BYLAWS OF LOWER POLK COMMUNITY BENEFIT DISTRICT,
A California Nonprofit Public Benefit Corporation
The name of this corporation is Lower Polk Community Benefit District.
A. Principal Office of the Corporation
The corporation’s board of directors (the “board”) will fix the location of the principal executive office of the corporation at any place within the State of California.
B. Other Offices of the Corporation
The board may at any time establish branch or subordinate offices at any place or places where this corporation is qualified to conduct its activities.
The purpose of this corporation shall be to promote social welfare and community enhancement in the San Francisco Lower Polk neighborhood through the development and operation of a community benefit district and other programs and initiatives. The goals of the Corporation include:
- • Developing clean and safe places to gather and congregate, including public or open
- Ensuring that the neighborhood is welcoming to diverse populations and reflects a mix of businesses that offer goods and services that meet the needs of the residents of the neighborhood;
- Promoting art and culture;
- Ensuring that there is a vibrant and viable neighborhood commercial district with flourishing small businesses and a community-friendly atmosphere;
- Ensuring that the neighborhood appearance reflects the local history and culture;
- Developing community-based partnerships to address issues and serve as stewards for change;
- Promoting sensitive treatment and dealings with people in need or with psychological challenges;
- Capitalizing on distinct architectural and street design to promote interesting experiences and qualities;
- Encouraging California Pacific Medical Center to provide access to quality medical care to the residents of the neighborhood; use local businesses for services and goods; and hire local residents; and
- Utilizing funding from California Pacific Medical Center for capital projects focusing on neighborhood and community safety, health, and cleanliness issues and events (such as farmer’s markets and block parties), and for streets and alleys improvements within the neighborhood.
CONSTRUCTION AND DEFINITIONS
Unless the context requires otherwise, the general provisions, rules of construction, and definitions in the California Nonprofit Corporation Law shall govern the construction of these bylaws. Without limiting the generality of the preceding sentence, the singular includes the plural, the plural includes the singular, and the term “person’ includes both a legal entity and a natural person.
DEDICATION OF ASSETS
This corporation’s assets are irrevocably dedicated to charitable and public purposes. No part of the net earnings, properties, or assets of the corporation, on dissolution or otherwise, shall inure to the benefit of any private person or individual, or to any director or officer of the corporation. On liquidation or dissolution, all properties and assets remaining after payment, or provision for payment, of all debts and liabilities of the corporation shall be distributed to a nonprofit fund, foundation, or corporation that is organized and operated exclusively for charitable purposes and that has established its exempt status under Internal Revenue Code Section 501(c)(3).
This corporation shall have no voting members within the meaning of the California Nonprofit Corporation Law. The board may, in its discretion, admit individuals to one or more classes of nonvoting members, which class or classes shall have such rights and obligations as the board may determine.
This corporation may refer to persons or entities associated with it as “members,” but no such reference shall constitute anyone as a voting member within the meaning of California Nonprofit Corporation Law.
Subject to the provisions and limitations of the California Nonprofit Public Benefit Corporation Law and any other applicable laws, the corporation’s activities and affairs shall be managed, and all corporate powers shall be exercised, by or under the direction of the board.
B. Number of and Qualifications for Directors
The board shall consist of 11 directors as follows: (a) 6 Property Owner Directors, no more than half of whom shall represent a publicly owned property (where, for clarity, property owned by a nonprofit organization shall not be considered publicly owned), (b)3 Business Owner Directors and (c) 2. At Large Directors.
For purposes of these bylaws:
- “Property Owner Director” means a director who is an owner, or an authorized representative of an owner, of a property subject to the Lower Polk Community Benefit District assessment (“Assessment”), but excluding any owner, or authorized representative of any owner, of a property subject to the Assessment that is more than thirty (30) days past due in remittance of the Assessment.
- “Business Owner Director means a director who is (a) an owner, or an authorized representative of an owner, of a for profit business that is a tenant within the Assessment boundaries and (b) not an owner, or an authorized representative of an owner, of a property Subject to the Assessment.
- “At Large Director” means a director who is either (a)(i) an authorized representative of a nonprofit organization that is a tenant within the Assessment boundaries and (ii) not an owner, or an authorized representative of an owner, of a property subject to the Assessment or (b) an at-large representative of the Lower Polk community.
