National EMS Management Association
Adopted November 2008
Article I. Name and Offices
Section 1.01 Charter
(a) The name of the nonprofit corporation is the National EMS Management Association (NEMSMA-hereinafter called the "Association") and is registered in the State of Texas as a not-for-profit agency.
(b) The Association is subject to the limitations for organizations that qualify as exempt organizations under Section 501(c)(3) of the Internal Revenue Service Code and its regulations as they now exist or may hereafter be amended.
Section 1.02 Other Offices
(a) The Association may have offices within or outside of the State of Texas as the Board of Directors may from time to time determine, or that activities of the Association may require.
Article II. Membership
Section 2.01 Definition of Membership
(a) Members shall consist of individuals and organizations that are involved or interested in the management of EMS systems.
(b) Members will be afforded all privileges of the Association, including voting rights, committee membership, election of the Board of Directors, conduct business on behalf of the Association and the right to advise and guide the Association in the conduct of its affairs.
Section 2.02 Application for Membership
(a) The Executive Director processes all applications for membership.
(b) The Executive Director shall review the application and accept or reject it based on eligibility criteria defined above.
(c) Applicants may be rejected for notice of official reprimand, sanction, or other negative action by a local, state or federal regulatory body, unprofessional conduct, or unethical or immoral behavior or other evidence of unprofessional behavior. Application decisions will be made in coordination with the president or his/her designee.
Section 2.03 Appeal
(a) Any applicant denied membership may appeal to the Board of Directors, which shall establish rules governing said appeals in accordance with the tenets of reasonable process. The applicant shall have the right to address the Board of Directors in support of acceptance of the application.
(b) The Board of Directors shall vote on the appeal after receiving comments from all concerned parties. The Board of Directors will review any factual written material presented that has direct bearing on the applicant's request for membership. The Board of Directors decision shall be considered final.
Section 2.04 Revocation of Membership Status
Members who fail to pay dues within sixty (60) days of the payment due date or failure to meet other requirements of memberships as determined by the Board of Directors may have their membership in the Association revoked.
Article III. Dues
Section 3.01 Dues for Association members shall be set by the Board of Directors.
Article IV. Board of Directors
Section 4.01 Management - The Board of Directors shall be vested with the general management and oversight of the Association's affairs. The Board of Directors shall supervise all funds, approve all budgets of the Association, including those of committees, appoint an auditor when deemed necessary, elect the officers, and appoint other officials of the Association.
Section 4.02 Composition - The Board of Directors shall consist of the President, the President-Elect, Immediate Past President, Secretary, Treasurer, and five Directors-At-Large.
Section 4.03 Eligibility - A member of the Board of Directors shall be a full member in good standing of the Association.
Section 4.04 Election of Board Members – An election shall be held during the fourth quarter of the calendar year as necessary to fill vacancies on the Board. A list of nominees shall be compiled from nominations submitted by the membership. The list of nominees shall be distributed by email to the full membership and posted on the NEMSMA Web site. Email or Web-form ballots shall be submitted using a reputable electronic voting system in accordance with a sound election process as determined by the Executive Director in coordination with the Board. The elected candidates shall be determined by those receiving the highest number of votes. In the event of a tie, the membership will be re-balloted by email or Web-form.
Section 4.05 Resignation - A member of the Board of Directors may resign at any time. Such resignation shall be made in writing and shall take effect at the time specified therein. If no time is specified, it shall take effect at the time of receipt by the Secretary. Acceptance of a resignation shall not be necessary to make it effective.
Section 4.06 Terms of Board of Directors
(a) Members of the Board of Directors shall be elected for terms of two (2) years, Each elected member of the Board of Directors may hold office for three (3) full consecutive two (2) year terms or six (6) years and complete their current officer term after which the Director must relinquish membership on the Board for at least one (1) year. Partial terms will not count towards the term limit.
