CC SR 20230418 06 - Foundation Action Items
CITY COUNCIL MEETING DATE: 04/18/2023
AGENDA REPORT AGENDA HEADING: Regular Business
AGENDA TITLE:
Consideration and possible action to execute Articles of Incorporation, By-Laws, and
Conflict of Interest Policy for the City’s future nonprofit RPV Community Foundation.
RECOMMENDED COUNCIL ACTION:
(1) Approve and execute the Articles of Incorporation, By-Laws, and Conflict of
Interest Policy for the City’s future nonprofit RPV Community Foundation by
taking the following actions (in a single motion):
a. Approve the attached RPV Community Foundation Articles of Incorporation
and authorize the Mayor and Mayor Pro Tem to execute the same as
incorporators;
b. Approve the attached By-Laws of the RPV Community Foundation;
c. Adopt the attached Conflict of Interest Policy of the RPV Community
Foundation;
d. Direct Staff and the City Attorney to file the Articles of Incorporation and By-
Laws with the California Secretary of State (Form ARTS-PB-501(c)(3));
e. Direct Staff and the City Attorney to file the Conflict of Interest Policy with the
California Fair Political Practices Commission;
f. Direct Staff and the City Attorney to apply to the Internal Revenue Service
(Form IRS 1023) for recognition as a Federal 501(c)(3) tax-exempt foundation;
g. Direct Staff and the City Attorney to apply to the California Franchise Tax Board
(California Exempt Organization Annual Information Return Form 199 or 199N
& 3500A) as a tax-exempt foundation;
h. Direct Staff and the City Attorney to register the RPV Community Foundation
with the California Attorney General (Form CT-1; Government Code §§ 12580
et seq.); and,
i. Direct Staff to prepare and submit to the California Secretary of State an Initial
Report within 90 days of incorporation (Form SI-100) of the RPV Community
Foundation.
FISCAL IMPACT: Any filing fees will likely be exempt for a City-formed community
foundation.
Amount Budgeted: N/A
Additional Appropriation: N/A
Account Number(s): N/A
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RANCHO PALOS VERDES
ORIGINATED BY: William Wynder, City Attorney
REVIEWED BY: Karina Bañales, Deputy City Manager
APPROVED BY: Ara Mihranian, AICP, City Manager
ATTACHED SUPPORTING DOCUMENTS:
A. Draft RPV Community Foundation Articles of Incorporation (page A-1)
B. Draft RPV Community Foundation By-Laws (page B-1)
C. Draft RPV Community Foundation Conflict of Interest Policy (page C-1)
BACKGROUND AND DISCUSSION:
On March 7, 2023, the City Council authorized Staff to move forward with taking the next
steps to form a nonprofit that will accept philanthropic donations to alleviate costs borne
by the City for capital projects and support programming to enrich the quality of life in
City. The Council also selected RPV Community Foundation as the name and affirmed
the governing structure, which will be the Council serving as the board of directors.
Tonight, Staff requests the City Council take the following actions necessary to
incorporate the RPV Community Foundation. These steps are identified in the order they
need to be taken and the City Council can authorize them in a single combined motion.
1. Approve the attached Articles of Incorporation (Attachment A) which includes the
following:
• The name of the foundation;
• The purpose or purposes of the foundation (a broad specific purpose statement
provides the foundation room for its mission to evolve with requiring an
amendment to the articles);
• The agent for services of process (as person who can receive lawsuit s and
other official correspondence and other matters – possibly the Office of the City
Clerk);
• Limitations of the foundation’s operations consistent with its tax-exempt status;
• The Foundation’s street and mailing address; and
• Appropriate dedication and dissolution clauses.
2. Authorize the Mayor and Mayor Pro Tem to execute the Articles of Incorporation
acting as the Foundation’s Incorporators and direct Staff and the City Attorney to
file the executed articles with the California Secretary of State (Form ARTS-PB-
501(c)(3)). The signors of the Articles of Incorporation perform a singular function
of acting as “incorporators” of the foundation.
3. Approve and file with the California Secretary of State the attached By-Laws
(Attachment B). The Foundation’s by-laws provide the fundamental provisions for
governance of the non-profit and include the following:
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• The powers and duties of the Board of Directors;
• How Directors are elected or otherwise selected (as requested, the entire City
Council is identified as the governing body, which will require the governing
body to comply with California open meeting laws, and will establish the
meetings of the governing body concurrently with meetings of the City Council);
• How the Board takes action (which is identical to the way the City Council takes
action);
• How Board meetings are called and conducted (again, identical to the way the
City Council meetings are called and conducted);
• The officers of the Foundation (California law requires three officers; a
president or chair, a secretary, and a treasurer or chief financial officer);
• The duties of responsibilities of these officers; and
• The level of indemnification provided by the Foundation to protect its officers,
directors and any employees it may hire.
