BYLAWS OF THE LOWER MAKEFIELD TOWNSHIP SWIM TEAM, INC.
TABLE OF CONTENTS
I. NAME, LOCATION AND CORPORATE SEAL
II. DEFINITION AND PURPOSE
V. BOARD OF DIRECTORS
VI. NOMINATIONS, ELECTIONS AND VACANCIES
VII. RELATIONSHIP WITH LOWER MAKEFIELD TOWNSHIP
IX. BOOKS AND RECORDS
X. TRANSACTION OF BUSINESS
XI. COMMUNICATION TO MEMBERS/ANNUAL REPORT
XIII. MISCELLANEOUS PROVISIONS
APPENDIX A. Conflict of Interest Policy
I. Name, Location and Corporate Seal
A. The name of the Non-Profit Corporation is Lower Makefield Township Swim Team, Incorporated. (Heretofore referred to as LMT Swim and Dive Team or the Organization)
B. The registered office of the Organization shall be at the pool complex at 1050 Edgewood Road, Yardley, PA 19067.
C. The Organization may have offices at other places, as the Officers of the Board may from time to time appoint or that the activities of the Organization may require.
D. The corporate seal shall have inscribed thereon the name of the Organization, the year of its Organization (1997), and the words “Corporate Seal, Pennsylvania”. The Board president shall be in possession of the corporate seal.
II. DEFINITION AND PURPOSE
LMT Swim and Dive Team is a competitive community swimming and diving program which develops physical skills for children of all abilities, fosters positive social interactions, and instills a life-long appetite for exercise in our youth, in a fun-filled atmosphere. We have a core belief that the LMT Swim and Dive Team is preparing its youth to not only be members of a successful swim and/or dive team, but responsible members of our society.
The season starts when the Lower Makefield Township pool opens (Tuesday after Memorial Day) and runs through the end of July in concordance with League scheduling. Practices run in the afternoon until school ends and then move to the morning. Meets are 2x/week in the evening and run from late June until late July. Registration runs annually from April 15th through June 1st.
The Organization is incorporated for the following purpose or purposes:
LMT Swim and Dive Team is an athletic Organization that fosters amateur competition in swimming and diving within the meaning of section 501(c)(3) of the Internal Revenue Code. The team teaches and trains young amateur swimmers and divers aged 6 – 18 (5 at coaches discretion), from novices to nationally-ranked athletes. Our team promotes growth of the sports of swimming and diving; provides members an opportunity to improve their skills and achieve success at their level of ability; and emphasizes strength of character, team unity and family participation.
LMT Swim and Dive Team is organized exclusively for charitable and educational purposes, including, for such purposes, making distributions to Organizations that qualify as exempt Organizations under section 501(c)(3) of the Internal Revenue Code, or the corresponding section of any future federal tax code.
A. Participating Athlete is any child, who is by June 15th age 6 through 18 years of age (5 at coaches discretion) and who is a member of the Lower Makefield Township Pool and who fulfills eligibility and financial requirements. Athletes can be 19 years of age if they are a graduating senior in high school. An athlete that is 18 years of age and has completed one year of college, is still eligible to swim and/or dive for LMT Swim and Dive Team, as long as they did not swim and/or dive competitively in college.
B. General Members are those adults who have children or guardianship of children that are participating athletes and abide by the rules of The LMT Swim and Dive Team.
C. Membership in this Organization is not transferable or assignable.
D. If there has been any membership issue or dispute, financial or other, in the past, the board reserves the right to either deny membership, or to place additional membership requirements as they see fit, to any particular family or member. This includes but is not limited to requiring cash payments and more stringent volunteer requirements. Should issues arise that are not resolved to the board's satisfaction, rejection, dismissal or suspension may be initiated and refunds would not be issued.
A. Board of Director Meetings shall be held monthly or as needed but at least one time in the fall, two times in the spring and two times in the summer
B. At least one general membership meeting will be held annually.
C. Special meetings of the members may be called at any time by any Board of Director or at least 10% of the members. At any time, upon written request of any person who has called a special meeting, it shall be the duty of the Secretary to set the time of the meeting, which shall be held not more than 60 days after receipt of the request. If the Secretary shall neglect or refuse to set the time of the meeting, the person or persons calling the meeting may do so. Business transacted at all special meetings shall be confined to the objects stated.
