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--></style></head><body lang=EN-US link=blue vlink=purple><div class=WordSection1><p class=MsoNormal>I would also recommend you review the attached legislation that is on its way to passage in the current session (would take effect 1/1/20). It overhauls many of the statutes related to nonprofit governance in Oregon and specifically addresses some conflict of interest issues. We will be doing an in-depth review of our bylaws to make sure our governance policies are adequately supported by this legislation, and that they are not in conflict with the new provisions. The new statute may resolve issues such as your question, whether or not your bylaws articulate anything on the subject (in other words, you may not need to address the topic at all in your bylaws). <o:p></o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal>Cheers!<br><br><o:p></o:p></p><table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 align=left style='border-collapse:collapse;margin-left:-2.25pt;margin-right:-2.25pt'><tr style='height:71.5pt'><td width=258 style='width:193.5pt;border:none;border-right:solid windowtext 1.0pt;padding:0in 8.65pt 0in 8.65pt;height:71.5pt'><p class=MsoNormal style='mso-element:frame;mso-element-wrap:around;mso-element-anchor-vertical:paragraph;mso-element-anchor-horizontal:column;mso-height-rule:exactly'><b><span style='font-size:10.5pt;font-family:"Avenir Next",sans-serif;color:windowtext'>W. Darin Rutledge<o:p></o:p></span></b></p><p class=MsoNormal style='mso-element:frame;mso-element-wrap:around;mso-element-anchor-vertical:paragraph;mso-element-anchor-horizontal:column;mso-height-rule:exactly'><span style='font-size:10.5pt;font-family:"Avenir Next",sans-serif'>Executive Director<b><o:p></o:p></b></span></p><p class=MsoNormal style='mso-element:frame;mso-element-wrap:around;mso-element-anchor-vertical:paragraph;mso-element-anchor-horizontal:column;mso-height-rule:exactly'><span style='font-size:10.5pt;font-family:"Avenir Next",sans-serif'>Klamath Falls Downtown Association<o:p></o:p></span></p><p class=MsoNormal style='mso-element:frame;mso-element-wrap:around;mso-element-anchor-vertical:paragraph;mso-element-anchor-horizontal:column;mso-height-rule:exactly'><span style='font-size:10.5pt;font-family:"Avenir Next",sans-serif'><a href="mailto:darin@downtownklamathfalls.org"><span style='color:#0563C1'>darin@downtownklamathfalls.org</span></a><o:p></o:p></span></p><p class=MsoNormal style='mso-element:frame;mso-element-wrap:around;mso-element-anchor-vertical:paragraph;mso-element-anchor-horizontal:column;mso-height-rule:exactly'><span style='font-size:10.5pt;font-family:"Avenir Next",sans-serif'>541.539.6212<b><o:p></o:p></b></span></p></td><td width=222 style='width:166.2pt;padding:0in 8.65pt 0in 8.65pt;height:71.5pt'><p class=MsoNormal style='mso-element:frame;mso-element-wrap:around;mso-element-anchor-vertical:paragraph;mso-element-anchor-horizontal:column;mso-height-rule:exactly'><b><img border=0 width=143 height=86 style='width:1.4895in;height:.8958in' id="Picture_x0020_1" src="cid:image001.png@01D504C9.412B44F0" alt="cid:image001.jpg@01D3D7ED.7D730FB0"></b><span style='font-size:10.5pt;font-family:"Avenir Next",sans-serif'><o:p></o:p></span></p></td></tr></table><p class=MsoNormal><span style='font-size:10.5pt;font-family:"Avenir Next",sans-serif'><o:p> </o:p></span></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><o:p> </o:p></p><div style='border:none;border-top:solid #B5C4DF 1.0pt;padding:3.0pt 0in 0in 0in'><p class=MsoNormal><b><span style='font-size:12.0pt;color:black'>From: </span></b><span style='font-size:12.0pt;color:black'>OMS_MANAGERS <oms_managers-bounces@listsmart.osl.state.or.us> on behalf of Suzanne Wolf <sznnwolf@gmail.com><br><b>Reply-To: </b>Oregon Main Street program managers <oms_managers@listsmart.osl.state.or.us><br><b>Date: </b>Tuesday, May 7, 2019 at 11:26 AM<br><b>To: </b>STUART Sheri * OPRD <Sheri.Stuart@oregon.gov>, Oregon Main Street program managers <oms_managers@listsmart.osl.state.or.us><br><b>Subject: </b>Re: [OMS_MANAGERS] Bylaw Verbiage<o:p></o:p></span></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><div><p class=MsoNormal>Good morning Sheri,<o:p></o:p></p><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal>Thank you for your reply to my email. I’ll take a closer look at the Oregon Nonprofit Corporation Handbook with regard to governance. Meanwhile, would you remind how to send out an email on listserv? I have done it before and in my email addresses I have <a href="mailto:omg_managers-request@listmart.osl.state.or.us">omg_managers-request@listmart.osl.state.or.us</a>; but, I am thinking this is just for you. <o:p></o:p></p><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal><br><br><o:p></o:p></p><blockquote style='margin-top:5.0pt;margin-bottom:5.0pt'><div><p class=MsoNormal>On May 6, 2019, at 2:00 PM, STUART Sheri * OPRD via OMS_MANAGERS <<a href="mailto:oms_managers@listsmart.osl.state.or.us">oms_managers@listsmart.osl.state.or.us</a>> wrote:<o:p></o:p></p></div><p class=MsoNormal><o:p> </o:p></p><div><div><p class=MsoNormal><span style='color:#1F497D'>Hi Suzanne,</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div><div><p class=MsoNormal><span style='color:#1F497D'> </span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div><div><p class=MsoNormal><span style='color:#1F497D'>I think organizations used to have a clause like this in the bylaws before having a conflict of interest policy became standard operating procedures. I am not legal counsel so you might want to get that advice. I did check The Oregon Nonprofit Corporation Handbook and it wasn’t the type of clause they include in their sample. In the handbook, they separate out the two functions of the board – to manage corporate “governance” and to manage corporate “operations.” They recommend bylaws focus on “governance” and leave “management” to the board and administrative policies. That means the bylaws should include how the board functions (how it is selected, how it makes valid decisions, etc., and, with membership organizations, who is a voting member, how members make proper decisions, and what voting rights members have).