Understanding New Mexico Elks Association Duties
Explore the distinct roles of the Board of Directors and the Governing Body within the New Mexico Elks Association, considering legal implications and recent resolutions from the Grand Lodge. Learn about the complexities of aligning with corporate laws and enjoying historical insights into officer designations.
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New Mexico Elks Association Training Committee 3/16/2025 New Mexico Elks Association 1
Chair Officers and Trustees 3/16/2025 New Mexico Elks Association 2
The duties of the Board of Directors (Lodge) and the duties of the Governing Body (Club) are separate and distinct and should not be confused. G.L. Statutes Section 12.070, Opinion 5. 3/16/2025 New Mexico Elks Association 3
Keep these simple rules in mind: The BOD discusses the same things that the Trustees did. There s just more people. The Governing Body is the same as the old House Committee. 3/16/2025 New Mexico Elks Association 4
Why dont we just keep the Trustees duties the same and call them the Board of Directors? Didn t a recent resolution pass at Grand Lodge allowing us to do that? 3/16/2025 New Mexico Elks Association 5
Well, this gets complicated. We need to look at both the Grand Lodge Statutes and New Mexico (and Texas) non-profit corporate regulations The governing Grand Lodge Statute is 16.020, the New Mexico code is 53-8-17, and the corresponding Texas code is 22.201. Lets look at each citation. 3/16/2025 New Mexico Elks Association 6
As it was: An incorporated Lodge shall make provision for a Board of Directors which shall be designated in accordance with the requirements of the corporation laws of the State or Territory in which such Lodge is situated and which shall be composed of the four Chair Officers of the Lodge and the Trustees, and which shall be vested with the powers and duties conferred upon the Board of Trustees by the Laws of the Order, including, but not limited to, Section 12.070. 3/16/2025 New Mexico Elks Association 7
As it is now: The Officers and Committees of all Lodges, whether incorporated or not, shall be designated by the same names or titles and shall possess the same functions and powers, as now obtain, or as may from time to time be provided by the Grand Lodge. The Chief or Presiding Officer of such corporation shall be the Exalted Ruler of the Lodge and shall be designated as such in the corporation and all other Officers of the corporation shall be the respective Officers of the Lodge and shall be known by their respective Lodge titles. All Lodge Members in good standing shall be members of the corporation. An incorporated Lodge may make provision for a Board of Directors which shall be designated in accordance with the requirements of the corporation laws of the State or Territory in which such Lodge is situated and which shall be composed of the four Chair Officers of the Lodge and the Trustees, and which shall be vested with the powers and duties conferred upon the Board of Trustees by the Laws of the Order, including, but not limited to, Section 12.070. Note that the language changes the shall to may allowing either, but does not change the definition of the composition of the Board of Directors of an Elks Lodge. 3/16/2025 New Mexico Elks Association 8
The New Mexico Law reads: 53-8-17. Board of directors. The affairs of a corporation shall be managed by a board of directors. Directors need not be residents of New Mexico or members of the corporation unless the articles of incorporation or the bylaws so require. The articles of incorporation or the bylaws may prescribe other qualifications for directors. 53-8-18. Number and election of directors. A. The number of directors of a corporation shall be not less than three. Subject to that limitation, the number of directors shall be fixed by, or determined in the manner provided in, the articles of incorporation or the bylaws. The number of directors may be increased or decreased from time to time by amendment to, or in the manner provided in, the articles of incorporation or the bylaws, unless the articles of incorporation provide that a change in the number of directors shall be made only by amendment of the articles of incorporation. No decrease in number shall have the effect of shortening the term of any incumbent director. If the number of directors is not fixed by, or determined in a manner provided in, the articles of incorporation or the bylaws, the number shall be the same as that stated in the articles of incorporation. B. The directors constituting the first board of directors shall be named in the articles of incorporation and shall hold office until the first annual election of directors or for such other period as may be specified in the articles of incorporation or the bylaws. Thereafter, directors shall be elected or appointed in the manner and for the terms provided in the articles of incorporation or the bylaws. In the absence of a provision fixing the term of office, the term of office of a director shall be one year. C. Directors may be divided into classes and the terms of office of the several classes need not be uniform. Each director shall hold office for the term for which he is elected or appointed and until his successor is elected or appointed and qualified. D. A director may be removed from office pursuant to any procedure provided in the articles of incorporation or the bylaws 3/16/2025 New Mexico Elks Association 9
