Current Situation
At last year’s special meeting of members that was held on July 10, 2021, the number of directors on the board was reduced down to three (3) with the intention to review all matters related to the governance of OCLS, and assess the viability to continue operations.
Since that time, the board developed a new vision and mission for OCLS, analyzed the financial situation, and arrived at a better understanding of how the organization had been historically run as well as its role and responsibilities in collaborating with the OCDSB. The board also worked with Kimberley Cunnington-Taylor, a lawyer who specializes in not-for-profit and charity law, who agreed to assist the OCLS on a pro bono basis to establish proper governance.
During the Covid-19 pandemic, OCDSB offered language classes virtually, and the only activity offered by OCLS was the Poster Design Contest, which was also conducted virtually.
Financial Situation:
Currently, OCLS has an Education Reserve Fund of $214,000 and no Operating Funds. It appears that OCLS has been operating at a deficit of $10K-$20K on an annual basis since 2013; the largest expenditure was for staff (e.g., Principal, office staff, bookkeeper).
Before Covid-19, when OCLS had a physical presence at Cambridge and the Adult High School, the organization was collecting activity fees (e.g., $45/child) from parents, and in return the parents would become voting members of the organization, receive physical workbooks for their children and be invited to participate in cultural activities organized by OCLS. The organization was not raising enough money (i.e., Operating Fund) to cover the operational expenses. The Education Reserve Fund was used to cover the deficit as needed.
However, regarding the Education Reserve Fund, Ms. Cunnington-Taylor advised that the money in the Education Reserve Fund is a restricted fund and should only be used for educational purposes (e.g., operating educational programs, including expenses related to educational programs, such as educational staff, educational materials, etc.) and should not be used for any operating expenses (e.g., insurance, rental of space, administrative or operational staff).
Therefore, to continue operating, OCLS will need to raise enough money (e.g,. $10K – $20K) to cover the operational expenses on an annual basis.
Challenges to the organization:
Membership to OCLS was contingent on the requirement for an adult (over the age of 18) to have a child enrolled in the Chinese Language classes offered by OCDSB at Cambridge or the Adult High School. Over the years, there has been a steady decline in student enrollment, resulting in less revenue generated from the activity fees that were collected. In addition, there were fewer general members and there was a drop in the number of board members and volunteers with the requisite knowledge, skills, and time to support the overall operational and fundraising needs of the charity. Since the enrollment of the language classes was no longer done in person, OCLS was unable to enlist new members nor collect activity fees
Also the current board members have limited time and ability to revive the organization and update the corporate governance on their own.
Next steps:
In conducting the analysis of the current position of the organization, with respect to its financial standing, and the level of involvement of the overall community, the board of directors are now turning to the general community to advise on this next critical decision for the future of OCLS.
The options currently presented are:
Option 1: Maintain the Organization
This would require a strong community engagement to support OCLS in its charitable purpose. To do so would require:
- New board members, onboarded and trained, to support the review and update of all governance material, and oversee the organization (e.g., human resource activities, professional services, financial health).
- Recruitment of members with the skillset and time to secure funding to cover expenses for the organization (e.g, approximately $10K-$20K/year).
- Review and validate the mission, vision and update the bylaws of the organization.
- Recruitment of members to assist with organizing of cultural programs, activities, and maintenance of OCLS webpages, social media, etc.)
- Develop a strategy to secure and fund an Executive Director to manage the operations charity.
- Secure an accountant who can ensure that all appropriate tax and corporation returns are filed annually.
- Work closely with lawyer to address the governance issues.
For additional details on what is required, please see Appendix A.
Option 2: Wind up and Dissolution of the Organization
This option may take up to two years and will result in the organization no longer existing. It is important to note that this will not impact OCDSB’s ability to continue offering Chinese language classes. However, it does mean that OCLS will no longer be providing the existing resource materials, offering any after class activities (e.g., Chinese Dance, Kung Fu, Lion Dance, etc.), nor organizing activities or events such as the Chinese New Year Luncheon, cultural day, and the various poster design and colouring contests.
To do so, would require:
- A resolution to dissolve the corporation
- Give notice of the intent to dissolve and apply for voluntary revocation of OCLS’s charitable status
- Finalizing any outstanding financial or contractual commitments
- Collecting property, distributing or disposing of property.
- Closing all accounts with private and public organizations
- Any remaining funds will be distributed to a registered charity (possibly multiple charities?).
- A consultation meeting will be held via MS Teams to discuss the options identified or any further suggestions.
A meeting will be held online on August 23, 2022 at 7PM EST to discuss the two options.
Please use this link to join the meeting.
Please feel free to email us your thoughts, ideas, and suggestions at email hidden; JavaScript is required.
Thank you,
OCLS Board Members
