Lawyers Alliance: Substantive Pro Bono Work For Business Lawyers

Monday, August 1, 2011 - 00:00

The Editor interviews Sean Delany , Executive Director, Lawyers Alliance for New York.

Editor: What is the mission of Lawyers Alliance for New York?

Delany: Lawyers Alliance for New York is the leading provider of business and transactional legal services for nonprofit organizations that are improving the quality of life in New York City neighborhoods. Our network of pro bono lawyers from law firms and corporations work together with our own staff of attorneys to fulfill corporate, tax, real estate, employment, intellectual property and any other business law need that our nonprofit clients might have. Many of those clients are developing affordable housing, stimulating economic development and providing vital social services all over New York City.

Editor: Tell us about the honorees at the Lawyers Alliance 2011 Business Law & Leadership Gala, celebrating pro bono service for New York City nonprofit organizations.

Delany: Lawyers Alliance was fortunate to have three exceptional honorees at our 2011 Business Law & Leadership Gala last spring. The first of these was Louise Parent, who is executive vice president and general counsel of American Express. Since 2005, we've been working with Louise and her lawyers in the legal department on pro bono work. Louise is extraordinarily active in pro bono work and public service in many other ways as well.

Another honoree was Deirdre Stanley, who as executive vice president and general counsel at Thomson Reuters is responsible for global legal function for the entire company, including its subsidiaries. We recognized Deirdre for her and her company's part in launching an exciting new pro bono program called TrustLaw Connect, an online platform that matches non-governmental organizations around the world with private sector lawyers on a pro bono basis.

Our third honoree, Cliff Rosenthal, is the president and CEO of the National Federation of Community Development Credit Unions, which is the national umbrella organization for community development credit unions around the country. Cliff helped design and implement their investment program for community development credit unions, which, among other services, provides capital to their 120 member organizations. We've worked with Cliff for more than 20 years on a variety of projects; this past fall, together we worked with 15 law firms and seven other pro bono organizations around the country to help provide $80 million in TARP funding under the Community Development Capital Initiative that the Treasury Department was sponsoring. It brought badly needed capital to credit unions all over the country.

Editor: How do corporations support your programs? What are some key corporate partnerships for Lawyers Alliance?

Delany: Corporations support our programs in a variety of ways. We've designed our pro bono program to enable in-house lawyers to put their legal skills to use to benefit our nonprofit clients. Our projects draw upon the existing skills of those lawyers and allow them to participate efficiently without needing additional training. They have opportunities to review contracts, update corporate bylaws, negotiate loan documents or leases, counsel a nonprofit manager on employment law issues or advise clients on intellectual property questions - all intensive business law needs that they are already familiar with from their day-to-day practice. Our projects range in scope from brief consultations to more extensive representation, so the time commitment for our projects is also flexible. We support all of those projects by having a Lawyers Alliance staff attorney act as co-counsel.

Specific examples of partnerships and projects we've worked on over the years include working with lawyers from American Express who helped the nonprofit Chinatown Partnership Local Development Corporation to negotiate an agreement with a for-profit vendor to install a solar-powered trash compactor that will enable them to deal with the neighborhood's waste disposal issues. We also have been working with a cultural organization located in Brooklyn. Lawyers from Citigroup are helping them review whether a number of their employees should be classified as independent contractors. Recently lawyers from Goldman Sachs helped a nonprofit called BEC New Communities, a group that assists low- and moderate-income individuals with accessing decent affordable housing, to review and update its bylaws. Lawyers from NBC assisted the nonprofit Housing Conservation Coordinators with some questions about whether an administrative assistant would fall into their collective bargaining agreement. And, Time Warner has advised the Real World Foundation with the trademark of a program name.

Editor: How are your initiatives tailored to the unique needs of New York City? What neighborhoods are most underserved and what nonprofit programs are most in need of your support?

Delany: The recession is far from over for the nonprofit sector, and the needs, particularly in low-income neighborhoods, are severe, especially because over the last 20 to 30 years, social services to the nonprofit sector - including vital safety net services - have been privatized. The nonprofit organizations now providing those services - services that once would have been provided directly by the government - are now being paid for by government funding, and these funds are very much in jeopardy due to the condition of state and local budgets. As a result, our work with those nonprofits is crucial in preserving their programs.

We are targeting the nonprofits serving the most hard-hit neighborhoods. For example, we have a project launching this summer to work with significant safety net grantees of the New York Community Trust, which numbers among the most important service providers in the city, to make sure that they'll be able to weather the storm and receive needed legal support.

Editor: Tell us about Lawyers Alliance's workshops and publication programs.

Delany: These are both important aspects of our work. In fiscal year 2011, we offered two dozen in-person workshops, with topics including mergers and strategic alliances, cause-related marketing, corporate sponsorship and operation of child-care centers, topics very much tailored to the specific legal issues of our nonprofit clients. We also launched a very active webinar program this past year, offering 10 webinars on a variety of topics including real estate, employment issues and corporate governance. It can be difficult for our nonprofit managers to gather their staff and travel to Lawyers Alliance, so the webinar format makes a lot of sense.