(b) Alternate Terms
(i) The Board reserves the right to adjust terms by one year if needed to address term staggering needs. The length of term will be determined prior to the election and declared when posting for nominees.
(ii) If a director serves an alternate one or three year term, their term limit would not be more or less than the six (6) years of service as described above in 4.06(a).
(c) Directors shall take office on the first day of the month following the conclusion of the election.
Section 4.07 Responsibilities of Members of the Board of Directors
(a) Board Members are expected to attend all regular, electronic and special meetings of the Board of Directors unless permission for absence is requested from and granted by the President. The seat of any Board Member who is absent without prior permission from two (2) consecutive regular or special meetings within two (2) years may be declared vacant by a majority of directors present at any regular meeting of the Board of Directors.
Section 4.08 Removal from Office
(a) The Board of Directors may remove a Board Member or Officer for cause by vote of two-thirds of the Board of Directors then in office, following reasonable notice and a hearing before the Board of Directors. Cause may be defined to include, but shall not be limited to an Officer's or Board Member's failure to attend meetings, fulfill the obligations of office, malfeasance and/or misfeasance of office and lapse of NEMSMA membership. The action of the Board of Directors shall be final. The Board of Directors shall establish procedures to implement this section.
(b) The Board Member or Officer shall be notified, in writing or email, thirty (30) days prior to the intended removal date, and be allowed thirty (30) days from the day the email or letter was sent to respond, in writing or email, to the Board of Directors.
Section 4.09 Vacancies on the Board of Directors - Any vacancy occurring on the Board of Directors, and any Directorship to be filled by reason of an increase in the number of Board Members, will be filled by appointment by the remaining Board Members. The new Board Member appointed to fill the vacancy will serve for the unexpired term of the predecessor in office.
Section 4.10 Regular Directors' Meetings - Regular meetings of the Board of Directors will be held at least once a year at a designated time and location or by conference call or Webcast. Other meetings may be called at the discretion of the Board of Directors.
Section 4.11 Annual Meetings - The Board of Directors must meet at least one (1) time following the close of the fiscal year to receive and accept the annual Financial Report. This is the official Annual Meeting of the Board of Directors.
Section 4.12 Manner of Acting - The Board of Directors of the Association shall be organized and act as follows:
(a) Meetings - Only Board Members who are voting members may vote at Board of Directors meetings. In the event of a tie vote of present Board Members, the President’s vote shall carry the motion.
(b) Presiding - The President shall preside at the meetings and, if not present, the President-Elect or a Board Member designated by the President shall preside.
(c) Place and Notice of Regular Meetings
(i) Written, facsimile transmission or email notice stating the place, day, and hour of any regular meeting of the Board of Directors will be delivered to each Director not less than seven (7) days before the date of the meeting by or at the direction of the President.
(ii) Such notice will be deemed to be delivered when either deposited in the United States mail addressed to the Board Member's address as it appears on the records of this Corporation with postage prepaid or a facsimile confirmation report shows successful transmission to the facsimile number on record for the Board Member or when the electronic mail transmission is time stamped as having been sent to the Board Member's electronic mail address on record. Such notice shall state the business to be transacted or the purpose of the regular meeting.
(i) No fewer than fifty percent (50%) of the members of the Board of Directors, exclusive of proxies as specified in these Bylaws, then in office shall constitute a quorum for the transaction of business. At all meetings of the Board of Directors, the presence of a quorum shall be necessary and sufficient to transact business. If the meeting is taking place by email or web-messaging system, each participating Board member shall post a message to document their participation in the electronic meeting. If a meeting cannot be organized because a quorum has not attended, a majority of the Board of Directors present may adjourn and reschedule the meeting to a time when a quorum as fixed in this section shall be present. Notice of the time and place or electronic method to which such meeting is adjourned shall be given to any Director not present either by mail, email, facsimile, telephone, or personally at least eight (8) hours prior to the hour of reconvening.
