Changes we made in forming a branch

AAUW North Carolina has just formed the Tar Heel Branch,, a “branch without borders” that will serve the entire state using the Montana model .

Given this experience, I have a few comments on the process AAUW recommends for branch formation. Since this is something folks tend to do once in a lifetime, there’s not much opportunity for learning the process. So here’s my two cents, particularly for the benefit of those who are forming these new-style virtual branches. I have written the membership department and membership committee with some of these comments, but don’t have the sense that changing the documented process is high on anyone’s TODO list.

The short version of the recommended process (login to get the whole scoop – or let me know where this is posted on is

  • Phase I: A small group recruits 15 individuals eligible for membership, chooses a branch name, notifies any branches that will be affected by the new branch, and petitions the state for approval.
  • Phase II: The initial group decides whether it will use bylaws or working rules during its initial period, finalizes the appropriate document and sends it to the AAUW bylaws chair for approval. Recruiting continues and discussion/implementation of programming begins.
  • Phase III: The group elects branch officers (using guidance from the bylaws or working rules). Copies of the state approval from Phase I, the bylaws chair approval from Phase II, and the list of (at least 15) charter members and the branch officers are sent to AAUW. The AAUW executive committee reviews this information and issues a formal letter confirming the branch as a duly chartered organization. Recruiting, programming continue.
  • Phase IV: The branch receives the charter, applies to the IRS for an EIN, opens a bank account and starts collecting dues.

We saw two major problems with this process

  1. State approval is requested after the 15 charter members are identified. It should be possible to describe the concept of the branch (“evening branch” in a community where another branch already exists, virtual branch that might recruit from all the other branches’ areas) to the state board and get the state’s approval before recruiting is very far along. The recruiting message can be much stronger if the organizers can say they have the state organization’s support.
  2. Dues are not collected until phase IV. In the best of cases, this process can take 3-6 months. Nonmembers who become prospects early in the process should become AAUW members as early as possible.

Here is the process as we modified it for the AAUW Tar Heel (NC) Branch:

  • Phase I: An initial group comes up with the idea for a new branch. They contact the state mvp and president to discuss how the new branch would advance the AAUW mission. The state lets the other branches (especially those that would be directly affected) know that this group would like to form. The group petitions the state for approval in principle of the branch concept.
  • Phase II: The core group recruits a fiscal agent, decides the amount (if any) of local dues that will be collected during this phase, and starts recruiting members (who pay dues at the this time).* As the group grows, discussions of programming start (both to serve the current members and to provide opportunities for recruiting additional members). The state provides resources to orient the new members on AAUW priorities and programs.
  • Phase III: The threshold of 15 members is reached. A group works out the bylaws or working rules which will guide the branch during the first year (and gets them approved by the Association bylaws chair). The members approve the name of the branch, approve bylaws/working rules, elect officers, and approve the amount of local dues. This information is sent to the state for its approval, and then the petition for a charter is sent to AAUW.
  • Phase IV: Once the charter is approved, AAUW creates the branch in its database, connects the branch members and officers to the branch in the database, and sends formal approval to the branch. The branch applies to the IRS for an EIN and opens a bank account. The branch settles accounts with the fiscal agent. Recruiting continues (with checks now being written to the new branch), and the branch programs begin using the branch’s formal name.

Again, we did it this way during July – December 2008, using AAUW NC as the fiscal agent. It really adds two steps to the proces: state approval in principle (Phase I) and the use of a fiscal agent (phase II, III). It’s likely that this isn’t the best process — but we tried to comply with the current requirements while making sure that our prospects got AAUW and AAUW NC benefits as soon as possible.

We recommend this modified process to any other group starting a new branch. It requires some familiarity with the dues schedule (MALs converting to branch membership, half-year dues, branch members from this state and other states joining the new branch as dual members, c/u reps joining the branch, etc.). It was helpful that the person responsible for tracking new member data was a branch treasurer who could see information on members (e.g. expiration date for MALs) through the Member Services Database. That meant that the when the list of charter members was submitted it could include the member id and expiration date of each charter members. A fiscal agent with branch treasurer access may be able to help the new branch with these details.


*The branch doesn’t exist, so it can’t have a bank account, therefore it needs a “fiscal agent” to collect dues. We did it this way partly because the last branch that formed in North Carolina had a terrible time with dues collected but not promptly forwarded to AAUW. A couple of models for this:

  • The state is the fiscal agent. A new member writes a check to the state. Someone in the core group is responsible for filling out an at-large membership form and forwarding the form and the check to the state treasurer. The state treasurer forwards the form and a check for at-large membership dues to AAUW (keeping the state portion of the dues, and holding the local portion in the state account for the branch).
  • Another branch is the fiscal agent. A new member writes a check to this branch. Someone in the core group is responsible for filling out the branch membership form and forwarding the form and the check to the branch treasurer. The branch treasurer processes this as usual, except that the local portion of the dues is held for the new branch. The existing branch may or may not confer the benefits of branch membership, but the new member will get benefits from AAUW and the state

There will be expenses for the branch during Phase 2 and 3 — postage, printing, etc. It may be that the core group will be willing to cover these out of pocket — but if the branch chooses to collect local dues (or has other income — perhaps fundraising?) the fiscal agent may also be asked to reimburse expenses.

2 thoughts on “Changes we made in forming a branch

  1. PS: The detailed information on applying for the EIN is part of the master document describing the entire process. I’d suggest including it with the information about the charter — I knew I’d seen it somewhere, but I was “flying blind” as I went through the EIN application. Fortunately I think I did make the correct choices in the IRS form.

  2. Once you have an EIN, there’s a form to fill out to document that for AAUW. Once that’s done, AAUW can send you a letter confirming that you’re included in the group 501(c)4 tax exemption. [You may need this to, say, confirm your nonprofit status with PayPal.] The helpline can give more information on this — or see the Finance Officers Toolkit for details.

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