Loading...
HomeMy WebLinkAbout10/20/1998, 5 - COMMUNITY PARTNERSHIP AND FOUNDATION POLICY council o,zo_�� j acEnaa Repoin �H CITY OF SAN LUIS OBISPO FROM: Ken Hampian,Assistant City Administrative Officerl Prepared By: Wendy George,Assistant to the City Administrative Officer tr� Paul LeSage,Parks and Recreation Director a SUBJECT: COMMUNITY PARTNERSHIP AND FOUNDATION POLICY CAO RECOMMENDATION 1) Adopt a resolution approving a Community Partnership and Foundation Policy. 2) Adopt a resolution endorsing a Community Recreation and Parks Foundation, subject to receipt of its 501(c) non-profit status, the formation of a board of directors and approval of proposed by-laws. DISCUSSION Background During the goal setting process for the 1997-99 Financial Plan, the Council created a goal to "encourage partnerships with non-profit organizations for the mutual benefit of both the City and the organizations." In considering this goal, the Council recognized that the possibilities for such partnerships and foundations are wide-ranging and could also create competition with other local non-profit agencies. Therefore, staff was directed to develop procedures for establishing them in a well-defined, logical way, based on a full understanding of the implications involved. In order to fulfill this direction, staff surveyed a number of other public agencies and gathered information about the types of partnerships and level of governmental support involved. . The results of this survey were presented to the City Council at its January 13, 1998, meeting. Following a discussion of the information provided, the City Council directed staff to develop a community partnership policy which addresses establishing partnerships for specific City-related projects and the formation of a Parks and Recreation Foundation. Staff was asked to include the following areas in the policy: • Guidelines for the level of"seed"money to be provided to a partner. • Guidelines for the level of"in-kind" support to be provided to a partner. • The type of formal agreement which must be developed with a partner. • Requirements which a partner must meet to prevent the City from assuming additional liability. • Methods of publicizing the City's interest in developing community partnerships. • The level of direct City involvement with a City-endorsed foundation. • Parameters for a City-endorsed foundation which would prevent it from competing with other non-profit organizations. Council Agenda Report-Community Partnership and Foundation Policy Page 2 Community Partnerships The proposed Community Partnership and Foundation Policy (Attachment 1) is divided into two sections. The first addresses partnerships and the second addresses City-endorsed foundations. In developing the section on partnerships, it became quickly apparent that it would be difficult to create hard and fast rules relating to the types of programs, projects and activities that would be appropriate for partnerships. Instead, the policy sets forth evaluation criteria, such as the level of public benefit offered by the partnership, the extent to which a partnership will help advance existing City goals and the cost-effectiveness of the partnership. These criteria can then be used on a case-by-case basis to evaluate the appropriateness of a given partnership. The policy also directs the City to form community partnerships only with entities that can demonstrate good organization and stability. Non-profits should have a board of directors, and, if funding is involved, must be qualified under Section 501(c) of the Internal Revenue Code. To assure that both parties in the partnership understand their responsibilities and any financial arrangements, the policy requires that a formal agreement be drawn up. If significant funding or significant in-kind support is involved, the agreement will be approved by the City Council. Otherwise, the City Administrative Officer may provide approval. The agreement will also protect the City from liability by providing indemnification and requiring the partner to be properly insured. Similar to the issue of trying to succinctly define appropriate types of partnerships, it was difficult for staff to provide specific parameters on the level or type of City support, given the variety of possibilities. However, the policy does provide a general guideline that it is reasonable to expect the City and the partner(s) to share the cost equally. It finther states that this ratio could vary depending on the cost of the program/project, the resources of the partner(s) and the degree of interest on the part of the City. The policy also assures that the potential impact on other existing City services and priorities will be considered when determining the level of the City's in-kind commitment. In order for partnerships to become one of the City's standard problem-solving tools, we propose to send copies of the approved policy to all non-profit organizations within the City. Staff will also consider and, when appropriate, recommend partnerships as a way of completing City programs, projects and activities that would otherwise lack sufficient funding for completion. The community will also be encouraged to consider partnerships when advocating to the City for the initiation of new programs or projects. (For example,as part of the bi-annual goal setting process.) City-Endorsed Foundations The second section of the policy addresses what we are now calling "City-endorsed foundations". (Attachment 1). We believe this is a more appropriate description than the term "City foundation", which was used during earlier discussions of this issue. These are foundations that are not formed directly by the City, but ones whose efforts the City sanctions; and for which the City may provide limited formation assistance, such as reviewing proposed by-laws to assure their compatibility with City interests. Prior to the City offering such recognition, the proposed foundation will be evaluated to assure that it will not compete for resources that are currently supporting other non- Council Agenda Report-Community Partnership and Foundation Policy Page 3 profit activities in the community. Endorsed foundations must be qualified under Section 501(c) of the Internal Revenue Code and have by-laws that clearly state their purposes. The policy requires formal action by the City Council to affect endorsement. The purpose of a City-endorsed foundation is to assist members of the community in raising funds for a particular program area that is of benefit to the City. Funds may be used for the construction or improvement of facilities, purchases of equipment, development of innovative programs and scholarships or other forms of financial assistance. Funds may be granted by the foundation to the City or to other community organizations that provide services or opportunities within the foundation's program area. The policy provides very specific restrictions on fundraising, which must be followed by any foundation wishing City endorsement. They shall not: • Accept funds that simply redistribute existing community resources. • Compete against other local non-profit organizations for funds that they have formerly received. • Undertake a general fundraising campaign. All fundraising must be directed toward a specific purpose. • Allocate funds other than to the specific stated purpose of the fundraising. Proposed San Luis Obispo Community Recreation and Parks Foundation Staff recommends that the City Council endorse the formation of a Community Recreation and Parks Foundation that will benefit all of the organizations that provide leisure services. As defined in the organization's proposed by-laws,the Foundation would: • Assist members of the community in raising funds for construction of new recreation facilities, improvements of existing facilities, purchase of equipment, development of innovative recreation programs and scholarships. • Obtain grants from other non-profit foundations. The proposed Community Recreation and Parks foundation will meet the guidelines of the Council relating to City-endorsed foundations. A set of bylaws (Attachment 3)has already been developed. Once a conditional endorsement is received from the City, a board of directors will be formed, based on the by-laws, and the organization will apply for its 501(c)non-profit status. The Foundation will be careful not to undertake any activity that is contrary to the goals and purposes of the various organizations that provide recreation and park services within the San Luis Obispo community. To ensure this,the board will appoint ex-officio advisory board members from these organizations. The Foundation will not accept funding that merely redistributes existing community resources, nor will it undertake a general fundraising campaign. Funds raised will be used only for the specific activity for which they are intended. Council Agenda Report-Community Partnership and Foundation Policy Page 4 Because of the community nature of this Foundation, all local recreation and park agencies can become active partners under its umbrella This can lead to other successful partnerships similar to the Santa Rosa Skate Park and the Mayor's Youth Task Force. It is likely that a small amount of staff time will be needed initially to assist with the organization of the Foundation. That time commitment will decrease as the Foundation board of directors becomes active. Many local citizens are already aware of the proposed Foundation and have expressed an interest in serving on the board. CONCURRENCES • The Parks and Recreation Commission endorses the formation of a Community Recreation and Parks Foundation. • The San Luis Obispo YMCA concurs with the formation of a Community Recreation and Parks Foundation,with the understanding that they will become an active partner in it. • The Field Users Task Force has also been apprised of the Community Recreation and Parks Foundation and has expressed its support. FISCAL IMPACT There is no fiscal impact to the City created by the establishment of a Community Partnership and Foundation Policy. Implementation of the policy has the potential to provide considerable outside financial support or cost savings to the City, but will also require the potential investment of funds and manpower on the part of the City. The net fiscal impact to the City will be determined on a case-by-case basis. Attachments 1 -Resolution approving the Community Partnership and Foundation Policy 2 -Resolution approving the City Endorsement of a Parks and Recreation Foundation 3 -Community Recreation and Parks Foundation By-Laws S—� RESOLUTION NO. (1998 Series) A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO APPROVING A COMMUNITY PARTNERSHIP AND FOUNDATION POLICY WHEREAS, there are many programs, projects and activities which are of interest to the City and the community, but cannot be addressed directly due to limitations on the City's human or financial resources; and WHEREAS, the City of San Luis Obispo has a tradition of citizen involvement in its programs,projects and activities; and WHEREAS, City resources