4. Approve and file with the Fair Political Practices Commission the attached Conflict
of Interest Policy (Attachment C). The Foundation is required by law to adopt the
attached draft Conflict of Interest Policy, which is identical to the City’s Conflict of
Interest Policy.
5. Direct City Staff and the City Attorney to obtain Federal 501(c)(3) tax-exempt
status, by applying for recognition to the Internal Revenue Service (Form IRS
1023).
6. Direct Staff and the City Attorney to obtain California tax exempt status, by
applying for recognition form the State Franchise Tax Board (California Exempt
Organization Annual Information Return Form 199 or 199N & 3500A).
7. Direct Staff and the City Attorney to prepare and submit to the California Secretary
of State its Initial Report within 90 days of incorporation (Form SI-100).
8. Before commencing the solicitation of donations to the Foundation, the Foundation
will be required to register with the California Attorney General (Form C T-1;
Government Code §§ 12580 et seq.).
9. Finally, the Foundation will need to obtain and employer identification number
should there be any members of Staff designated as “employees” of the
corporation (Form IRS SS-4).
CONCLUSION:
Staff recommends the City Council, in a single motion, take the necessary steps to
incorporate the RPV Community Foundation, including approving and executing the
Articles of Incorporation, By-Laws, and Conflict of Interest Policy.
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Staff will return in 90 days with additional information on next steps which include
confirmation that the Foundation was approved by the California Secretary of State,
California Franchise Tax Board, and California Attorney General.
ALTERNATIVES:
In addition to the Staff recommendation, the following alternative action is available for
the City Council’s consideration:
1. Take no action to formally incorporate the RPV Community Foundation.
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01203.0002/867982.2
ARTICLES OF INCORPORATION
OF
RPV COMMUNITY FOUNDATION
a California Nonprofit Public Benefit Corporation
I.
The name of this corporation is RPV COMMUNITY
FOUNDATION .
II.
A. This corporation is a nonprofit public benefit corporation and is not organized for
the private gain of any person. It is organized under the California Nonprofit Public Benefit
Corporation Law for public and charitable purposes.
B. The specific and primary purpose of this corporation is to support the City of
Rancho Palos Verdes and the residents of the City of Rancho Palos Verdes by providing funding,
through grants, donations, and corporate support, for community benefits and services to benefit
the community within the present and future boundaries of the City of Rancho Palos Verdes.
III.
The name and address in the State of California of this corporation’s initial agent for
service of process is:
Teresa Takaoka, City Clerk
City of Rancho Palos Verdes
30940 Hawthorne Blvd.
Rancho Palos Verdes, California 90275
IV.
The initial street and mailing address for this corporation is:
Rancho Palos Verdes City Hall
30940 Hawthorne Blvd.
Rancho Palos Verdes, California 90275
V.
A. Notwithstanding any provision contained in these Articles or in any other governing
instrument of this corporation, this corporation shall not carry on any activities not permitted to be
carried on (a) by a corporation exempt from federal income tax under Section 501(c)(3) of the
Internal Revenue Code (“Code”) or the corresponding provision of any future United States
internal revenue law, or (b) by a corporation contributions to which are deductible under Section
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170(c)(2) of the Code or the corresponding provision of any future United States internal revenue
law.
B. No substantial part of the activities of this corporation shall consist of carrying on
propaganda, or otherwise attempting to influence legislation, and this corporation shall not
participate or intervene in any political campaign (including the publishing or distribution of
statements) on behalf of any candidate for public office, or for or against any cause or measure
being submitted to the people for a vote.
C. Notwithstanding any provision contained in these Articles or in any other governing
instrument of this corporation, this corporation shall not, except to an insubstantial degree, engage
in any activities or exercise any powers that are not in furtherance of the purposes of this
corporation.
VI.
The property of this corporation is irrevocably dedicated to
charitable purposes and no part of the net income or assets of this
corporation shall ever inure to the benefit of any director, officer, or member
hereof or to the benefit of any private person. Upon the dissolution or
winding up of this corporation, its assets remaining after payment, or
provision for payment, of all of its debts and liabilities shall be distributed
to a nonprofit fund, foundation or corporation designated by the Board of
Directors of this corporation which is organized and operated exclusively
for charitable, cultural, recreational or educational purposes and which has
established its tax exempt status under Section 501(c)(3) of the Code or the
corresponding provision of any future United States internal revenue law.
VII.
Notwithstanding any provision contained in these Articles or
in any other governing instrument of this corporation, this corporation is
required to distribute its income for each taxable year at such times and in
such manner as not to subject this corporation to tax under Section 4942 of
the Code or the corresponding provision of any future United States internal
revenue law. In addition, this corporation shall not, during any period and
to the extent that it is a private foundation described in Section 509 of the
Code or the corresponding provision of any future United States internal
revenue law: (a) engage in any act of self-dealing as defined in Section
4941(d) of the Code; (b) retain any excess business holdings as defined in
Section 4943(c) of the Code; (c) make any taxable expenditures as defined
in Section 4945(d) of the Code; or (d) make any investments in such manner
as to subject the corporation to tax under Section 4944 of the Code or the
corresponding provision of any future United States internal revenue law.
