LGC Takes Regulator To Court Over Reorganization

Sep 4, 2013

The Local Government Center is taking its regulator to court—again.  This time, over how the organization is restructuring.  On Tuesday, the LGC requested a Merrimack Superior Court judge to declare the restructuring legal.  

Last Sunday, the LGC finalized its split into three separate organizations—the New Hampshire Municipal Association, the HealthTrust risk pool, and Property-Liability Trust risk pool.  Each has its own board, bylaws, and general counsel.  And State Senator Peter Bragdon oversees the risk pools as Executive Director.

In a letter dated August 22nd, The Bureau of Securities Regulation told the LGC it objects to the reorganization plan.  The bureau says under state law, non-profits can only merge with or transfer assets to other non-profits.  The LGC umbrella was actually set-up as a Limited Liability Corporation.  So, the bureau says, the LGC can’t move its money into the non-profit HealthTrust and Property-Liability Trust risk pools.

But the LGC decided that the action was legal, and went ahead with the reorganization. 

Now, it’s asking the Merrimack Superior Court to agree.