Chartering

• Background Information on Chartering

  A museum or historical society with collections that wishes to organize as a nonprofit private education corporation must do so by petitioning the Board of Regents for the issuance of a charter. A charter is granted by the Board of Regents as an instrument of incorporation to a museums and historical societies with collections that satisfy Regents standards of organizational and educational quality. These standards are consistent with professionally accepted principles and practices as adopted by the American Alliance of Museums and the American Association for State and Local History. To achieve them usually takes a period of development. For that reason chartering is a two-step process, from provisional to absolute charter. Museums and historical societies with collections are organized by people who have responsibility for collections of artistic, scientific and historical objects, or the desire to acquire such collections, and the potential or actual resources to preserve them. Since the collections are the principal assets of museums and historical societies with collections, the primary concern of any group organizing museums and historical societies with collections is to safeguard the existing collections and those to be acquired.

  Since the primary obligation of museums and historical societies with collections is to assemble, preserve and interpret its collections, the housing of the collection is of the utmost importance. The organizing committee must determine if it has an adequate facility or the resources to acquire the space necessary to assemble, catalog, preserve and exhibit its collections. There must be room not only for exhibitions, but environmentally sound and secure space to store that portion of the collections not on exhibit. 

• Benefits of Chartering

  After museums or historical societies with collections have organized, it may wish to incorporate. Most important of the many advantages of incorporation is that museums and historical societies with collections becomes a legal entity. Title to the organization's collections is held in the name of the organization. It is thus protected from falling into the hands of the individual trustees in the event the museum or historical society with collections should dissolve.

  Another important advantage of incorporation is that it makes museums and historical societies with collections eligible to apply to the United States Internal Revenue Service as a nonprofit, tax exempt education corporation under Section 501(C)(3) of the Internal Revenue Code. This is important to an organization, because money raised from admission charges or gifts would otherwise be considered taxable income. The exemption also encourages financial contributions and donations to the collections since donors may deduct the donation from their personal income tax.

  Finally, incorporation by the Board of Regents gives museums and historical societies with collections the prestige and recognition of being a member of The University of the State of New York. 

• New York State Education Department Statement on Museum Deaccessioning

  The New York State Board of Regents (“the Regents”) charters museums in New York State as educational corporations and has governing authority over these incorporated organizations. In 2011, the Regents approved an amendment to its Rules regarding deaccession policies, including the practice of deaccessioning and the use of funds resulting from such practice. 

  Recently, there had been some confusion in the museum field regarding deaccessioning regulations. The Regents Rules are in alignment with the American Alliance of Museums (AAM) Code of Ethics for Museums that remain in place.

  The relevant Regents Rules are listed below:

  Title 8 of the Official Compilation of Codes, Rules and Regulations of the State of New York

  §3.27
  (a) Definitions.

  (10) Deaccession means: (a) removing an object from an institution's collection or (b) the act of recording/processing a removal from an institution's collection.
  (5) Facilities. The institution shall:

  (e) Deaccession. The criteria and process (including levels of permission) used for determining what items are to be removed from the collections, and a statement limiting the use of any funds derived therefrom in accordance with subparagraph (vii) below;

  (iv) ensure that collections or any individual part thereof and the proceeds derived therefrom shall not be used as collateral for a loan;
  (v) ensure that collections shall not be capitalized; and
  (vi) ensure that proceeds derived from the deaccessioning of any property from the institution's collection be restricted in a separate fund to be used only for the acquisition, preservation, protection or care of collections. In no event shall proceeds derived from the deaccessioning of any property from the collection be used for operating expenses or for any purposes other than the acquisition, preservation, protection or care of collections.