[SIGNATURES ON FOLLOWING PAGE]
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[SIGNATURE PAGE TO ARTICLES OF INCORPORATION]
I hereby declare that I am the person who executed the foregoing Articles of
Incorporation, which execution is my act and deed.
Dated:
__________
___________________________
Barbara Ferraro
Rancho Palos Verdes
Mayor/Incorporator
Dated:
__________
__________________________
John Cruikshank
Rancho Palos Verdes
Mayor Pro Tem/Incorporator
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BYLAWS
OF
RPV COMMUNITY FOUNDATION,
a California Nonprofit Public Benefit Corporation
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BYLAWS
OF
RPV COMMUNITY FOUNDATION,
a California Nonprofit Public Benefit Corporation
ARTICLE I
NAME
The name of this corporation shall be RPV COMMUNITY FOUNDATION.
ARTICLE II
PRINCIPLE OFFICE OF THE CORPORATION
The principal office for the transaction of the activities and affairs of this corporation is
located at Rancho Palos Verdes City Hall, 30940 Hawthorne Blvd., Rancho Palos Verdes,
California 90275. The board of directors may change the location of the principal office.
ARTICLE III
PURPOSES AND OBJECTIVES: LIMITATIONS
Section 1. Specific Purpose. The specific and primary purpose of this corporation is
to support the City of Rancho Palos Verdes and the residents and businesses of the City of Rancho
Palos Verdes by providing funding, through grants, donations, and corporate support, for
charitable, cultural, recreational, and educational purposes to benefit the community. This
corporation is organized and shall be operated exclusively for charitable purposes within the
meaning of Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the “Code”).
Section 2. General Purposes. The general purposes and powers of this corporation are
the following:
(a) to receive, hold, and disburse gifts, bequests, devises, and other funds to
advance the purpose and objectives of this corporation;
(b) to own and maintain or to lease suitable real and personal property which is
deemed necessary for the purpose and objectives of this corporation; and
(c) to enter into, make, perform, and carry out contracts of every kind for any
lawful purpose, without limit as to amount.
Section 3. Limitations. This corporation has been formed under the California
Nonprofit Public Benefit Corporation Law (California Corporations Code Section 5110 et seq.)
for the purposes and objectives described above.
This corporation shall not carry on any activities not permitted to be carried on (a) by a
corporation exempt from federal income tax under Section 501(c)(3) of the Code or the
corresponding provision of any future United States internal revenue law, or (b) by a corporation
contributions to which are deductible under Section 170(c)(2) of the Code or the corresponding
provision of any future United States internal revenue law.
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No substantial part of the activities of this corporation shall consist of the publication or
dissemination of materials with the purpose of attempting to influence legislation, and this
corporation shall not participate or intervene in any political campaign on behalf of any candidate
for public office or for or against any cause or measure being submitted to the people for a vote.
This corporation shall not, except to an insubstantial degree, engage in any activities or
exercise any powers that are not in furtherance of its purposes and objectives described above.
ARTICLE IV
CONSTRUCTION AND DEFINITIONS
Unless the context requires otherwise, the general provisions, rules of construction, and
definitions in the California Nonprofit Public Benefit Corporation Law shall govern the
construction of these Bylaws. Without limiting the generality of the above, the masculine gender
includes the feminine and neuter, the singular number includes the plural, the plural number
includes the singular, and the term “person” includes both a legal entity and a natural person.
ARTICLE V
DEDICATION OF ASSETS
The property of this corporation is irrevocably dedicated to charitable purposes and no part
of the net income or assets of this corporation shall ever inure to the benefit of any director, officer,
or member hereof or to the benefit of any private person. Upon the dissolution or winding up of
this corporation, its assets remaining after payment, or provision for payment, of all of its debts
and liabilities shall be distributed to a nonprofit fund, foundation or corporation designated by the
board of directors of this corporation which is organized and operated exclusively for charitable
purposes and which has established its tax exempt status under Section 501(c)(3) of the Code or
the corresponding provision of any future United States internal revenue law.
ARTICLE VI
MEMBERS
Section 1. Directors as Members. This corporation shall have no voting members
within the meaning of the California Nonprofit Public Benefit Corporation Law. Any action that
would otherwise require approval by a majority of all members or approval by the members shall
require only approval of the board of directors, as authorized by Section 5310 of the California
Nonprofit Public Benefit Corporation Law.
Section 2. Meetings. There shall be no meetings of members as such. The persons
constituting the board of directors may, at any given time and from time to time, act in their
capacity as members pursuant to Section I of this Article VI, at meetings of the board of directors
held as provided in Section 5 of Article VII of these Bylaws.
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ARTICLE VII
DIRECTORS
Section 1. Powers.