Heres the Texas equivalent: Sec.A22.201.AAMANAGEMENT BY BOARD OF DIRECTORS. Except as provided by Section 22.202, the affairs of a corporation are managed by a board of directors. The board of directors may be designated by any name appropriate to the customs, usages, or tenets of the corporation. Sec.A22.202. MANAGEMENT BY MEMBERS. (a) The certificate of formation of a corporation may vest the management of the affairs of the corporation in the members of the corporation. If the corporation has a board of directors, the corporation may limit the authority of the board to the extent provided by the certificate of formation or bylaws. (b)A corporation is considered to have vested the management of the corporation s affairs in the board of directors of the corporation in the absence of a provision to the contrary in the certificate of formation, unless the corporation is a church organized and operating under a congregational system that: (1) was incorporated before January 1, 1994; and (2) has the management of its affairs vested in the corporation s members. 3/16/2025 New Mexico Elks Association 10
Both States require nonprofit corporations to be managed by a Board of Directors , and both allow the flexibility of the corporation to define the composition of the Board. This may sound like the Lodge can define the Board to be the Trustees, but the Grand Lodge Statutes Section 16.020 comes into play by defining the Board of Directors of an Elks Lodge: a Board of Directors which shall be designated in accordance with the requirements of the corporation laws of the State or Territory in which such Lodge is situated and which shall be composed of the four Chair Officers of the Lodge and the Trustees, and which shall be vested with the powers and duties conferred upon the Board of Trustees by the Laws of the Order, including, but not limited to, Section 12.070. 3/16/2025 New Mexico Elks Association 11
In New Mexico and Texas, the combination of Grand Lodge Statutes and state law define our requirements . As a result, New Mexico and Texas Elks Lodges must: Have a Board of Directors That Board must consist of: The four chair officers The Trustees Think of it as strategy and tactics: The chair officers provide the day to day tactics The Trustees provide the long term strategy Together they provide a balanced approach to Lodge management 3/16/2025 New Mexico Elks Association 12
Whew! Lets look at what their supposed to do 3/16/2025 New Mexico Elks Association 13
What about Resolution 2018-3 which allows Lodges with a Board of Directors to assign the duty to manage the club to the Board of Directors as the Governing Body? Doesn t that mean one Board can cover both at the same meeting? No 3/16/2025 New Mexico Elks Association 14
Section 16.020 defines the makeup of the Board of Directors, and that definition is: The Board shall consist of the four Chair Officers and the Trustees. Section 16.040 gives several options for the makeup of the Governing Body, one of which is: The Exalted Ruler, Esteemed Leading Knight, Esteemed Loyal Knight, Esteemed Lecturing Knight and the Trustee of the Lodge. Look Familiar? 3/16/2025 New Mexico Elks Association 15
So, incorporated Lodges in NM and TX (all of them) have already had the same personnel serving in both capacities. The resolution doesn t change a thing.While the faces may be the same, the duties are not. Section 12.070, Opinion 5 makes this clear: 05 The duties of the Board of the Lodge and its duties as the House Committee are separate and distinct and should not be confused. When sitting as a House Committee they operate the Club and hear complaints for violations of House Rules. The Board has control of Lodge property and supervises all attendant problems thereto. 3/16/2025 New Mexico Elks Association 16
Resolution 2018.3 has no effect on Board of Directors or Governing Body operating requirements of NM or TX Lodges. 1. Separate meetings are required for each Board, with separate minutes for each meeting. 2. Each Board must meet monthly, and report to the Lodge at a regular Lodge meeting each month. 3. 3/16/2025 New Mexico Elks Association 17
3/16/2025 New Mexico Elks Association 18
12.070 Remember: The Board of Directors is at all times subject to the control and direction of the Lodge (GLS Sec. 12.070, Opinion 1 ) The Lodge is the supreme power and the Board of Directors are but agents of the Lodge. The Lodge may provide that a special committee take over a function customarily performed by the Board of Directors. 3/16/2025 New Mexico Elks Association 19
12.070 The Board shall have a Chairman and Secretary, elected by the Board from its membership immediately following the annual installation. The Board shall reorganize upon the resignation of its Chairman and the election of his successor. The Chairperson for the Board must attend the Clinics of the DDGER for the District unless excused for good cause. The Chairperson of the Board has the same responsibilities as the Chairperson of the Trustees did. The Chairperson of the Trustees position no longer exists. 3/16/2025 New Mexico Elks Association 20
The Exalted Ruler, Leading Knight, Loyal Knight, and Lecturing Knight are Members of the Board. They shall be given the same notice of all meetings of the Board, and in the same manner, as is given to the other members of the Board. 3/16/2025 New Mexico Elks Association 21
The Board must meet at least once every month and keep accurate minutes of each meeting. The Board shall hold at least one regular meeting each month and needed special meetings called by the Chair. While ordinarily the Board holds open meetings, closed meetings are sometimes necessary to allow more free discussions. The Lodge can require the production and reading of the minutes of the meetings. 3/16/2025 New Mexico Elks Association 22
