Governance

About The Ark’s Governance Policies

In 2010, The Ark’s Board of Directors approved a series of governance policies in compliance with nonprofit disclosure requirements from the IRS Form 990. (The 990 is the annual federal tax form that all nonprofit organizations with gross annual receipts of $25,000 or more are required to file.) This change in nonprofit reporting requirements paralleled the Sarbanes-Oxley requirements for publically-owned corporations following the Enron scandal.

The current Form 990 disclosures do not require but strongly encourage nonprofit boards to adopt a variety of board policies regarding governance practices. Suggestions for nonprofits go beyond Sarbanes-Oxley in some instances.

We are pleased to be in compliance with the disclosure requirements and the best practices that many of these policies represent. In the interest of transparency, select Ark Governance Policies are posted here. The Ark’s Board revised and updated the policies in 2017.

Public Policy Statement
Non-Discrimination and Anti-Harassment Policy
Equal Opportunity Employment Policy
Conflicts of Interest, Confidentiality & Non-Disclosure Policy
Whistleblower Policy
Joint Venture Policy
Gift Acceptance Policies & Procedures

Communicating a Concern Regarding Compliance
Any person who wants to communicate a concern regarding The Ark’s compliance with a legal requirement or written Ark policy is encouraged to begin by contacting their direct supervisor. As an alternative, communication may be made to the Executive Director, Board Chair, or, in the event of a concern related to finance or financial controls, the Audit Committee Chair.

Communication may be made in person, by phone or in writing. Communications may be designated confidential, but anonymous communications will not be considered. All such communications will be handled with sensitivity, discretion and confidentiality to the extent allowed by the circumstances and the law. They will be reviewed and addressed by appropriate Ark representatives. A reply will be given once the issue has been reviewed.

Ark policy expressly prohibits any board member, employee or volunteer from retaliating or taking any adverse action against anyone who, in good faith, raises or helps to resolve credible concerns regarding Ark policy or legal issues.

Direct Supervisor for Club Volunteers and Assistant House Managers:
Volunteer and Front of House Manager
Michael Lippert
(734) 761-1800 ext. 29
michael@theark.org

Direct Supervisor for Production Volunteers:
Operations Director
Emily Ross
(734) 761-1800 ext. 23
emily@theark.org

Executive Director
Marianne James
(734) 761-1800 ext. 24
marianne@theark.org

Board Chair
Kathryn Huss
(734) 646-9796
khuss@umich.edu

Public Policy Statement

The core mission of The Ark is to enrich the human spirit through the presentation, preservation and encouragement of folk, roots and ethnic music and related arts. It is The Ark’s policy not to take a position on any public issue that does not relate directly to its core mission or its business operation.

In order to maintain its nonprofit status and in compliance with nonprofit federal tax law, The Ark will not directly or indirectly participate in any political campaigning on behalf of (or in opposition to) candidates for elective public office.

Approved by the Board of Directors March 28, 2005
Amended and approved by the Board of Directors September 24, 2012
Amended and approved by the Board of Directors March 27, 2017

Non-Discrimination and Anti-Harassment Policy

The Ark is committed to providing a safe and welcoming atmosphere for all people to listen to, learn about, perform and share music. It is the policy of The Ark to provide equal employment and volunteer opportunities to all qualified employees or applicants, and to administer its personnel practices and maintain an environment free of discrimination or harassment on the basis of age, religion, color, race, national or ethnic origin, sex, sexual orientation, gender identity, gender expression, marital status, familial status, veteran status, height, weight, non-job-related medical condition or disability, or any unlawful criterion or circumstance.

Approved by the Board of Directors June 28, 2010
Amended and approved by the Board of Directors March 27, 2017

Equal Opportunity Employment Policy

The Ark is an Equal Opportunity Employer, offering equal opportunity for employment or advancement to all qualified applicants or employees without regard to age, religion, color, race, national or ethnic origin, sex, sexual orientation, gender identity, gender expression, marital status, familial status, veteran status, height, weight, or non-job-related medical condition or disability, or any unlawful criterion or circumstance.