(a) General Corporate Powers. Subject to the provisions of the California
Nonprofit Public Benefit Corporation Law and any limitations in the Articles of Incorporation and
these Bylaws, the business and affairs of this corporation shall be managed, and all corporate
powers shall be exercised, by or under the direction of the board of directors; provided, however,
that in order to preserve the nonprofit, exempt-from-income-tax status of this corporation, neither
the board nor any member thereof shall do any act, or authorize or suffer the doing of any act by
an officer or employee of this corporation, on behalf of the corporation, which is inconsistent with
the Articles or these Bylaws or the nonprofit purpose of this corporation. Any such act or acts shall
be null and void.
(b) Specific Powers. Without prejudice to these general powers, and subject to
the same limitations, the directors shall have the power to:
(i) Appoint and remove, at the pleasure of the board, all officers, agents,
and employees of this corporation; prescribe any powers and duties for them that
are consistent with law, with the Articles of Incorporation, and with these Bylaws;
and fix their compensation in a manner consistent with the Articles of
Incorporation, and with these Bylaws.
(ii) Change the principal office from one location to another within the
City of Rancho Palos Verdes, California; and designate any place within Los
Angeles County, California, for the holding of any meeting or meetings.
(iii) Adopt, make, and use a corporate seal; and alter the form of the seal.
(iv) Borrow money and incur indebtedness on behalf of this corporation
and cause to be executed and delivered for this corporation’s purposes and
objectives, in the corporate name, promissory notes, bonds, debentures, deeds of
trust, mortgages, pledges, hypothecations, and other evidences of debt and
securities.
(c) Limit on Dissolution. The Foundation may not be dissolved without the
express authorization of the City Council of the City of Rancho Palos Verdes.
Section 2. Board of Directors. The authorized number of directors of the board shall
be five (5). The board of directors shall be composed of the following:
(a) Five sitting members of the City of Rancho Palos Verdes City Council.
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Section 3. Term, Removal, and Vacancy.
(a) Term of Office. Directors shall be appointed for a term of two (2) years,
except that the length of the terms of each of the initial five (5) directors shall be staggered, as
follows:
(i) Eric Algeria’s term shall end on November 2024;
(ii) John Cruikshank’s term shall end on November 2024;
(iii) David L. Bradley’s term shall end on November 2026;
(iv) Barbara Ferraro’s term shall end on November 2026; and
(v) Paul Seo’s term shall end on November 2026.
(b) Number of Terms. Directors may serve no more than two (2) consecutive
terms of office and shall not be eligible to serve again until the expiration of at least six (6) months
after the end of that person's last term of office..
(c) Resignation. Any director may resign by giving written notice to the chair
of the board or to the executive director or the secretary of the board. The resignation shall be
effective when the notice is given unless it specifies a later time for the resignation to become
effective. If a director’s resignation is effective at a later time, the board may elect a successor to
take office as of the date when the resignation becomes effective.
(d) Removal. Directors of the board may be removed with or without cause. A
director of the board, other than the councilperson, may only be removed from the board by a
majority vote of the board. The councilperson may only be removed from the board by a majority
vote of the City Council.
(e) Vacancies. Upon the expiration of their term, directors of the board shall
retain their position on the board until their successor is appointed. Notwithstanding the previous
sentence, if the councilperson on the board ceases to be a member of the Rancho Palos Verdes
City Council for any reason, he or she shall automatically be removed from the board of directors,
effective on the date that such person ceases to be a member of the City Council. Moreover, if a
City resident board member ceases to be a City resident, or if a business representative ceases to
represent a business located in the City of Rancho Palos Verdes, such person shall be automatically
removed for the board of directors, effective on the date of the triggering event.
Section 4. Leadership of the Board.
(a) Chair of the Board. The chair of the board shall be the City’s Mayor. The
chair of the board shall preside at meetings of the board of directors and exercise and perform such
other powers and duties as may be from time to time assigned to him/her by the board of directors
or prescribed by the Bylaws.
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(b) Vice Chair of the Board. The vice chair of the board shall be the City’s
Mayor Pro Tem. The vice chair shall have a term as vice chair of two (2) years, except that the
vice chair’s initial term as vice chair shall expire on June 30, 2023. A board member may serve
any number of terms as vice chair and such terms may be consecutive. In the absence or disability
of the chair of the board, the vice chair of the board shall perform all the duties of the chair of the
board, and when so acting shall have all the powers of, and be subject to all the restrictions upon,
the chair of the board.
Section 5. Directors’ Meetings.
(a) Applicability of the Ralph M. Brown Act. All meetings of the board of
directors of this corporation shall be subject to the provisions of the Ralph M. Brown Act
(Government Code §§ 54950 et seq.). However, if any applicable provisions of these Bylaws are
more stringent than those contained in the Brown Act, then the provisions in these Bylaws shall
control.
