Reminder: VDACS Charitable Organization Form 102 Due May 15!

To all Virginia nonprofits, this is a reminder that May 15 is the deadline to renew your Form 102 with the Virginia Department of Agriculture and Consumer Services (VDACS) Office of Charitable and Regulatory Programs.

Organizations that wish to solicit charitable funds in Virginia must register with VDACS.  If you’ve already registered, you still need to renew your registration each year by May 15.

Don’t forget to include an updated list of officers and directors, a copy of your 990, and any amendments to your bylaws or articles of organization.  VDACS has a handy checklist for any other documents you might also need to include.

You can get a copy of Form 102 on VDACS’ website.

Operation Socialization Guest Blog, Part 2: Contracts and Waivers

Don’t miss Part 2 of my “Are You Covered” guest blog series with Operation Socialization!  The series is designed to help trainers think about the business end of training, and give pointers about protecting their businesses.

Part 1 discussed the importance of creating an entity for your business and properly insuring the business.

Part 2 talks about contracts and waivers, with extra tips for those of you who work with aggressive dogs.

Watch for Part 3, which will discuss ways to protect yourself and your business from liability.

Never underestimate the importance of treating training as a business, and doing all you can to protect that business.  If you’d like to know more about the basics of protecting your business, check out these top ten tips!

Special Thanks to Operation Socialization for Guest Blogger Opportunity!

Hearty thanks to Operation Socialization for offering me a great guest blogger opportunity!  Operation Socialization is a network of professional dog trainers and businesses. Operation Socialization’s vision is to raise awareness about the importance of puppy socialization and to provide the humans on the other end of the leash with education and resources to give puppies the best possible start in life.

Operation Socialization recently asked me about ways to protect a dog training business.  Operation Socialization’s main focus for the guest blog series is on  risk management and insurance issues.  Insurance is one of the many components to protecting your business.  For a nice checklist to get you started (or to double check for your existing business), take a look at this prior blog post.

To read the first part of my response to  Operation Socialization’s questions on risk management and insurance issues, take a look at my guest post:  Are You Covered?  Protecting Your Business, Part One.

How Do I Find A Good Rescue?

Data provided by the Virginia Department of Agriculture and Consumer Affairs (VDACS) demonstrate how vital rescues are to animal welfare. In Virginia in 2010, rescues accounted for 10,816 stray, seized, transferred and surrendered animals. These Virginia rescues adopted 4,886 and transferred another 1,846 of those animals. The rescues euthanized only 427 of those animals. This is an adoption rate of 45%, and euthanasia rate of only 4%.

The overall 2010 figures, including data for shelters, pounds, humane societies and rescues, show a different picture. Of an overall number of 185,948 stray, seized, transferred and surrendered animals, 54,425 were adopted, another 24,137 were transferred and 72,403 were euthanized. This is an adoption rate of 29%, and euthanasia rate of 39%.

With their high adoption rates and low euthanasia rates, rescues are a very attractive option for someone looking to adopt a companion animal. However, not all rescues are created equally.

On more than one occasion, I have gotten a phone call from a person who adopted an animal from a “rescue,” only to discover that the rescue was hardly a benevolent non-profit. The “rescue” instead was in the business of selling animals that are unhealthy or not the size or breed that was promised. And even when rescues have their heart in the right place, more and more rescues act as venues for animal hoarders, like we’ve seen recently with Annette Thompson in Goochland County and Janet Hollins in Prince William County.

In light of all this, there are several things that you can do to make sure that the rescue you are considering is legitimate.

First, if the rescue claims to be a 501(c)(3), you can double check this using the Guidestar website. Guidestar can show you vital information such as the non-profit’s mission statement and recent 990 tax filings. The rescue’s 990 will show you even more information, such as how the organization is funded and how much the organization spends on administration and fundraising versus costs directly related to the animals’ care.

Second, a rescue claiming to be a non-profit may have additional state regulations and obligations. For instance, all Virginia non-profits must register with VDACS’s Department of Consumer Affairs to solicit as a charitable organization. You can check whether the rescue is registered to solicit using the Department of Consumer Affairs’ website.

Third, check to see if the rescue is complying with its state registration or reporting obligations. In Virginia, rescues must register and report data annually to VDACS and the Office of the State Veterinarian. VDACS maintains an online database that tells you which rescues are reporting, and gives data for each rescue for how many animals they take in per year, the source of those animals, and the disposition of the animals.

Fourth, the rescue should have a written adoption contract that complies with all legal obligations. For instance, Virginia rescues must comply with Virginia Code Section 3.2-6574, which requires a written contract between the rescue and adopter in which the adopter agrees to neuter an intact dog or cat within 30 days of adoption or the date that the animal reaches six months of age.  Any decent rescue will likely also have a contractual provision that requires the adopter to return the animal to the rescue if the adopter can no longer care for the animal.

If you are checking out a rescue, here are some red flags to watch out for:

• The “rescue” claims to be a 501(c)(3), but you can find no information using Guidestar and state regulatory sites.
• The rescue uses a high percentage of funds for administrative costs, rather than costs directly related to care of the animals, such as veterinary care, food, training and boarding.
• The “rescue” does not have a contract. Or it has a contract, but the contract lacks key provisions, such as requiring the adopter to spay or neuter the animal, or return the animal to the rescue if the adopter can no longer care for the animal.
• The “rescue” cannot produce identifying information and veterinary records for their companion animals.
• The “rescue” charges high “adoption fees,” and has a website promising to sell you the perfect purebred or designer breed puppies or kittens. Take a look at the ASPCA’s website for more information on internet scams.

