These guidelines were developed several years ago, and are presented as an
outline of the requirements for a good set of bylaws:
1. A clear, concise statement of the purposes for which the association is
formed and the powers which the association may exercise. (By-laws must agree
with Articles of Confederation.)
2. Specific statement of who is eligible for membership, the requirements to
become a member, voting rights. Should include a section on issuing of
membership certificates.
3. Specific rules regarding suspension or termination of membership and
compensation for investments in the association.
4. If organized as an association with capital stock, requirements should be
spelled out specifically.
5. A section concerned with meetings of members, including:
(1) details concerning the regular annual meeting (including order of
business);
(2) special meetings, including requirements for calling a special
meeting;
(3) rules regarding notice of meetings; (4) rules concerning voting
(absentee ballots, etc.); (5) the number and percentage of membership
which constitutes a quorum (it is very important to include this).
6. Number and qualifications of Directors.
7. Election of Directors It is very importan to spell highly desirable to
build in a rotation system. for replacement in case of death, resignation or
during term of office.
8. Procedure for election of officers, term of office, succession, desirable
qualifications, the titles of officers, and the procedures for filling
vacancies.
9. A section of compensation for directors, including approval by the
membership. (Compensation varies widely; amounts or rules for determining amount
of compensation for directors should be approved at a regular or special meeting
of the members.)
10. A section describing the general duties of directors in detail (should
include role in management, employment of manager, board and insurance),
agreements with members, handling and depositing funds of the association.
11. A section on specific duties of the officers (usually a minimum will
cover President, Vice President, Secretary and Treasurer).
12. Duties of committees (usually will cover the Executive and other
permanent standing committees).
13. Duties of the manager (very important--should include general duties,
duty to account, and control of employees--preparation of this section should
incorporate the principle of "letting the manager manage").
14. A section on patron's and patrons' net margin (this section should
exploit the principle of margins above costs, the member or patron share of
these margins, how they are computed, how they are paid, and the association
right to a first lien on these for all indebtedness of the patron to the
association).
15. A section explaining revolving funds and other methods used in
financing.
16. A section explaining the rules and procedures that will be followed if
the association goes out of business.
17. A section covering unclaimed money (such as unclaimed patron net margins
or refunds, etc.) and the procedure that will be followed.
18. The business or fiscal operating year of the association.
19. A section on the procedure for amending the by-laws (very important).
20. Miscellaneous provision such as printing and distributing by-laws,
preparation of a corporate seal for the association, etc.