can be used in partnership with others to create opportunities for otherwise unfeasible projects or programs; and WHEREAS, under certain limited conditions the City and community can also benefit from the establishment of a foundation to encourage public contributions and grant funding for specific purposes that affect City programs. NOW, THEREFORE,BE IT RESOLVED by the Council of the City of San Luis Obispo as follows: The City of San Luis Obispo Community Partnership and Foundation Policy found in Attachment 1 is hereby approved. Upon motion of , seconded by and on the following roll call vote: AYES: NOES: ABSENT: the foregoing resolution was adopted this day of 11998. Mayor Allen Settle ATTEST: Lee Price, City Clerk s-s Resolution No. (1998 Series) Page 2 l APPROVED AS TO FORM: Y. G.fw or s. ity Attorney S-G Attachement 1 city of San lulS OBISPO community pantnEnship and foundation policy Purpose. There are many programs, projects and activities which are of interest to the City and the community,but cannot be addressed directly due to limitations on the City's human or financial resources. However, in keeping with the City's tradition of citizen involvement, City resources can be used in partnership with others to create opportunities for otherwise unfeasible projects or programs. The City encourages the formation of such community partnerships whenever possible. Under certain limited conditions the City will also consider endorsing the establishment of a foundation to encourage public contributions and grant funding for specific purposes that affect City programs. Both partnerships and foundations can be methods for the public to become more involved in creating the quality of life that is so special to the residents. A few examples of some successful City partnerships are: • Performing Arts Center • DARE Program • Prado Day Center • Santa Rosa Park roller hockey rink • STAR At-Risk Program • Creek Stewardship Program I. COMMUNITY PARTNERSHIPS Eligible Programs, Projects and Activities. On occasion, the City may propose a partnership with another community organization. More often, however, partnerships with the City are proposed by community organizations wishing.to initiate or enhance certain programs, projects or activities of special interest to them. In judging whether or not to participate in such partnerships,the City will consider such things as: • The level of public benefit offered by the partnership; • The extent to which such a partnership will help advance existing City goals; • Whether or not the partnership will help meet a currently unmet community need; • The potential success and cost-effectiveness of the proposed partnership strategy; • Whether or not the City is the appropriate public agency partner(or if another agency would be more appropriate). Eligible Community Partners. The City shall only form community partnerships with entities that can demonstrate good organization and stability throughout the term of the partnership. Non-profit organizations should have a board of directors and, if funding is 1 S-7 to be received from the City, must be qualified under Section 501(c) of the Internal Revenue Code. If no funding is to be received from the City, official non-profit status is not required. Community Partnership Agreement. All community partnerships require a formal agreement between the City and the partner(s). The agreement shall clearly define the purpose of the partnership, the City's responsibilities, the partner(s)' responsibilities, the level of in-kind (e.g., labor and materials) and direct financial support the City shall contribute, the level of in-kind or financial support the partner(s) shall contribute, any reporting responsibilities the partner(s) shall have and any other operational details relevant to the purpose of the partnership. The City's standard contract agreement format shall be used to document the partnership. If City funding, or significant in-kind support is to be provided, or the purposes of the partnership could have major community impact, the partnership agreement shall be approved by the City Council. Other agreements may generally be approved by the City Administrative Officer. Level and Type of City Support. Because there is such a diversity in the nature of potential partnerships, it is difficult to establish rigid parameters for an appropriate level of City support. As a general guideline, it is reasonable to expect the City and the partner(s) shall each contribute half the cost toward a community partnership. However, this ratio could vary depending upon the program/project cost, resources of the partner(s) and level of interest on the part of the City. In-kind contributions shall be counted, as well as actual cash, in calculating the total contribution of the parties. Once agreement is reached on the levels of contribution by the parties, it will be documented in the partnership agreement. The level of in-kind support to be committed from the City, particularly the amount of staff support, shall be determined based on work load considerations and the potential impact on other existing City services and priorities. In particular, before the commitment of financial or in-kind support which cannot be easily accommodated within existing departmental budgets, the availability of additional funding must be determined. Examples: The City and the Central Coast Women's League form a partnership to enhance the existing skate park The total cost of the enhancements is anticipated to be $40,000. Each party commits to contributing $20,000 either in cash or in a combination of "in- kind"services, e.g. volunteer or staff labor, and cash. The City and Friends of Las Casas de Adobe (FOCA)form a partnership to rehabilitate the three City-owned adobes. The total cost of the project is anticipated $1.2 million. The parties agree that the City will provide $25,000 in "seed money"from the General Fund to allow FOCA to perform initial studies and establish fundraising mechanisms. In addition the City agrees to provide certain assistance, such as tree trimming, and to approve other sources of funding such as the Community Development Block Grant. The City's funding commitment is documented in the partnership agreement. The Friends of Las Casas de Adobe are responsible for the remaining funding. 