(b) Regular Meetings. The board of directors shall schedule regular meetings
of the board of directors at such time and place as determined by the board of directors. Meetings
of the board of directors shall be held in the City of Rancho Palos Verdes at Hesse Park in
McTaggart Hall, unless otherwise determined by resolution of the board of directors or stated in
the notice of meeting.
(c) Special Meetings. Special meetings of the board of directors may be called
at any time by the chair of the board or by a majority of the authorized number of directors of the
board. Notice of special meetings shall be given in accordance with Section 54956 of the
Government Code, as may be amended from time to time. Any waiver of notice of a special
meeting shall be filed with the corporate records and made a part of the minutes of the special
meeting.
(d) Quorum. A quorum shall be present when a majority of the authorized
number of directors are present, except to adjourn. A quorum must be present in order for the
board of directors to conduct business. Every act or decision done or made by a majority of the
directors present at a meeting duly held at which a quorum is present shall be regarded as the a ct
of the board of directors, subject to the more stringent provisions of the California Nonprofit Public
Benefit Corporation Law, including, without limitation, those provisions relating to (i) approval
of contracts or transactions in which a director has a direct or indirect material financial interest,
(ii) appointment of committees, and (iii) indemnification of directors. A meeting at which a
quorum is initially present may continue to transact business, notwithstanding the withdrawal of
directors, if any action taken is approved by at least a majority of the required quorum for that
meeting.
(e) Adjournment. A majority of the directors present, whether or not
constituting a quorum, may adjourn any meeting to another time and place.
(f) Notice of Adjournment. Notice of adjournment shall be given in
accordance with Section 54955 of the Government Code, as may be amended from time to time.
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Section 6. Compensation and Reimbursement. Directors and members of committees
shall receive no compensation of any kind for their services as directors or officers. However,
directors and officers may be reimbursed for expenses, as may be determined by resolution of the
board to be just and reasonable.
Section 7. Liabilities. No director now or hereafter shall be personally liable for any
indebtedness or liability of this corporation, and any and all creditors of this corporation shall look
only to the assets of the corporation for payment.
ARTICLE VIII
BOARD COMMITTEES
Section 1. Board Committees. The board of directors may establish one or more board
committees, each consisting of no more than two (2) directors, to serve at the pleasure of the board.
The board may designate one (1) or more directors as alternate members of any board committee
who may replace any absent member at any meeting of the board committee. The board of
directors may also appoint any number of persons who are not directors to serve at the pleasure of
the board on any board committee, and said persons shall have a vote in the recommendation of
the committee of which they are a member. The board of directors may adopt rules for the
government of any board committee not inconsistent with the provisions of these Bylaws.
Section 2. Committee Member Selection. The chair of the board shall appoint
committee members from the board, subject to confirmation by the board.
Section 3. Restrictions on Board Committees. A board committee shall have the
power to make advisory recommendations to the board of directors regarding the subject matter of
its charge, but shall have no other power, and shall have no power to bind the board of directors
or the corporation in any way or thing whatsoever.
ARTICLE IX
OFFICERS
Section 1. Officers. The officers of this corporation shall be an executive director, a
secretary, and a treasurer. Any number of offices may be held by the same person, except that
neither the secretary nor the treasurer may serve concurrently as the executive director or chair of
the board.
Section 2. Executive Director. The executive director shall be the City Manager of the
City of Rancho Palos Verdes. Subject to such supervisory powers, if any, as may be given by the
board of directors to the chair of the board, and subject to the control of the board of directors, the
executive director shall generally supervise, direct, and control the business and the officers of the
corporation. The executive director shall be the chief executive officer of the corporation. The
executive director may designate deputies to assist him/her, as needed, and may also designate
deputies to assist the secretary and the treasurer, as needed.
Section 3. Secretary. The secretary shall be the City Clerk of the City of Rancho Palos
Verdes or his/her designee. The secretary shall attend to the following:
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(a) Book of Minutes. The secretary shall keep or cause to be kept, at the
principal office or such other place as the board of directors may direct, a book of minutes of all
meetings and actions of directors, committees of directors, with the time and place of holding,
whether regular or special, and, if special, how authorized, the notice given, the names of those
present at such meetings, the number of directors present or represented at directors’ meetings,
and the proceedings of such meetings.
(b) Custody of Articles and Bylaws. The secretary shall keep or cause to be
kept, at the principal office of the corporation, a copy of the Articles of Incorporation and Bylaws,
as amended.
(c) Notices, Seal, and Other Duties. The secretary shall give, or cause to be
given, notice of all meetings of the board of directors, and of committees of the board, required by
the Bylaws or by law to be given. The secretary shall keep the seal of the corporation , if any, in
safe custody. The secretary shall have other powers and perform such other duties as may be
prescribed by the board of directors or the Bylaws.
