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Subject: Dues for Board Members?
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BradP
(Kansas)

Posts:2640


01/17/2006 6:41 AM  
I had a question for some associations out there, do your board members get free or reduced homeowners dues? Do you apply that to any committee member and are there rules for what determines an active committee member? We are looking at voting on something in April and wanted to see what other associations are doing. Thanks!
RogerB
(Colorado)

Posts:5067


01/17/2006 7:21 AM  
BradP, all owners must pay their assessment in full in accordance with your Declaration and/or bylaws. A committee member is selected in accordance with your bylaws - usually by the board. Those that wish to serve on a committee can volunteer and are usually happily accepted.

Good luck,
RogerB
BradP
(Kansas)

Posts:2640


01/17/2006 9:47 AM  
Roger,

Thanks for the reply. Is it illegal in any state for HOA board members or committee members to receive compensation? We are in Kansas, I have heard of other communities around us that are doing it.

Thanks!
LisaS
(Illinois)

Posts:341


01/17/2006 3:39 PM  
Per our Declaration, if there was a vote by the membership whereby 2/3 agreed that Board members be paid, then we could be paid. In Illinois, it is not 'against the law'.

I am aware of more than one association in Massachusetts where dues are waived in lieu of compensation. Again, it is per their bylaws/declaration. I would guess waiving dues would be preferable do to tax implications for the recipient of compensation and the record keeping for the assocation (W-2's or I-9's).

One theory supporting Board members dues not being waived is the idea that it makes for a more fiscally responsible Board. If the dues are raised for whatever reason (projects/mismanagement/etc), then Board members have to pay more as well. We remind our membership of this when they complain aout dues being raised!! (our dues are not waived as a Board)

Lisa
LindaJ


Posts:0


01/17/2006 10:47 PM  
Our Board members do NOT receive any compensation. We can submit an expense report for reimbursement of association expenses, but we cannot claim out of pocket expenses (time, mileage, etc.) on our state income tax because we are a Non-Profit organization. We are a 100% volunteer Board. We think this works best for us, and keeps everyone free of hidden agendas.
RogerB
(Colorado)

Posts:5067


01/18/2006 9:33 AM  
Where paying board members is allowed by state law, beyond reimbursement for out-of-pocket expenses, I have questions to those who are paying board members.

1) Does your Declaration specifically allow a differential payment rate on assessments?
2) How does your accounting record the income and expenses in accordance with GAPP?
3) Does your HOA insurance cover members who receive payments?
4) Are they classified as employees or independent contractors?
5) If employees, then how do you handle taxes and social security?
6) If independent contractors, are they self insures and are they paying their own social security and taxes?
7) What additional risks do paid board members take on compared to volunteers?

A few things to ponder,
Roger
JohnM3
(Florida)

Posts:288


01/23/2006 10:22 AM  
Florida State law does not allow Board Members to be paid at all period. It is illegal in my opinion it is silly and immoral. Thats why Social Scurity is messed up cause Congress pays nothing into it hense they refuse to fix it. Same holds true for you if you dont pay you dont know how bad it feels or how it affects your life.
Wear the other guys shoes to see how it fits, and feels.
LisaS
(Illinois)

Posts:341


01/23/2006 11:19 AM  
While on some level I agree with John...sometimes it is neccesary. I do not receive any form of compensation. I volunteer because I want to contribute.

But in many communities, that's not the case. It's a thankless job, with long hours and no shortage of hassle or blame. I can understand in the case of some long standing HOA's that some compensation would be offered (not huge $$, small $$)in order to get people involved rather than just hand over everything to a management company and hope they do a great job although they have no stake in the outcome. I guess it's up to the community to decide what is best for their situation. There's lots of pieces of the puzzle to consider.
BrianB
(California)

Posts:2820


01/23/2006 1:00 PM  
OUr CC&R's forbid payment for the normal duties of the board. Board members can be compensated for expenses (travel, postage, etc.), but not for their time as board members.

Our bookkeeper, however, is not a member of the board, and is compensated for her time. Basically, we hire her.
MarshaW


Posts:0


01/23/2006 1:45 PM  
Board members pay the same price as the homeowners do.
JeanneK
(Maryland)

Posts:12


01/23/2006 4:24 PM  
I'm in Maryland and I believe the law is silent on this but most bylaws here state that Board members may not receive compensation for service on the Board.
LisaM
(California)

Posts:2


01/24/2006 5:52 PM  
In California-

Our CC&Rs forbid compensation. In addition, many protections are lost if a director becomes a paid, professional director. To maintain their protections, directors cannot receive compensation for their service on the board.

Volunteer means the rendering of services without compensation.

Compensation means remuneration whether by way of salary, fee, or other consideration for services rendered. Most CC&Rs and Bylaws prohibit the compensation of directors.

Expenses Allowed. Reimbursement of expenses is allowed. Payment of per diem, mileage, or other reimbursement expenses to a director or executive officer does not affect that person's status as a volunteer. Corp. 7231.5(b), CCP 425.15(d), Civ. 1365.7(b)
CharlesW1
(Georgia)

Posts:826


07/14/2006 9:03 AM  
LisaS,

That is one of the best responses I have read thus far. You hit the nail on the head with that one!
I’m new to the discussion board and I’m educating myself about running for our board on the 22nd of July! I see from your posts you are well educated about having a well running BOD. I like your thinking. I too would like to be liked by my neighbors, respected and appreciated as much as possible.

Chuck W.

Charles E. Wafer Jr.
RichardE
(Kansas)

Posts:5


07/16/2006 1:27 PM  
In our addition we do not and will not allow free dues, allow discounts, for services rendered, etc. We will reimburse for money spent to perform the duties of the job, postage, printing, materials for volunteer work such as staining playground equipment etc. We hire out most all necessary services to licensed contractors,lawyers, etc. Also I insist on a paper trail which also involves two signatures on each check.
Just a few comments.

Richard E.
Quail Crossing
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