WHAT IS A CONGRESSIONAL
CHARTERED ENTITY?
By Knight Ridder Newspapers
A congressional charter is a law passed by Congress
that states the mission, authority and activities of a group. Being chartered by Congress is like being incorporated at the
federal level, and provides no assurance that the federal government will watch over the group.
Congress has issued federal charters since 1791, sometimes
creating corporate entities ,but more often recognizing a wide range of groups that already are incorporated at the state
level, according to the Congressional Research Service, a nonpartisan analytic arm of Congress.
Besides veterans groups, they include other fraternal
groups such as the Girl Scouts of America, financial institutions such as Federal Reserve Banks and Fannie Mae and Freddie
Mac, government corporations such as the Tennessee Valley Authority and nonprofit support groups such as the National Park
Foundation and the National Trust for Historic Preservation.
Congress has chartered about 100 fraternal or patriotic
groups.
The charters are largely honorific. The main attraction
for national organizations "is that it tends to provide an `official' imprimatur to their activities, and to that extent it
may provide them prestige and indirect financial benefit," according to a 2004 report by the Congressional Research Service.
To obtain a charter, a bill is introduced in Congress
and must be voted into law. To be eligible for a charter, groups generally must engage in activities that are clearly in the
public interest and be of a unique type. Although issuing new charters was banned in 1992, Congress has made exceptions over
the years.
