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Non Profits Orgs. & Compensation (Paid Board Members)

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  • Non Profits Orgs. & Compensation (Paid Board Members)

    Since there has been some interesting discussions on non profit organizations I thought the topic of compensation, and any non profit that has board members that receive compensation- might be an additional topic to discuss. Personally, I'm not aware of many myself that do operate with board members receiving compensation. I will also add that my personal feelings are that I'm not entirely against it, provided that it's within reason (in the grand overall scope of the org) and based on performance (like any other 'job'- not sure it that'd be the correct way to put it). I don't believe I've ever read any list anywhere (as it pertains to horse rescue orgs) that details those that do receive compensation.

    ETA: Information on determining whether any org. board member receives compensation can be found by doing a search of the org. on Guidestar (or similar site), pulling up the most recent 990 return.





    Sidenote: My only experience in providing assistance to rescue orgs. are that none (no board members) receive compensation- but that's been my experience.
    Last edited by Marli; Aug. 11, 2009, 09:49 AM. Reason: add'l info


  • #2
    Our bylaws for my org allow our Board members to be reimbursed for educational programs and expenses they occur but no, they are not paid nor are they currently allowed to accept a salary or payment for their services as Board members.

    HOWEVER,

    If any of my Board serves in a professional capacity such as a trainer, therapist etc. I have absolutely no issue whatsoever to include a reasonable salary for their services. The reason for that is that turnover of volunteers is huge in TR, like it is in rescue, and we need to ensure that we always are the very best we can be for our riders and program participants. Since our program will be run 5-6 days a week, 8 hours per day, finding all volunteer professional staff is virtually impossible and because the instructors and therapists are so vital to the program, many will or are serving as board members. Eventually we hope to offer education opportunities and tuition reimbursement as well as access to health care for our staff.

    We are not at that point yet in the program but will be very soon so it is a topic we are also interested in hearing COTH opinions on.
    I Loff My Quarter Horse & I love Fenway Bartholomule cliques

    Just somebody with a positive outlook on life...go ahead...hate me for that.

    Comment


    • #3
      What kind of compensation are we talking about? If we're talking about compensation for professional services (attorney, accountant, whatever) that are outside the scope of being on the BOD, then the organization needs to have a clear conflict of interest policy. This protects the org. from claims (real or imagined) that a BOD member is benefiting from his association with the org. by getting paid an above average amount for his/her service (or good).

      If instead you are talking about paying board members just to sit on the board, you need to be careful. Directors and officers of an nonprofit generally are not paid - unless they also serve was the Exec. Director or in some other category that's outside the scope of their BOD job.

      I hope that all makes sense. It is early and I went for a jog - I may be delirious.
      Visit us at Bluebonnet Equine Humane Society - www.bluebonnetequine.org

      Want to get involved in rescue or start your own? Check out How to Start a Horse Rescue - www.howtostartarescue.com

      Comment

      • Original Poster

        #4
        CowgirlJenn- I think both capacities can have interest for discussion. All aspects, if you follow. You're not delirious!

        Comment


        • #5
          Originally posted by cowgirljenn View Post
          What kind of compensation are we talking about? If we're talking about compensation for professional services (attorney, accountant, whatever) that are outside the scope of being on the BOD, then the organization needs to have a clear conflict of interest policy. This protects the org. from claims (real or imagined) that a BOD member is benefiting from his association with the org. by getting paid an above average amount for his/her service (or good).

          If instead you are talking about paying board members just to sit on the board, you need to be careful. Directors and officers of an nonprofit generally are not paid - unless they also serve was the Exec. Director or in some other category that's outside the scope of their BOD job.

          I hope that all makes sense. It is early and I went for a jog - I may be delirious.
          Exactly what I was getting at Jenn, maybe I should go for a run to clear my head
          I Loff My Quarter Horse & I love Fenway Bartholomule cliques

          Just somebody with a positive outlook on life...go ahead...hate me for that.

