Congressional charter
Encyclopedia
A congressional charter is a law passed by the United States Congress
United States Congress
The United States Congress is the bicameral legislature of the federal government of the United States, consisting of the Senate and the House of Representatives. The Congress meets in the United States Capitol in Washington, D.C....

 that states the mission, authority and activities of a group. Congress issued federal charter
Charter
A charter is the grant of authority or rights, stating that the granter formally recognizes the prerogative of the recipient to exercise the rights specified...

s from 1791 until 1992 under Title 36 of the United States Code
Title 36 of the United States Code
Title 36 of the United States Code outlines the role of Patriotic Societies and Observances in the United States Code.*Subtitle I—Patriotic and National Observances and Ceremonies*Subtitle II—Patriotic and National Organizations...

.

The relationship between Congress and the organization is largely a symbolic honorific
Honorific
An honorific is a word or expression with connotations conveying esteem or respect when used in addressing or referring to a person. Sometimes, the term is used not quite correctly to refer to an honorary title...

 giving the organization the aura of being "officially" sanctioned by the U.S. government. However Congress does not oversee or supervise organizations with the charter (other than receiving a yearly financial statement). In order to clarify that the chartered organizations are not government entities and not supervised by the government both the House and the Senate in 1990s agreed not to issue additional charters.

Background

Prior to the District of Columbia being granted the ability to issue corporate charters in the late 1800s, corporations operating in the District required a congressional charter. With limited exceptions, most corporations created by Congress are not federally chartered, but are simply created as District of Columbia corporations as a result of the enabling law.

Some charters create corporate entities and is akin to being incorporated at the federal level. Examples of such charters are the Federal Reserve Bank
Federal Reserve Bank
The twelve Federal Reserve Banks form a major part of the Federal Reserve System, the central banking system of the United States. The twelve federal reserve banks together divide the nation into twelve Federal Reserve Districts, the twelve banking districts created by the Federal Reserve Act of...

, Federal Deposit Insurance Corporation
Federal Deposit Insurance Corporation
The Federal Deposit Insurance Corporation is a United States government corporation created by the Glass–Steagall Act of 1933. It provides deposit insurance, which guarantees the safety of deposits in member banks, currently up to $250,000 per depositor per bank. , the FDIC insures deposits at...

, Fannie Mae, Freddie Mac, and the Tennessee Valley Authority
Tennessee Valley Authority
The Tennessee Valley Authority is a federally owned corporation in the United States created by congressional charter in May 1933 to provide navigation, flood control, electricity generation, fertilizer manufacturing, and economic development in the Tennessee Valley, a region particularly affected...

. Other national level groups with such charters are the American Red Cross
American Red Cross
The American Red Cross , also known as the American National Red Cross, is a volunteer-led, humanitarian organization that provides emergency assistance, disaster relief and education inside the United States. It is the designated U.S...

, National Academy of Sciences
United States National Academy of Sciences
The National Academy of Sciences is a corporation in the United States whose members serve pro bono as "advisers to the nation on science, engineering, and medicine." As a national academy, new members of the organization are elected annually by current members, based on their distinguished and...

, Boy
Boy Scouts of America
The Boy Scouts of America is one of the largest youth organizations in the United States, with over 4.5 million youth members in its age-related divisions...

 and Girl
Girl Scouts of the USA
The Girl Scouts of the United States of America is a youth organization for girls in the United States and American girls living abroad. It describes itself as "the world's preeminent organization dedicated solely to girls". It was founded by Juliette Gordon Low in 1912 and was organized after Low...

 Scouts, the 4H Club, National Park Foundation
National Park Foundation
Chartered by Congress, the National Park Foundation is the official charity of America’s nearly 400 national parks. Funds contributed to the Foundation are invested directly into the national parks...

 and the Disabled American Veterans
Disabled American Veterans
The Disabled American Veterans, or DAV, is an organization for disabled veterans that helps them and their families through various means. It currently has over 1.2 million members...

, National Trust for Historic Preservation
National Trust for Historic Preservation
The National Trust for Historic Preservation is an American member-supported organization that was founded in 1949 by congressional charter to support preservation of historic buildings and neighborhoods through a range of programs and activities, including the publication of Preservation...

, the United States Olympic Committee
United States Olympic Committee
The United States Olympic Committee is a non-profit organization that serves as the National Olympic Committee and National Paralympic Committee for the United States and coordinates the relationship between the United States Anti-Doping Agency and the World Anti-Doping Agency and various...

, the National Conference on Citizenship
National Conference on Citizenship
The National Conference on Citizenship was founded in 1946 and was later chartered by the United States Congress in 1953. NCoC was created in order to be a leader in promoting our nation’s civic life by tracking, "measuring and promoting civic participation and engagement in partnership with other...

, or NeighborWorks America
NeighborWorks America
The Neighborhood Reinvestment Corporation, doing business as NeighborWorks America,is a Congressionally chartered nonprofit organization that supports community development in the United States. The organization provides grants and technical assistance to 235 U.S...

.

More common is a charter that recognizes a group already incorporated at the state level. These mostly honorific charters tend "to provide an 'official' imprimatur to their activities, and to that extent it may provide them prestige and indirect financial benefit." Groups that fall into this group are usually veterans’ groups, fraternal groups or youth groups like the USO, the Girl Scouts of the USA
Girl Scouts of the USA
The Girl Scouts of the United States of America is a youth organization for girls in the United States and American girls living abroad. It describes itself as "the world's preeminent organization dedicated solely to girls". It was founded by Juliette Gordon Low in 1912 and was organized after Low...

 or the Boy Scouts of America
Boy Scouts of America
The Boy Scouts of America is one of the largest youth organizations in the United States, with over 4.5 million youth members in its age-related divisions...

. Congress has chartered about 100 fraternal or patriotic groups.

Process

Eligibility for a charter is based on a group’s activities, whether they are unique, and whether or not they are in the public interest. If this is the case, a bill to grant a charter is introduced in Congress and must be voted into law.

There have been questions about the federal government’s power to manage corporations who have received a charter. Because of questions on who is responsible for the activities of these entities, the issuance of charters was officially stopped in 1992, though some exceptions have been made. The granting of a charter does not include congressional oversight
Congressional oversight
Congressional oversight refers to oversight by the United States Congress of the Executive Branch, including the numerous U.S. federal agencies. Congressional oversight refers to the review, monitoring, and supervision of federal agencies, programs, activities, and policy implementation. Congress...

.

External links

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