Controls the funds, investments and real and personal property of the Lodge, not otherwise provided by law and collect the income and rents there from. Is responsible for the physical plant, building, real and personal property, plumbing, repairs, insurance and decorating. Must maintain a proper system to keep account of the Lodge property in its custody(GLS Sec. 12.070 (10) ). 3/16/2025 New Mexico Elks Association 23
Is responsible for handling investment of Lodge funds, but are subject to the control and direction of the Lodge with respect to the manner and term of such investments. Investments are to be in the name of the Lodge, not in the name of the Board. (GLS Sec. 12.070 (15) ) Must maintain a record of investments made under the direction of the Lodge. 3/16/2025 New Mexico Elks Association 24
DOES NOT hold monies collected from interest, dividend or rents. These are Lodge funds to be turned over to the Secretary unless otherwise provided by By-law or specific direction of the Lodge. Hold Bonds of Officers Record of such should be noted in the minutes of the Board. Execute all leases contracts or other papers when ordered by the Lodge. 3/16/2025 New Mexico Elks Association 25
Establish an Accident Prevention Program with one member of the Board designated as chairperson. Purchase all supplies required by the Lodge. Recommend (Not Order) the Payment/Non-Payment of Bills. Board may recommend payment of Lodge bills, but cannot order payment or sign checks to pay bills. The recommendations of the Board are NOT binding upon the Lodge. Recommendations must be presented in writing at the next regular Lodge meeting. 3/16/2025 New Mexico Elks Association 26
Present a segregated budget to the Lodge not later than the final regular meeting in April. In Lodges where a Budget Committee is required by By-law, the budget shall be prepared by that committee. The Lodge may instruct the Board or Budget Committee as to items to be included in the budget. Establish appropriate controls to ensure expenditures are within budget. Unexpended balances in the budgeted items go back to the general fund at the end of the Lodge year and are available for appropriation the following year. 3/16/2025 New Mexico Elks Association 27
A proposal to expend funds in excess of the budget appropriation must be referred to the Board of Directors for consideration and recommendation. It may then be adopted by not less than a 2/3 vote of members present in a regular meeting. The Lodge is not obligated to observe the Board of Directors recommendation, although it is generally prudent to do so. Appropriations set forth in a budget do not authorize expenditure of funds until the Lodge passes a specific motion authorizing same. 3/16/2025 New Mexico Elks Association 28
It is a violation of the Laws of the Order for Board to set up their own budget to cover rents and income from investments without Lodge approval, and to disburse funds there from by checks signed by the Board Secretary only, and to refuse to handle and disburse these funds under Lodge control and through the Lodge Treasurer. 3/16/2025 New Mexico Elks Association 29
Report Activities to the Lodge The Board of Directors shall present a written report of its transactions to the Lodge, at the first regular meeting each month. The Board shall present a written summary report to the Lodge semi- annually The books and records of the Board of Directors are subject to audit by the Lodge Auditing Committee. 3/16/2025 New Mexico Elks Association 30
It is incumbent upon the Lodge, Board of Directors and the Governing Body to recognize the responsibility to comply with the provisions of GLS, Sec. 16.050 . A Lodge, Corporation, Club, Social Parlor or other facility under the control of the Lodge must obtain a Permit from the Board of Grand Trustees before it can: Purchase property exceeding $25,000 cost Make alterations where cost exceeds $25,000 Contract for service or equipment where total cost exceeds $25,000 A contract may be entered into subject to the approval of the Lodge and of the Board of Grand Trustees. 3/16/2025 New Mexico Elks Association 31
Statutory Restrictions contd: Acquire property by lease for a period of one year, or more Lease its property to others for a period of five (5) years, or more Construct a new facility building or otherwise Sell, exchange or give away real property Incur or refinance a debt involving a mortgage Borrow money for any purpose. 3/16/2025 New Mexico Elks Association 32
If in doubt, ask for advice from your Area Special Representative through your District Deputy. Application forms are available from the office of the Grand Secretary. Completed form packages are to be sent to your District Deputy (or, if your Lodge is working with a Special Representative, to him/her), who will review them and forward them to the Area Special Representative. Do not send forms directly to the Board of Grand Trustees or anyone else. Be sure forms are complete, are properly signed and bear the Lodge Seal. Submit application forms well in advance. 3/16/2025 New Mexico Elks Association 33
Minutes of last meeting Budget performance analysis Treasure report on funds, investments Old Business New Business Potential investments Out-of-budget fund requests Any property, building issues Close 3/16/2025 New Mexico Elks Association 34
Also referred to as the Board of Governors, Supervising and Managing Body or House Committee 3/16/2025 New Mexico Elks Association 35