2 s�8 Organizations which are formally approved partners of the City may be eligible for certain benefits which are not normally made available to other groups. For example, use of City equipment, such as the trolley or portable toilets, may be approved on a case-by- case basis for official City partners. Indemnification and Liability Insurance. Any partner(s) shall agree to indemnify the City against all claims or actual liability arising out of the partnership. The City's standard indemnification language shall be included in the partnership agreement. Any partner(s) shall provide proof of insurance in accordance with the City's standard Insurance Requirements for Contractors. Exceptions to the insurance requirements shall be approved by the Risk Manager. Promotion of Community Partnership Opportunities. Partnerships have become a part of the City's standard set of problem solving tools, and this formalized policy shall be made available to non-profit organizations within the community. In addition to being receptive to partnerships proposed by such organizations, staff shall also consider, and when appropriate recommend,partnerships as a way of completing City programs, projects and activities that otherwise lack sufficient funding. The community will also be encouraged to suggest potential partnership strategies when advocating to the City Council for the initiation of new programs,projects, and activities(i.e. during the bi- annual goal setting process). II. CITY-ENDORSED FOUNDATIONS Formation of Community Foundations. The formation of community foundations has become a way of tapping into new resources to support programs, projects, and activities that benefit the public. While the City will not directly form such a foundation, under certain conditions the City might endorse and assist in such efforts. In addition to assuring public benefit, one key condition prior to endorsement or assistance is that the proposed foundation is not being formed to compete for resources presently supporting other non-profit activities in the community. Endorsement shall be by the City Council, and forms of assistance provided by City staff shall be advisory only, such as reviewing proposed bylaws to assure compatibility with City conditions and interests. Purposes of a City-Endorsed Foundation. A City-endorsed foundation's purpose shall be to assist members of the community in raising funds for a particular program area that is of benefit to the City, for example recreation and parks. Funds may be used for the construction of new facilities, improvements of existing facilities, purchase of equipment, development of innovative programs or providing scholarships or financial assistance to program participants. Funds may be granted by the foundation to City departments or programs, as well as to other organizations within the community which provide services or opportunities within the given program area. 3 S-9 The Endorsement Process. Endorsement of a local foundation shall be given by the City Council through the adoption of a resolution. In order to consider the appropriateness of an endorsement,the following will be considered: • Non-profit status. The foundation must be qualified under section 501(c) of the Internal Revenue Code. • By-laws. A City-endorsed Foundation shall have formal by-laws which clearly state the purpose of the foundation and provide operational directives which assure that the foundation will satisfactorily meet the conditions of this policy. • Board of Directors. City employees shall not serve on the board of directors of a City-endorsed foundation. However, as appropriate, City employees may serve in an advisory capacity to the board of directors. • Fiscal Provisions. * A City-endorsed foundation shall not accept fimds that simply redistribute existing community resources. * A City-endorsed foundation shall avoid competing against other local non- profit organizations for funds that have typically gone to these other community organizations. * A City-endorsed foundation shall not undertake a general fundraising campaign. All fundraising shall be directed toward a particular defined purpose. A City-endorsed foundations primary source of fimds shall be through the solicitation of grants, donations and bequests and the conducting of special fundraising events for a particular purpose. * A City-endorsed foundation shall allocate all funds raised to the particular program,activity or facility stated to be the purpose for the fundraising. 