No more than 49 percent of the persons serving on the board may be “interested persons.” An interested person is (1) any person compensated by the corporation for services rendered to it within the previous 12 months, whether as a full-time or part-time employee, independent contractor, or otherwise, excluding any reasonable compensation paid to a director as director, and (2) any brother, sister, ancestor, descendant, spouse, brother-in-law, sister-in-law, son-inlaw, daughter-in-law, mother-in-law, or father-in-law of such person. However, any violation of this paragraph shall not affect the validity or enforceability of transactions entered into by the corporation.
C. Terms of Office and Election
The initial directors shall be appointed by the incorporator of the corporation (or, to the extent not appointed by the incorporator of the corporation, the board). The board shall divide the initial directors into three groups of approximately equal number. The directors in the first group shall hold office for a term of one (1) year, the directors in the second group shall hold office for a term of two (2) years and the directors in the third group shall hold office for a term of three (3) years, in each case until a successor director has been elected and qualified.
Subject to the preceding paragraph, directors shall be elected by the board at a regular meeting, and each director shall hold office for a term of three (3) years and until a successor director has been elected and qualified; provided, however, that a director elected to fill a vacancy on the board shall serve for the remainder of the term of his or her predecessor. Directors shall be eligible for re-election without limitation on the number of terms they may serve provided they continue to meet the qualifications requirements contained in Section VII(B).
D. Events Causing Vacancies on Board
A vacancy or vacancies on the board shall occur in the event of (1) a death, removal, or resignation of any director, or (2) a declaration by resolution of the board of a vacancy in the office of a director who has been convicted of a felony, declared of unsound mind by a court order, or found by final order or judgment of any court to have breached a duty under California Nonprofit Public Benefit Corporation Law, Chapter 2, Article 3.
E. Resignation of Directors
Any director may resign by giving written notice to the president or the secretary of the board. The resignation shall be effective when the notice is given unless it specifies a later time for the resignation to become effective. Unless otherwise specified in the notice, the resignation need not be accepted to be effective. If a director’s resignation is effective at a later time, the board may elect a successor to take office as of the date when the resignation becomes effective.
F. Removal of Directors
Any director may be removed, with or without cause, by the vote of two-thirds of the directors then in office at a special meeting called for that purpose, or at a regular meeting, provided that notice of that meeting and of the removal questions are given as provided herein. A Property Owner Director shall be deemed automatically removed (without requirement of any board vote) if he or she is an owner, or an authorized representative of an owner, of a property subject to the ASSessment that is more than thirty (30) days past due in remittance of the Assessment. Any vacancy caused by the removal of a director shall be filled as provided in Section VII(G).
G. Filling of Vacancies
Vacancies on the board may be filled by approval of the board or, if the number of directors then in office is less than a quorum, by (1) the affirmative vote of a majority of the directors then in office at a meeting held according to notice or waivers of notice complying with these bylaws, or (2) a sole remaining director.
H. No Vacancy on Reduction of Number of Directors
Any reduction of the authorized number of directors shall not result in any director being removed before his or her term of office expires.
I. Brown Act
The corporation shall comply with the requirements of the Ralph M. Brown Act.
J. Place of Board Meetings
Meetings of the board shall be held at any place within the boundaries of the Lower Polk Community Benefit District that has been designated by resolution of the board. Meetings may be held outside of the boundaries of the Lower Polk Community Benefit District (including by teleconference) only in accordance with the Ralph M. Brown Act.
If, because of fire, flood, earthquake, or other emergency, it would be unsafe to meet in the customary location, the meetings may be held for the duration of the emergency at some other place specified by the presiding officer of the board or his or her designee. The change of meeting site shall be announced, by the most rapid means of communication available at the time, in a notice to media organizations who have requested written notice of meetings.
K. Regular Meetings
The board shall establish by formal action the time and place for holding regular meetings and shall conduct Such regular meetings in accordance with Such resolution.
An agenda shall be prepared for all regular board meetings. The agenda shall contain a brief, general description of each item of business to be transacted or discussed during the meeting, specify the time and location of the meeting and be posted at least 72 hours before the meeting in a location that is freely accessible to members of the public and on the corporations website, if it has one.