  (7) Deaccessioning of collections. An institution may deaccession an item in its collection only in a manner consistent with its mission statement and collections management policy and where one or more of the following criteria have been met:

  (i)    the item is inconsistent with the mission of the institution as set forth in its mission statement;
  (ii)    the item has failed to retain its identity;

  (iii)    the item is redundant;

  (iv)    the item's preservation and conservation needs are beyond the capacity of the institution to provide;

  (v)    the item is deaccessioned to accomplish refinement of collections;

  (vi)    it has been established that the item is inauthentic;

  (vii)    the institution is repatriating the item or returning the item to its rightful owner;

  (viii)    the institution is returning the item to the donor, or the donor's heirs or assigns, to fulfill donor restrictions relating to the item which the institution is no longer able to meet;

  (ix)    the item presents a hazard to people or other collection items; and/or

  (x)    the item has been lost or stolen and has not been recovered.

  Museum Reporting Requirements

  §3.27 & §3.30
  Each institution shall file with the commissioner an annual report, in a form prescribed by the commissioner, which records the educational and cultural activities of the institution and presents an accurate statement of all financial operations. Each institution shall include in its annual report a list of all items or item lots deaccessioned in the past year and all items or item lots disposed of in the past year.

  More Information on Deaccessioning

  NYSED 
  2011 Amendment of Regents Rule §3.27, Relating to Museum Collections Management Policies
  https://www.regents.nysed.gov/meetings/2011/2011-02-12

  American Alliance of Museums (Direct Care of Collections) 
  https://www.aam-us.org/programs/ethics-standards-and-professional-practices/direct-care-of-collections/

  Association of Art Museum Directors 2020 Resolution regarding Deaccessions (AAMD)
  https://aamd.org/for-the-media/press-release/aamd-board-of-trustees-approves-resolution-to-provide-additional

Charter Instructions

• Applying for a Provisional Charter

  In New York State museums, historical societies and educational corporations are incorporated by the State Education Department/ Board of Regents. A museum, historical society or educational corporation that owns, or intends to own a collection may apply for a charter. There are two types of charters: Provisional and Absolute. Provisional Charters are granted before Absolute Charters. Provisional Charters have a term of five years after which the Provisional may be extended or an application for an Absolute Charter may be submitted. 

  A museum or educational corporation that does not own or intend to own a collection does not qualify for a charter. These organizations should apply for a Regents Certificate of Incorporation.

  Steps to Apply for a Provisional Charter

  Step 1: A board of trustees must be formed for the creation of a new museum or educational corporation. The board can have no more than one third of its members related by birth, marriage, or domicile.

  Step 2: An application for a Provisional Charter can be submitted to the Board of Regents. A sample petition and the required Cultural Agency Questionnaire can be downloaded below. 

  Step 3: The petition must be completed, signed, and notarized by the board members in the following way:

  • Petition: Notarized signatures from the Board of Trustees. A minimum of five signatures is required.

  Step 4: The Cultural Agency Questionnaire should be completed, and the supporting documentation listed on page ten of the questionnaire should be compiled. The supporting documentation includes:

  • Constitution and/or By-Laws
  • List of Trustees
  • Code of Ethics
  • Emergency/Disaster Plan
  • List of all Board Committees
  • List of positions, hours per week of employees, and salaries, if applicable
  • Resumes of professional staff members if organization's operating budget is greater than $100,000, if applicable
  • Copy of the organization's IRS tax-exempt letter, if applicable
  • Budget or list of potential expenditures
  • Copy of the organization's Collection Management Policy
     

  Step 5: The petition (original and two copies), a check for $100 made out to the New York State Education Department, the Cultural Agency Questionnaire, and supporting documentation should be mailed to the Office of Counsel at:

  New York State Education Department, Office of Counsel
  89 Washington Avenue, Room 148 EB, Albany, NY 12234

  Step 6: The application will be reviewed by the Office of Counsel and the Chartering Program at the New York State Museum. Upon completion of both reviews, and assuming all the paperwork is in order, the application will be added to a future Regents Agenda to be voted on. It can take two to three months for an application to be reviewed, added to an Agenda, and be voted on during a Regents Meeting.