4 S-/o RESOLUTION NO. (1998 Series) A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO ENDORSING THE PARKS AND RECREATION FOUNDATION WHEREAS, a Community Parks and Recreation Foundation will benefit all organizations that provide leisure services; and WHEREAS, a Community Parks and Recreation Foundation will assist members of the community in raising funds for construction of new recreation facilities, improvements of existing facilities, purchase of equipment, development of innovative recreation programs and scholarships; and WHEREAS, a Community Parks and Recreation Foundation can obtain grants from other non-profit foundations; and WHEREAS, a Community Parks and Recreation Foundation will be structured under its by-laws so that it will not undertake any activity that is contrary to the goals and purposes of the various community agencies that offer recreation and park services and will not accept funding that merely redistributes existing community resources; and WHEREAS, a Community Parks and Recreation Foundation will provide an umbrella for local recreation and parks agencies to form new effective partnerships. NOW, THEREFORE,BE IT RESOLVED by the Council of the City of San Luis Obispo as follows: That the San Luis Obispo Community Recreation and Parks Foundation receives the City's formal endorsement. Upon motion of , seconded by and on the following roll call vote: AYES: NOES: ABSENT: the foregoing resolution was adopted this day of , 1998. S—r1 Resolution No. (1998 Series) Page 2 Mayor Allen Settle ATTEST: Lee Price,,City Clerk APPROVED AS TO FORM: Q- ,1114U4At,W.AAA4 4f'U--t G: or " City.Attorney BY-LAWS of the San Luis Obispo Community Recreation & Parks Foundation I NAME The name of the organization shall be the San Luis Obispo Community Recreation and Parks Foundation. The organization will serve the City of San Luis Obispo and its immediate vicinity. II ADDRESS The principal office for the transaction of the business of the Corporation is hereby fixed and located at 1341 Nipomo Street, San Luis Obispo, CA 93401, County of San Luis Obispo, State of California. III PURPOSES 1. Assist members of the community in raising funds for. construction of new recreation facilities, improvements of existing recreation facilities, purchase of equipment, development of innovative recreation programs, and scholarships for recreation and parks programs. 2. Obtain grants from non-profit foundations for the purpose noted in 1 above. 3. This organization shall not undertake any activity that is contrary to the goals and purposes of the various organizations that provide recreation and parks services within the San Luis Obispo community. IV MEMBERSHIP 1. The voting membership of the Corporation shall consist solely of the members of the Board of Directors. 2. Interested citizens may be appointed to the organization by the Board as non- voting auxiliary members. 3. The Board. will appoint 1 to 3 ex-officio, non-voting advisory members to the organization. These members will represent the various agencies, both public and non-profit, that offer recreation and parks services in the community. The 1 ATTACHMENT 3 S-13 purpose of these members will be to advise the Board ,of Directors on the recreation and parks needs of the community. V BOARD OF DIRECTORS 1. Numbers of Directors The Board of Directors shall consist of nine (9) members. A majority of the Board (5 members) shall constitute a quorum for the transaction of business. Proxy quorums can conduct general business and vote if at least two (2) Board Officers are in attendance and all Board Proxies are written, signed, and presented at the calling of the roll. 2. Powers of Directors Subject to the powers of the members as provided by law or as set forth herein, all corporate powers of the Corporation shall be exercised by, or under the authority of, and the business and affairs of the Corporation shall be controlled by, the Board of Directors. Without limiting the generality of the foregoing, the Board of Directors shall have the following powers: To conduct, manage, and control the affairs and business of the Corporation and to make such rules and regulations therefore, not inconsistent with the law, the Articles of Incorporation, or the By-laws as the Board may deem best. 3. Composition of the Board a) The Board of Directors shall be composed of members with an interest in parks & recreation activities and with a commitment to work actively to improve these programs in the San Luis Obispo community. b) Representatives shall be appointed and serve the Board of Directors for a three-year term, with three members' terms expiring each year on a rotating basis. There is no limit on terms to be served. C) Board members are appointed from the members of the community at large at the annual January Board meeting by recommendation of the Board of Directors. These representatives shall be appointed and serve the Board of Directors for a three-year term. d) All Directors shall serve at the adoption of these By-laws and be known as the "Founding Board of Directors." In order to establish the rotating format as noted above, three of the founding directors will serve a two- year term, three will serve a three-year term, and three will serve a four- year term. 2 5-i5� 4. Vacancies Any vacancy or vacancies on the Board of Directors resulting from death, incapacity, resignation, expiration of term of office, removal, or otherwise, shall be filled by the procedure described under VI Section 3 of these By-laws. A Director appointed to fill an unexpired term shall serve for the remainder of the unexpired term. 5. Place of Meeting Regular meetings of the Board of Directors shall be held at any place within the City which has been designated from time to time by resolution of the Board of Directors. In the absence of such designation, regular meetings shall be held at the principal office of the Corporation. 