Section 4. Treasurer. The treasurer shall be the Director of Finance for the City of
Rancho Palos Verdes. The treasurer shall attend to the following:
(a) Books of Account. The treasurer shall keep and maintain, or cause to be
kept and maintained, adequate and correct books and records of accounts of the properties and
business transactions of this corporation. The treasurer shall send or cause to be given to the
directors such financial statements and reports as are required to be given by law, by these Bylaws,
or by the board. The books of account shall be open to inspection by any director at all reasonable
times.
(b) Deposit and Disbursement of Money and Valuables. The treasurer shall (i)
deposit or cause to be deposited all money and other valuables in the name and to the credit of this
corporation with such depositories as may be designated by the board of directors, (ii) disburse the
funds of this corporation as may be ordered by the board of directors, (iii) render to the executive
director and directors, whenever they request it, an account of all transactions effected by the
treasurer and of the financial condition of this corporation, and (iv) have such other powers and
perform such other duties as may be prescribed by the board of directors or the Bylaws.
(c) Bond. If required by the board of directors, the treasurer shall give this
corporation a bond in the amount and with the surety or sureties specified by the board of directors
for faithful performance of the duties of such office and for restoration to this corporation of all its
books, papers, vouchers, money, and other property of every kind in the possession or under
control of the treasurer on such officer’s death, resignation, retirement, or removal from office.
(d) Tax Filings. The treasurer shall prepare and file all necessary tax and
financial documents on behalf of this corporation.
Section 5. Resignation or Removal of Officers. Resignation or removal from the
position of City Manager, City Clerk, or Director of Finance shall be deem ed resignation or
removal from the position of executive director, secretary, or treasurer, respectively.
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Section 6. Vacancies in Office. A vacancy in any office because of death, resignation,
removal, or any other cause shall be filled in the manner designated by the City of Rancho Palos
Verdes.
ARTICLE X
INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES, AND AGENTS
Section 1. Right of Indemnity. To the fullest extent permitted by law, this corporation
shall indemnify any present or former director, officer, employee or other “agent” of the
corporation, as that term is defined in Section 5238(a) of the California Corporations Code, against
all expenses, judgments, fines, settlements and other amounts actually and reasonably incurred by
them in connection with any “proceeding,” as that term is used in that Section, and including an
action by or in the right of the corporation, by reason of the fact that the person is or was a person
described in that section. “Expenses,” as used in this Section, shall have the same meaning as in
Section 5238(a) of the California Corporations Code.
Section 2. Approval of Indemnity. On written request to the board by any person
seeking indemnification under Section 5238(b) or Section 5238(c) of the California Corporations
Code, the board shall promptly determine under Section 5238(e) of the California Corporations
Code whether the applicable standard of conduct set forth in Section 5238(b) or Section 5238(c)
has been met and, if so, the board shall authorize indemnification. If the board cannot authorize
indemnification because the number of directors who are parties to the proceeding with respect to
which indemnification is sought prevents the formation of a quorum of directors who are not
parties to that proceeding, the indemnification may be authorized by the court in which such
proceeding is or was pending, pursuant to Section 5238(e) of the California Corporations Code.
Section 3. Advancement of Expenses. To the fullest extent permitted by law, expenses
incurred by a person seeking indemnification under Sections 5238(b) or 5238(c) of the California
Corporations Code in defending any proceeding covered by those Sections shall be advanced by
the corporation upon the request of such person and upon receipt by the corporation of an
undertaking by or on behalf of that person that the advance will be repaid unless it is ultimately
determined that the person is entitled to be indemnified by the corporation for those expenses.
Section 4. 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 liability asserted against or incurred by any officer, director, employee,
or agent in such capacity or arising out of the officer’s, director’s, employee’s, or agent’s status as
such.
ARTICLE XI
RECORDS AND REPORTS
Section 1. Maintenance of Corporate Records. The corporation shall keep:
(a) Adequate and correct books and records of account; and
(b) Written minutes of the proceedings of its board, board committees and
community committees.
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Section 2. Inspection by Directors. Every director shall have the absolute right at any
reasonable time to inspect the corporation’s books, records, documents of every kind, physical
properties, and the records of each of its subsidiaries. The inspection may be made in person or by
the director’s agent or attorney. The right of inspection includes the right to copy and make extracts
of documents.
Section 3. Annual Report. The corporation shall cause an annual report to be sent to
the directors within one hundred twenty (120) days after the end of the corporation’s fiscal year.
That report shall contain the following information, in appropriate detail, for the fiscal year:
(a) The assets and liabilities, including the trust funds, of the corporation as of
the end of the fiscal year.
(b) The principal changes in assets and liabilities, including trust funds.
(c) The revenue or receipts of the corporation, both unrestricted and restricted
to particular purposes.
(d) The expenses or disbursements of the corporation for both general and
restricted purposes.
(e) Any information required by Section 4 below.
The annual report shall be accompanied by any report on it of independent accountants or,
if there is no such report, by the certificate of an authorized officer of the corporation that such
statements were prepared without audit from the corporation’s books and records.
