mission and that the goals of each organization are compatible. It is not uncommon for an existing organization to initiate the development of a CASA program or to approach the planning committee about forming an alliance. Occasionally the committee will decide to approach potential-sponsoring organizations directly. About 40% of CASA programs that were under umbrella agencies in 1998 were under nonprofit family and children?s services agencies. Other common umbrella organizations include child abuse prevention councils, child advocacy centers, and agencies dealing with domestic violence.

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Questions for Consideration

If an umbrella structure is being considered, there are some fundamental questions that should be carefully considered prior to any agreement:

  • Is the mission of the proposed parent organization compatible with that of CASA?
  • What is the community?s perception of that organization?
  • Is there a potential for conflict if the two organizations are serving the same population?
  • Is the organization financially sound?
  • Will it be able to carry the additional start-up costs for CASA?
  • Is the sponsoring agency?s interest long-term or do they wish to spin off the program in the future?
  • How actively will the sponsoring agency market CASA, pursue funding for the program, and utilize existing political contacts to support CASA?
  • What will be the role of the umbrella agency's board with respect to CASA?
  • Will CASA have its own board to establish policies and set goals?
  • What will be the financial relationship between CASA and the umbrella agency? Are there limitations on fundraising?
  • How will future planning for CASA be approached after the program's establishment?

The committee should examine the potential for conflicts of interest that may occur between CASA and the parent organization when both organizations may be serving the same families. When this occurs, the potential for disagreement about the proposed permanent plan for the child or the visitation schedule between the child and parents is likely at some point. Issues of confidentiality also arise when one party has confidential information that the other would find helpful. If CASA is to be under such an organization, it is important to create procedures for dealing with and resolving conflicts prior to implementing the joint organization.

There are some community agencies that should not administer the CASA program because of an inherent conflict. The agency responsible for child protection in the community is an obvious example. Though their mandate is to protect the child, their role is to balance the interests of the state and the parents with those of the child while CASA is focused solely on the child. The office of the public prosecutor and the attorney general?s office are two other obviously inappropriate entities for administering CASA.

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Factors Supporting Successful Umbrella Arrangements

The experience of many CASA organizations administered by umbrella organizations has demonstrated that there are a number of conditions that support the effectiveness of this type of structure:

1) Independence of CASA. In order to provide recommendations regarding the best interests of children to the court, CASA volunteers must be totally independent. There should be no possibility, or even the perception, that an umbrella organization could influence the volunteers or the program in any way.

This can be achieved, in part, by having a separate advisory board for the CASA program. The role of such a board would include:

    • Developing and approving policies for CASA, including agreements with the court and social services when appropriate
    • Developing and recommending the program?s budget
    • Promoting collaborative relationship with the umbrella organization and periodically reviewing the agreement that guides the relationship between the organizations
    • Promoting CASA through public relations activities
    • Monitoring and evaluating program operations
    • Developing and implementing fundraising activities for the benefit of CASA

There should be members of the umbrella agency?s governing board on the CASA advisory board and membership from the CASA board on the umbrella agency?s governing board.

2) Separate staff for CASA. In the early stages of program development, an umbrella agency may be tempted to utilize existing staff to recruit, train, and supervise volunteers. Because of the nature of the work of CASA volunteers, access to expert supervision is critical to the volunteer?s and the program?s success. Volunteer supervision in a CASA program requires consistency and continuity. It can not easily be assigned to staff who have other duties or divided up among several staff members. National CASA standards recommend that a full-time supervisor should supervise no more than 30 volunteers. If the program expects to have that number of volunteers within the first year or two of operation, it is strongly recommended that there be separate staff for the CASA program.

3) Written Agreement. A formal written agreement between CASA and the umbrella organization outlining the responsibilities and rights of each should be developed. Such an agreement assures that both entities have carefully considered the implications of this arrangement in advance and that the unique needs of each organization will be balanced as implementation proceeds. The governing board of the parent organization should approve and sign this letter before the CASA program begins using the agency?s tax-exempt status to raise funds.

The agreement should be for a limited time period, allowing adequate time to develop a solid working relationship and to work out any potential problems that arise. At least one year, but no more than two years is recommended. At the end of the agreed time, each party should complete an evaluation. The results should be shared jointly with both boards and appropriate action taken to resolve any problems or to modify the arrangement if either organization wishes to do so. This process should be completed annually thereafter.

The development of a CASA program within a sponsoring organization can be an effective method of combining community resources and creating a strong, sustainable program. Developing a plan that respects the uniqueness of each organization and realistically addresses the possibility of disagreements and conflicts will help to assure that the arrangement succeeds.


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