The agenda shall include information regarding how, to whom, and when a request for disability related modification or accommodation, including auxiliary aids or services, may be made by a person with a disability who requires a modification or accommodation in order to participate in the meeting.
The agenda shall provide an opportunity for members of the public to address the board on any item of interest to the public, before or during the board’s consideration of the item, that is within the corporation’s subject matter jurisdiction, provided that no action shall be taken on any item not appearing on the agenda unless otherwise authorized by applicable law.
Any person who requests a copy of the agenda, or a copy of all the documents constituting the agenda packet, for any regular board meeting in writing must be mailed a copy of the requested materials at the time that the agenda is posted or upon distribution to all, or a majority of all, of the members of the board, whichever occurs first. Any request for mailed copies of agendas or agenda packets shall be valid for the calendar year in which it is filed, and must be renewed following January 1 of each year. The board may establish a fee for mailing the agenda or agenda packet, which fee shall not exceed the cost of providing the service. If requested, the agenda and documents in the agenda packet shall be made available in appropriate alternative formats to persons with a disability.
L. Special Meetings
Special meetings of the board for any purpose may be called at any time by the president or by a majority of the directors then in office.
Notice of the time and place of special meetings shall be given to each director by (1) personal delivery of written notice; (2) first-class mail, postage prepaid; (3) telephone, including a voice messaging System or other System or technology designed to record and communicate messages, or by electronic transmission, either directly to the director or to a person at the directors office who would reasonably be expected to communicate that notice promptly to the director; (4) facsimile; (5) electronic mail; or (6) other electronic means. All such notices shall be given or sent to the director’s address or telephone number as shown on the corporation’s records.
Notices sent to directors by first-class mail shall be deposited in the United States mails at least four days before the time set for the meeting. Notices given to directors by personal delivery, telephone, or electronic transmission shall be delivered, telephoned, or sent, respectively, at least 48 hours before the time set for the meeting.
The public shall be given notice of a special meeting as follows: at least 24 hours before the time of the special meeting, (1) written notice of the special meeting shall be delivered to each local newspaper of general circulation and radio or television station requesting notice in writing, and (2) notice of the special meeting shall be posted in a location that is freely accessible to members of the public and on the corporation’s website, if it has one. Such notice shall specify the time and place of the special meeting and the business to be transacted or discussed, and no other business shall be considered at the special meeting.
Every notice for a special meeting shall provide an opportunity for members of the public to directly address the board concerning any item that has been described in the notice for the meeting before or during consideration of that item.
M. Designated Public Meetings
To the extent required by any agreement between the corporation and the City and County of San Francisco (or any subdivision thereof), the corporation shall comply with the provisions of Section 12L of the San Francisco Administrative Code. Without limiting the foregoing, to the extent required by any agreement between the corporation and the City and County of San Francisco (or any subdivision thereof):
- the board shall designate at least two meetings of the board (regular or special) per year as designated public meetings in accordance with Section 12L of the San Francisco Administrative Code. Issues addressed by the board at designated public meetings shall be of approximately the same general nature and significance to the corporation as issues typically addressed by the board at its other regular or special meetings;
- at at least one designated public meeting per year, the public shall have an opportunity to address the board on membership on the board and to propose candidates for membership on the board;
- at every designated public meeting, the public shall have an opportunity to directly address the board on any item of interest to the public relating to the operations of or services provided by the corporation; at any designated public meeting, the board may adopt reasonable regulations to insure that the intent of Section 12L of the San Francisco Administrative Code is carried out, provided that the board allows for at least 30 minutes of public comment at each designated public meeting, the corporation shall provide the public with notice of each designated public meeting at least 30 days in advance of the meeting;
- the board shall cause a written notice of the date, time and location of each designated public meeting to be submitted to the Clerk of the Board of Supervisors (who shall post the written notice where notices of meetings of the Board of Supervisors are posted) and to the San Francisco Main Library Government Information Center (which shall post the written notice where notices of meetings of City boards and commissions are posted). In addition, upon inquiry by a member of the public, the corporation shall disclose the date, time and location of the designated public meeting.