          Comment

          • Original Poster

            #6
            Originally posted by equineartworks View Post
            Our bylaws for my org allow our Board members to be reimbursed for educational programs and expenses they occur but no, they are not paid nor are they currently allowed to accept a salary or payment for their services as Board members.

            HOWEVER,

            If any of my Board serves in a professional capacity such as a trainer, therapist etc. I have absolutely no issue whatsoever to include a reasonable salary for their services. The reason for that is that turnover of volunteers is huge in TR, like it is in rescue, and we need to ensure that we always are the very best we can be for our riders and program participants. Since our program will be run 5-6 days a week, 8 hours per day, finding all volunteer professional staff is virtually impossible and because the instructors and therapists are so vital to the program, many will or are serving as board members. Eventually we hope to offer education opportunities and tuition reimbursement as well as access to health care for our staff.

            We are not at that point yet in the program but will be very soon so it is a topic we are also interested in hearing COTH opinions on.
            I believe in this situation, since there is a possibility that goods/services may have the potential to be provided by individuals that may also serve on the board- careful language will need to be used, as Jenn suggested.

            Comment


            • #7
              Well, as a BOD...it seems I pay out, not get paid!!!

              I know we had to be very careful & precise in writing our by laws.
              www.specialhorses.org
              a 501(c)3 organization helping 501(c)3 equine rescues

              Comment


              • #8
                Originally posted by cowgirljenn View Post
                What kind of compensation are we talking about? If we're talking about compensation for professional services (attorney, accountant, whatever) that are outside the scope of being on the BOD, then the organization needs to have a clear conflict of interest policy. This protects the org. from claims (real or imagined) that a BOD member is benefiting from his association with the org. by getting paid an above average amount for his/her service (or good).

                If instead you are talking about paying board members just to sit on the board, you need to be careful. Directors and officers of an nonprofit generally are not paid - unless they also serve was the Exec. Director or in some other category that's outside the scope of their BOD job.

                I hope that all makes sense. It is early and I went for a jog - I may be delirious.
                I have read where the president of the HSUS, a non profit, has a salary of $204,000 and benefits.
                So, I think it is legal to pay non profit employees conducting non profit business.

                It used to be that non profits like the Red Cross board and officers were all volunteers and no one was paid.
                Don't know when that changed.

                The problem with paid work for non profits by anyone volunteering is that there definitively can be conflict of interest and questions how the money coming in as donations is used, if for the cause the non profit handles or to give some enterprising people a way to have a job.

                Comment


                • #9
                  Originally posted by Marli View Post
                  I believe in this situation, since there is a possibility that goods/services may have the potential to be provided by individuals that may also serve on the board- careful language will need to be used, as Jenn suggested.
                  exactly Marli, and it is now and will be as we go forward.

                  Some people however, do have an issue with non-profits paying anyone and I wanted to be sure I stressed why we would need to do that. In our case 90% of the program relies on Physical, Occupational and Speech Therapists and their support staff as well as Child Psychologists and other professionals. Finding medical and mental health professionals willing to cover 40+ hours each week is rough, and because we are a small underserved area already...well, it's vital we do our best to ensure we retain the best staff we can. Our situation is a bit unique...it compares more to a community and human services organization than an equine org. The horses are a huge part of it though!
                  I Loff My Quarter Horse & I love Fenway Bartholomule cliques

                  Just somebody with a positive outlook on life...go ahead...hate me for that.

                  Comment

                  • Original Poster

                    #10
                    Yes, I totally understand and it is reasonable, imo.

                    Comment


                    • #11
                      A BOG member who is paid for professional services isn't unheard of. However, it is fraught with danger. A nonprofit would need to take extraordinary measures to ensure the transaction was at arms length and did not constitute private inurement.

                      Any business or transaction involving a BOG member would be subject to careful examination - and that would be considered perfectly normal.

                      Same issue pertains to a BOG member who received any benefits of any kind from the nonprofit.