D. Written notice of every meeting of the members, stating the time, place and purpose thereof, shall be given by or at the direction of the Secretary to each member of record entitled to vote at the meeting, at least 7 days prior to the day named for the meeting, unless a greater period of notice is required by statute in a particular case. If the Secretary shall neglect or refuse to give notice of the meeting, the person or persons calling the meeting may do so. In the case of a special meeting, the notice shall specify the general nature of the business to be transacted.
E. A meeting of the general membership duly called shall not be organized for the transaction of business unless a quorum is present. The presence in person of 15% of the general membership entitled to vote shall constitute a quorum at all meetings of the general membership for the transaction of business except as may be otherwise provided by law or by the Articles of Incorporation. The general members present at a duly organized meeting can continue to do business until adjournment, notwithstanding the withdrawal of enough general members to leave less than the quorum. If a meeting cannot be organized because a quorum has not attended, those present may, except as otherwise provided by statute, adjourn the meeting to such time and place as they may determine, but in the case of any meeting called for the election of Board of Directors, those who attend the second of such adjourned meetings, although less than a quorum, shall nevertheless constitute a quorum for the purpose of electing Board of Directors. In the case of any meeting called for any other purpose, those who attend the second of such adjourned meetings, although less than a quorum, shall nevertheless constitute a quorum for the purpose of acting upon any resolution or other matter set forth in the notice of the meeting, if written notice of such second adjourned meeting, stating that those general members who attend shall constitute a quorum for the purpose of acting upon such resolution or other matter, is given to each general member of record entitled to vote at such second adjourned meeting at least 10 days prior to the day named for the second adjourned meeting.
F. One or more persons may participate in a meeting of the Board or members by means of conference calls or similar communications by means of which all persons participating in the meeting can hear one another. Participation in a meeting pursuant to this section shall constitute presence in person at such meeting.
G. Action(s) of the general members may be taken without a meeting if a consent or consents are made in writing that set forth the action(s) to be taken and are signed by all general members who would be entitled to vote at a meeting for such purpose and shall be filed with the Secretary of the Organization.
V. BOARD OF DIRECTORS
A. The business affairs of this Organization shall be managed by the Board of Directors
1. The Board of Directors is composed of 12 Board Members (5 elected Executive Officers plus 7 appointed officers)
i. The elected Executive Officers of the Board consist of President, 1st Vice President, 2nd Vice President/Registrar, Secretary and Treasurer.
ii. The appointed board officers consist of LMTA (Gold) Squad League Representative, LMTB (Blue) Squad League representative, Dive Squad Representative, Record Keeper/Invitational Swim Meet Coordinator, Team Spirit Coordinators (2) and Past President.
2. The Head Swim and Dive coaches and Meet Directors/Volunteer Coordinators act as associate members of the board.
B. Members of the Board of Directors must be general members in order to be appointed or elected to the board.
C. The Executive Officers of the Board of Directors shall be elected by the members at the annual meeting.
D. Members of the Board of Directors will commence and finish their term at the post-season/ September board meeting.
E. The term of office for each Executive Officer of the Board of Directors shall be two years or until their successor assumes office. In the interest of maintaining continuity, alternating elections will be held as such: The President and 2nd Vice President/Registrar shall be elected one year; the 1st Vice President, Secretary and Treasurer shall be elected the following year.
F. Any Executive Officer or agent of the Board of Directors may be removed by a majority of remaining Executive Officers of the Board of Directors whenever in its judgment the best interests of the Organization will be served thereby, but such removal shall be without prejudice to the contract rights of any person so removed.
G. Meetings of the Executive Officers of the Board of Directors may be called by the President, or at the request of three Executive Officers, as necessary with at least 3 days notice.
H. A majority of the Executive Officers of the Board of Directors shall be necessary to constitute a quorum for the transaction of business. The acts of a majority of the Executive Officers present at a meeting at which a quorum is present shall be the acts of the Executive Officers. Any action that is allowed at a meeting of the Executive Officers may be taken without a meeting if consented to in writing by all of the Executive Officers in office and filed with the Secretary of the Organization. In case of a tie, the President breaks the tie.