N. Quorum and Action by the Board
A majority of the authorized number of directors shall constitute a quorum for the transaction of any business except adjournment. Except as otherwise provided in these bylaws or required by law (including with respect to certain transactions with respect to which a director has a material financial interest), every action taken or decision made by a majority of the directors present at a duly held meeting at which a quorum is present shall be an act of the board. A meeting at which a quorum is initially present may continue to transact business, despite the withdrawal of some directors from that meeting, if any action taken or decision made is approved by at least a majority of the required quorum for that meeting.
No action shall be taken by secret ballot.
O. Waiver of Notice
Notice of a meeting need not be given to any director who, either before or after the meeting, signs a waiver of notice, a written consent to the holding of the meeting, or an approval of the minutes of the meeting. The waiver of notice or consent need not specify the purpose of the meeting. All such waivers, consents, and approvals shall be filed with the corporate records or made a part of the minutes of the meetings. Notice of a meeting need not be given to any director who attends the meeting and who, before or at the beginning of the meeting, does not protest the lack of notice to him or her.
P. Prohibition on Prerequisites for Attendance at Meetings
A member of the public shall not be required, as a condition to attendance at a meeting of the board, to register his or her name, to provide other information, to complete a questionnaire, or otherwise to fulfill any condition precedent to his or her attendance. If an attendance list, register, questionnaire, or other similar document is posted at or near the entrance to the room where the meeting is to be held, or is circulated to the persons present during the meeting, it shall state clearly that the signing, registering, or completion of the document is voluntary, and that all persons may attend the meeting regardless of whether a person signs, registers, or completes the document.
A majority of the directors present, whether or not a quorum is present, may adjourn any meeting to another time and place.
A written notice of the adjournment shall be given in the same manner as for special meetings. A copy of the notice of adjournment shall be conspicuously posted on or near the door of the place where the meeting was held within 24 hours after the time of the adjournment.
R. Recordings and Broadcastings
Any person attending a board meeting shall have the right to record the meeting with an audio or video recorder or a still or motion picture camera in the absence of a reasonable finding by the board that the recording cannot continue without noise, illumination, or obstruction of view that constitutes, or would constitute, a persistent disruption of the proceedings.
Any audio or video recording of board meeting made for whatever purpose by or at the direction of the board shall be subject to inspection pursuant to the California Public Records Act
but may be erased or destroyed 30 days after the recording. Any inspection of an audio or video recording shall be provided without charge on equipment made available by the board.
The board shall not prohibit or otherwise restrict the broadcast of its meetings in the absence of a reasonable finding that the broadcast cannot be accomplished without noise, illumination, or obstruction of view that would constitute a persistent disruption of the proceedings.
S. Emergency Meetings
The board may take action on items not appearing on a posted agenda only if (1) a majority of the board determines that the matter is an emergency (i.e. a crippling disaster or other activity exists which severely impairs public health, safety or both), (2) two-thirds of the members of board present at the meeting, or, ifless than two-thirds of the members are present, a unanimous vote of those present, determine that there is a need to take immediate action which came to the attention of the board after the agenda was posted, or (3) the item was properly posted for a prior meeting of the board occurring not more than five calendar days prior to the date action is taken on the item, and at the prior meeting the item was continued to the meeting at which action is being taken. In any such case, prior to discussing the item, the board shall publicly identify the item. –
In the case of an emergency situation involving matters upon which prompt action is necessary due to the disruption or threatened disruption of public facilities, the board may hold an
emergency meeting without complying with the notice requirements herein. However, each local newspaper of general circulation and radio or television station that has requested notice of special meetings shall be notified by the presiding officer or designee thereof one hour prior to the emergency meeting, or, in the case of a dire emergency (a crippling disaster, mass destruction, terrorist act, or threatened terrorist activity that poses peril so immediate and significant that requiring the board to provide one-hour notice before holding an emergency meeting may endanger the public health, safety, or both, as determined by a majority of the members of the board), at or near the time that the presiding officer or designee notifies the members of the board of the emergency meeting. This notice shall be given by telephone. In the event that telephone services are not functioning, the notice requirements of this Section shall be deemed waived, and the board or its designee shall notify those newspapers, radio stations, or television stations of the fact of the holding of the emergency meeting, the purpose of the meeting, and any action taken at the meeting as soon after the meeting as possible.
