Commissioner's Consents/Regents’ Authorization

Commissioner's Consents/Regents’ Authorization [1]

Education Law §216 gives the Board of Regents broad authority to incorporate educational institutions by issuing them a charter. Institutions issued a Regents charter are incorporated as education corporations. In general, the following institutions must be chartered by the Board of Regents: (1) a college, university or other institution of higher education; (2) a nursery, elementary, secondary or charter school; (3) a library, archives, museum, historical society or other cultural institution; and (4) a public television or public radio station.

Institutions with educational purposes may also be incorporated under the Not-for-Profit Corporation Law (NPCL) or the Business Corporation Law (BCL), or organized under the Limited Liability Company Law (LLCL), by filing with the Department of State. However in some instances, as further discussed below, the consent of the Commissioner of Education or written authorization of the Regents must be obtained before becoming incorporated by the Department of State or before certain documents may be filed with the Department of State.

The provisions of the Non-Profit Revitalization Act of 2013 (L.2013, Ch. 549) generally became effective on July 1, 2014 and, among other things, include amendments to the Not-for-Profit Corporation Law and Education Law that change the process for filing certificates of incorporation and other corporate documents with the Department of State, including requirements for obtaining the consent of the Commissioner of Education or authorization from the Regents for such fillings. The following summarizes the Commissioner’s consent/Regents authorization requirements under the Education Law (Ed L) and the Not-for-Profit Corporation Law (NPCL), as amended by the Act.

Consent Process

Corporate purposes requiring Commissioner’s consent or Regents’ authorization

Effective July 1, 2014, the consent of the Commissioner of Education is generally required to form a corporation through the Department of State only if the corporate purposes include the operation of a school; college, university or other entity providing postsecondary education; library; or museum or historical society. The Regents’ written authorization is required to operate a college or university [Ed L §216; NPCL §404(d)].

Effective July 1, 2014, organizations with educational purposes that do not include the operation of a school; college, university or other entity providing postsecondary education; library; or museum or historical society generally do not require the Commissioner’s consent in order to incorporate through the Department of State. However, such corporation must provide a certified copy of its certificate of incorporation to the Commissioner within 30 business days after the corporation receives confirmation from the Department of State that the certificate has been accepted for filing [NPCL §404(d)].

Preschool Special Education approved programs. In addition to the above, Commissioner’s consent is also required to incorporate or form an “approved program”, as defined in Ed L §4410(1)(b), under the Not-for-Profit Corporation Law, the Business Corporation Law, the Limited Liability Company Law, or Partnership Law, to provide special services or programs to preschool children with disabilities [Ed L §4410(6)].

Corporate Names and Assumed Names

The Regents’ written authorization is required to confer any degree or use advertise or transact business under the name “university” or “college”, or any name or descriptive material indicating or tending to imply operation of a school of law, medicine, dentistry, pharmacy, veterinary medicine, nursing, optometry, podiatry, architecture or engineering [Ed L §§ 216 and 224(1)(a)].

Commissioner’s consent is required when an individual, association, partnership, company or corporation seeks to use, advertise or transact business under the name “museum” or “arboretum”, or any name, title or descriptive material indicating or tending to imply a museum or arboretum [Ed L §216].

Commissioner’s consent is not required for a Not-for-Profit Corporation’s use of any specific education-related term in its name, with the exception of the terms: College, University, Museum, and Arboretum (see Education Law §§216 and 224[1][a]). Proposed corporate purposes, either for-profit or not-for-profit, that involve activities for which the Board of Regents may charter [7] (incorporate) generally need consent (see Education Law §216 and see also NPCL §404[d]). Moreover, Commissioner’s consent is required for a Business Corporation, a Limited Liability Company, or Limited Partnership to use certain terms in their legal or assumed name (see BCL §301[a][11], LLCL §204[i]; Partnership Law §121-102[a][3][A]; and General Business Law §130[2][c]). These terms, or any abbreviation or derivative thereof, are:

school
education
elementary
secondary
kindergarten
prekindergarten
preschool
nursery school
museum
history
historical
historical society
arboretum
library
college, university or other term restricted by Education Law §224
conservatory
academy
institute

Regents consent is required before an education corporation may file an assumed name certificate under General Business Law §130 [GBL §130(11); Ed L §219(5)].

