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member of such person; <br /> 2. is not in an employment relationship subject to the direction or control of the <br /> person who is the subject of the compensation arrangement <br /> 3. does not receive compensation or other payments subject to approval by the <br /> person who is the subject of the compensation arrangement <br /> 4. has no material financial interest affected by the compensation arrangement; and <br /> 5. does not approve a transaction providing economic benefits to the person who is <br /> the subject of the compensation arrangement, who in turn has approved or will <br /> approve a transaction providing benefits to the board or committee member. <br /> c. the board or compensation committee shall obtain and rely upon appropriate data as to <br /> comparability prior to approving the terms of compensation. Appropriate data may <br /> include the following: <br /> 1. compensation levels paid by similarly situated organizations, both taxable and <br /> tax-exempt, for functionally comparable positions. "Similarly situated" <br /> organizations are those of a similar size, purpose, and with similar resources <br /> 2. the availability of similar services in the geographic area of this organization <br /> 3. current compensation surveys compiled by independent firms <br /> 4. actual written offers from similar institutions competing for the services of the <br /> person who is the subject of the compensation arrangement <br /> d. As allowed by IRS Regulation 4958-6, if this organization has average annual gross <br /> receipts (including contributions)for its three prior tax years of less than $1 million, the <br /> board or compensation committee will have obtained and relied upon appropriate data as <br /> to comparability if it obtains and relies upon data on compensation paid by three <br /> comparable organizations in the same or similar communities for similar services. <br /> e. the terms of compensation and the basis for approving them shall be recorded in written <br /> minutes of the meeting of the board or compensation committee that approved the <br /> compensation. Such documentation shall include: <br /> 5. the terms of the compensation arrangement and the date it was approved <br /> 6. the members of the board or compensation committee who were present during <br /> debate on the transaction, those who voted on it, and the votes cast by each board <br /> or committee member <br /> 7. the comparability data obtained and relied upon and how the data was obtained <br /> 8. If the board or compensation committee determines that reasonable compensation <br /> for a specific position in this organization or for providing services under any <br /> other compensation arrangement with this organization is higher or lower than <br /> the range of comparability data obtained, the board or committee shall record in <br /> the minutes of the meeting the basis for its determination. <br /> 9. If the board or committee makes adjustments to comparability data due to <br /> geographic area or other specific conditions, these adjustments and the reasons for <br /> them shall be recorded in the minutes of the board or committee meeting. <br /> 10. any actions taken with respect to determining if a board or committee member <br /> had a conflict of interest with respect to the compensation arrangement, and if so, <br /> actions taken to make sure the member with the conflict of interest did not affect <br /> 16 <br /> 26-04 <br />