During a meeting held pursuant to the immediately preceding paragraph, the board may meet in closed session if agreed to by a two-thirds vote of the members of the board present, or, if less than two-thirds of the members are present, by a unanimous vote of the members present. The minutes of a meeting held pursuant to the immediately preceding paragraph, a list of persons who the presiding officer or designee of the board notified or attempted to notify, a copy of the roll call vote, and any actions taken at the meeting shall be posted for a minimum of 10 days in a public place as soon after the meeting as possible.
T. Compensation and Reimbursement
Directors shall serve in such capacity without compensation except that they shall be allowed reasonable advancement or reimbursement of expenses incurred in the performance of their regular duties as directors. Directors shall not be compensated for rendering services to the corporation in any capacity other than as a director unless such compensation is reasonable. Any payments to directors shall be approved in advance in accordance with this corporation’s conflict of interest policy, as set forth in Article XIV of these bylaws.
A. Creation and Powers of Committees
The board may create ad hoc advisory committees. These committees shall not have any authority of the board and shall be serve a purely advisory purpose. Such committees:
- Shall be composed of less than a quorum of the board;
- May include non-board members
- Shall have a finite charge and be required to report back to the board within a specific
- period of time of less than a year,
- Shall establish their own meeting schedule (i.e. the schedule is not established by the
- board); and
- Shall have no decision making authority or continuing subject matter jurisdiction.
B. Meetings and Action of Committees
Meetings and actions of ad hoc advisory committees shall not be subject to the provisions of these bylaws regarding meeting notice and other requirements for meetings.
A. Offices Held
The officers of this corporation shall be a president, a secretary, and a chief financial officer (treasurer). The corporation, at the board’s discretion, may also have a vice president and such other officers as the board may determine.
Any number of offices may be held by the same person, except that neither the secretary nor the chief financial officer may serve concurrently as the president.
B. Election of Officers
The officers of this corporation shall be chosen by the board and shall serve at the pleasure of the board, Subject to the rights of any officer under any employment contract. All officers shall be directors.
C. Removal of Officers
Without prejudice to the rights of any officer under an employment contract, the board may remove any officer with or without cause.
D. Resignation of Officers
Any officer may resign at any time by giving written notice to the board. The resignation shall take effect on the date the notice is received or at any later time specified in the notice. Unless otherwise specified in the notice, the resignation need not be accepted to be effective. Any resignation shall be without prejudice to any rights of the corporation under any contract to which the officer is a party.
E. Vacancies in Office
A vacancy in any office because of death, resignation, removal, disqualification, or any other cause shall be filled in the manner prescribed in these bylaws for normal appointments to that office, provided, however, that vacancies need not be filled on an annual basis.
The president shall preside at all board meetings. The president shall have such other powers and duties as the board or the bylaws may provide.
G. Vice President
If the president is absent or disabled, the vice president, if there is one, shall perform all duties of the president. When so acting, the vice president shall have all powers of and be subject to all restrictions on the president. The vice president, if there is one, shall have such other powers and perform such other duties as the board or the bylaws may provide.
The secretary shall keep or cause to be kept, at the corporation’s principal office or such other place as the board may direct, a book of minutes of all meetings, proceedings, and actions of the
The secretary shall keep or cause to be kept, at the corporation’s principal office, a copy of the articles of incorporation and bylaws, as amended to date.
The secretary shall give, or cause to be given, notice of all meetings of the board that these bylaws require to be given. The secretary shall have such other powers and perform such other duties as the board or the bylaws may provide.
I. Chief Financial Officer
The chief financial officer shall keep and maintain, or cause to be kept and maintained, adequate and correct books and accounts of the corporation’s properties and transactions. The chief financial officer shall send or cause to be given to the directors Such financial statements and reports as are required to be given by law, by these bylaws, or by the board. The books of account shall be open to inspection by any director at all reasonable times.
The chief financial officer shall (i) deposit, or cause to be deposited, all money and other valuables in the name and to the credit of the corporation with such depositories as the board may designate; (ii) disburse the corporation’s funds as the board may order; (iii) render to the president and the board, when requested, an account of all transactions as chief financial officer and of the financial condition of the corporation; and (iv) have such other powers and perform such other duties as the board or the bylaws may provide.
