The Supreme Court of Alaska has ruled that only the National Council of the Girl Scouts of the United States, a representative body that meets every three years to elect members of the National Board of Directors, has authority to increase the dues for Girl Scouts across the country, and has held that a $10 increase approved by the National Board in 2016 is improper.
The Girl Scouts of the USA is a congressionally chartered nonprofit that charters local Girl Scout Councils responsible for promoting and organizing programs throughout the country. The Farthest North Council is chartered to run the programs in Fairbanks and northern Alaska. The National Council had raised dues nine times between 1941 and 2009, when it set the dues at $12 a year. In 2012, the National Board raised the dues to $15, and in 2016, it raised them again to $25. It did not obtain approval from the National Council for either increase. Farthest North Council contested the raise approved by the National Board in 2016.
Considering the case under Washington, D.C. law because the Girl Scouts USA was chartered there, a position that neither party contested, a trial court held that the National Board had authority under the constitution and bylaws of the Girl Scouts USA to set the dues. On appeal, the state Supreme Court has reversed.
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The Congressional Charter establishes the National Council and the National Board of Directors as the governing bodies of the Girl Scouts USA, the Court wrote. The National Council is comprised of approximately 1,500 individuals, including some elected by the local Girl Scout councils such as Farthest North, and meets every three years to elect the members of the National Board and conduct other business.
The Congressional Charter grants the National Council authority to adopt and amend a constitution and bylaws and elect a board of directors. It grants the National Board of Directors “the powers of the Council” but only “to the extent provided in the constitution and bylaws.” “To the extent provided” is the “operative language” the Court must interpret, it said.
Article V of the constitution provides that the National Council shall establish the criteria for credentials, one of which is a certificate of membership. A certificate of membership is issued only upon the payment of annual dues. But because, the National Board “is not similarly delegated this power elsewhere” in the constitution, “the power is exclusively held by the National Council,” the Court concluded.
The Court also noted that the constitution specifically provides that decisions on membership dues made by the National Council “shall require a majority of votes cast.” The only reason to include this provision, the Court said, must be “to proclaim that only the National Council has the authority” to set the dues.
The Girl Scouts argued that the constitution gives the National Council the authority to establish “general” requirements of membership and that the Board has authority to establish specific “standards” so long as they are consistent with requirements established by the National Council. But the Court decided that that $25 was inconsistent with the $12 standard set by the National Council in 2009. “By unilaterally increasing the membership dues under the guise of ‘administration of requirements,’ the Board exceeded its constitutional authority,” the Court said.
The Court also rejected a claim that the National Board had the power to manage the affairs of the corporation “between sessions of the National Council.” The Court said such power had to “yield to more specific constitutional provisions.” (Farthest North Girl Scout Council v. Girl Scouts of the United States of America, Supreme Ct., AK, No. S-17144, 9/13/19.)
YOU NEED TO KNOW
Whose organization is it? (See Ready Reference Page: “The Key Question: Whose Organization Is It?”) This is the classic conflict when there are voting members of an organization. This Court, based on a rather narrow reading of the governing documents of the organization, has concluded that the dues question is ultimately the domain of the body including the selected representatives of the members. That could be changed by amendments to the documents, but at this point it would probably be difficult to get the members to give up any of their authority.
One interesting question not discussed in the Court’s opinion is whether every Girl Scout member is entitled to a refund of a portion of her dues since the increase by the National Board was improper.
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