</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div><div><p class=MsoNormal><span style='color:#1F497D'> </span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div><div><p class=MsoNormal><span style='color:#1F497D'>The other area where compensation might arise is when you applied for 501c3 status. There is a question about compensation of Directors. That’s a little bit different than the question you are posing.</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div><div><p class=MsoNormal><span style='color:#1F497D'> </span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div><div><p class=MsoNormal><span style='color:#1F497D'>Sheri</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div><div><p class=MsoNormal><span style='color:#1F497D'> </span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div><div><div style='border:none;border-top:solid #B5C4DF 1.0pt;padding:3.0pt 0in 0in 0in'><div><p class=MsoNormal><b><span style='font-size:10.0pt;font-family:"Tahoma",sans-serif'>From:</span></b><span class=apple-converted-space><span style='font-size:10.0pt;font-family:"Tahoma",sans-serif'> </span></span><span style='font-size:10.0pt;font-family:"Tahoma",sans-serif'>OMS_MANAGERS [<a href="mailto:oms_managers-bounces@listsmart.osl.state.or.us">mailto:oms_managers-bounces@listsmart.osl.state.or.us</a>]<span class=apple-converted-space> </span><b>On Behalf Of<span class=apple-converted-space> </span></b>Suzanne Wolf<br><b>Sent:</b><span class=apple-converted-space> </span>Tuesday, April 30, 2019 5:28 PM<br><b>To:</b><span class=apple-converted-space> </span>STUART Sheri * OPRD via OMS_MANAGERS<br><b>Subject:</b><span class=apple-converted-space> </span>[OMS_MANAGERS] Bylaw Verbiage</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div></div></div><div><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Times New Roman",serif'> <o:p></o:p></span></p></div><div><div><div><div><div><div><div><p class=MsoNormal><span style='font-size:13.5pt;font-family:"Times New Roman",serif'>Hello everyone!</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div><div><div><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Times New Roman",serif'> <o:p></o:p></span></p></div></div><div><div><p class=MsoNormal><span style='font-size:13.5pt;font-family:"Times New Roman",serif'>Our Board is currently reviewing our bylaws and would appreciate your feedback regarding verbiage about our investment powers.</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div></div><div><div><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Times New Roman",serif'> <o:p></o:p></span></p></div></div><div><div><p class=MsoNormal><span style='font-size:13.5pt;font-family:"Times New Roman",serif'>In our bylaws, Article IV; B states, “HDOG may invest either monetary or service assets for the furtherance of HDOG. No portion of the assets, either monetary or service, will be used for the benefit of any HDOG personnel or affiliate for personal gains.” </span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div></div><div><div><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Times New Roman",serif'> <o:p></o:p></span></p></div></div><div><div><p class=MsoNormal><span style='font-size:13.5pt;font-family:"Times New Roman",serif'>A discussion occurred about the second sentence. In the event of a conflict of interest, does the language of our bylaws reflect a transaction (regarding the organization’s funds and activities) that clearly is in the best interest of the charity rather than private interest? Should the second sentence be omitted? In other words, under certain circumstances (for example; monies from a grant), conflict situations are acceptable in which a charitable organization’s personnel and affiliates who are business/property owners do privately benefit. Should a subsection of this article be added that specifically addresses Board members who are business/property owners? If so, any suggestions? Is the action of recusing one’s self from discussing and voting on such matters the only option for Board members who are business/property owners? </span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div></div><div><div><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Times New Roman",serif'> <o:p></o:p></span></p></div></div><div><div><p class=MsoNormal><span style='font-size:13.5pt;font-family:"Times New Roman",serif'>Thank you for your consideration!</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div></div><div><div><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Times New Roman",serif'> <o:p></o:p></span></p></div></div><div><div><p class=MsoNormal><span style='font-size:13.5pt;font-family:"Times New Roman",serif'>Suzanne Wolf, Secretary</span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div></div><div><div><p class=MsoNormal><span style='font-size:13.5pt;font-family:"Times New Roman",serif'>Historic Downtown Oak Grove (HDOG) </span><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p></o:p></span></p></div></div></div></div></div></div></div></div></div></blockquote></div><p class=MsoNormal><o:p> </o:p></p></div></div></div></div></body></html>