  All chartered organizations should apply for exemption status at the New York State Charities Bureau here.

  8 NYCRR 3.27 defines the regulations set for organizations that petition the NY Board of Regents for both the provisional and the absolute charter. 

  Sample Documents

  Sample Provisional Charter Petition (48.5 KB)

  Provisional Cultural Agency Questionnaire (25.81 KB)

  Constitution (76.3 KB)

  Sample Museum Bylaws (290.76 KB)

  Sample Collections Management Policy (149.19 KB)

  Sample Emergency Disaster Plan (62.5 KB)

  Sample Code of Ethics (23.5 KB)
• Applying for an Absolute Charter

  An Absolute Charter application may be submitted if the museum or educational corporation at the end of the term of their Provisional Charter. Absolute Charter application have additional qualifications that must be met in the following areas:

  • Personnel
  • Finances
  • Facilities
  • Collections
  • Exhibitions
  • Programs

  To determine if your organization qualifies for an Absolute Charter review the Museum Association of New York's Standards and Best Practices document here:

  Standards and Best Practices (449.9 KB)

   

  Steps to Apply for an Absolute Charter

  Step 1: At the end of the five-year term for which a Provisional Charter is granted a museum or educational corporation may apply for an Absolute Charter. To determine if your organization qualifies for an Absolute Charter review the Standards and Best Practices document above.

  Step 2: An application for an Absolute Charter can be submitted to the Board of Regents. A sample petition and board resolution, and the required Cultural Agency Questionnaire can be downloaded below.

  Step 3: The petition and board resolution must be completed, signed, and notarized by the board members in the following way:

  • Petition: Notarized signatures from the Board President and Secretary (or any two officers) or three-fourths of the board of trustees,
  • Board Resolution: Signed by the Board Secretary

  Step 4: The Cultural Agency Questionnaire should be completed, and the supporting documentation outlined on page ten of the questionnaire should be compiled. The supporting documentation includes:

  • Constitution and/or By-Laws
  • List of Trustees
  • Code of Ethics (including a Conflict of Interest Policy and a Whistleblower Policy)
  • Emergency/Disaster Plan
  • List of all Board Committees (including Finance and Collections Committees)
  • List of positions, hours per week or employees and salaries, if applicable
  • Resumes of professional staff members if organization's operating budget is greater than $100,000, if applicable
  • Copy of the organization's IRS tax-exempt letter
  • Current Budget
  • Copy of the organization's Collection Management Policy

  Step 5: The petition (the original and two copies), board resolution (original and two copies), a check for $60 made out to the New York State Education Department, the Cultural Agency Questionnaire, and supporting documentation should be mailed to the Office of Counsel at:

  New York State Education Department, Office of Counsel
  89 Washington Avenue, Room 148 EB, Albany, NY 12234

  Step 6: The application will be reviewed by the Office of Counsel and the Chartering Program at the New York State Museum. Upon completion of both reviews, and assuming all the paperwork is in order, the Chartering Program at the New York State Museum will reach out to schedule a site visit of the museum or educational corporation.

  Step 7: Upon completion of the site visit, the application will be added to a future Regents Agenda to be voted on. It can take two to three months for an application to be reviewed, added to an Agenda, and be voted on during a Regents Meeting. 

  8 NYCRR 3.27 defines the regulations set for organizations that petition the NY Board of Regents for both the provisional and the absolute charter. 

  Sample Documents

  Absolute Charter Petition and Board Resolution (27.5 KB)

  Absolute Questionnaire (22.08 KB)

  Sample Collections Management Policy (149.19 KB)

  Sample Emergency Disaster Plan (62.5 KB)

  Sample Museum Bylaws (290.76 KB)

  Sample Code of Ethics (23.5 KB)
• Applying to Extend the Provisional Charter

  A Provisional Charter has a term of five years. At the end of the term a museum or educational corporation may choose to apply for an Absolute Charter if they fulfill the requirements to do so. If not, the museum or educational corporation may apply to extend their Provisional Charter for an additional five years.