(ii) If there is not a quorum, at the request of the President, the Board of Directors may take any action or adopt any resolution by mail, email or facsimile transmission vote under such procedures as may be adopted from time to time by the Board of Directors. Such action of resolution shall be authorized, approved, and adopted upon receiving the affirmative vote of at least a majority of the votes returned to the Board within the time specified in the ballot.
(e) Proxy Voting
(i) All Board Members in order to exercise the privileges of membership at Board of Directors' meetings, must either be present or must submit a proxy to the President or other Board Member who is presiding over the Board meeting. Otherwise, no Board Member may be represented by another person.
(ii) Votes by proxy shall be exercised only by the person specifically designated in the proxy to do so. Proxies shall be in writing or email, state the meeting at which they shall be exercised, by whom they may be exercised, and specify the limitation of the authority they allow through that proxy.
(iii) Proxies shall be signed, in writing or by email address, by the appointing Board Member and filed with the Secretary prior to the date of the meeting, and thereafter entered by the Secretary into the minutes of the meeting. Unless otherwise specified in these Bylaws, decisions of the Board of Directors will be made by a majority of Board Members present and voting either in person or by proxy.
Section 4.13 Call of Special Directors' Meetings - A special meeting of the Board of Directors may be called for by either the President or any officer of the Association. A quorum of the Board of Directors is necessary to conduct business at a special meeting.
Section 4.14 Notice of Special Directors' Meetings
(a) For a special meeting of the Board of Directors, personal, written, email, or facsimile transmission notice stating the place, day, and hour of any special meeting of the Board of Directors will be delivered to each Board member not less that two (2) days before the date of the meeting.
(b) A special meeting of the Board of Directors may be called for by the President or an Officer of the Association. Such notice will be deemed to be delivered when either deposited in the United States mail addressed to the Board Member's address as it appears on the records of this Corporation with postage prepaid or a facsimile confirmation report shows successful transmission to the facsimile number on record for the Board Member or when the email transmission is time stamped as having been sent to the Board Member's electronic mail address on record. Such notice shall state the business to be transacted or the purpose of the regular meeting.
Section 4.15 Waiver of Notice - Attendance of a Board Member at any meeting of the Board of Directors will constitute a waiver of notice of such meeting except where such Board Member attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened.
Section 4.16 Conflict of Interest - Directors must abstain from voting on matters affecting personal gain, gains for family members, or organizations where members of the Board of Directors are employees.
Section 4.17 Rules - The rules contained in the current edition of Robert's Rules of Order shall govern meetings of the Association, the Board of Directors, and any subsidiary bodies in all cases to which they are applicable and in which they are not inconsistent with these bylaws and any special rules of order the Association may adopt.
Section 4.18 Method of Meetings - The Board of Directors authorize the conduct of any meeting in person, by conference call, email, web messaging system or by other methods it deems appropriate.
Article V. Officers of the Association
Section 5.01 Officers of the Association - The Officers of the Association shall consist of the President, President-Elect, Immediate Past President, Secretary and Treasurer.
Section 5.02 Compensation of Board of Directors - No member of the Board of Directors, or the member of any committee of the Association shall be paid any compensation for services as a Board Member or committee member and shall not benefit in any way solely by reason of being a member of said Board of Directors or one of its committees. The Board of Directors may provide reimbursement of reasonable expenses incurred by Board Members or other members in connection with authorized Association business. This shall not exclude compensation paid to the Executive Director or a firm contracted for providing association management services which employs or contracts for the person designated as the Executive Director.
Section 5.03 Terms of Officers - The Officers of the Association shall hold office for two (2) years. Officers may be removed from office by a majority vote of the Board of Directors whenever in the judgment of the Board of Directors, the best interest of the Association will be served. However, such removal will be without prejudice to any constitutional rights of the Officer so removed. Officers shall continue as members of the Board of Directors for the full duration of the term of office, regardless of the date of election to the Board of Directors.