The chief financial officer shall be the treasurer of the corporation.
EXECUTION OF INSTRUMENTS, DEPOSITS, AND FUNDS
A. Execution of Instruments
The board, except as otherwise provided in these bylaws, may by resolution authorize any officer or agent of the corporation to enter into any contract or execute and deliver any instrument in the name of and on behalf of the corporation, and such authority may be general or confined to specific instances. Unless so authorized, no officer, agent, or employee shall have any power or authority to bind the corporation by any contract or engagement or to pledge its
credit or to render it liable monetarily for any purpose or in any amount.
B. Checks and Notes
Except as otherwise specifically determined by resolution of the board, or as otherwise required by law, (i) checks, drafts, promissory notes, orders for the payment of money, and other evidence of indebtedness of the corporation greater than $2,500 shall be signed by both the president and the chief financial officer, and (ii) checks, drafts, promissory notes, orders for the payment of money, and other evidence of indebtedness of the corporation less than or equal to $2,500 may be signed by either the president or the chief financial officer (or, to the extent authorized by the president or the chief financial officer, any person serving as executive director of the corporation).
C. Fiscal Year
The fiscal year of the corporation shall end on December 31 of each year.
INDEMNIFICATION AND INSURANCE
To the fullest extent permitted by law, this corporation shall indemnify its directors, officers, employees, and other persons described in Section 5238(a) of the California Nonprofit Corporation Law, including persons formerly occupying any Such positions, against all “expenses” (as defined in such Section), judgments, fines, settlements, and other amounts actually and reasonably incurred by them in connection with any “proceeding” (as defined in Section), and including an action by or in the right of the corporation, by reason of the fact that the person is or was a person described in such Section.
This corporation shall have the right, and shall use its best efforts, to purchase and maintain insurance to the full extent permitted by law on behalf of its officers, directors, employees, and other agents, to cover any liability asserted against or incurred by any officer, director, employee, or agent in Such capacity or arising from the officers, directors, employee’s, or agent’s status as Such.
CORPORATE RECORDS: REPORTS
A. Maintenance of Corporate Records
This corporation shall keep the following:
(1) adequate and correct books and records of account; and
(2) minutes of the proceedings of its board.
The minutes and other books and records shall be kept either in written form or in any other form capable of being converted into clearly legible tangible form or in any combination of the two.
B. Directors’ Right to Inspect
Every director shall have the absolute right at any reasonable time to inspect the corporation’s books, records, documents of every kind, physical properties, and the records of each subsidiary. The inspection may be made in person or by the director’s agent or attorney. The right of inspection includes the right to copy and make extracts of documents.
C. Annual Report for Directors
The corporation shall cause an annual report to be sent to the directors. The report and any accompanying material may be sent by electronic transmission. The report shall contain in appropriate detail the following:
(a) The assets and liabilities, including the trust funds, of the corporation as of the end of the fiscal year.
(b) The principal changes in assets and liabilities, including trust funds, during the fiscal year.
(c) The revenue or receipts of the corporation, both unrestricted and restricted to particular purposes, for the fiscal year.
(d) The expenses or disbursements of the corporation, for both general and restricted purposes, during the fiscal year.
(e) A brief description of any transactions involving more than S50,000 (or any transaction which was one of a number of transactions involving the same person which transactions in the aggregate involved more than $50,000) or indemnifications or advances aggregating more than $10,000 in which the corporation or its subsidiary was a party, and in which any director or officer of the corporation or subsidiary, or any holder of more than 10 percent of the voting power of the corporation or its subsidiary, had a direct or indirect material financial interest. The description shall include the names of the interested persons involved in such transactions, such persons relationship to the corporation, the nature of such persons interest in the transaction, and, where practicable, the amount of such interest, provided, that in the case of a transaction with a partnership of which such person is a partner, only the interest of the partnership need be Stated.
The report shall be accompanied by any report thereon of independent accountants, or, if there is no such report, the certificate of an authorized officer of the corporation that such statements were prepared without audit from the books and records of the corporation.
