The members of the Fort Lewis College Alumni Association are voting, between now and August 6, 2005 at the Annual Meeting of the Association, on accepting a revised set of bylaws. A 2/3 affirmative majority of those voting is required for the new bylaws to be placed into effect.
     Among several changes to the current procedures that govern how the Board of Directors manages the affairs of the Association, there are several important implications of this proposal, which is endorsed by vote of the Association’s Board of Directors and supported by an agreement with Fort Lewis College. This agreement, which has been approved by the Board of Trustees of the College, describes the College’s commitment to the future of the Alumni Association - and vice versa.

WHY?
     During the summer and fall of 2004, the US Postal Service conducted an audit in Durango of the use of non-profit mailing privileges. They uncovered during the audit that the Fort Lewis College Alumni Association was incorporated in 1965 as a Colorado non-profit corporation. This incorporation makes the Association a "separate legal entity" from both Fort Lewis College and from the Fort Lewis College Foundation. It also meant that the Association, which had assumed for many years that it qualified for non-profit mailing status, was in fact not qualified to use that privilege. To qualify, the Association essentially had to qualify for recognition as a §501(c)(3) tax exempt organization under the IRS code.
     An additional implication of the ruling was that the Association's Board of Directors - as the board of a "separate entity - would not be protected in any way by the State of Colorado in any question involving liability. The acquisition of corporate directors and officers insurance (D&O) was not possible as a non-profit organization since the Association was not recognized as a 501(c)(3). Other volunteer boards associated with the College, such as the Board of Directors of the Skyhawk Booster Club, have the same protection as the College's staff since those boards are internal to the College's administrative structure. 

THE PROCESS
     Facing the reality of paying first-class postage for all mailings, along with the other implications, the Association's Board of Directors undertook a study of alternatives and found two directions as possible solutions to the untenable situation of the status quo: (1) seek recognition by the IRS as a §501(c)(3) tax exempt organization or (2) dissolve the Colorado non-profit corporation and become an internal part of the College's structure. The Board negotiated agreements with the College definingn the relationship under both possible solutions.
     The 501(c)(3) option offered independence but carried a very high price. The benefit of “independence” carries a price tag which includes up-front expenditures for three years of audited financial statements, a filing fee of $500 to the IRS, and possibly legal assistance in the filing of the forms. On an on-going basis, being a 501(c)(3) organization would require the Association to raise enough funds to pay salary and benefits for its own administrative management and support staff - an Alumni Director and some administrative assistance, at least - in addition to regular financial reporting overhead. After the up-front and annual commitments, the Association would then have to generate funds for alumni programming, such as the magazine and local alumni chapter events.
     It should be noted that the Fort Lewis College Foundation is a §501(c)(3) organization, and the Foundation pays the salaries and benefits for three College employees who support its leadership and administrative staffing needs. A similar arrangement would be in effect for the Alumni Association to follow a similar path. There are many reasons that the Foundation needs to be its own §501(c)(3), structurally independent of the College. The Alumni Board was not convinced that the Alumni Association had the same needs. 

WHAT DOES IT MEAN?
     The biggest implication of a decision of the Association to accept the proposed bylaws is that the Association will dissolve the Colorado non-profit corporation known as “The Fort Lewis College Alumni Association” and become an internal unit in the College. In so doing, the Association will no longer be a “separate entity” from the College - as described by the US Postal Service in ruling that the Association could no longer use the College’s non-profit mailing privileges. As an internal alumni association, we would regain the use of the College’s non-profit mailing privileges.
     The Board of Directors of the Association would become an advisory board to the College’s Office of Alumni Relations if the ballot measure passes with the required 2/3 affirmative vote. The implication is that the individuals who are elected to the Board would have reduced personal liability and no continuing fiduciary responsibility. The College has assured that the Board will continue to select the recipients of the Alumni and Old Fort scholarships and awards - historically, a major emphasis of the Association - and involvement in all Association planning. 
     The Alumni Association Board of Directors urges alumni to vote YES on the acceptance of the proposed bylaws, which will bring the Association inside the College’s administrative structure. It is clearly a benefit to the College to have a strong Alumni Association, and the Board is convinced that the College will support enhancement of the Association’s programs in a seamless transition from our current structure.