Section 5.04 Succession of Officers – Succession of officers from President-Elect to President, and from President to Immediate Past President, shall be automatic, and no further vote of the Board or the Association is required. A director accepting nomination to the office of President-Elect shall acknowledge his or her intent to serve the full six year succession of offices.
Section 5.05 President
(a) The President shall be an ex-officio member of all committees and shall have the general duties and powers of supervision and management usually vested in the office of President of an Association. The President shall oversee activities of the Executive Director in the routine, day to day business of the Association. The President shall also perform other such duties as may be prescribed from time to time by the Board of Directors.
(b) Powers and Duties of the President - The President shall be the Chief Executive Officer of the Association and shall have the general powers and duties of supervision and management usually vested in the office of the President of a corporation. The President shall preside at all meeting of the members and of the Board of Directors and shall have general supervision, direction and control of all affairs of the Association. Except as the Board of Directors shall otherwise authorize, he or she may execute contracts on behalf of the Association.
(c) The President will serve two (2) additional years as Immediate Past President once their presidency term ends.
Section 5.06 President-Elect
(a) The President-Elect shall be elected by and from the members of the Board of Directors and shall perform the duties and exercise the powers of the President during any absence or disability of the President. The President-Elect shall perform other such duties as may be prescribed from time to time by the Board of Directors.
(b) Powers and Duties of the President-Elect - The President-Elect shall assume all duties and authorities of the President in the President's absence and shall have such powers and duties as may be prescribed by the Board of Directors. The President-Elect shall assume the office of President following the expiration of the President's term or in the event of the President's death, resignation or removal.
(c) The President-Elect will serve four (4) additional years at the conclusion of the President-Elect term; the first two (2) as President and the second two (2) as Immediate Past President.
Section 5.07 Immediate Past President
(a) The Immediate Past President shall help transition the President into their new role. The purpose is to provide consistency and a historical perspective to the President and the Board.
(b) The Immediate Past President will vacate the Board for a minimum of one year following their term if the criterion for term limits has been achieved.
Section 5.08 Secretary
(a) The Secretary shall be elected by and from the members of the Board of Directors and shall record, reproduce, and distribute the minutes of all meetings of the Board of Directors or oversee the activities of the Executive Director in the same. The Secretary shall be the custodian of the Association records, shall give all notices as are required by law or by these Bylaws, and generally, shall perform all duties incident to the office of Secretary and such other duties as may be required by law, by the Articles of Incorporation, or by these Bylaws, or which may be assigned from time to time by the Board of Directors or oversee the activities of the Executive Director in the same.
(b) Powers and Duties of the Secretary - The Secretary shall see that accurate and complete minutes of all meetings of the Board of Directors and of the membership are kept, and send out communications to the membership of the Association as necessary. The Secretary shall determine the presence of a quorum and record votes. Should these tasks be conducted by the Executive Director, the Secretary shall oversee those activities.
(c) A Secretary elected by the Board will serve a two year term as Secretary. Once the Secretary term concludes, the board member must seek re-election by the association body unless elected to the role of President-Elect.
Section 5.09 Treasurer
(a) The Treasurer shall be elected by and from the members of the Board of Directors and shall oversee the financial affairs of the Association. The Treasurer shall perform all duties incident to the office of Treasurer and such other duties as may be required by law, by the Articles of incorporation, or by these Bylaws, or which may be assigned from time to time by the Board of Directors.
(b) Powers and Duties of the Treasurer - The Treasurer shall have or designate the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Association. The Treasurer shall be responsible for the deposit and disbursement of all monies and other valuables in the name and to the credit of the Association in such depositories as may be designated by the Board of Directors. The Treasurer shall render to the President and Board of Directors, whenever requested, an accounting of all transactions and of the financial condition of the corporation. The Treasurer shall provide an annual audit and quarterly report or accounting review to the Board of Directors. The Treasurer may oversee the activities of the Executive Director or another designated agent to perform the listed duties.