I'd like to tell your readers they can play an extremely important role as volunteers in our educational programs. We need the services of lawyers from both law firms and corporations to assist in leading workshops on issues such as intellectual property or insurance law that are important to our clients but are not within the specific expertise of Lawyers Alliance attorneys.

In 2001, we launched the Strategic Legal Thinking Seminar Series, which went national four or five years ago. We offer workshops to nonprofit managers in a dozen cities around the country three times a year on legal topics they're interested in (again, working with a network of pro bono providers in those locations). Sponsored by Pfizer and DLA Piper, the series is a very popular way for nonprofit managers to access legal information, especially in out-of-the-way places.

On the publication side we have 16 different legal manuals that we distribute to nonprofit managers. The three most popular are "Getting Organized," which is for startup organizations; "The Volunteer Workforce," which is for nonprofits that work with volunteers; and "Bylaws that Work," our newest publication, which is about creating and maintaining effective bylaws for nonprofits. As with our workshops, we often need volunteer lawyers to help us out; as I speak, volunteer lawyers are helping us update one of our major publications.

Editor: What are some trends in the nonprofit world? I understand some nonprofits are launching for-profit ventures. How is Lawyers Alliance getting involved?

Delany: Our program preservation initiative is the most important service that we provide. Over the last two years we helped more than 150 groups preserve their programs.

That said, there are some "green shoots," a few early signs of encouragement for economic development in low-income communities. For instance, we've just started working with a social service agency in East Harlem that wants to expand its home healthcare program by working with for-profit providers and making use of their home healthcare licenses from the state. The license is very much in demand, and it could be used to build a new revenue stream through a for-profit/nonprofit joint venture.

A sustainable agricultural organization in central New York is creating a statewide healthy food distribution program that ultimately will reach New York City. We are strategizing with them on program structure, and law firm volunteers are helping them realize our plans.

Here in Manhattan, we're helping a for-profit thrift store convert to nonprofit status so it can benefit other organizations with the proceeds from its sales. These are signs of life, but we're far from out of the woods in the nonprofit sector.

Editor: What are some distinguishing features of nonprofit versus for-profit employment law?

Delany: Employment law is one of the mainstays of our practice because all of our clients, except the very smallest, have employment law needs. For a nonprofit, staffing is a very large part of the budget, as well as a large component of its ability to provide services.

In New York City the nonprofit sector employs a huge part of the total workforce - more than half a million people, in one recent survey, which is more than the financial services, real estate and insurance industries combined. While many of those people are employed in healthcare, cultural or educational institutions, the largest number of nonprofit employers are community-based organizations working in low-income communities.

There is no nonprofit employment law per se, but there are some differences in practice. For example, compensation of employees, particularly senior managers, is regulated under the tax code to prevent excessive compensation, which is analogous but quite different in its application from compensation issues that arise in the for-profit sector.

In addition, nonprofits rely on volunteers and nontraditional employees such as independent contractors, which can create regulatory issues. Additionally, many nonprofits are too small to have a human resources staff, making compliance especially challenging.

Some of the most rewarding pro bono work that we can offer younger lawyers is in the employment law area. These days, large corporate clients, especially those with in-house employment attorneys, are less likely to turn to their law firms for day-to-day counseling in employment law, leaving younger employment lawyers at large law firms at a loss for crucial one-on-one counseling experience. Through pro bono work with Lawyers Alliance, they can get that experience.

Editor: Would you comment about compliance issues in these times of challenging fundraising?

Delany: In these times of diminished funding, nonprofit compliance is more important than it has ever been. Nonprofits must have active boards of directors monitoring the organization, particularly its finances, with heightened vigilance.

Transparency has been a byword for the nonprofit sector for a long time. However, today transparency should be viewed not just as an obligation but also as an opportunity to make its case to the public. Government filings (including Form 990) are marketing tools as well as disclosure forms, and we're encouraging our clients to view them that way.

Many of our clients are for the first time becoming engaged in new revenue-generating activities that have tax implications, so our clients need legal counsel on issues such as unrelated business income tax and other revenue-related issues. I would advise all nonprofits to do their homework on this front.

Editor: What are some best practices to avoid undue scrutiny?

Delany: Nonprofits need to ensure that their registration and filing obligations are up to date. With fundraising activity, nonprofits have federal obligations not only in terms of their filings, but also in the information they provide donors. The same is true at the state level. Particular fundraising activities like conducting bingo, games of chance or raffles have both local and state regulatory implications, and nonprofits should consult with counsel before going down those roads.

Editor: Any final words for our readers?

Delany: There are business law pro bono providers in cities all over the country, and I would urge those of your readers who may want to volunteer to visit the Lawyers Alliance's website, lawyersalliance.org, where we have a list of providers around the country in that national network. While it continues to be the case that the lion's share of pro bono work, at least at large law firms, is done by litigators, business lawyers at large law firms and at corporations remain an untapped resource for pro bono work. We need their help now more than ever.

Please email the interviewee at sdelany@lawyersalliance.org with questions about this interview.