I. The Executive Officers of the Board of Directors may establish one or more committees, consisting of one or more Executive Officers of the Organization, if adopted by a majority of the Executive Officers. Any such committee shall have and may exercise all of the powers and authority of the Executive Officers, except that no such committee shall have any power or authority as to the following:
- Submit to members for their approval any action required by statute.
- Fill a vacancy by an Executive Board Member
- Adopt, amend or repeal the Bylaws.
- Amend or repeal any resolution of the Board of Directors.
- Act on matters committed by the Bylaws or resolution of the Board of Directors to another committee of the Board of Directors.
J. The Board of Directors may designate one or more Executive Officers as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member(s) present at any meeting and not disqualified from voting, whether or not he/she or they constitute a quorum, may unanimously appoint another Officer to act at the meeting in the place of the absent or disqualified member. Each committee of the Board shall serve at the pleasure of the Board.
K. Any or all Executive Officers of the Board of Directors, may be removed from office without assigning any cause by the vote of a majority of the Organizations general membership at any annual or regular election of the elected Executive Officers of the Board. In case any one or more of the Executive Officers are so removed, new Executive Officers may be elected at the same meeting.
L. The Executive Officers of the Board of Directors may declare vacant the office of an Executive Officer if he/she is declared of unsound mind by an order of the court, is convicted of a felony, or if within 60 days after notice of his/her selection he/she does not accept such office either in writing or by attending a meeting of the Executive Officers of the Board.
M. An Executive Officer of the Board of Directors shall stand in a fiduciary relation to the Organization and shall perform his/her duties as an Executive Officer, including his/her duties as a member of any committee of the Board of Directors upon which he/she may serve, in good faith, in a manner he/she reasonably believes to be in the best interest of the Organization, and with such care, including reasonable inquiry, skill and diligence, as a person of ordinary prudence would use under similar circumstances.
N. In performing his/her duties, Officers of the Board of Directors shall be entitled to rely in good faith on information, opinions, reports or statements, including financial statements and other financial data, in any case prepared by any of the following:
- One or more Officers, employees or independent contractors of the Organization whom the Officer reasonably believes to be reliable and competent in the matters presented.
- Counsel, public accountants or any persons as to matters that the Executive Board member reasonably believes to be within the professional or expert competence of such person.
- A committee of the Board upon which he/she does not serve, designated in accordance with law on matters within its authority.
O. An Officer of the Organization shall not be personally liable for monetary damages for any action taken or any failure to take any action, unless:
- The Officer has breached or failed to perform the duties of his office under this section.
- The breach or failure to perform constitutes self-dealing, willful misconduct or recklessness.
P. Only Executive Officers may vote on fees paid to coaches. Any Executive Officer who is a parent of an athlete coach must excuse themselves from any discussion involving their child’s compensation
Q. The duties of the Executive Officers of the Board of Directors are as follows:
- To authorize all budgets, programs and expenditures of the Organization
- To serve as the final executive decision making body on all official grievances and/or appeals made in regard to decisions or rulings set forth by the board or any committee thereof.
- To establish membership and registration fees on an annual basis, no later than April 1st.
- To vote on all motions presented at Board of Directors meetings.
- To regularly attend Board of Directors meetings. Any Executive Officer not attending three consecutive Board of Directors meetings without adequate reason forfeits that position on the Board.
- To establish all policies and procedures for the Organization.
- To create or modify any Officer job description.
- In addition to the powers and authorities conferred by these Bylaws upon the Executive Officers of the Board of Directors, the Executive Officers will have all decision-making powers of the Organization.
R. The specific duties of the Executive Officers shall include but not limited to:
The President: shall be the Chief Executive Officer of the Organization and shall work toward the success of the Organization as a whole and its members; he/she shall preside at all meetings of the members and directors; he/she shall have general and active management of the affairs of the Organization; shall see that all orders and resolutions of the Board are carried into effect, subject, however, to the right of the Executive Officers of the Board to delegate any specific powers, except such as may be by statute exclusively conferred on the President, to any other Executive Officers or Appointed Officers of the Organization. The President shall execute all documents requiring a seal of the Organization. He/she shall be EX-OFFICIO a member of all committees and shall have the general powers and duties of supervision and management usually vested in the office of President.