6. Regular Meeting Regular meetings of the Board of Directors shall be held on the day and at the hour or at such other day and time as may be determined by the Board of Directors. Written notice of the time and place of such regular meetings shall be given to Board Members by first-class mail at least four (4) days prior to the date of the meeting. 7.. Annual Meeting The annual meeting of the organization shall be the first regular meeting of the calendar year. 8. Special Meetings Special meetings of the Board of Directors for any purpose or purposes shall be called at any time by the President of the Board. Written notice of the time and place of the special meetings shall be delivered personally to each Director or sent by mail. Such notice shall be given by mail at least four (4) working days prior to the time of the holding of the meeting. 9. Adjournment In the absence of a quorum at any meeting of the Board of Directors, the majority of the Directors present may adjourn any meeting to another time and place or until another regular meeting, in which case notice of the meeting shall be given to all members of the Board. 10. Attendance Attendance at all Board meetings by all Directors is required. A Director may be excused by the President for good cause. The failure of a Director to attend three consecutive meetings of the Board of Directors without being excused by the President for good cause, shall determine the termination of the Director's membership to the Board. 11. Compensation The Directors shall receive no compensation for their services. 3 S-15- 12. Removal A Director may be removed from office, for cause, by the vote of a two-thirds majority of the full Board of Directors. VI OFFICERS 1. Officers The officers of this Corporation shall be a President, a Vice-President, Secretary/Treasurer, and such other officers as the Board of Directors may appoint. All officers shall be members of the Board of Directors. Directors shall be elected at the first regularly-scheduled Board of Directors meeting after January 1 of each year and serve a term of one year. 2. Vacancies A vacancy in any office because of the death, resignation, removal, disqualification, or otherwise, shall be filled by the Board of Directors. 3. President Subject to the control of the Board of Directors, the President shall have general supervision, direction, and control of the business affairs of the Corporation. He/she shall preside at all meetings of the members and Directors and shall have such other powers and duties.as may be prescribed from time to time by the Board of Directors. 4. Vice-President In the absence or disability of the President, the Vice-President shall perform all the duties of the President; and, in so acting, shall have all the powers of President. The Vice-President shall have such other powers and perform such other duties as may be prescribed from time to time by the Board of Directors. 5. Secretary/Treasurer The Secretary/Treasurer shall keep a full and complete record of the proceedings of the Board of Directors, shall supervise the keeping of the books of the Corporation, and shall make service of such notices as may be necessary or proper. The Secretary/Treasurer shall ensure that all tax returns and other filing required by any Federal, State, or local law, ordinance, or regulations are made. The Secretary/Treasurer will act as the Chief Financial Officer of the Corporation, shall receive, and safely keep, all funds of the Corporation and deposit the same as may be designated by the Board of Directors. Such funds may be paid out only on the check of the Corporation signed by the President, Vice-President, Secretary/Treasurer, or members of the Board of Directors authorized to do so. May endorse and receive payments of bills and notes payable to the Corporation. The Secretary/Treasurer shall have such other 4 E46 powers and perform such duties as may be prescribed from time to time by the Board of Directors. 6. No officer of the San Luis Obispo Community Recreation and Parks Foundation shall have any power or authority, outside of the normal day-today business of the Corporation, to bind the Corporation by any contract or engagement, or to pledge its credit, or render it liable in connection with any transaction unless so authorized by the Board of Directors. VII CONEWITEES This Corporation shall have other committees, such as standing and ad hoc committees, as authorized by the Board of Directors. Membership on such committees shall be appointed by the existing Board of Directors of the Corporation, except that two of the members of the Committee must be members of the Board of Directors. VIII EXECUTIVE CONMUMES This Corporation shall have a standing executive committee consisting of President, Vice-President, and Secretary/Treasurer. This committee is to act on behalf of the Board of Directors should the need arise. All action taken by the executive committee must be ratified by the full Board at the next scheduled Board meeting. IX FISCAL PROVISIONS 1. Purpose — The corporation seeks to raise funds for the purpose of expanding community recreation and parks services. The corporation will not accept funds that redistribute existing resources. The corporation will not accept funds that have historically gone to other organizations. 