                      As far as being paid - a nonprofit run by volunteers is all fine and dandy but if the nonprofit grows to a certain size, paid employees become necessary and legitimate.

                      At the other end of the spectrum is the gigantic Enron type charities that don't really do much but churn money. Extremely well paid employees with tremendous and very generous benefits.
                      Brothers and sisters, I bid you beware
                      Of giving your heart to a dog to tear.
                      -Rudyard Kipling

                      Comment


                      • #12
                        Originally posted by Bluey View Post
                        I have read where the president of the HSUS, a non profit, has a salary of $204,000 and benefits.
                        So, I think it is legal to pay non profit employees conducting non profit business.
                        Paying EMPLOYEES is perfectly normal.

                        But the question was about paying BOARD MEMBERS.

                        I know the board members for CDCTA don't get paid. And I am pretty sure that the board members for USEA and USEF don't get paid. Though they may, in some cases, be reimbursed for travel expenses.
                        Janet

                        chief feeder and mucker for Music, Spy, Belle and Tiara. Someone else is now feeding and mucking for Chief and Brain (both foxhunting now).

                        Comment

                        • Original Poster

                          #13
                          Can anyone give as an example (it is disclosed info on 990's) a horse rescue org. that is not so large (more in comparing apples to apples as opposed to using HSUS that is very large) that has board members that do receive compensation?

                          Comment


                          • #14
                            Originally posted by Bluey View Post
                            I have read where the president of the HSUS, a non profit, has a salary of $204,000 and benefits.
                            So, I think it is legal to pay non profit employees conducting non profit business.
                            Now I have something to aspire to! *grin*

                            More seriously, I think it all depends on how you set it up. And that you are honest about it.

                            So much is expected of nonprofits now that I think it is hard for the larger ones to operate without any paid staff and get stuff done. I'm paid minimum wage (for 40 hours/week, although I work far more than that most weeks) and we now pay a book-keeper (a whopping $100/month and he also will be doing our 990s included in that $1200/year). We just got too big to keep both positions volunteer. AND we're honest about who gets paid and how much. (And both positions are getting below what is comparable in other similar size non-profits and in similar-size corporations).

                            We don't pay our Directors and won't. We would eventually like to pay an admin. assistant and a part-time fundraiser, but those things are both faaaaaaar in the future. We want the bulk of our money going to the horses.
                            Visit us at Bluebonnet Equine Humane Society - www.bluebonnetequine.org

                            Want to get involved in rescue or start your own? Check out How to Start a Horse Rescue - www.howtostartarescue.com

                            Comment


                            • #15
                              Not related to the recent threads - but I have always wondered - how can anyone run a rescue full time and not get paid? Ummmm.. what are they supposed to eat? Donated leather?
                              "Kindness is free" ~ Eurofoal
                              ---
                              The CoTH CYA - please consult w/your veterinarian under any and all circumstances.

                              Comment


                              • #16
                                Originally posted by EqTrainer View Post
                                Not related to the recent threads - but I have always wondered - how can anyone run a rescue full time and not get paid? Ummmm.. what are they supposed to eat? Donated leather?

                                I'll be honest.. in my mind, it IS related to the recent threads.
                                How can someone run a rescue, own a farm, a trailer, truck, involve the whole family in the rescue (husband, children) and not be paid? That's when I am leery of broker prices when (and we have seen this before) it is so easy to tack on an arbitrary amount to said broker price... just wondering!

                                I would accept payment to someone doing the ground work day in and day out and being on the BOD but it has to be clearly stated.

                                Comment


                                • #17
                                  Originally posted by DressageGeek "Ribbon Ho" View Post
                                  Well, as a BOD...it seems I pay out, not get paid!!!

                                  I know we had to be very careful & precise in writing our by laws.
                                  Exactly! Some NFP end up going under because their directors earn nothing and can not even sustain themselves. BOD should be made up of self sufficient people who can take on the responsibilities without needing compensation. That is why it is a charity.

