Closing a Non-Profit Organization
When an organization does not get renewed funding from a major funder – ORR or another source – this will often cause dramatic changes in their program activities and possibly a need to make difficult transitions. There is, of course, not a lot that NCB can offer to assist these in these transitions, but we do extend our sincere sympathy to these programs and offer whatever support and assistance is possible.
Transition checklist
To start with, we are sure that each organization is getting professional advice that is appropriate to their specific situations, but here are a few things that your organization may need to consider.
Clients
- Refer to other providers
- Get authorization to share records with selected referral provider
Client Records
- Plans must be made to keep the records for the length of time dictated by applicable state laws
- Current and former clients must know how they can access records
Financial Records
- Your accounting people will be able to advise you best on what is necessary to do, but some things to think about are state and IRS requirements
Contracts
- Notify/terminate contracts
- Make provision to assure that contractual obligations are fulfilled on contracts that cannot be terminated
Celebrate the contributions of your staff and volunteers. Many people work hard to build and run organizations like ours and thanks and recognition are always appropriate.
What can NCB do?
One thing that NCB can offer is to maintain ‘historical’ information on SOT programs. This might include an organizational profile, staff information, website information, or contact information for key staff. It could also include ‘legacy materials’. Many organizations have spent considerable time and effort creating different types of materials that they may want to continue to make available to the public. HealTorture.org can be a repository for these materials.
If a program finds it needs to close and will not be able to maintain its website, it may be possible to put a link from their old address to a page on HealTorture.org. This page can give information about the organization and also information about referral resources in the community; within certain parameters, whatever particular information a program would like to have available on the internet after their own website is down.
Other Resources
It’s been estimated that perhaps up to 100,00 nonprofit organizations closed their doors in the last two years. Many of our colleagues are currently facing very challenging situations and are looking at making difficult decisions that may have profound consequences for their clients, their missions, and their staffs. Because these challenges face so many nonprofits, there is quite a lot of information to be found online. Two resources are here:
From The Nonprofit Law Blog, here are links to two articles regarding nonprofit dissolution. “10 Things Nonprofits Should Consider Before Electing to Dissolve” http://www.nonprofitlawblog.com/home/dissolution/(link is external) and “Dissolution”: http://www.nonprofitlawblog.com/home/2008/10/dissolution.html(link is external)
“How to Close a Non Profit Organization” from the ‘For Dummies’ series, has succinct and helpful suggestions: http://www.dummies.com/how-to/content/how-to-close-a-nonprofit-organization.html