Approved by the Board of Directors June 28, 2010
Amended and approved by the Board of Directors March 27, 2017

Conflicts of Interest, Confidentiality & Non-Disclosure Policy

Maintaining The Ark as a leader in non-profit corporate citizenship requires each of us to conduct our business with the highest standards of integrity. This policy regarding conflicts of interest, confidentiality and non-disclosure applies organization-wide.

Non-disclosure/Confidentiality
Ark Board Members, Charter Members, employees and volunteers shall maintain confidentiality regarding Ark matters and refrain from obtaining, using or sharing any proprietary Ark information with any person or entity, including any list of The Ark’s contributors for personal or private solicitation purposes. “Proprietary information” includes all information or material that has or could have commercial value, or could provide other people or organizations with private contributor information, or could benefit another business that The Ark is engaged with or competes with.

Conflicts of Interest
Ark Board Members, Charter Members, employees and volunteers must avoid using their association with The Ark to enrich themselves or others while conducting Ark business. They must scrupulously avoid even the appearance of a conflict of interest.

No Ark Board Member, Charter Member, employee or volunteer shall derive any personal profit or gain, directly or indirectly, by reason of his or her affiliation with The Ark (except of course Ark employees are entitled to their job compensation). Each individual shall disclose to The Ark any personal interest which he or she may have in any matter pending before the organization and shall refrain from participation in any decision on such matter.

No Ark Board Member, Charter Member, employee, or volunteer should ever ask for any personal gift or favor from any individual or organization that does — or seeks to do — business with The Ark. However, it’s all right to accept offered gifts, favors, or amenities that are of nominal value and do not involve personal gain or give the appearance of impropriety.

Similarly, you may not give an Ark-related gift or favor to anyone unless it involves Ark-approved sales promotions, advertising, or publicity, or unless it is of nominal value, and it does not give the appearance of impropriety.

Without first receiving approval from the Board of Directors, you must not acquire or hold any of the following financial interests in an organization with which The Ark does business:

  • Any interest as a proprietor or partner.
  • Any interest exceeding 5% of the total stock or bonds of a company.
  • Any interest in the form of a loan, advance, or other financial arrangement in an amount greater than 5% of the combined capital and debt of a company (whether or not publicly owned).
  • Unless you receive approval from the Board of Directors, you must not be personally involved in any business transaction that The Ark may undertake with the organization in which you have a financial interest.

Formerly Standards of Conduct, approved by Board of Directors June 28, 2010
Revised and approved by the Board of Directors March 27, 2017

Whistleblower Policy

The Ark Board of Directors, Charter Members, employees, and volunteers are expected to know and comply with all Ark policies and to follow the law. If you ever detect what you think is a violation of law or Ark policy, we expect you to report it promptly to your direct supervisor or the Executive Director or the Chair of the Board, and, if it relates to financial matters, to the Audit Committee as well.

You need not fear reprisals because Ark policy prohibits any form of retaliation against anyone who reports a credible suspected violation of law or Ark policies.

Any person may send a communication to the Board, any director or the Audit Committee regarding a concern about The Ark’s accounting or auditing matters or possible violation of law or Ark policy. Such communications may be designated confidential, but anonymous communications will not be considered. All such communications will be handled with sensitivity, discretion and confidentiality to the extent allowed by the circumstances and the law. The status of all outstanding communications addressed to the Board, any director, or the Audit Committee will be reported to the Board and/or the Audit Committee, as appropriate, on a periodic basis. Ark policy expressly prohibits any Board member, employee or volunteer from retaliating or taking any adverse action against anyone who, in good faith, raises or helps to resolve credible concerns about possible violations of the law or Ark policy.

Formerly Whistleblower Policy for Finance, approved by the Board of Directors, June 28, 2010
Revised and approved by the Board of Directors March 27, 2017

Joint Venture Policy

This policy shall apply to any joint venture with any taxable entity that The Ark shall participate in, and is designed to assure that the primary mission of The Ark is carried out and that The Ark’s tax exempt status is not compromised in any way.