2. Solicitation of Funds — The Corporation will not undertake a general fundraising campaign. The Corporation's primary source of funds shall be through solicitation of grants, donations, bequests, and conducting fundraising events. Funds raised must be allocated to the program, activity, or facility for which it was specifically raised. None of these funds may be used for any other purpose. Community recreation and parks activities, programs, facilities, and grants shall be provided for the benefit of the community and shall remain, to the extent possible, noncommercial. Funds obtained will be used to further recreation and parks programs and services within the Community of San Luis Obispo. 3. Operating Expense — The Corporation may solicit a minimal amount of funds annually for the purpose of defraying operating expenses. 5 5-/7 4. Budgeting — The Board of Directors shall prepare an annual-operating budget for the Corporation at the first meeting of each fiscal year. 5. Checks — Checks payable by the Corporation shall be signed by any two (2) of the following officers: President, Vice-President, Secretary/Treasurer. 6. Insurance — The Corporation shall have the right to purchase and maintain insurance to the full extent permitted by law on behalf of its officers, directors, employees, and other agents, against any liabilities asserted against, or incurred by, any officer, director, or agent in such capacity, or arising out of, the officers, director's, or agent's status as such. R AMENDMENT OF BY-LAWS These By-laws may be amended or replaced and new By-laws adopted by the vote of a majority of the members of the Board of Directors at any Board meeting at which a quorum is present, except that a By-law fixing or changing the number of Directors may be adopted, amended, or repealed only by the vote or written consent of a majority of the Directors of the Corporation. Written notice given to.the Board of Directors by mail at least four (4) days in advance of the meeting shall constitute proper notice. At the request of any Director, such notice may be included in the notice giving the date and place of a regular meeting. XI PROHIBITION AGAINST SHARING CORPORATE ASSETS No director, officer, or other person connected with this Corporation, or any private individual shall receive, at any time, any of the net earnings or pecuniary profit from the operations of the Corporation provided, however, that this provision shall not prevent payment to any such person of reasonable compensation for services performed for the Corporation in effecting any of its public or charitable purposes, provided that such compensation is otherwise permitted by these By-laws and is fixed by resolution of the Board of Directors; and no such person or persons shall be entitled to share in the distribution of, and shall not receive, any of the corporate assets on dissolution of the Corporation. All members, if any, of the Corporation shall be deemed to have expressly consented and agreed that on such dissolution or winding up of the affairs of the Corporation, whether voluntarily or involuntarily, the assets of the Corporation, after all debts have been satisfied, shall be distributed, upon majority vote of the Board of Directors, to the various organizations in the community that provide recreation and parks services. 6 S-/8 XII INDEMNIFICATION The San Luis Obispo Community Recreation and Parks Foundation shall, to the maximum extent permitted by California law, indemnify each of its Directors and Officers and agents against any expenses, judgments, fines, and settlements in connection with any proceedings arising by reason of the fact any such person is, or was, a Director or Officer of the San Luis Obispo Community Recreation and Parks Foundation. XIII VOTING On all matters that require a vote of the Directors of this Corporation, each Director shall have one vote. An authorized written and signed proxy by each Director may be used and given to the President or any attending Board member. XIV FISCAL YEAR The fiscal year of the Corporation shall be from July 1 through June 30. XV ANNUAL REPORTS The Board of Directors shall cause an "Annual Report" to be conducted 120 days after the end of the Corporation's fiscal year. The Annual Report will include: 1. The assets and liabilities of the Corporation as of the beginning and the end of the fiscal year 2. The principal changes in assets and liabilities within the fiscal year 3. The revenue or receipts of the Corporation, both unrestricted and restricted to particular purposes 4. The expenses of disbursements of the Corporation for both general and restricted purposes WRITTEN CONSENT OF THE DIRECTORS ADOPTING BY-LAWS We, the undersigned, are all of the persons named as the initial Directors in the Articles of Incorporation of the San Luis Obispo Recreation and Parks Foundation, a California non-profit corporation, and pursuant to the authority granted to their Directors by these By-laws to take action by unanimous, written consent without a meeting, consent to, and do hereby adopt, the foregoing By-laws, consisting of seven pages, as the By-laws of this Corporation. (Name of Director), Director Date (Name of Director), Director Date (Name of Director), Director Date (Name of Director), Director Date (Name of Director), Director Date (Name of Director), Director Date (Name of Director), Director Date (Name of Director), Director Date (Name of Director), Director Date CERTIFICATE This is to certify that the foregoing is a true and correct copy of the By-laws of the Corporation named in the title thereto and that such By-laws were duly adopted by the Board of Directors of said Corporation. (Name of Secretary/Treasurer), Secretary/Treasurer Date 8 5-ao