The 1st Vice-President: shall act as the President due to latter’s absence or incapacity, and shall perform such other duties as he/she may be required to do from time to time. He/she should also manage the fundraising efforts of the Organization.
The 2nd Vice-President/Registrar: shall act as the President due to the absence or incapacity of the President and 1st Vice-President, and shall perform such other duties as he/she may be required to do from time to time. He/she should also manage the registration process and prepare rosters, directories, reports and documents as needed.
The Secretary: shall attend all sessions of the Board and all meetings of the members and act as clerk thereof, and record all the votes of the Organization and the minutes of all its transactions. He/she shall perform like duties for all committees of the Board when required. He/she shall give notice of all meetings of the members and of the Board, and shall perform such other duties as may be prescribed by the Board or President, under whose supervision he/she shall be. He/she shall maintain the Bylaws of the Organization, including current and prior versions.
The Treasurer: shall have custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Organization, and shall keep the monies of the Organization in a separate account to the credit of the Organization. He/she shall disburse the funds of the Organization as may be ordered by the Executive Officers of the Board, taking proper vouchers for such disbursements, and shall render to the President and remaining Executive Board members, at the regular meetings of the Board of Directors or whenever they may require it, an account of all his/her transactions as Treasurer and of the financial condition of the Organization. He/she should also maintain the Organization budget and report on it at regular Board of Director meetings, and prepare and file necessary tax returns for the Organization. The Treasurer is authorized to speak on behalf of the Organization to local, state and federal government authorities regarding financial and tax matters relating to the Organization.
S. The provisions of this section shall not apply to:
The responsibility or liability of a Board member pursuant to any criminal statute; or the liability of a Board member for payment of taxes pursuant to local, state, federal law.
T. Executive Officers of the Board of Directors are not required to fulfill the dual meet volunteer requirements throughout the swim and/or dive season as the general membership is, but they are required to be on standby if needed.
VI. NOMINATIONS, ELECTIONS AND VACANCIES
- The Board of Directors shall solicit the general membership to run for open Executive Officers of the Board positions.
- The Executive Officers of the Board of Directors will present a slate of nominated candidates to the general membership at least one week prior to the annual meeting.
- At the annual meeting, the President presents the slate of officers, tallies the votes for each officer and announces the newly elected officers.
- Each general member shall be entitled to one vote. No member shall sell his vote for money or anything of value. Upon request of a member, the books or records of membership shall be produced at any regular or special meeting of the Organization. If at any meeting the right of a person to vote is challenged, the presiding officer shall require such books or records to be produced as evidence of the right of the person challenged to vote, and all persons who appear by such books or records to be members entitled to vote, may vote. Upon the termination of a membership, the right of a member to vote, and his/her right, title and interest in or to the Organization or its property, shall cease.
- Voting may be by ballot, mail, electronic or any reasonable means determined by the Executive Officers of the Board of Directors. Elections for Executive Officers of the Board need not be by ballot except upon demand made by a member at the election and before the voting begins.
- In advance of any meeting of members, the Executive Officers of the Board of Directors may appoint judges of election, who need not be members, to act at such meeting or any adjournment thereof. If judges of election are not so appointed, the presiding Executive Officer of any such meeting may, and on the request of any member shall make such appointment at the meeting. The number of judges shall be one or three. No person who is a candidate for Executive Office shall act as a judge.
- If the office of any Board of Director member(s) becomes vacant for any reason, the Executive Officers of the Board may appoint a successor(s), who shall hold office for the unexpired term in which such vacancy occurred.
- Vacancies in the Board of Directors, including vacancies resulting from an increase in the number of Executive Officers, shall be filled by a vote by the majority of the remaining members of the Executive Officers of the Board, though less than a quorum, and each person so elected shall be an Executive Officer until his/her successor is elected by the general membership, who may make such election at the next annual meeting of the general membership.