Definition : A joint venture means any joint ownership or contractual arrangement through which there is an agreement to jointly undertake a specific business enterprise, investment, or exempt purpose or activity without regard to (1) whether The Ark controls the venture or arrangement (2) the legal structure of the venture or arrangement, or (3) whether the venture or arrangement is treated as a partnership for federal income tax purposes or as an association or corporation for federal income tax purposes. Not included in the definition are ventures or arrangements that meet both of the following conditions: (1) 95% or more of the venture’s or arrangement’s income for its tax year ending with or within The Ark’s tax year is described in Internal Revenue Code sections 512(b)(1)-(5)(including unrelated debt-financed income); and (2) The primary purpose of The Ark’s contribution to or investment or participation in the venture or arrangement is the production of income or appreciation of property.

In the event The Ark wishes to enter into a venture or arrangement involving a taxable person or entity, the following shall be required:

  • All agreements shall be in writing and shall be signed by all participating parties, provided that the Program Director or Executive Director may from time to time enter into verbal agreements that will be documented in the Program Director’s files.
  • The Ark shall receive adequate confirmation or control of the project to assure that the activity of the venture or arrangement furthers the exempt purpose of The Ark.
  • The activity of the venture or arrangement shall give priority to exempt purposes over maximizing profits for the other participants.
  • The venture or arrangement shall not engage in any activities that may jeopardize the tax exempt status of The Ark, including
  • A prohibition against political intervention
  • A prohibition against substantial lobbying
  • A prohibition against political contributions

The Ark may terminate the Joint Venture at any time if, in The Ark’s sole discretion, it determines that any aspect or consequence of the Joint Venture is incompatible with the mission, values, goals, or image of The Ark or the community that it serves, or if the Joint Venture jeopardizes The Ark’s tax exempt status.
Only the Executive Director, Program Director or specific designates are authorized to enter into joint venture agreements on The Ark’s behalf.

Approved by the Board of Directors June 28, 2010
Amended and approved by the Board of Directors March 27, 2017

Gift Acceptance Policies & Procedures

The Ark encourages donors to make gifts that support the mission and programming of the organization. The purpose of this policy statement is to set forth guidelines and prescribe necessary approvals for acceptance of gifts made by donors to The Ark.

A. Cash Gifts and Pledges

1. Unrestricted Gifts of Cash – Gifts given without restriction on the use of the gift

a) Unrestricted gifts are recorded as unrestricted and may be used for any purpose, including funding current operations, capital projects, or to maintain reserves.

b) Unrestricted bequests are designated at the discretion of the Board of Directors and on advice from the Finance and Development Steering Committees.

2. Restricted Gifts of Cash – Gifts given for purposes specified by the donor

a) Gifts restricted for Operations are recorded and deposited into the current operating account or into the Operating Reserve.

b) The Ark may consider accepting gifts restricted for programming; such contributions will be subject to review from the Program Committee and others as appropriate.

c) The Ark may consider accepting gifts restricted for other purposes, such as capital projects; such contributions will be subject to review from the Board of Directors or others as appropriate.

d) The Ark Endowment Fund has been established at the Ann Arbor Area Community Foundation. Gifts made to that fund are subject to the policies of the AAACF.

3. Pledges – Promises to contribute amounts specified by donors

a) Pledges may be restricted or unrestricted as described above and may be one-year or multi-year commitments.

b) Pledges are expected to be fulfilled with contributions of cash or stock.

4. Matching gifts

Unless the company specifies otherwise, matching gifts from corporations follow the restrictions of the donor whose gift is being matched: if a donor makes an unrestricted gift, the matching gift is unrestricted and, if the donor makes a restricted gift, the match is likewise restricted. The Ark counts matching gifts toward an individual’s gift total in the year the matching gift is received.

5. Publicly Traded Securities

Upon receipt of a gift of donated securities, the Executive Director (or specific designates) places, as soon as practical, the securities with a recognized broker for sale at the earliest practical date. It is not The Ark’s policy to hold securities for an extended length of time. Such gifts are credited to donors according to current IRS codes.

6. Credit Cards

The Ark accepts VISA, MasterCard and Discover. For gifts made by credit card, the date the charge is processed by The Ark is the applicable date of the gift.

