Info Bytes 06.30.22
CIC Info Bytes are frequent, succinct updates that provide educational and engagement opportunities to help your community thrive!
This week’s CIC Info Bytes is a brief retrospective on the first half of 2022. We’ve published 24 weekly CIC Info Bytes and 7 original blog articles since January 1, 2022. In addition to a boatload of content, we have continued to add structure, new features and graphics to both CIC Info Bytes and Condo Connection to help you linger longer and visit more often. We hope you’ll enjoy the new email format applied going forward.
Just like Condo Connection, CIC Info Bytes is 100% volunteer based. In order to remain a neutral, trustworthy source of information, Condo Connection does not accept monetary contributions for advertisements or product promotions. We eschew most direct requests, but if you and your community have benefitted from the information you receive, please consider supporting Condo Connection. We’ve published several resources that can add immediate value to your community.
In closing, please have a wonderful Independence Day weekend!
Take the 2022 RESERVE QUESTIONNAIRE
As always, YOUR participation is key! Please grab your favorite beverage, get comfy and relax your way into this ~15 minute survey.
Full results will be published the first week of August! View results from 2021
A Board in Washington State voted to pay themselves $25 per person, per meeting
Compensation for directors of nonprofit corporations in WA State is specifically permitted by RCW 24.03A.160 and RCW 24.03A.545, but the ramifications of doing so could impact D&O coverage
D&O policies are either geared toward uncompensated volunteers OR paid directors
Double-check your declaration, bylaws and articles of incorporation. If you find no compensation prohibition in those documents, and your community is incorporated in WA State, the law is clear that compensation is specifically allowed by the Nonprofit Corporation Act (RCW 24.03A). The Nonprofit Miscellaneous and Mutual Corporations Act is relatively silent re: compensation other than to say determining compensation is a power of the organization.
As always, being reasonable is required. Just because most CICs do not compensate their volunteer directors does not mean that it is unreasonable for Jere's community to do so. Is $25 per meeting, per director, a reasonable sum of money? How many meetings are scheduled per year? If you divide out the hours involved, and consider the dozens of hours some volunteers provide every month, it probably comes out to $1/hr or less.
Volunteer directors in Washington State have a duty of ordinary and reasonable care which is not synonymous with a fiduciary duty. You might also enjoy reading To Pay or Not to Pay: Compensating Nonprofit Directors and Officers written by a law firm in Illinois.
We asked this question to an insurance broker (HUB). Here's the response from a leading D&O carrier:
First, most governing documents do not authorize Director or Officer compensation. Second, all volunteer immunity statutes I am aware of refer to non-compensated. By definition, a volunteer is not compensated. Third, paid directors and officers do not qualify for our program as it is susceptible to conflicts of interest and the appearance of impropriety. I am not aware of any other programs that would allow compensated D&Os. Fourth, if you pay, it will not be long before you pay all. Also, how would compensation be determined? Also, they would be considered and have WC (workers compensation) consequences and corresponding issues with employment liability issues.
CIC Volunteer Feat of the Week
Paper records you say? Volunteer Carolyn from the great state of Illinois has a solution for your community. Over the course of several years, Carolyn scanned, indexed and de-duped all the paper records from four associations dating back to the 1970’s. In addition, she created a spreadsheet-based ledger to capture decades of decisions. What a feat!
Click here to submit a volunteer feat to be featured in an upcoming CIC Info Bytes!
CIC State Statute Database Project
We need YOUR help to create a comprehensive CIC state statute database
Please email us if you're interested !
+++ Have a question that you'd like to ask directly to your peers? Ask YOUR listserv! +++
Homeowners | Volunteer Leaders | Managers & Management Companies | Vendors
A Note About Ukraine
The people of Ukraine are undergoing tremendous displacement from their homes coupled with loss of life, tragedy and suffering. You can pledge to support the people of Ukraine in 30 seconds and learn more about ways to provide direct support to organizations making a difference there.
>> Condo Connection is completely free to view 24/7/365 <<
Click here to learn how you can support homeowner-centric information and resources for common interest communities (CICs).
Take action to support value-added alternatives to CAI that prioritize the interests of CICs and their homeowners.