The proposed bill establishes the Decentralized Unincorporated Nonprofit Association Act in Arkansas, creating a legal framework for nonprofit associations that are not incorporated. It defines a decentralized unincorporated nonprofit association as a group of at least 100 members united for a common nonprofit purpose, operating under its own governing principles. The bill outlines the legal status, powers, and limitations of these associations, emphasizing their distinct legal entity status and perpetual existence. It prohibits profit distribution to members while allowing reasonable compensation for services, clarifies liability issues, and includes provisions for governance, property ownership, and the appointment of agents for service of process.

Additionally, the bill introduces new provisions regarding governance, operational structure, and the conversion of these associations into other entity types. Key insertions include requirements for agent appointments, reimbursement for authorized expenses, and indemnification rights for members and administrators. It also details the procedures for dissolution, winding up, and mergers, ensuring compliance with governing laws. The bill emphasizes uniformity in application across states adopting similar legislation and sets an effective date of January 1, 2026, aiming to modernize and clarify the operational framework for decentralized unincorporated nonprofit associations in Arkansas.