B. Non-Cash Gifts

1. In-Kind Contributions/Noncash Contributions (gifts of goods or services)

a) When The Ark agrees to receive a gift of goods (e.g., building materials, equipment) or a gift of individual or corporate services (e.g., advertising, printing, installation, etc.)—often referred to as a “Gift In Kind”—the gift is processed as a non-cash gift. The Ark does not issue a receipt showing the cash value of such gifts, but acknowledges receipt of the object or services.

b) Donors are required to fill out form 8283 if their deduction for a non-cash contribution is more than $500. For noncash property (goods) worth more than $5,000, The Ark is required to sign the portion of Form 8283 which acknowledges receipt of the gift and will do so after the donor has provided to The Ark a copy of the signed appraisal, and after the donor and appraiser have completed and signed their sections of Form 8283. It is important for The Ark to retain a copy of the signed and executed Form 8283.

c) If The Ark disposes of an item listed in Section B of form 8283 within three years of its receipt, The Ark must file Form 8282 with the Internal Revenue Service.

d) For tax purposes gifts in-kind must be valued by the donor, and costs associated with an appraisal are the responsibility of the donor.

e) In-kind contributions may be used to fulfill pledges to The Ark for items deemed of value to the organization, subject to evaluation by the Development Steering Committee or others as appropriate. The Ark may require an appraisal or other guarantee of fair market value for any items donated in lieu of pledged cash. Such a contribution is acknowledged as payment toward the pledged amount.

2. Real Estate or Real Property

a) No gift of real estate or real property is accepted if such acceptance causes The Ark to incur a financial burden, potential liability, or other obligations, unless otherwise determined by the Board of Directors.

b) A Phase I environmental impact study or, in the case of Michigan real property, a baseline environmental assessment accepted by the Michigan Department of Environmental Quality, done at the owner’s expense, is required to accompany a gift of real estate.

c) Acceptance is contingent on an independent appraisal paid for by the donor. The Ark does not value any such donated item for tax purposes.

d) If property cannot be liquidated in a reasonable amount of time, The Ark may choose to decline the gift.

3. Life Insurance

a) Subject to review by the Finance Committee, The Ark accepts only fully-paid insurance policies for which The Ark is named as beneficiary and the irrevocable owner of the policy.

b) Gifts of life insurance policies are credited at face value as pledges receivable as designated by the Board of Directors unless specified by the donor.

4. Closely Held Securities

a) Gifts of closely held securities are subject to prior approval of the Board of Directors with advice from the Finance Committee. The valuation of securities that are not publicly traded is the responsibility of the donor, and such gifts must be accompanied by an independent qualified appraisal.

b) Gifts of closely held securities are accepted barring any restrictions on their sale once their legal marketability is determined. The donor is required to provide this valuation if appropriate.

c) Securities need to be marketable and able to be liquidated in a reasonable amount of time.

d) Donor is responsible for all costs associated with ensuring donated securities are marketable with no restrictions.

5. Planned Gifts

The Ark appreciates the generosity of those donors who wish to name the organization as a beneficiary in Charitable Remainder Trusts, Charitable Remainder Unitrusts, and Charitable Lead Trusts.

C. Unacceptable Gifts

The Board of Directors makes the final decision about acceptance of gifts that may be deemed to fall outside of established policy guidelines. The Ark reserves the right to refuse a charitable gift without publicly disclosing the reason. The Ark is not required to accept any charitable gifts or contributions, particularly those which:

1. Are designated with restrictions that fall outside the organization’s mission and program priorities;

2. May cost the organization money, provide a liability or potential penalty of any kind;

3. Have conditions that are not deemed in the best interest of The Ark, or those that fall outside ethical boundaries;

4. Are not able to be liquidated into cash in a reasonable amount of time.

D. Interpretation of Gift Acceptance Policies

Only the Executive Director and specific designates are authorized to receive gifts on The Ark’s behalf. The Executive Director is assisted in the interpretation and implementation of these guidelines by the Chair of the Board of Directors, Treasurer, Finance Committee, Development Steering Committee, and others as appropriate. Other Board members may be consulted at Board’s discretion. Advice may be sought from the agency’s auditors. The Board’s role is to approve gift agreements and the acceptance of gifts that deviate from these policies.