D. Annual Report under Property and Business Improvement District Law of 1994
The corporation shall cause to be prepared, in accordance with Section 36650 of the Streets and Highways Code, a report for each fiscal year, except the first year, for which the Assessment is levied and collected. The report shall be filed with the clerk and shall refer to the Lower Polk Community Benefit District by name, specify the fiscal year to which the report applies, and, with respect to that fiscal year, shall contain all of the following information:
(1) Any proposed changes in the boundaries of the Lower Polk Community Benefit District or in any benefit zones or classification of property or businesses within the Lower Polk Community Benefit District.
(2) The improvements and activities to be provided for that fiscal year.
(3) An estimate of the cost of providing the improvements and the activities for that fiscal year.
(4) The method and basis of levying the Assessment in sufficient detail to allow each real property or business owner, as appropriate, to estimate the amount of the Assessment to be levied against his or her property or business for that fiscal year.
(5) The amount of any surplus or deficit revenues to be carried over from a previous fiscal year.
(6) The amount of any contributions to be made from sources other than the Assessment.
E. Financial Packet under Section 12L-5(a) of the San Francisco Adminstrative Code
To the extent required by any agreement between the corporation and the City and County of San Francisco (or any Subdivision thereof), members of the public, upon giving ten days’ notice to the corporation, shall be entitled to inspect a packet of financial information, as described in Section 12L.5(a) of the San Francisco Administrative Code, during the corporation’s regular business hours or to receive a copy of such packet of information for which the corporation may recover from the member of the public the corporation’s direct costs of duplication.
AMENDMENT OF BYLAWS
These bylaws may be amended or repealed and new bylaws adopted by the vote of two-third of the directors then in office at any meeting of the board, provided that notice of such action has been sent to all directors in accordance with the notice requirements contained herein.
CONFLICT OF INTEREST AND COMPENSATION APPROVAL POLICES
A. Purpose of Conflict of Interest Policy
The purpose of this conflict of interest policy is to protect this tax-exempt corporation’s interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest of an officer or director of the corporation or any “disqualified person” as defined in Section 4958(f)(1) of the Internal Revenue Code and as amplified by Section 53.4958-3 of the IRS Regulations and which might result in a possible “excess benefit transaction” as defined in Section 4958(c)(1)(A) of the Internal Revenue Code and as amplified by Section 53.4958 of the IRS Regulations. 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.
(1) Interested Person.
Any director, principal officer, member of a committee with governing board delegated powers, or any other person who is a “disqualified person” as defined in Section 4958(f)(1) of the
Internal Revenue Code and as amplified by Section 53.4958-3 of the IRS Regulations, who has a director indirect financial interest, as defined below, is an interested person.
(2) Financial Interest.
A person has a financial interest if the person has, directly or indirectly, through business, investment, or family:
(a) an ownership or investment interest in any entity with which the corporation has a transaction or arrangement,
(b) a compensation arrangement with the corporation or with any entity or individual with which the corporation has a transaction or arrangement, or
(c) a potential ownership or investment interest in, or compensation arrangement With, any entity or individual with which the corporation 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 Section C, paragraph (2) below, 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.
C. Conflict of Interest Avoidance Procedures
(1) 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.
(2) Determining Whether a Conflict of Interest Exists.
After disclosure of the financial interest and all material facts, and after any discussion involving the interested person, the interested person 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.
(3) Procedures for Addressing the Conflict of Interest.
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.
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. After exercising due diligence, the governing board or committee shall determine whether the corporation 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.
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 corporation’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.
(4) Violations of the Conflicts of Interest Policy.
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.
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.
D. Records of Board and Board Committee Proceedings
The minutes of meetings of the governing board and all committees with board delegated powers shall contain:
(1) 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; and
(2) 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.
E. Compensation Approval Policies
A voting member of the governing board who receives compensation, directly or indirectly, from the corporation for services is precluded from voting on matters pertaining to that member’s compensation.
A voting member of any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the corporation for services is precluded from voting on matters pertaining to that members compensation.
No voting member of the governing board or any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the corporation, either individually or collectively, is prohibited from providing information to any committee regarding compensation.
