Nonprofit Membership Class: Intentions Matter

Question:

With regards to nonprofit membership, is there any law that prevents a nonprofit organization that was first established by family members from creating a special membership class that is designed solely for the founders to maintain control of the board?

Answer:

No. There is no law that prevents giving the voting membership class to the founders when they start out. However, nonprofit membership can be a delicate issue. If you are attempting to take away voting power from members that currently have that power, those members will most likely object. If those members that had voting rights stripped away challenge in court, they may prevail.

If you are considering taking away voting rights from current members in order to keep the nonprofit in the control of your family, you should probably consult with an attorney about laws related to nonprofit membership before making any binding decisions.