                                  Locally a small rescue went under because the local online horse crowd decided she must take a vow of poverty along with running a 24/7/365 rescue at her own home. Poor dear was ridiculed for even the slightest indulgence - paid for with HER money Not the Rescues of course. It drove her nuts! They would chatter online about a new show halter for her personal horse NOT supported by the rescue. Or even any personal purchase made that was not sack cloth and ashes. It was HORRID! She finally ran out of person cash sold and moved on. The drum beats of the local online crowd are merciless.
                                  "If you don't know where you are going, any road will take you there"

                                  Comment


                                  • #18
                                    Originally posted by Woodland View Post
                                    Exactly! Some NFP end up going under because their directors earn nothing and can not even sustain themselves. BOD should be made up of self sufficient people who can take on the responsibilities without needing compensation. That is why it is a charity.

                                    Locally a small rescue went under because the local online horse crowd decided she must take a vow of poverty along with running a 24/7/365 rescue at her own home. Poor dear was ridiculed for even the slightest indulgence - paid for with HER money Not the Rescues of course. It drove her nuts! They would chatter online about a new show halter for her personal horse NOT supported by the rescue. Or even any personal purchase made that was not sack cloth and ashes. It was HORRID! She finally ran out of person cash sold and moved on. The drum beats of the local online crowd are merciless.
                                    I so understand where you are coming from with this and it is something that we struggled with when it comes to our program here at our farm. You are under a microscope...and that is ok! But there will always be some bitter folks out there that will not even accept thorough online financials. That is a fact of life unfortunately. Lucky for me my newest car is a 1996 and I haven't been on a vacation since my honeymoon nearly 16 years ago

                                    A few years ago I was involved with a TR group. Nice program but lots of drama. But they also had 5 horses in the program but volunteer time and donations went to support the other nine horses the owner of the property had there as well. Since all the horses are on the same property that means the insurance is higher (especially since there was a stallion) along with the other costs such as hay, grain, farrier care, vet care etc. That to me was very wrong. It happens ALL THE TIME though. To make matters worse, volunteer efforts went to a few of the horses that were paying boarders. Not cool. But again, a very common occurrence.
                                    I Loff My Quarter Horse & I love Fenway Bartholomule cliques

                                    Just somebody with a positive outlook on life...go ahead...hate me for that.

                                    Comment


                                    • #19
                                      Originally posted by FalseImpression View Post
                                      I'll be honest.. in my mind, it IS related to the recent threads.
                                      How can someone run a rescue, own a farm, a trailer, truck, involve the whole family in the rescue (husband, children) and not be paid? That's when I am leery of broker prices when (and we have seen this before) it is so easy to tack on an arbitrary amount to said broker price... just wondering!

                                      I would accept payment to someone doing the ground work day in and day out and being on the BOD but it has to be clearly stated.
                                      I think you are missing my point entirely. HOW is someone supposed to work full time running a rescue AND make any money to live on? Is running a rescue only for the independently wealthy? Everyone has to eat.
                                      "Kindness is free" ~ Eurofoal
                                      ---
                                      The CoTH CYA - please consult w/your veterinarian under any and all circumstances.

                                      Comment


                                      • #20
                                        Originally posted by EqTrainer View Post
                                        I think you are missing my point entirely. HOW is someone supposed to work full time running a rescue AND make any money to live on? Is running a rescue only for the independently wealthy? Everyone has to eat.
                                        Somehow they make it work. What got me started was Lori from Sunkissed, after the barn burned down and insurance did not completely cover (of course!) doing foal watch to help meet expenses.This is why it is so critical to have support for fundraisers, because you simply can't do it all.

                                        But it is also why people often get confused between what is the rescue and what is personal...which is why you need to be absolutely transparent.
                                        www.specialhorses.org
                                        a 501(c)3 organization helping 501(c)3 equine rescues

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