E. Review and Amendments of Gift Acceptance Policies

1. Responsibility for review and suggested amendments is with The Ark’s Executive Director, in consultation with the appropriate committee.

2. The procedure to amend these guidelines is as follows: The Executive Director provides written recommendations to the Board of Directors for approval.

F. Code of Conduct

Representatives of The Ark exercise caution to avoid pressure, persuasion or undue influence and encourage donors to seek their own counsel when considering any gift.

All personnel employed by The Ark to contact prospective donors or to promote the planned gifts program are paid a salary or fixed wage, and do not receive commissions which could give such personnel a direct beneficial interest in any agreement.

G. Confidentiality

The Ark recognizes that it is in a position of trust with the donor, and that the donor has placed trust in the organization concerning confidentiality. Therefore, all donor information, correspondence and governing instruments are kept in a secure place, which is accessible to individuals with approval of the Executive Director. It is known by The Ark’s staff that this is confidential information.

H. Use of Constituent Lists

It is the organization’s policy not to sell, loan, trade, or share its constituent lists to individuals or organizations interested in using it for fund raising.

I. Protection of Donor’s Interest

No program, agreement, trust, contract or commitment is knowingly urged upon any prospective donor that would benefit The Ark at the expense of the donor’s interest and welfare.

No agreement is made between The Ark and any agency, person, company or organization on any matter related to investments, management or otherwise which knowingly jeopardizes the donor’s interest.

J. Use of Legal Counsel

A prospective donor is advised to seek legal or tax counsel of his/her attorney in any and all aspects of a proposed gift, whether by bequest, trust agreement, contract, or outright gift. They are advised to consult with their attorney or accountant on matters related to the tax implications and estate planning aspects of a planned gift agreement.

The Ark consults with separate legal counsel in all matters pertaining to its planned giving program and consults counsel when executing agreements, contracts, trusts or legal documents. In no case is The Ark’s attorney the attorney for the donor. Donors are advised to seek their own legal or tax counsel.

No legal fee is paid by The Ark for the drafting of a will or other trust instruments on behalf of prospective donors, even if the organization is to be named as a beneficiary. No legal fee is paid by The Ark for determining the marketability of any donated property, whether securities or real property. The Board of Directors must authorize any exemptions to this policy.

K. Gift Acknowledgement Policies

Effective 1994, the Omnibus Budget Reconciliation Act of 1993 (OBRA) added Internal Revenue Code section 170(f)(8), which denies donors a charitable deduction for any contribution of $250 or more unless the donor obtains a written acknowledgement of the contribution from the charity. The Ark is in full compliance with the law; it is the policy of the organization to provide an acknowledgement for all gifts regardless of the size.

The law also requires charities to provide written disclosure about the solicitation or receipt of quid pro quo contributions that exceed $75. The disclosure must: inform the donor that the amount of the contribution that is tax deductible for federal income tax purposes is limited to the excess of the amount on any money and other property contributed by the donor, over the value of the goods and services provided by the charity; and provide the donor with a good-faith estimate of the value of such goods and services. This disclosure must be made when the contribution is solicited or when the contribution is received.

There are three situations in which a disclosure is not required: where the goods or services are “insubstantial,” i.e., token or otherwise de minimis;” where no donative intent is present, i.e., sales of T-shirt at reunion; where only an intangible benefit is provided to the donor, i.e., participation in a religious ceremony.

L. Policy for Thanking Donors

In addition to processing all gifts and generating gift receipts, The Ark is also responsible for thanking donors for their gifts in a timely manner. This acknowledgement includes the official gift receipt. The Ark has established internal procedures for thanking donors for their contribution including information on who signs the letter, what type of acknowledgement letter is sent, what letters are kept in permanent files, etc.

Approved by the Board of Directors June 28, 2010
Amended and approved by the Board of Directors March 27, 2017