VII. RELATIONSHIP WITH LOWER MAKEFIELD TOWNSHIP
A. The non-profit Organization of the swim/dive team is not an entity of Lower Makefield Township. The Organization is not appointed nor is it accountable to the Township’s Board of Supervisors. The Township does not pay the Organizations bills, nor does it direct Organization expenditures or coaching decisions. The Organization hires its own Independent Contractor Coaches. Organization revenue does not pass through the Township.
B. To have use of the Township pool, the Organization must submit to the Township the following items/comply with the following conditions:
- The Organization must submit a list of athletes and Lower Bucks Swim League officers no later than June 1st.
- The Organization must submit approval for swim/dive team practice and meet schedules along with any other Organization sponsored events at the pool to the Pool Manager annually, prior to the opening of the pool or during the summer season as schedules change.
- Use of the pool facility by the Organization is subject to availability, as determined and approved by the Pool Manager.
- The Organization must agree to Township rules on the use of the pool facility by non-pool members during Organization events.
- The pool facility is overseen by the Lower Makefield Township Parks & Recreation Board as part of the township’s parks facilities.
- To use the Lower Makefield Township pool, the Organization must comply with the following conditions:
- Submit an insurance policy naming the Township as additional insured and provide policy limits of not less than $1,000,000
- The insurance policy is to cover workers compensation and liability each year.
- The insurance policy is annual and automatically renews every year
- Visiting swim/dive teams that are not members of the Lower Bucks Swim League must provide proof of insurance to the Township at least 5 days prior to any event.
B. Insurance fees for athletes will be determined by the Lower Bucks Swim League and signed waivers will be collected by the LMT Swim and Dive Team annually, from each athlete during registration.
IX. BOOKS & RECORDS
A. The Organization shall keep an original or duplicate record of the proceeding of the Executive Officers and Appointed Officers of the Board of Directors, the original or a copy of its Bylaws, including all amendments thereto to date, certified by the Secretary of the Organization, and an original or a duplicate athlete register, giving the names of the athletes, and showing their respective addresses and other details. The Organization shall also keep appropriate, complete and accurate books or records of account. The records provided for herein shall be kept at either the registered office of the Organization in this Commonwealth, or at its principal place of business, wherever situated and should be retained for a minimum of three years.
B. Every general member shall, upon written demand under oath stating the purpose thereof, have a right to examine, in person or by agent or attorney, the athlete membership registration, books and records of account, and records of the proceedings of the Executive Officers and Appointed Officers of the Board of Directors, and to make copies or extracts. A proper purpose shall mean a purpose reasonably related to the interest of such person as a member. In every instance where an attorney or other agent shall be the person who seeks the right to inspection, a power of attorney or such other writing that authorizes the attorney or other agent to so act on behalf of the member shall accompany the demand under oath. The demand under oath shall be directed to the Organization at its registered office in this Commonwealth or at its principal place of business, wherever situated.
X. TRANSACTION OF BUSINESS
A. Whenever the lawful activities of the Organization involve among other things the charging of fees or prices for its services or products, it shall have the right to receive such income and, in doing so, may make an incidental profit. All such incidental profits shall be applied to the maintenance and operation of the lawful activities of the Organization, and in no case shall be divided or distributed in any manner whatsoever among the general membership or the Officers of the Board of Directors of the Organization.
B. All checks or demands for money and notes of the Organization shall be signed by The President or Treasurer or other Executive Officers as the Board may from time to time designate.
XI. COMMUNICATION TO MEMBERS/ANNUAL REPORT
A. All information is available upon official request and approval from the Executive Officers of the Board of Directors.
A. Whenever written notice is required to be given to any person, it may be given to such person, either personally or by sending a copy thereof by first class mail postage prepaid or by email, to his/her address appearing on the books of the Organization or, in the case of the Board of Directors, supplied by him/her to the Organization for the purpose of notice. If the notice is sent by mail or email, it shall be deemed to have been given to the person entitled thereto when deposited in the US mail or sent via computer. A notice of meeting shall specify the place, day and hour of the meeting and any other information required by statute or these Bylaws. When a special meeting is adjourned it shall not be necessary to give any notice of the adjourned meeting or of the business to be transacted at an adjourned meeting, other than by announcement at the meeting at which such adjournment is taken.
