Alaska Nonprofit Corporation Act: Formation, Governance, and Dissolution

The Alaska Nonprofit Corporation Act, codified at Alaska Statutes Chapter 10.20, is the state law that governs how nonprofit corporations in Alaska are formed, operated, and dissolved. It sets the filing requirements, the minimum board and officer structure, the rules for meetings and voting, the ongoing reporting obligations, and the procedures for merging or shutting a nonprofit down. It applies to charitable, religious, educational, civic, fraternal, cultural, scientific, agricultural, athletic, professional, trade, and labor organizations, among others.¹

A few categories of organization sit outside the Act. Cooperative corporations, electric and telephone cooperatives, and entities regulated under Alaska’s insurance or banking laws cannot be organized under Chapter 10.20.¹ Homeowners and condominium associations commonly do organize under it, but they are private organizations: they cannot levy taxes or enforce building codes the way a municipality can.²

Forming the Corporation

To create a nonprofit under the Act, the organizers file Articles of Incorporation (Form 08-438) with the Division of Corporations, Business and Professional Licensing, part of the Alaska Department of Commerce, Community, and Economic Development (DCCED). The articles must state the corporation’s purpose. The filing fee is $50.²

Online filings are processed and posted immediately upon payment. Hardcopy filings take roughly 10 to 15 business days from March through September, and more than 15 business days from October through February.³ The state recommends consulting legal counsel when drafting the articles because the filed document becomes a permanent public record.²

Once formed, the corporation has broad statutory powers under AS 10.20.011. It can sue and be sued in its own name, buy and sell real and personal property, enter contracts, borrow money, issue notes or bonds secured by its assets, make donations for charitable, scientific, or educational purposes, set up pension plans, appoint officers and set their pay, adopt bylaws, and do business in other states and countries. The statute closes with a catch-all allowing any power necessary or convenient to carry out the stated purpose.⁴

Board and Officers

Under AS 10.20.081, a nonprofit’s affairs are managed by a board of directors, and the board must have at least three members. Certain homeowners associations qualifying under AS 34.08 may be excepted from the three-director minimum.⁵

AS 10.20.121 requires a president, one or more vice presidents as the bylaws prescribe, a secretary, and a treasurer. One person can hold more than one office, with a single restriction: the president cannot also be the secretary. Counting the three directors and the four officer roles, a nonprofit must fill at least seven titled positions, though as few as three individuals can hold them.⁵

Fiduciary Duties

Directors and officers owe fiduciary duties to the corporation and are held to the standard of a “reasonably prudent person.” They must act in good faith with the diligence, care, and skill an ordinarily prudent individual would use in a similar role.²

Common violations fall into three groups: mismanagement, such as spending on unapproved items or bouncing checks; non-management, such as failing to attend meetings or exercise oversight; and conflicts of interest, where the board member or a family member stands to benefit from a decision. A board member with a conflict should refrain from voting on the matter, but can still be counted toward the quorum.²

With Members or Without

The Act does not require a nonprofit to have members. If it has none, the board is the sole governing body and can act on major matters, including amending the articles, by majority vote of directors in office.²

If the corporation does have voting members, members must approve major governance changes. An amendment to the articles of incorporation needs a two-thirds vote of the members present or represented by proxy at a properly noticed meeting, or the written consent of every member entitled to vote.⁶ The articles and bylaws set the specifics for notice and quorum.

Remote Meetings and Electronic Voting

Before 2020, meetings generally had to happen in person. Senate Bill 24 changed that. The Alaska Legislature passed it unanimously on March 22, 2021, Governor Mike Dunleavy signed it on March 31, 2021, and it took effect retroactively to March 11, 2020 to cover the pandemic period.⁷

SB 24 permanently authorizes remote participation in several ways:

Members may vote by remote communication or by proxy executed through electronic transmission (AS 10.20.071(b)).
Bylaws may prescribe remote communication as a valid method for establishing a quorum (AS 10.20.076).
Regular and special board meetings may be held by remote communication, at a designated place, or both (AS 10.20.116(a)).
The initial organizational meeting may be conducted remotely (AS 10.20.166(a)).⁸

“Remote communication” is defined broadly to include electronic communication, conference telephone, videoconference, the Internet, and any other method that lets participants in different locations communicate on a substantially simultaneous basis. Meeting notices must say how the meeting will be held.⁸

Ongoing Compliance

Biennial Report

Every nonprofit must file a biennial report with the DCCED Corporations Section. Corporations incorporated in an even-numbered year file in even years; those incorporated in odd years file in odd years. For nonprofits, the report is due July 2, and a late penalty applies to anything postmarked after August 1.⁹ The filing fee is $25. Missing the filing can cost the corporation its nonprofit status and its eligibility for state grants.²

