Division of Assets During Realignment

ACTION ITEM: DISPERSING ASSETS AT THE TIME OF MERGER
January 9, 2008

The following motion was approved at the January 9 meeting of the Board of Directors:

"The Finance Committee moves that upon the merger of Girl Scouts – Joshua Tree Council with Golden Valley Girl Scout Council and the Girl Scout Councils in Los Angeles County the remaining assets be allocated in the following way."

  1. Assets tied to a specific location remain in that location. Examples: merchandise in the Girl Scout shops, petty cash and office equipment, pledges made by individuals, grants for specific programs tied to a specific county.
  2. The Bakersfield Service Center is the only building of value that Joshua Tree Council owns. Since it is located in Kern County and will become part of the new council with Golden Valley, the Los Angeles council will receive a cash amount equal to 60% of the value of the Bakersfield Service Center.
  3. After Los Angeles has been reimbursed for the value of the Service Center, the remaining cash will be divided with 60% going to Los Angeles and 40% going to Kern County.
  4. The total amount spent on both mergers by Joshua Tree Council will be totaled and 60% will be charged to Los Angels County and 40% charged to Kern County.

RATIONALE

  1. For the past two years, 60% of the girl membership of the council has come from Los Angeles County and 40% has come from Kern County.
  2. For the past two years Kern County has generated about 40% of the income and Los Angeles County has generated about 60%. Kern County has been responsible for 25% of the expenses, and Los Angeles County for about 30% of the expenses with over 40% of the expenses going to overhead that can not be directly assigned to one county or the other.
  3. Girl Scouts of the USA advises that we consider each class of asset separately and not divide the total assets by any set formula. When an asset such as a building is transferred in a merger, there should be cash to support the operation of that asset that will accompany it.

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