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What do we do when our project is no longer practical?

Your Legal Questions Answered

What do we do when our project is no longer practical?

The mission of our 501(c)(3) organization is to advocate for animals. We have a project whose stated goal is to get 3 elephants from a local zoo into a sanctuary. Two of the elephants have died, and the third was transported to a zoo across the country. With the remaining elephant so far away, it is not practical for us to work on getting her released. (We are really small.)  We would like to change the mission of this project to encompass advocating for the retirement of any elephant in a zoo, so that we can support other efforts around the country. May we do this? How do we handle donations that were received at the time the elephants were still alive?

This sounds like a classic case for application of the cy pres doctrine of using restricted charitable funds for a purpose as similar as possible to the original when the original purpose becomes illegal, impractical or impossible.  But I am not sure that it really is.

In part it may depend on how you solicited (or received) the funds being used for the project.  If the solicitation was for general purposes of advocating for animals, of which the elephant project was merely one part, then you wouldn’t be using the funds for anything other than what you asked for if you broadened the purpose within the ambit of advocacy for animals. 

If the funds are truly restricted to helping these three elephants but there is not a lot of money left (which would be likely if you are really a “small” organization), you might be able to get a waiver from your state Attorney General to use the remaining funds for your general program.  If there is a lot of money involved, you might have to go to court for approval in a cy pres hearing.

But it looks as though your purpose may actually not be impractical.  If your alternative program is to advocate for retiring any elephant in any zoo anywhere in the country, you could spend the remaining project money on seeking to liberate the third elephant, which is now in a zoo somewhere else in the country.  It sounds like this is the original purpose of your program, even though the elephant has been moved.  You may want to hold some money for a long-term effort rather than spending it all at once if it is less likely to be effective immediately. 

You could then concentrate on raising new funds for advocating for animals in other situations and continuing your programs within your overall mission, remembering that you want to be clear in your solicitations that any specific program you promote is only one of the many things you are asking support for.

Tuesday, April 18, 2017

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