Certificates of Amendment

Effective July 1, 2014, Commissioner’s consent is required to file a certificate of amendment with the Department of State only if the amendment adds, changes or eliminates a purpose, power or provision which includes the operation of a school; college, university or other entity providing post secondary education; library; or museum or historical society, or if the amendment changes the name of a corporation whose certificate of incorporation required the Commissioner’s consent [NPCL §804(a)(i); Ed L §216].

Effective July 1, 2014, corporations with educational purposes that seek to file a certificate of amendment with the Department of State that does not include the operation of a school; college, university or other entity providing postsecondary education; library; or museum or historical society, or does not include a change of name of a corporation whose certificate of incorporation required the Commissioner’s consent, are not required to obtain the Commissioner’s consent in order to file the certificate of amendment with the Department of State. However, such corporation must provide a certified copy of its certificate of amendment to the Commissioner within 30 business days after the corporation receives confirmation from the Department of State that the certificate has been accepted for filing [NPCL §804(a)(i); Ed L §216 ] .

Certificates of Merger/Consolidation

Commissioner’s consent is required for the filing of a certificate of merger or consolidation under NPCL Article 9 if the corporate purposes of the surviving or consolidated corporation include the operation of a school; college, university or other entity providing postsecondary education; library; or museum or historical society [NPCL §§404(d) and 909(a); Ed L §216].

Effective July 1, 2014, if the purposes of any constituent or consolidated corporation having educational purposes do not include the operation of a school; college, university or other entity providing postsecondary education; library; or museum or historical society, the corporation is not required to obtain the Commissioner’s consent in order to file a certificate of merger with the Department of State. However, such corporation must provide a certified copy of its certificate of merger to the Commissioner within 30 days after the corporation receives confirmation from the Department of State that the certificate has been accepted for filing [NPCL §§404(d) and 909(b); Ed L §216] .

Commissioner’s consent is required for the filing of a certificate of consolidation or certificate of merger with the Department of State if any constituent corporation to such consolidation or merger, or the consolidated corporation, is or will be an education corporation [Ed L §216-a(4)(d)(10) and (11)].

Dissolutions

In a proceeding for non-judicial dissolution under Article 10 of the Not-for-Profit Corporation Law, the Commissioner’s consent is required to be annexed to or endorsed on the certificate of dissolution of a Not-for-Profit corporation whose corporate purposes include the operation of a school; college, university or other entity providing postsecondary education; library; or museum or historical society [NPCL §§404(d) and 1003(b)(1); Ed L §216].

Regents consent is required before a petition for judicial dissolution of an education corporation under Article 11 of the Not-for-Profit Corporation Law may be presented [Ed L §216(4)(d)(13) and NPCL §1102(a)].

Applications for Authority to do business in New York State

Effective July 1, 2014, Commissioner’s consent is required to file an application for authority if the application sets forth a purpose or activity which includes the operation of a school; college, university or other entity providing postsecondary education; library; or museum or historical society, or includes a corporate or company name which requires Commissioner’s consent under section 2. Above [NPCL §§404(d) and 1304(c); Ed L §216].

Effective July 1, 2014, a foreign corporation with educational purposes that seeks to file an application for authority with the Department of State that does not include the operation of a school; college, university or other entity providing postsecondary education; library; or museum or historical society, or include a corporate name which requires Commissioner’s consent under section 2. above, is not required to obtain the Commissioner’s consent. However, such corporation must send by certified mail, return receipt requested, a certified copy of the application for authority to the Commissioner within 10 business days after the corporation receives confirmation from the Department of State that the application for authority has been accepted for filing [NPCL §404(d) and 1304(d); Ed L §216].