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AnthonyD3
(Arizona)

Posts:8

03/04/2006 11:45 PM
I think you are missing the point. In as much as it is a point of law, it is the same as why public aervants can't accept gifts people like policemen, aldermen,county clerks,deputies and HOA Board members. It's a matter of ethical behavior and a conflict of interest. It perfectly ok for her to do the accounting and getpaid as long as she resigns from the Board.

BarbaraS
(New Mexico)

Posts:46

03/05/2006 7:44 AM
Thank you Anthony for your reply. Am I to assume that this issue would be regulated state by state? I'm still waiting for someone here to help my find the NM state HOA code. I disagree with this being considered an ethical consideration. We think it would be unethical not to give this retired teacher $60 a month to cover her expenses - if she itemized expenses we're sure they would be at least this much. Her time spent as Treasurer is completely volunteer. We consider her "two hats" completely separated from each other.

AnthonyD3
(Arizona)

Posts:8

03/05/2006 9:01 AM
Barbara, it is very clear that you are sympathetic toweard your treasurer. but the conflict is clearly defined in the fact that paid and volunteer does not peacefully coexist. The ethical delimma is hers in this fact and legal with the board. It is illegal for the Board to pay a Board member. it is a conflict of interest and unethical for a Board member to receive payment for duties. It is permissable for expenses to be paid for on behalf of those duties but not to the tresurer in advance unless it is directly to a company ie Like a check to Kinkos for copies or office Max for cartridges or supplies. But a check should never go to a Board member directly as a payment nor cash be dispensed.It sure will make your HOA a legal and above board organization. it is not required for an Hoa to be INC.

RogerB
(Colorado)

Posts:3726

03/05/2006 9:46 AM
AnthonyD3, according to attornies, in Colorado it is legal to be a board member and to be hired separately as an independent consultant such as a bookkeeper. It is not legal to pay board members for serving on the board. Are you confusing the two? Otherwise what state and statute are you referencing? RogerB

Roger Borcherding Official HOATalk.com Sponsor DARCO Property Management (Colorado) (303) 925-0150 *See legal notice below (end of page) or go to www.hoatalk.com/legal

AudreyB
(Florida)

Posts:104

03/05/2006 1:13 PM
Roger, FL statute 617.0505 says, "Payment of dividends and distribution of income to members prohibited; issuance of certificates of membership; effect of stock issued under prior law." "... and distribution of income to members prohibited..." So, how is it "legal to be a voting board member and to be hired separtely as an independ consultant such as a bookkeeper? Don't you agree there's a conflict of interest here? Secondly, how can attornies consider, it's perfectly legal for a member to wear two hats? In FL there's the ethic and the conflict of interest Anthony speaks about. Most states do not allow a Board member to also be allowed to be paid a salary. I do not have know where Anthony lives. He is right. Audrey

RogerB
(Colorado)

Posts:3726

03/05/2006 4:08 PM
AudreyB, there certainly is an appearance of confilict of interest in hiring a member of the association as a contractor. That is why I stated the procedures the board should follow to maintain "clean hands" and thus reduce the appearance of improper conduct. But keep in mind that in the case we are discussing that the members have agreed thus removing the appearance of impropriety. Nevertheless, if it was me, I would resign from the board to remove any potential appearance of conflict of interest. Do you think the Florida statue you quote precludes hiring a company for which a member is an employe? If so, is the HOA criminating against that company? We all wear at least two hats when we serve on a Board and also work at a day-time job. I think the statue you quoted is to prevent payments to members, other than reimbursements, for serving on the Board or committees as previously discussed. RogerB

Roger Borcherding Official HOATalk.com Sponsor DARCO Property Management (Colorado) (303) 925-0150 *See legal notice below (end of page) or go to www.hoatalk.com/legal

AnthonyD3
(Arizona)

Posts:8

03/05/2006 4:29 PM
Roger I don't think this statute is precluding reimbersements but is is to stop what you mentioned the appearance of impropriety. There is a national HOA association that also helps bring a standard to the different states minor differences. There is a national standard that HOA's must meet and states can be stricter than the national standard but not more lenient. For instance there is a federal housing standard all states can increase its standards and requirements differently however they may not fall below them.

RogerB
(Colorado)

Posts:3726

03/05/2006 4:39 PM
Again Anthony, can you please provide the state and statute to which you keep referring to as "this statute". RogerB

Roger Borcherding Official HOATalk.com Sponsor DARCO Property Management (Colorado) (303) 925-0150 *See legal notice below (end of page) or go to www.hoatalk.com/legal

BarbaraS
(New Mexico)

Posts:46

03/06/2006 7:22 AM
Anthony. Do you have an on-line site where I can get the national HOA standards? I still have no word from my state of NM. B

AudreyB
(Florida)

Posts:104

03/06/2006 10:00 AM
Roger, From the beginning of the subject of the Treasurer being a Board member and also being hired and paid as a Treasurer, has been beaten to death and has about twelve pages worth of wonderful opinions on this subject, that the Treasurer in question should remove themselves from the Board first in order to be hired and paid as Treasurer. The statute I quoted says in my words, a board member may not be compensated for volunteering. There's the conflict of interest as long as this Treasurer who lives in Florida as I do, remains on the Board and being paid is against the statute of Florida law. This volunteer is being illeally paid. This Treasurer who is refusing to resign themselves as a board member, needs to be recalled, and pay back the money they have illegally received to date, back to the HOA. Afterwards,I would hope the HOA would save themselves lots of money and find themselves a new volunteer Treasurer who has no interest in being hired. The answer to your question, do I think the Florida statute I quoted precludes hiring a company for which a member is an employee? To avoid any conflicts or conflicts of interest, in the long run, it makes better business sense for a HOA, and would also be doing themselves a tremoundous favor, to hire a firm other than one the Board member works for. Secondly, it depends on what the company requirements/rules are for having a second job after hours, and whether or not the company rules also includes HOA's. Thirdly, the HOA is under no obligation to hire the entire firm/company the board member works for. To save themselves lots of money, just hire the board member who has to first resign their volunteered position. I do not understand why this volunteer doesn't see they got themselves a raise from receiving nothing to being paid $250 a month. Quit the volunteer position, for the hired position of Treasurer. Make cents (play on spelling) to me. Reminder, my FL HOA amended to illegally compensate our volunteers. So, I have a funny great example: We could not find a volunteer committee member for the illegally paid data entry position. So, the President sent out the message she would be willing to hire any member of the Association for this position, and remembered to mention that they would in no way be a board member. Take care, Audrey

AudreyB
(Florida)

Posts:104

03/08/2006 12:50 PM
Hello Everyone, I have a news flash to the subject of compensating board members. Reminder of my short story: My BOD's illegally amended our articles of incorporation in 2004. Our new HOA attorney states that their amendment is not in compliance with the FL statutes, therefore, this illegal amendment was recently rescinded. This just in today: My new HOA's attorney is in the process of sending out letters, requesting those who received their illegal compensation at our HOA's annual meeting in October 2005, needs to return the amount written on their checks back to our Association immediately. The bottom line is: A volunteer BOD's cannot be compensated in FL. From the beginning of the subject of the Treasurer being paid and remaining on the Board. If a volunteer, who is on the Board wants to be hired, they first have to resign from the Board. No resignation, NO compensation. My FL HOA has now learn a valuable lesson for everyone to learn from, not to repeat their mistake, as well as has set a precedent for BOD volunteers everywhere (I hope) to not ever be compensated. Audrey

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