  Steps to Extend the Provisional Charter

  Step 1: At the end of the Provisional Charter's five-year term a museum or educational corporation may apply to extend their Provisional Charter.

  Step 2: An application to Extend the Provisional Charter can be submitted to the Board of Regents. A sample petition and board resolution can be downloaded below.

  Step 3: The petition and board resolution must be completed, signed, and notarized by the board members in the following way:

  • Petition: Notarized signature from the Board President and Secretary (or any two officers) or three-fourths of the board of trustees.
  • Board Resolution: Signed by the Board Secretary

  Step 4: The petition (the original and two copies), board resolution (original and two copies), and a check for $60 made out to the New York State Education Department should be mailed to the Office of Counsel at:

  New York State Education Department, Office of Counsel
  89 Washington Avenue, Room 148 EB, Albany, NY 12234

  Step 5: The application will be reviewed by the Office of Counsel and the Chartering Program at the New York State Museum. Upon completion of both reviews, and assuming all the paperwork is in order, the application will be added to a future Regents Agenda to be voted on. It can take two to three months for an application to be reviewed, added to an Agenda and be voted on during a Regents Meeting.

  Sample Documents

  Extend the Provisional Charter Petition and Resolution (42 KB)

  Extend and Amend the Provisional Charter Petition and Resolution (46.5 KB)
• Applying to Amend the Charter

  A museum or educational corporation may apply to amend their Provisional or Absolute Charter at any time during the Charter's term. Possible amendments to a museum or educational corporation's charter include the:

  • Corporate Name
  • Corporate Purposes
  • Corporate Address
  • Number of Trustees

  Steps to Amend the Charter

  Step 1: The decision to amend must be agreed upon by the board of the museum or educational corporation with a three fourths majority vote.

  Step 2: An application to Amend the Charter can be submitted to the Board of Regents. A sample petition and board resolution can be downloaded below.

  Step 3: The petition and board resolution must be completed, signed, and notarized by the board members in the following way:

  • Petition: Notarized signature from the Board President and Secretary (or any two officers) or three-fourths of the board of trustees.
  • Board Resolution: Signed by the Board Secretary.

  Step 4: The petition (the original and two copies), board resolution (original and two copies), and a check for $60 made out to the New York State Education Department should be mailed to the Office of Counsel at:

  New York State Education Department, Office of Counsel
  89 Washington Avenue, Room 148 EB, Albany, NY 12234

  Step 6: The application will be reviewed by the Office of Counsel and the Chartering Program at the New York State Museum. Upon completion of both reviews, and assuming all the paperwork is in order, the application will be added to a future Regents Agenda to be voted on. It can take two to three months for an application to be reviewed, added to an Agenda and be voted on during a Regents Meeting.

  Sample Documents

  Amend the Charter Petition and Resolution (27.5 KB)
• Applying to Merge or Consolidate the Charter

  Definitions:

  Merger: Two or more corporations combine. The corporate existence of one continues and the existence of the other(s) terminates.

  Consolidation: Two or more corporations combine. The corporate existence of both original corporations terminates, and a new corporation begins.

  Museums or educational corporations might decide to merge or consolidate to combine resources, or services. Merging or consolidating chartered museums or educational corporations requires an act of the Regents.

  Steps to Merge/Consolidate

  Step 1: The decision to dissolve must be agreed upon by the board of the museum or educational corporation with a three-fourths majority vote from each board.

  Step 2: An application to formally merge/consolidate can be submitted to the Board of Regents. A sample petition and certificate of approval can be downloaded below.