As with any company, don’t just rely on the rescue’s website. You should be able to call the rescue and speak with a live person. When you see a particular companion animal you are interested in, you should be able to meet the animal and the foster, and review the animal’s veterinary records, before you decide if the animal is right for you. If you already have a dog and you are looking to adopt a second dog, ask to set up a meet and greet for the dogs.  If the rescue is hesitant with any of these requests, think again before you adopt from them!

Come See Me and Bean Kinney in Booth 721 at the Chantilly Virginia Super Pet Expo!

Law firm Bean, Kinney & Korman, PC will be in Booth 718 721 (left side, right behind the Franchise Pavillion) for the Super Pet Expo in Chantilly, Virginia on March 18-20, 2011!  I will be there with two of my colleagues — Jennifer Lee and Alain Lapter — to talk about ways our law firm can help pet owners and pet care industry companies and organizations.  For pet owners, we’ll discuss everything from pet trusts to owner responsibility issues such as dog bite and dangerous dog liability.   For businesses and rescues, we’ll talk about many ways to protect your entity, from intellectual property to corporate, compliance and contract issues.  And we’ll have really fun giveaways!  Although Sophie will have to stay at home for this, I may also try to arrange for some guest appearances by Boomer!  Don’t miss it!

UPDATE (3/14/11):  The Super Pet Expo has had to make some floor plan revisions.  Bean Kinney’s booth will be #721 — right across from our original location.

Protecting Your Business: A Checklist For New (And Existing!) Pet Care Businesses In Virginia

Whether you are starting up a new pet care business, or you want to make sure you are covering your bases with your existing business, here’s a great checklist for you.  Watch for more details on these steps in later posts.

1.         Choose a name and protect your mark.  Before settling on a name, check for name availability with both the Clerk’s Office for Virginia’s State Corporation Commission and the U.S. Patent and Trademark Office.  It’s not enough to make sure that no one is using the name of your business.  To fully protect your mark, it is well worth registering your mark on the state level and filing a trademark application with the USPTO.  It usually pays off to consult with a trademark attorney at this step.

2.         Choose a business entity.  The most common entities are a sole proprietorship, a partnership, a limited liability company (LLC) and a corporation.  LLCs are a popular choice for businesses due to the LLC’s flexibility.  It is often in your best interest to consult with a corporate attorney at this point.

3.         Register your business.  Corporations, LLCs and limited partnerships must register with the Virginia State Corporation Commission.  If you are a franchise, you will also have to register with the State Corporation Commission’s Division of Securities and Retail Franchising.

4.         Register any trade names and general partnerships.  If you are using a trade name that is other than your entity’s official name, make sure that you register the trade name with your local Circuit Court Clerk’s Office.  Note that general partnerships also need to register with the Circuit Court.

5.         Check on state requirements.  Depending on your profession and business, you may have state licensing, registration or other requirements.  For instance, veterinarians and veterinary facilities must comply with licensing and registration requirements for the Virginia Board of Veterinary Medicine and the Virginia Department of Health Professions.  Commercial dog breeders, animal shelters and pounds, and rescues are subject to state reporting and other requirements.  Non-profits also have to register with the Virginia Department of Agriculture and Consumer Services’ Division of Consumer Protection to solicit as a charitable organization.  Various state laws also impact groomers, dog kennels and boarding facilities.

6.         Comply with zoning and permitting requirements and code regulations.  You will need to check with your local jurisdiction to ensure that you have complied with zoning and permitting requirements.  This step is more streamlined in some jurisdictions than others.  For instance, the City of Alexandria has created a “Permit Center” as a “One Stop Shop” in an effort to simplify this process.  (By the way, in 2010, Alexandria changed its small business zoning to add a new permitted use in the Cameron Station area for pet supplies, grooming and/or training with no overnight accommodations, if you’re looking for a location!)  Additionally, be sure to check on all building and other code regulations.

7.         Get a local business license.  Once you have registered your business and complied with your locality’s zoning and permitting requirements, you need to get a business license.  This license must be renewed annually.  When you apply for a license, this will also trigger the duty to estimate and pay your local business, professional and occupational license (BPOL) taxes.

8.         Comply with tax requirements.  Along with your BPOL taxes, make sure you have complied with other local tax requirements, such as business personal property taxes.  Of course, you also need to comply with state and federal taxes.  If you run a non-profit such as a rescue, make sure that you look into federal, state and local tax exemptions.  This is another time when you may want to seek help from a tax attorney or accountant.

9.         Get insurance.  Look into the many different insurance policies designed to protect your business, including insurance for general liability, professional liability and malpractice, umbrella liability, business property, business income and extra expense, animal bailee, equipment and commercial automobile coverage.  A good insurance broker can help you out here.

10.       Keep accurate and complete business records.  Generally, the privilege of obtaining a state or local license carries with it the state or locality’s right to audit your business and inspect your records.  Additionally, as mentioned above, certain businesses such as commercial dog breeders, animal shelters, pounds and rescues have their own obligations to maintain records and report information.  The importance of keeping accurate and complete records cannot be emphasized enough. 

Too many people think that they can start out on their own with a business such as dog walking, dog training or animal rescue without following these steps.  You can’t just wait until you have a solid clientele base before you worry about setting up and registering your business entity, getting insurance and a business license, and complying with these other requirements.  If you lack the resources to comply with these requirements prior to taking on your very first client, you should work for an established company for a while first before you take that leap. 

This post is not meant to be a full checklist of everything that is required for your particular business, but it is a great starting point to make sure that you have thought of the most important items to start up and protect your business.  Another great resource in thinking through whether you are ready to start your own business is the Virginia Department of Business Assistance’s Business One Stop Service.