(c) A Treasurer elected by the Board will serve a two year term as Treasurer. Once the Treasurer term concludes, the Board member must seek re-election by the association body unless elected to the role of President-Elect.
Article VI. COMMITTEES
Section 6.01 Appointment of Chairpersons and Committee Members
(a) The President, under direction of the Board of Directors, shall establish committees, appoint committee chairs and, in conjunction with the chairs, appoint committee members. Committees shall be established and serve at the pleasure of the Board of Directors and operate under such policies as the Board of Directors may approve.
Section 6.02 Eligibility - Committee Chairs must be members in good standing.
Section 6.03 Appointment - The President, under the direction of the Board of Directors, shall appoint Committee Chairs upon assuming office. The President shall consider the recommendations of all interested parties in appointing Committee Chairpersons. The President may change Committee Chairs at any time. The President also appoints Vice Chairs to Committees to assist with the efforts of the Association.
Section 6.04 Terms - Committee Chairs, Vice Chairs and Committee members shall serve two year terms. Committee Chairs may serve no more than two successive full two-year terms, unless an extension is approved by a simple majority of the Board of Directors.
Section 6.05 Removal - A Committee member, Committee Chair, or Committee Vice Chair may be removed from a committee by the President or Board of Directors at any time. The President, under the direction of the Board of Directors, shall appoint a new Committee Chair in the event of a vacancy.
Section 6.06 President's Council - Each Chair of a Committee shall be a member of the President's Council, by virtue of their appointment as Committee Chair. The President of the Association shall serve as the Chair of the President's Council. The President may appoint Chairs of Ad Hoc Committees to the President's Council. The President's Council will meet when necessary as deemed by the President. The President's Council may join the Board of Directors at their meeting, but shall not be considered voting members. The purpose of the President's Council shall be to promote communication among Committee Chairs and provide a forum for resolution of issues germane to more than one Committee.
Article VII. LIAISONS AND REPRESENTATIVES
Section 7.01 Liaisons - The President may appoint liaisons to other organizations with similar goals and objectives. The Board of Directors shall determine which organizations should have liaisons. Liaisons are sent to meetings of other groups only for the purpose of providing and receiving information, unless additional responsibilities are specifically authorized by the Board of Directors.
Section 7.02 Representatives - Other organizations with an interest in EMS performance and quality and other groups that have been approved vote of the Board of Directors may send representatives to the Board of Directors meetings. The President shall have the power to limit their attendance to specific portions of the meetings. They shall not have a vote in Association affairs.
Article VIII. OPERATIONS AND EXECUTIVE DIRECTOR
Section 8.01 Executive Director - The Board of Directors may hire an Executive Director or contract for association management services that may include Executive Director services.
Section 8.02 Day to Day Operations - Day to day operations of the Association will be managed by the Executive Director with oversight from the President and the Association.
Section 8.03 Fiscal Year - The fiscal year of the Association will begin on July 1 and end on June 30 of each year unless otherwise set by the Board of Directors.
Section 8.04 Execution of Documents
(a) Except as otherwise provided by law, checks, drafts, and promissory notes, orders for the payment of money, and other evidence of indebtedness of the Association shall be signed by the Treasurer and any other Officer of the Association. The Board of Directors may delegate such duties to the Executive Director within prescribed limits on the amount of individual transactions.
(b) Any contracts or other written legal agreements which the Association enters into must be approved by a majority vote of the Board of Directors. The President shall have the power to sign such legal documents as the agent of the Association. The Board of Directors may empower other individuals, including the Executive Director, to sign legal documents as agents of the Association.
(c) Contracts, leases, or other instruments executed in the name of, and on behalf of, the Association will be signed by the Secretary and any other Officer of the Association.
Section 8.05 Books and Records - The Association will keep correct and complete books and records of account, and will also keep minutes of the proceedings of its Boards of Directors. The Association will keep at its registered office a list of all names and addresses of the Board of Directors, and a copy of the Bylaws including amendments to date, certified by the Secretary of the Association.
