Bylaws are a fundamental component of nonprofit formation, management and governance in every state. Essentially, they are a formal statement of the rules and regulations with which the subject organization must comply, as well as detailed instructions outlining how it will be run and operated by its governing board of directors. The bylaw requirements for Colorado nonprofits are established by local regulation, state law and statewide nonprofit institution guidelines, which collectively contain the same basic bylaw directives typical of most states, as well as several Colorado-specific variations.
Basic Content of Colorado Nonprofit Bylaws
In Colorado, as in all states, the drafting of bylaws is a critical component of the process of starting a nonprofit. The bylaws are the formal means through which the nonprofit establishes and sets forth its charitable purpose and vision, organizational structure and operational and administrative mechanisms, and governing board of directors which has final authority for its conduct. Bylaws must outline the legal and fiduciary roles, responsibilities and supporting functions of the board and its members, as well as how these will be met, reviewed and maintained. They must also describe policies and procedures concerning issues of board membership, election and removal of directors, length of terms, meeting protocol and proceedings, conflict of interest resolution, and bylaw provision revision and amendment.
Colorado State Government Law
The Colorado government expressly obliges all nonprofits organized in the state to draft and submit bylaws prior to, and as a condition of, attaining state recognition. Pursuant to the Colorado Revised Nonprofit Corporation Act (CRNCA), nonprofits must contain several specifically enumerated indicia in their bylaws in addition to the basic provisions common across states. These specific directives for bylaw content include, for example, requirements that bylaws prescribe the precise number of directors comprising the governing board, at a minimum of one; any additional personal or professional qualifications for directors not otherwise mandated by the CRNCA; and limitations on removal of directors for cause.
The Colorado Nonprofit Association
The Colorado Nonprofit Association (CNA) is a statewide organization that represents, and comprises as members, the entire body of nonprofit entities existing throughout the state. The CNA's stated principal mission is to mobilize expert training, lobbying and leadership efforts to facilitate for its member nonprofits the most efficient and effective accomplishment of their individual charitable objectives. Accordingly, with bylaw best practices an integral component of this comprehensive nonprofit-governance focus, the CNA effectively operates in conjunction with local regulations and state law in delineating their governing rules and regulations. As manifested in its government-endorsed, "Principles and Practices for Nonprofit Excellence in Colorado," the CNA serves a vital role in creating optimal conditions in and by which nonprofits can successfully adhere -- and succeed by so adhering -- to the bylaw policies and standards conscientiously developed and implemented by the association itself.
Public Importance of Bylaws
In Colorado as in all states, nonprofit bylaws are not mandatory public documents; both despite, and because of, this permittance of privatization, nonprofits are strongly encouraged to make bylaws readily publicly available, indeed in service of effectuating their very underlying purpose: to improve transparency and accountability of state charitable organizations. The CNA continually emphasizes the prevailing import of Colorado nonprofits' conducting and expressing themselves by means and in modes that strengthen and demonstrate to the public these exact two attributes. A nonprofit's bylaws, as the expression of how it conducts its business and, literally, raises and spends the funds it solicits, are perhaps the most meaningful embodiment of such demonstration; correspondingly, they should be demonstrated publicly to most meaningfully strengthen public trust and thereby encourage public participation in statewide charitable endeavors.