This requirement of an annual report shall not apply if the corporation receives less than
Twenty-Five Thousand Dollars ($25,000.00) in gross receipts during the fiscal year, provided,
however, that the information specified above for inclusion in an annual report must be furnished
annually to all directors who requests it in writing.
Section 4. Annual Statement of Certain Transactions and Indemnifications. As part of
the annual report to all directors, or as a separate document if no annual report is issued, the
corporation shall annually prepare and furnish to each director a statement of any transaction or
indemnification of the following kind within one hundred twenty (120) days after the end of the
corporation’s fiscal year:
(a) Any transaction (i) in which the corporation, its parent, or its subsidiary was
a party, (ii) in which an “interested person” had a direct or indirect material financial interest, and
(iii) which involved more than Fifty Thousand Dollars ($50,000.00), or was one of a number of
transactions with the same interested person involving, in the aggregate, more than Fifty Thousand
Dollars ($50,000.00). For this purpose, an “interested person” is either of the following:
(i) Any director or officer of the corporation, its parent, or subsidiary
(but mere common directorship shall not be considered such an interest); or
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(ii) Any holder of more than ten percent (10%) of the voting power of
the corporation, its parent, or its subsidiary. The statement shall include a brief
description of the transaction, the names of interested persons involved, their
relationship to the corporation, the nature of their interest in the transaction and, if
practicable, the amount of that interest, provided that if the transaction was with a
partnership in which the interested person is a partner, only the interest of the
partnership need be stated.
(b) Any indemnifications or advances aggregating more than Ten Thousand
Dollars ($10,000.00) paid during the fiscal year to any officer or director of the corporation under
Article X of these Bylaws.
ARTICLE XII
GENERAL CORPORATE MATTERS
Section 1. Fiscal Year. The fiscal year of this corporation shall commence on July 1
and conclude on June 30.
Section 2. Checks, Drafts and Evidence of Indebtedness. All checks, drafts, or other
orders for payment of money, notes, or other evidences of indebtedness, issued in the name of or
payable to this corporation, shall be signed or endorsed by both (i) the chair of the board or a vice
chair of the board, and (ii) the treasurer of the corporation.
Section 3. Corporate Contracts and Instruments; How Executed. The board of
directors, except as otherwise provided in these Bylaws, may authorize any officer or officers,
agent or agents, to enter into any contract or execute any instrument in the name of and on behalf
of this corporation, and this authority may be general or confined to specific instances; and, unless
so authorized or ratified by the board of directors or within the agency power of an officer, no
officer, agent or employee shall have any power or authority to bind this corporation by any
contract or engagement or to pledge its credit or to render it liable for any purpose or for any
amount.
Section 4. Policies. The RPV Community Foundation shall be governed by the
officially adopted policies of the City of Rancho Palos Verdes, except to the extent that such
policies conflict with these Bylaws or California Nonprofit Public Benefit Corporation Law. In
the event of any conflict, these Bylaws and California Nonprofit Public Benefit Corporation Law
shall govern.
Section 5. Parliamentary Procedure. The RPV Community Foundation shall conduct
meetings in accordance with the parliamentary procedures of the City of Rancho Palos Verdes.
ARTICLE XIII
AMENDMENTS
New Bylaws may be adopted or these Bylaws may be amended or repealed by approval of
the board of directors. Notwithstanding the above, Sections 1(c), 2, and 4(a) of Article VII, and
Article IX, may not be amended, removed, or otherwise made ineffective without the express
approval of the City Council of the City of Rancho Palos Verdes.
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CERTIFICATE OF INCORPORATOR
I hereby certify that I am the Incorporator of the RPV Community Foundation, a California
nonprofit public benefit corporation, and that I adopted the above and foregoing Bylaws as the
Bylaws of this corporation pursuant to my authority under California Corporations Code section
5134 on __________________, 2023, and that they have not been amended since that date.
Executed on ______________, 2023, at Rancho Palos Verdes, California.
__________________________________________
Barbara Ferraro
Rancho Palos Verdes Mayor/Incorporator
Executed on ______________, 2023, at Rancho Palos Verdes, California.
__________________________________________
John Cruikshank
Rancho Palos Verdes Mayor Pro Tem/Incorporator
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01203.0002/868891.1
RPV COMMUNITY FOUNDATION
CONFLICT OF INTEREST POLICY
Article I
Purpose
The purpose of the conflict of interest policy is to protect the interests of the RPV
Community Foundation (“Foundation”) when it is contemplating entering into a transaction
or arrangement that might benefit the private interest of an officer or director of the
Foundation or might result in a possible excess benefit transaction. This poli cy is intended
to supplement but not replace any applicable state and federal laws governing conflict of
interest applicable to nonprofit and charitable organizations.
Article II
Definitions
1. Interested Person
Any director, principal officer, or member of a committee with governing board delegated
powers, who has a direct or indirect financial interest, as defined below, is an interested
person.