B. Whenever any written notice is required to be given under the provisions of the statute or the Articles or Bylaws of this Organization, a waiver thereof in writing, signed by the person(s) entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice. Except as otherwise required by statute, neither the business to be transacted nor the purpose of a meeting need be specified in the waiver of notice of such meeting. In the case of a special meeting of members, such waiver of notice shall specify the general nature of the business to be transacted. Attendance of a person at any meeting shall constitute a waiver of notice of such meeting, except where a person attends a meeting for the express purpose of objecting at the beginning of the meeting to the transaction of any business because the meeting was not lawfully called or convened.
XIII. MISCELLANEOUS PROVISIONS
A. The fiscal year of the Organization shall begin on the first day of January and end on the last day of December each year.
B. So long as the Organization shall continue to be organized on a non-stock basis, the Executive Officers of the Board of Directors shall have authority to provide for the general membership to make capital contributions in such amounts and upon such terms as are fixed by the directors in accordance with the provisions of section 5541 of the Nonprofit Corporation Law of 1988.
C. The Executive Officers of the Board of Directors, by resolution, may authorize the Organization to accept subventions from members or nonmembers on terms and conditions not inconsistent with the provisions of section 5542 of the Nonprofit Corporation Law of 1988, and to issue certificates therefore.
A. The Organization shall indemnify each of its Board Officers, employees and independent contractors whether or not then in service as such (and his/her executor, administrator and heirs),against all reasonable expenses actually and necessarily incurred by him/her in connection with the defense of any litigation to which the individual may have been a party because he/she is or was a Board Officer, employee or independent contractor of the Organization. The individual shall have no right to reimbursement however, in relation to matters as to which he/she has been adjudged liable to the Organization for negligence or misconduct in the performance of his/her duty as Board Officer, employee or independent contractor by reason of willful misconduct, bad faith, gross negligence or reckless disregard of the duties of his/her office or employment. The right to indemnify for expenses shall also apply to the expenses of suits that are compromised or settled if the court having jurisdiction of the matter shall approve such settlement.
B. The foregoing right of indemnification shall be in addition to, and not exclusive of, all other rights to that which such officers or employees may be entitled.
XV. DISSOLUTION CLAUSE
Lower Makefield Swim Team, Inc. assets are permanently dedicated to exempt purposes. In the event that LMT Swim Team, Inc. is dissolved, after paying or adequately providing for the debts and obligations of the Organization, its assets shall be distributed to a non-profit fund, foundation, or Organization which has established its tax exempt status under section 501©(3) of the Internal Revenue Code, or corresponding section of any future federal tax code, OR its assets shall be distributed to Lower Makefield Township, for a public purpose.
A. Amendments may be proposed by any qualified voting member at any time. Proposed amendments must be submitted in writing to the President who shall present such proposals to the Board of Directors at the next Board meeting.
B. Bylaws may be adopted, amended or repealed by a vote of members present who are entitled to cast at least a majority of the votes at any regular or special meeting convened after notice to the members has been made.
C. The Secretary shall keep the official copy of the Bylaws and all adopted amendments thereto.
Adopted, July 25, 2018
Sandy Borowsky, President Date: 7/25/2018
Prepared by: Sarah Weinstein, Secretary
Conflict of Interest Policy
The following policy has been adopted by resolution of the Board of Directors as of July 27, 2013
Article I: PURPOSE
The purpose of the conflict of interest policy is to protect Lower Makefield Township Swim Team, Incorporated’s (the Organization) interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest of a member of the Board of Directors of the Organization or might result in a possible excess benefit transaction. This policy is intended to supplement but not replace any applicable state and federal laws governing conflict of interest applicable to nonprofit and charitable Organizations.
Article II DEFINITIONS
1. Interested Person
Any director or member of a committee with governing board delegated powers, who has a direct or indirect financial interest, as defined below, is an interested person.
2. Financial Interest
A person has a financial interest if the person has, directly or indirectly, through business,
investment, or family:
a. An ownership or investment interest in any entity with which the Organization has a transaction or arrangement,
b. A compensation arrangement with the Organization or with any entity or individual with which the Organization has a transaction or arrangement, or
c. A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which the Organization is negotiating a transaction or arrangement. Compensation includes direct and indirect remuneration as well as gifts or favors that are not insubstantial.