Registered Agent and Office

Under AS 10.20.026, every domestic nonprofit must continuously maintain a registered agent and a registered office with an Alaska physical address, so that service of process, notices, and demands can be delivered. The agent cannot be the corporation itself, and cannot be a limited liability company. Failing to keep one on file can lead to involuntary dissolution of the corporation’s authority to transact business under AS 10.20.325. Changing the agent or office requires a board resolution and a Statement of Change filing with a $25 fee.¹⁰

Changes to Officers or Directors

When the officers or directors change, the corporation must file notice with the Corporations Section by July 2 of that year. The notice includes the name and address of the new board member, who is being replaced, and the office held. The fee is $25.²

Amending, Merging, and Dissolving

Amendments to the articles of incorporation follow the two-thirds-of-members rule (or all-member written consent) if the corporation has voting members, and a majority vote of directors in office if it does not.⁶ The articles of amendment must be signed by the president or vice president and the secretary or assistant secretary and filed with the state. The fee is $25. Any change to the articles, including deletions, corrections, or renumbering, counts as an amendment. Bylaws are not filed with the state and are maintained internally.¹¹

Mergers and consolidations are governed by Article 4, beginning at AS 10.20.221. Each board involved must approve a written plan by resolution. The plan names the merging corporations and the survivor, sets out terms and conditions, describes any resulting changes to the survivor’s articles, and includes anything else the parties consider necessary.¹²

Voluntary dissolution under AS 10.20.290 again splits by whether members have a vote. With voting members, the board adopts a resolution recommending dissolution and submits it to a properly noticed annual or special meeting, where it needs two-thirds of the votes members present or represented by proxy are entitled to cast. Without members or voting members, a majority of directors in office can authorize dissolution.¹³

Once the resolution is adopted, the corporation stops doing business except as needed to wind up its affairs, notifies known creditors, and collects and distributes its assets. A copy of the resolution must be filed with the commissioner immediately. If the corporation files the resolution but has not obtained a certificate of dissolution within two years, the commissioner dissolves it involuntarily.¹³ The filing fee for articles of dissolution is $15.²

Out-of-State Nonprofits Operating in Alaska

A nonprofit organized under another state’s or country’s laws must get a certificate of authority from the commissioner before transacting business in Alaska. Under AS 10.20.455, the foreign corporation cannot do anything in Alaska that a domestic nonprofit would be barred from doing. Alaska will not refuse a certificate solely because the home-state rules on internal affairs differ, and it does not regulate those internal affairs.¹⁴ Applications go to the Division of Corporations, Business and Professional Licensing, online or on paper.¹⁵

What the Act Does Not Do

Incorporating under Chapter 10.20 does not make a nonprofit tax-exempt. Alaska does not grant tax exemption. That designation comes only from the IRS at the federal level. Organizations pursuing federal exemption should include their Alaska incorporation documents in the IRS application and should put the IRS-required language into their Alaska filings. Even with federal exemption, a nonprofit still needs an Alaska business license before engaging in business activity and must meet other state regulatory requirements.⁵

Charitable solicitation is governed by a separate statute. Organizations that solicit contributions in Alaska must register with the Alaska Department of Law under the Alaska Charitable Solicitations Act (AS 45.68). Registration is due annually by September 1, and the annual fee for charitable organizations is $40. Failing to register violates the Act and triggers civil penalties under the Alaska Consumer Protection Act. Paid solicitors face a $200 annual fee and a $10,000 surety bond, and failing to register as a paid solicitor is a class A misdemeanor with potential civil penalties up to $25,000 per violation.¹⁶

Bylaws

Bylaws are not filed with the state, but they do most of the governance work day to day. Under AS 10.20.011(12), a corporation may adopt and amend bylaws for its administration and regulation, so long as they stay consistent with the articles of incorporation and state law. Bylaws should spell out the duties of directors and officers, procedures for conducting business, and policies on conflicts of interest. If bylaws are submitted with a state filing, the Division of Corporations returns them.¹¹²

1
ICNL. Alaska Statutes on Nonprofits
2
Alaska DCCED. Nonprofit Community Association Handbook
3
Alaska DCCED. Online Filing Instructions — Nonprofit Articles
4
FindLaw. Alaska Statutes § 10.20.011
5
Alaska DCCED. Nonprofit and Religious FAQs
6
FindLaw. Alaska Statutes § 10.20.181
7
Dorsey & Whitney. Alaska Legislature Passes Bill Allowing Virtual Meetings
8
Alaska State Legislature. SB 24 Bill Text
9
Alaska DCCED. Biennial Reports
10
Alaska DCCED. Statement of Change — Registered Agent
11
Alaska DCCED. Articles of Amendment Filing Instructions
12
Alaska eStatutes. AS 10.20.221 — Procedure for Merger
13
FindLaw. Alaska Statutes § 10.20.290
14
FindLaw. Alaska Statutes § 10.20.455
15
Alaska DCCED. Online Filing Instructions — Foreign Nonprofit Certificate of Authority
16
Alaska Department of Law. Charitable Organization and Paid Solicitor Registration