The Governing Body must take one of the following forms and the manner selected must be specified in the By-Laws. (GLS Sec. 16.040) The Exalted Ruler, Leading, Loyal, Lecturing Knights and Trustees. In this configuration, the Exalted Ruler is the Chair. The Trustees of the Lodge A House Committee Not fewer than three nor more than thirteen members The exact number must be set forth in the By-Laws Appointed by the Exalted Ruler 3/16/2025 New Mexico Elks Association 36
The Lodge may, if it chooses, form a separate corporation (GLS, Sec. 16.030) This corporation is subject to Same Statutory Provisions as any Other Form of Governing Body. 3/16/2025 New Mexico Elks Association 37
The Governing Body is at all times subject to the control and direction of the Lodge except: in those actions and decisions pertaining to an employment relationship Pricing of goods and services No member of the Governing Body shall be employed in any capacity by the Governing Body; nor shall any Exalted Ruler be employed by a House Committee appointed by him. 3/16/2025 New Mexico Elks Association 38
The Governing Body must meet monthly The Governing Body must submit monthly written reports to the Lodge detailing the financial condition of the Club and the condition of the budget. The copies should remain in the Secretary s file. Minutes of meeting of the Governing Body are subject to review and inspection by the DDGER during his/her official visitation 3/16/2025 New Mexico Elks Association 39
The books and records of the Governing Body are subject to audit by the Lodge Auditing Committee and neither the Governing Body nor the Board of Directors is authorized to employ its own accountant. 3/16/2025 New Mexico Elks Association 40
Keep Record of Receipts and Expenses Funds derived from Club operation are Lodge funds. Receipts shall be turned over to the Lodge Secretary and bills incurred shall be paid by the Lodge Treasurer on vouchers approved by the Exalted Ruler and the Secretary. The Governing Body is responsible to see that accurate daily records are kept and vouchers prepared for payment by the Lodge Treasurer. It is improper for the Club Manager to maintain a separate bank account not under the control of the Lodge Treasurer, or to have a batch of pre-signed blank checks from the Lodge Treasurer. 3/16/2025 New Mexico Elks Association 41
Management and operation of Club, Kitchen, Bar, Gaming, etc Although the Lodge can exercise control, decisions relative to the day-to- day operations are best left to the Governing Body. If the House Rules do not set hours, the Governing Body may do so. Supervise & Control Facility Rental This is a function of the Governing Body, not of the Board of Directors 3/16/2025 New Mexico Elks Association 42
Hiring and Firing Management of all Club employees, even if the employee is a member. The Governing Body may employ a Club Manager who is not an Elk. Actions and decisions in this area are not subject to the control of the Lodge Prices of Goods. (Restaurant and/or Bar) Requires close attention. This action is not subject to the control or approval of the Lodge. 3/16/2025 New Mexico Elks Association 43
Enforce House Rules The Governing Body has full authority to suspend a member from Club privileges for a period not exceeding one (1) year for violation of the House Rules or conduct unbecoming an Elk on the premises, after due notice to the member and after a hearing before the Governing Body. Maintain Building Security Change Locks periodically rekey after personnel changes 3/16/2025 New Mexico Elks Association 44
Prepare a Segregated Budget A separate and comprehensive budget for the proposed operation of the Club, social parlor or other facility, must be presented to the Lodge for approval on or before the first regular Lodge meeting in May. 3/16/2025 New Mexico Elks Association 45
Minutes of last meeting Budget performance Club Manager report Kitchen Manager report Gaming Manager report Old Business New Business Upcoming events Staffing/Employee issues House Rule violation issues Close 3/16/2025 New Mexico Elks Association 46
Thank you 3/16/2025 New Mexico Elks Association 47
An incorporated Lodge shall make provision for a Board of Directors which shall be designated in accordance with the requirements of the corporation laws of the State or Territory in which such Lodge is situated and which shall be composed of the four Chair Officers of the Lodge and the Trustees, and which shall be vested with the powers and duties conferred upon the Board of Trustees by the Laws of the Order, including, but not limited to, Section 12.070. 3/16/2025 New Mexico Elks Association 48
01 All actions of the Board are subject to the will of the Lodge set forth in proper resolutions. By resolution the Board could be empowered to fix the salaries for clerical assistants to the Secretary. The Board is bound by the depository designation approved by the Lodge. 02 The Lodge is the supreme power and the Board its agent. If the Lodge wishes to provide that a special committee take over a function customarily performed by the Board, it may do so. 3/16/2025 New Mexico Elks Association 49
Section 12.070. The Board of Trustees, or the Board of Directors if the Lodge is incorporated under Section 16.020, (herein called the Board ), after each annual installation shall meet and organize by electing a Chairman and Secretary who shall be members of the Board. The Chairman of the Board shall attend all District Deputy Clinics unless excused for good cause by the District Deputy, provided, however, in the event the Exalted Ruler or Esteemed Leading Knight is the Chairman, then one other member of the Board shall be designated by the Board and required to attend all District Deputy Clinics. 3/16/2025 New Mexico Elks Association 50
