Minnetonka Baseball Association
Conflict of Interest Policy
Article I -- Purpose
Minnetonka Baseball Association (MBA) is a Minnesota nonprofit corporation and a tax-exempt organization. The purpose of this conflict of interest policy is to protect MBA’s interests when it is contemplating entering into a transaction or arrangement that might benefit the private interests of an officer, director or leader of MBA or might result in a possible excess benefit transaction. This policy is intended to supplement, but not replace, any applicable state and federal laws governing conflicts of interest applicable to nonprofit and charitable organizations.
Article II -- Definitions
1. Interested person -- Any director, officer, leader, or member of a committee with governing board delegated powers, who has a direct or 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 MBA has a transaction or arrangement,
b. A compensation arrangement with MBA or with any entity or individual with which MBA has a transaction or arrangement, or
c. A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which MBA 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. A person who has a financial interest may have a conflict of interest only if the Board of Directors decides that a conflict of interest exists.
Article III -- 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 Board of Directors.
2. Determining Whether a Conflict of Interest Exists -- After disclosure of the financial interest and all material facts, and after any discussion with the interested person, he/she shall leave the Board of Directors meeting while the determination of a conflict of interest is discussed and voted upon. The remaining board members shall decide if a conflict of interest exists.
3. Procedures for Addressing the Conflict of Interest
a. An interested person may make a presentation at the Board 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.
b. The President shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.
c. After exercising due diligence, the Board shall determine whether MBA 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.
d. If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the Board shall determine by a majority vote of the disinterested directors whether the transaction or arrangement is in MBA'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
a. If the Board 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.
b. If, after hearing the member's response and after making further investigation as warranted by the circumstances, the Board determines the member has failed to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action.
Article IV – Records of Proceedings
The minutes of the Board and all committees with board delegated powers shall contain:
a. 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 Board's decision as to whether a conflict of interest in fact existed.
b. 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.
Article V – Compensation
A voting member of the Board who receives compensation, directly or indirectly, from MBA 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 MBA for services is precluded from voting on matters pertaining to that member's compensation. No voting member of the Board or any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from MBA, either individually or collectively, is prohibited from providing information to any committee regarding compensation.
Article VI – Annual Statements
1. Each director, officer, leader and member of a committee with Board delegated powers shall annually sign a statement which affirms such person:
a. Has received a copy of the conflict of interest policy,
b. Has read and understands the policy,
c. Has agreed to comply with the policy, and
d. Understands MBA 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.
2. If at any time during the year, the information in the annual statement changes materially, the person shall disclose such changes and revise the annual disclosure form.
Article VII – Periodic Reviews
To ensure MBA 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:
a. Whether compensation arrangements and benefits are reasonable, based on competent survey information (if reasonably available), and the result of arm's length bargaining.
b. Whether partnerships, joint ventures, and arrangements with management organizations, if any, conform to MBA's written policies, are properly recorded, reflect reasonable investment or payments for goods and services, further charitable purposes and do not result in inurement or impermissible private benefit or in an excess benefit transaction.
Article VIII – Use of Outside Experts
When conducting the periodic reviews as provided for in Article VII, MBA may, but need not, use outside advisors. If outside experts are used, their use shall not relieve the Board of its responsibility for ensuring periodic reviews are conducted.
Minnetonka Baseball Association
Annual Board Member Statement
1. Name: ____________________________________ Date: ____________________
2. Position: _____________________________________
3. I affirm the following (initial below):
I have received a copy of the MBA Conflict of Interest Policy. _________
I have read and understand the policy. _________
I agree to comply with the policy. _________
I understand that MBA is charitable and in order to maintain its federal tax exemption it must engage primarily in activities which accomplish one or more of tax-exempt purposes. _________
4. Do you have a financial interest (current or potential) as defined in the Conflict of Interest policy with MBA? Yes No
If yes, please describe: ____________________________________________
ii. If yes, has the financial interest been disclosed, as provided in the Conflict of Interest policy? Yes No
______________________________________ Date: _________________