  Step 3: The petition and certificate of approval must be completed, signed, and notarized by the board members in the following way:

  • Petition: Notarized signature of two Board Officers from each corporation
  • Certificate of Approval: One certificate for each corporation. Notarized signatures of Chairman and Secretary

  Step 4: The petition (the original and two copies), certificate of approval (the original and two copies), and a check for $100 made out to New York State Education Department is to be sent to the Office of Counsel at: 

  New York State Education Department, Office of Counsel
  89 Washington Avenue, Room 148 EB, Albany, NY 12234

  Step 5: The application will be reviewed by the Office of Counsel and the Chartering Program at the New York State Museum. Upon completion of both reviews, and assuming all the paperwork is in order, the application will be added to a future Regents Agenda to be voted on. It can take two to three months for an application to be reviewed, added to an Agenda and be voted on during a Regents Meeting.

  The merging/consolidation process is governed by New York State Education Law §223 and §216-a.

  Sample Documents

  Merge the Charter Petition and Certificate (24.66 KB)

  Consolidate the Charter Petition and Certificate (21.3 KB)
• Applying to Dissolve the Charter

  Dissolving a museum or educational corporation's charter means the organization is ending operations and wishes to formally end the terms of their charter. 

  A museum or educational corporation might decide to dissolve due to a lack of membership or money, because the organization formed for a specific purpose that has been completed or is no longer relevant. Dissolving a chartered museum or educational corporation requires an act of the Regents.

  Please read the New York State Education Department's Statement on Museum Deaccessioning here.

  Steps to Dissolve

  Step 1: The decision to dissolve must be agreed upon by the board of the museum or educational corporation with a three-fourths majority vote. 

  Step 2: An application must be sent to the Board of Regents to dissolve the corporation. A sample petition, board resolution, and tax affidavit can be downloaded below.

  Step 3: The petition, board resolution, and tax affidavit must be completed, signed, and notarized by the board members in the following way:

  • Petition: Notarized signatures from the Board President and Secretary (or any two officers) or three-fourths of the board of trustees.
  • Board Resolution: Signed by the Board Secretary
  • Tax Affidavit: Notarized signatures from the Board President and Secretary

  Step 4: The petition (the original and two copies), board resolution (the original and two copies), tax affidavit (the original and two copies), and a check for $60 made out to the New York State Education Department should be mailed to the Office of Counsel at:

  New York State Education Department, Office of Counsel
  89 Washington Avenue, Room 148 EB, Albany, NY 12234

  Step 5: The application will be reviewed by the Office of Counsel and the Chartering Program at the New York State Museum. Upon completion of both reviews, and assuming all the paperwork is in order, the application will be added to a future Regents Agenda to be voted on. It can take two to three months for an application to be reviewed, added to an Agenda and be voted on during a Regents Meeting. 

  Step 6: After being notified of the voting results the corporation should make an application to the Supreme Court within three months of the dissolution to direct the disposition of any remaining assets. The petition should be applied to the Supreme Court in the judicial district of the museum or educational corporation. 

  Go to the following website and select the county in which the museum or educational corporation's corporate address is: https://www.nycourts.gov/courts/cts-outside-nyc-SUPREME.shtml

  Make sure the petition is duly verified and includes all the assets, their location and estimated value, and ascertainable debts.

  Collections (including books, objects of art or objects of historical significance etc.) still held by the petitioning museum or educational corporation should be transferred to libraries, museums or educational institutions willing to accept them.

  If the current charter of the museum or educational corporation includes a provision outlining the disposition of assets in the event of dissolution, that provision should be followed by the court as far as possible.

  Any surplus monies, after the payments of debts and dissolution fees, can be directed by the court to be given to any educational, religious, benevolent, charitable, or other not-for-profit organization that the trustees of the museum or educational corporation indicate in their petition (as approved by the court).

  During the process of dissolving the Board of Trustees will remain in office of the purpose of settling the museum or educational corporation's affairs.

  The dissolution process is governed by the New York State Education Law §220.

  Sample Documents

  Dissolution of the Charter Petition and Resolution (32 KB)