2. Financial Interest
A person has a financial interest if the person has, directly or indirectly, through business,
investment, or family:
a. An ownership or investment interest in any entity with which the Foundation has
a transaction or arrangement,
b. A compensation arrangement with the Foundation or with any entity or individual
with which the Foundation has a transaction or arrangement, or
c. A potential ownership or investment interest in, or compensation arrangement
with, any entity or individual with which the Foundation is negotiating a transaction
or arrangement.
Compensation includes direct and indirect remuneration as well as gifts or favors that are
not insubstantial.
A financial interest is not necessarily a conflict of interest. Under Article III, Section 2, a
person who has a financial interest may have a conflict of interest only if the appropriate
governing board or committee decides that a conflict of interest exists.
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Article III
Procedures
1. Duty to Disclose
Disclosure is required on FPPC Form 700 pursuant to Government Code Section 87200.
No additional disclosure is required by this Conflict of Interest Code.
2. Determining Whether a Conflict of Interest Exists
After disclosure of the financial interest and all material facts, and after any discussion
with the interested person, he/she shall leave the governing board or committee meeting
while the determination of a conflict of interest is discussed and voted upon. The
remaining board or committee members shall decide if a conflict of interest exists.
3. Procedures for Addressing the Conflict of Interest
a. An interested person may make a presentation at the governing board or
committee meeting, but after the presentation, he/she shall leave the meeting
during the discussion of, and the vote on, the transaction or arrangement involving
the possible conflict of interest.
b. The chairperson of the governing board or committee shall, if appropriate,
appoint a disinterested person or committee to investigate a lternatives to the
proposed transaction or arrangement.
c. After exercising due diligence, the governing board or committee shall determine
whether the Foundation can obtain with reasonable efforts a more advantageous
transaction or arrangement from a person or entity that would not give rise to a
conflict of interest.
d. If a more advantageous transaction or arrangement is not reasonably possible
under circumstances not producing a conflict of interest, the governing board or
committee shall determine by a majority vote of the disinterested directors whether
the transaction or arrangement is in the Foundation’s best interest, for its own
benefit, and whether it is fair and reasonable. In conformity with the above
determination it shall make its decision as to whether to enter into the transaction
or arrangement.
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4. Violations of the Conflicts of Interest Policy
a. If the governing board or committee has reasonable cause to believe a member
has failed to disclose actual or possible conflicts of interest, it shall inform the
member of the basis for such belief and afford the member an opportunity to
explain the alleged failure to disclose.
b. If, after hearing the member’s response and after making further investigation
as warranted by the circumstances, the governing board or committee determines
the member has failed to disclose an actual or possible conflict of interest, it shall
take appropriate disciplinary and corrective action.
Article IV
Records of Proceedings
The minutes of the governing board and all committees with board delegated powers shall
contain:
a. The names of the persons who disclosed or otherwise were found to have a
financial interest in connection with an actual or possible conflict of interest, the
nature of the financial interest, any action taken to determine whether a conflict of
interest was present, and the governing board’s or committee’s decision as to
whether a conflict of interest in fact existed.
b. The names of the persons who were present for discussions and votes relating
to the transaction or arrangement, the content of the discussion, including any
alternatives to the proposed transaction or arrangement, and a record of any votes
taken in connection with the proceedings.
Article V
Compensation
a. A voting member of the governing board who receives compensation, directly
or indirectly, from the Foundation for services is precluded from voting on matters
pertaining to that member’s compensation.
b. A voting member of any committee whose jurisdiction includes compensation
matters and who receives compensation, directly or indirectly, from the Foundation
for services is precluded from voting on matters pertaining to that member’s
compensation.
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Article VI
Annual Statements
Each director, principal officer and member of a committee with governing board
delegated powers shall annually sign a statement which affirms such person:
a. Has received a copy of the conflicts of interest policy,
b. Has read and understands the policy,
c. Has agreed to comply with the policy, and
d. Understands the Foundation is charitable and in order to maintain its federal tax
exemption it must engage primarily in activities which accomplish one or more of
its tax-exempt purposes.
Article VII
Periodic Reviews
To ensure the Foundation operates in a manner consistent with charitable purposes and
does not engage in activities that could jeopardize its tax-exempt status, periodic reviews
shall be conducted. The periodic reviews shall, at a minimum, include the following
subjects:
a. Whether compensation arrangements and benefits are reasonable, based on
competent survey information, and the result of arm’s length bargaining.
b. Whether partnerships, joint ventures, and arrangements with management
organizations conform to the Foundation’s written policies, are properly recorded,
reflect reasonable investment or payments for goods and services, further
charitable purposes and do not result in inurement, impermissible private benefit
or in an excess benefit transaction.
Article VIII
Use of Outside Experts
When conducting the periodic reviews as provided for in Article VII, the Foundation may,
but need not, use outside advisors. If outside experts are used, their use shall not relieve
the governing board of its responsibility for ensuring periodic reviews are conducted.
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