A financial interest is not necessarily a conflict of interest. Under Article III, Section 2, a person who has a financial interest may have a conflict of interest only if the Board decides that a conflict of interest exists.
Article III PROCEDURES
1. Duty to Disclose
In connection with any actual or possible conflict of interest, an interested person must disclose the existence of the financial interest and be given the opportunity to disclose all material facts to the directors and members of committees with delegated powers considering the proposed transaction or arrangement.
2. Determining Whether a Conflict of Interest Exists
After disclosure of the financial interest and all material facts, and after any discussion with the interested person, he/she shall leave the Board or committee meeting while the determination of a conflict of interest is discussed and voted upon. The remaining Board or committee members shall decide if a conflict of interest exists.
3. Procedures for Addressing the Conflict of Interest
a. An interested person may make a presentation at the Board or committee meeting, but after the presentation, he/she shall leave the meeting during the discussion of, and the vote on, the transaction or arrangement involving the possible conflict of interest.
b. The chairperson of the Board or committee shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.
c. After exercising due diligence, the Board or committee shall determine whether the Organization can obtain with reasonable efforts a more advantageous transaction or arrangement from a person or entity that would not give rise to a conflict of interest.
d. If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the Board or committee shall determine by a majority vote of the disinterested directors whether the transaction or arrangement is in the Organization’s best interest, for its own benefit, and whether it is fair and reasonable. In conformity with the above determination it shall make its decision as to whether to enter into the transaction or arrangement.
4. Violations of the Conflicts of Interest Policy
a. If the governing board or committee has reasonable cause to believe a member has failed to disclose actual or possible conflicts of interest, it shall inform the member of the basis for such belief and afford the member an opportunity to explain the alleged failure to disclose.
b. If, after hearing the member’s response and after making further investigation as warranted by the circumstances, the governing board or committee determines the member has failed to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action.
Article IV RECORDS OF PROCEEDINGS
The minutes of the Board of Directors shall contain:
a. The names of the persons who disclosed or otherwise were found to have a financial interest in connection with an actual or possible conflict of interest, the nature of the financial interest, any action taken to determine whether a conflict of interest was present, and the Board’s or decision as to whether a conflict of interest in fact existed.
b. The names of the persons who were present for discussions and votes relating to the transaction or arrangement, the content of the discussion, including any alternatives to the proposed transaction or arrangement, and a record of any votes taken in connection with the proceedings.
Article V COMPENSATION
a. A voting member of the governing board who receives compensation, directly or indirectly, from the Organization for services is precluded from voting on matters pertaining to that member’s compensation.
b. A voting member of any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Organization for services is precluded from voting on matters pertaining to that member’s compensation.
c. No voting member of the governing board or any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Organization, either individually or collectively, is prohibited from providing information to any committee regarding compensation.
Article VI: ANNUAL STATEMENTS
Each of the elected and appointed members of the Board of Directors shall annually sign a statement that affirms such person:
a. Has received a copy of the conflicts of interest policy,
b. Has read and understands the policy,
c. Has agreed to comply with the policy, and
d. Understands the Organization is charitable and in order to maintain its federal tax exemption it must engage primarily in activities which accomplish one or more of its tax-exempt purposes.
Article VII: PERIODIC REVIEWS
To ensure the Organization operates in a manner consistent with charitable purposes and does not engage in activities that could jeopardize its tax-exempt status, periodic reviews shall be conducted. The periodic reviews shall, at a minimum, include the following subjects:
a. Whether compensation arrangements and benefits are reasonable, based on a reasonable effort, and the result of arm’s length bargaining.
b. Whether partnerships, joint ventures, and arrangements with other Organizations conform to the Organization’s written policies, are properly recorded, reflect reasonable investment or payments for goods and services, further charitable purposes and do not result in inurement, impermissible private benefit or in an excess benefit transaction.
Article VIII: USE OF OUTSIDE EXPERTS
When conducting the periodic reviews as provided for in Article VII, the Organization may, but need not, use outside advisors. If outside experts are used, their use shall not relieve the governing board of its responsibility for ensuring periodic reviews are conducted.