Article IX. AMENDMENTS TO THE BYLAWS
Section 9.01 Amendments to the Bylaws - These Bylaws may be amended by two-thirds (2/3) vote of the general membership voting upon any presentation of proposed amendments.
Article X. PROHIBITION OF DIVIDENDS
No part of the net earnings of the Association shall inure to the benefit of, or be distributable as dividends or in any other manner, to its members, Officers or other private persons, except that the Association shall be authorized and empowered to pay reasonable compensation for services rendered and to make payment and distributions in furtherance of the purposes set forth in the Articles of Incorporation.
Article XI. FINANCES
Section 11.01 Budget - The Board of Directors shall establish a budget, prepared by the President or designee(s), for each fiscal year and shall operate under generally-accepted accounting principles.
Article XII. NOTICE AND WAIVER OF NOTICE
Section 12.01 Notice
(a) Whenever any notice is required by these Bylaws to be given, personal notice is not required unless expressly so stated, and any such notice shall be deemed to be sufficient if given by mail or telephonic or other written or electronic communication, charges prepaid, addressed to the party entitled thereto at its physical or electronic address as it appears on the records of the Association, and such notice shall be deemed to have been given on the day of such mailing. Members are not entitled to receive notice of any meetings, except as otherwise provided by the Bylaws.
Section 12.02 Waiver of Notice
(a) Whenever any notice is required to be given under the provisions of any law, or under the provisions of the Articles of Incorporation, or under these Bylaws, a waiver thereof in writing by the person or persons entitled to said notice, whether before or after the time stated therein, shall be deemed proper notice.
Article XIII. MISCELLANEOUS PROVISIONS
Section 13.01 Indemnification
(a) The Association will indemnify, every person (and the heirs and personal representatives of such persons) who is or was a Board Member, Officer or agent of the Association against all liability and reasonable expense from any claim, action, suit or proceeding
(i) If such Board Member, Officer or agent is wholly successful with respect thereto or
(ii) if not who live successful, then if such Board Member, Officer or agent is determined to have acted in good faith, in what he/she reasonably believed to be the best interest of the Association, and, in addition, with respect to any criminal action or proceeding is determined not to have had reasonable cause to believe that his/her conduct was unlawful. The termination of any claim, action, suit or proceeding, by judgment, settlement (whether with or without court approval) or dismissal shall not be used to create a presumption that a Board Member, Officer or agent did not meet the standards of conduct set forth in this Section.
(b) The terms claim, action, suit or proceeding shall include any claim, action, suit or proceeding and all appeals thereof (whether brought by or in the right of the Association, any other corporation or otherwise), civil criminal, administrative or investigative, or threat thereof, in which a Board Member, Officer or agent of the Association (or his heirs and personal representatives) may become involved, as a party of otherwise:
(i) by reason of his being or having been a Board Member, Officer or agent of the Association or of any corporation which he/she served as such at the request of the Association, or
(ii) by reason of his acting or having acted in any capacity in a partnership, association, trust or other organization or entity where he/she served as such at the request of the Association, or
(iii) by reason of any action taken or not taken by him in such capacity, whether or not he/she continues in such capacity at the time such liability or expense shall have been incurred. The terms "liability" and "expense" shall include, but shall not be limited to, counsel fees and disbursements and amounts of judgment, fines or penalties against, and amounts paid in settlement by or on behalf of, a Board Member, Officer or agent.
(c) The term 'wholly successful" shall mean
(i) Termination of any action, suit or proceeding against the person in question without any finding of liability or guilt against him/her,
(ii) Approval by a court, or by other means with knowledge or the indemnity herein provided, of a settlement of any action, suit or proceeding, or
(iii) the expiration of a reasonable period of time after the making of any claim or threat of an action, suit or proceeding without the institution of the same, without any prepayment or promise made to induce a settlement.