When approving compensation for directors, officers, employees and contractors, and any other compensation contract or arrangement, in addition to complying with the conflict of interest requirements set forth in this Article, the board or a duly constituted compensation committee of the board shall also comply with the following additional requirements and procedures:
(1) the terms of compensation shall be approved by the board or compensation committee prior to the first payment of compensation;
(2) all members of the board or compensation committee who approve compensation arrangements must not have a conflict of interest with respect to the compensation arrangement as specified in IRS Regulation Section 53.4958-6(c)(iii), which generally requires that each board member or committee member approving a compensation arrangement between this corporation and a “disqualified person’ (as defined in Section 4958(f)(1) of the Internal Revenue Code and as amplified by Section 53.4958-3 of the IRS Regulations):
(a) is not the person who is the Subject of the compensation arrangement, or a family member of such person;
(b) is not in an employment relationship subject to the direction or control of the person who is the subject of the compensation arrangement;
(c) does not receive compensation or other payments subject to approval by the person who is the subject of the compensation arrangement,
(d) has no material financial interest affected by the compensation arrangement, and
(e) does not approve a transaction providing economic benefits to the person who is the subject of the compensation arrangement, who in turn has approved or will approve a transaction providing benefits to the board or committee member,
(3) the board or compensation committee shall obtain and rely upon appropriate data as to comparability prior to approving the terms of compensation, where appropriate data may include the following:
(a) compensation levels paid by similarly situated organizations, both taxable and tax-exempt, for functionally comparable positions, where “similarly situated” organizations are those of a similar size and purpose and with similar resources;
(b) the availability of similar services in the geographic area of this corporation;
(c) current compensation Surveys compiled by independent firms; and
(d) actual written offers from similar institutions competing for the services of the person who is the subject of the compensation arrangement.
As allowed by IRS Regulation 4958-6, if this corporation has average annual gross receipts (including contributions) for its three prior tax years of less than $1 million, the board or compensation committee will have obtained and relied upon appropriate data as to comparability if it obtains and relies upon data on compensation paid by three comparable organizations in the same or similar communities for similar services; and
(4) the terms of compensation and the basis for approving them shall be recorded in written minutes of the meeting of the board or compensation committee that approved the compensation; such documentation shall include:
(a) the terms of the compensation arrangement and the date it was approved;
(b) the members of the board or compensation committee who were present during debate on the transaction, those who voted on it, and the votes cast by each board or committee member;
(c) the comparability data obtained and relied upon and how the data was obtained;
(d) if the board or compensation committee determines that reasonable compensation for a specific position in this corporation or for providing services under any other compensation arrangement with this corporation is higher or lower than the range of comparability data obtained, the board or committee shall record in the minutes of the meeting the basis for its determination;
(e) if the board or committee makes adjustments to comparability data due to geographic area or other specific conditions, these adjustments and the reasons for them shall be recorded in the minutes of the board or committee meeting,
(f) any actions taken with respect to determining if a board or committee member had a conflict of interest with respect to the compensation arrangement, and if so, actions taken to make sure the member with the conflict of interest did not affect or participate in the approval of the transaction (for example, a notation in the records that after a finding of conflict of interest by a member, the member with the conflict of interest was asked to, and did, leave the meeting prior to a discussion of the compensation arrangement and a taking of the votes to approve the arrangement);
(g) the minutes of board or committee meetings at which compensation arrangements are approved must be prepared before the later of the date of the next board or committee meeting or 60 days after the final actions of the board or committee are taken with respect to the approval of the compensation arrangements. The minutes must be reviewed and approved by the board and committee as reasonable, accurate, and complete within a reasonable period thereafter, normally prior to or at the next board or committee meeting following final action on the arrangement by the board or committee.
F. 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:
(1) has received a copy of the conflicts of interest policy,
(2) has read and understands the policy,
(3) has agreed to comply with the policy, and
(4) understands the corporation 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.
G. Periodic Reviews
To ensure the corporation 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:
(1) whether compensation arrangements and benefits are reasonable, based on competent Survey information, and the result of arms-length bargaining; and
(2) Whether partnerships, joint ventures, and arrangements with management organizations conform to the corporation’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.
H. Use of Outside Advisors
When conducting the periodic reviews as provided for in Section G, the corporation may, but need not, use outside advisors. If outside advisors are used, their use shall not relieve the governing board of its responsibility for ensuring periodic reviews are conducted.