(d) The rights of indemnification provided in this Section shall be in addition to any rights to which any such Board Member, Officer or agent may otherwise be entitled. Irrespective of the provisions of this Section, the Board of Directors may, at any time and from time to time, approve indemnification of Board Members, Officers or other agent to the full extent permitted by the provisions of Texas law at the time in effect, whether on account of past or future transactions.
(e) Expenses incurred with respect to any claim, action, suit or proceeding may be advanced by the Association (by action of the Board of Directors, whether or not a disinterested quorum exists) prior to the final disposition thereof upon receipt of a written request for same and an undertaking by or on behalf of the recipient to repay such unless he is entitled to indemnification.
Section 13.02 Liability - The Members shall not be liable for the debts of the Association.
Article XIV. TERMINATION OF ASSOCIATION
Section 14.01 Liquidation and Dissolution
(a) The Association may be declared defunct at the discretion of the Board of Directors, by a three-fourths (3/4) majority vote.
(b) The Association shall be a strictly non-profit, non-stock, non-political organization, and no part of the income or assets of the organization shall inure to any Board Member or Officer or member.
(c) Upon the liquidation or dissolution of the Association, the Board of Directors shall, after paying or making provision for the payment of all liabilities of the Association, dispose of all assets, exclusively for the purposes of the Association in such manner, or to such organizations operated exclusively for charitable, educational, or scientific purposes as shall at the time qualify as an exempt organization under Section 501(c)(3) of the Internal Revenue Service Code of 1954 or the corresponding provision of any future United States Internal Revenue Service law.
Section 14.02 Adoption Clause - These bylaws shall constitute the original bylaws of the Association and shall become effective immediately upon their adoption by the Incorporators as required by the general statutes of the Department of State of the State of Texas.
Article XV. Conflicts of Interest
Section 15.01 Purpose - The purpose of the conflict of interest policy is to protect this tax-exempt organization’s (Association) interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest of an officer or director 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.
Section 15.02 Definitions
(a) Interested Person - Any director, principal officer, 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.
(b) Financial Interest
(i) A person has a financial interest if the person has, directly or indirectly, through business, investment, or family:
(ii) An ownership or investment interest in any entity with which the Association has a transaction or arrangement,
(iii) A compensation arrangement with the Association or with any entity or individual with which the Association has a transaction or arrangement, or
(iv) A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which the Association 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 appropriate governing board or committee decides that a conflict of interest exists.
Section 15.03 Procedures
(a) 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 governing board delegated powers considering the proposed transaction or arrangement.
(b) 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 governing 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.
(c) Procedures for Addressing the Conflict of Interest
(i) An interested person may make a presentation at the governing 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.
(ii) The chairperson of the governing board or committee shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.
(iii) After exercising due diligence, the governing board or committee shall determine whether the Association 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.
(iv) If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the governing board or committee shall determine by a majority vote of the disinterested directors whether the transaction or arrangement is in the Association’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.
(d) Violations of the Conflicts of Interest Policy
(i) 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.
(ii) 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.
Section 15.04 Records of Proceedings - The minutes of the governing board and all committees with board delegated powers 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 governing board’s or committee’s 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.
Section 15.05 Compensation
(a) A voting member of the governing board who receives compensation, directly or indirectly, from the Association 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 Association 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 Association, either individually or collectively, is prohibited from providing information to any committee regarding compensation.
Section 15.06 Annual Statements - Each director, principal officer and member of a committee with governing board delegated powers shall annually sign a statement which 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 Association 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.
Section 15.07 Periodic Reviews - To ensure the Association 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 competent survey information and the result of arm’s length bargaining.
(b) Whether partnerships, joint ventures, and arrangements with management organizations conform to the Association’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.
Section 15.08 Use of Outside Experts- When conducting the periodic reviews as provided for in Article VII, the Association 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.