Board Meeting, May 17th, 2005

Board members present

  • John Goerzen (CosmicRay) (President)
  • Benj. Mako Hill (mako) (Vice-President)
  • David Graham (cdlu) (Secretary)
  • Jimmy Kaplowitz (Hydroxide) (Treasurer)
  • Branden Robinson (BrandenRobinson)
  • Ian Jackson (IanJackson)
  • Bdale Garbee (bdale)
  • Martin Schulze (Joey) (late)

Board members absent with regrets

  • Bruce Perens (BrucePerens)

Registered guests present

  • Michael Schultheiss (schultmc)
  • Bill Allombert (yp17)
  • MJ Ray (slef)
  • Romain Francoise (ore)

Recorder: David Graham (Secretary)

Agenda

  1. Opening
  2. Roll call
    • Regrets received from (noone)
  3. President's update (John Goerzen)
  4. Treasurer's report (Jimmy Kaplowitz)
  5. Outstanding minutes (David Graham)
    • March 15th, 2005
    • April 12th, 2005 (log only at this time)
    • April 26th, 2005 (log only at this time)
  6. Items up for discussion:
    • (announce) OFTC leadership change
    • Tax filing status (Jimmy Kaplowitz)
    • Project committee (charter) disposition (unclaimed)

These are the draft minutes for the May 17th, 2005 Board meeting held at 19:00 UTC in #spi on irc.spi-inc.org.

President's update (John Goerzen)

No update was presented by the president.

Treasurer's report (Jimmy Kaplowitz)

No treasurer's report was presented.

Outstanding minutes (David Graham)

On approving the minutes for March 15th, 2005:

David Graham:Yes
Jimmy Kaplowitz:Yes
Ian Jackson:Abstain
John Goerzen:Yes
Branden Robinson:Yes
Benjamin Mako Hill:Yes
Bdale Garbee:Did not vote
Martin Schulze:Did not vote

The minutes for March 15th, 2005 were approved by a vote of:

Yes: 5, No: 0, Abstain: 1, Did not vote: 2

6. Items up for discussion

OFTC leadership

David Graham announced that David B. Harris has taken over the leadership of SPI member project, the Open and Free Technology Community following the resignation of Stuart Walsh. As such Harris is entitled to be an Advisor to the board should he choose to exercise this right.

Tax filing status

Summary

  • Benjamin Mako Hill will meet with SPI Attorney Greg Pomerantz' lawyer and accountant friend named Jeff Slavet.
  • Benjamin Mako Hill will send an agreement from Frank Boardman at MBS Bookkeeping to the Board for Board's approval.
  • Existing resolutions are sufficient to get us signed up with MBS Bookkeeping. Some funds are available from motion motion 2005-04-12.jpg.2, and the Treasurer is free to request further funding through Board resolutions as needed.
  • Jimmy Kaplowitz will continue to attempt to reach the New York State Charities Bureau to get clarification on SPI's status with them.

Project Committee

Discussion

Ian Jackson felt the Project Committee should be abolished and Projects should contact relevant people directly within SPI for specific purposes. David Graham felt the Project Committee should be put to a Call for Volunteers and only abolished if none came forward.

Ian Jackson, seconded by Jimmy Kaplowitz, moved that the Project Committee charter be revoked and the committee abolished. This motion is designated 2005-05-17.iwj.1, voted on as follows:

Ian Jackson:Yes
Jimmy Kaplowitz:Yes
David Graham:No
John Goerzen:Abstain
Branden Robinson:Abstain
Bdale Garbee:Yes
Benjamin Mako Hill:Abstain
Martin Schulze:Did not vote

Motion 2005-05-17.iwj.1 was approved by a vote of: Yes: 3, No: 1, Abstain: 3, Did not vote: 1

Membership Committee

The matter of the Membership Committee's membership was referred to a call for volunteers to go out to the mailing lists.

Guest MJ Ray volunteered to join the Membership Committee during the meeting.

Better Business Bureau Compliance Report

The content of this report is available in Appendix C and will be discussed at a later date.

Next meeting

The next meeting is a special-purpose meeting on the subject of tax filing and will take place on June 21st, 2005 at 19:00 UTC.

Closing

The meeting closed at 19:44, having lasted 44 minutes and 21 seconds.

Appendix A: Current Board Membership

Date electedNameRole
[2003-03-11]John GoerzenPresident
[2003-03-11]Benjamin Mako HillVice President
[2003-11-29]David GrahamSecretary
[2004-02-20]Jimmy KaplowitzTreasurer
[2004-07-29]Bdale Garbee
[2004-07-29]Branden Robinson
[2003-11-29]Ian Jackson
[2003-03-11]Bruce Perens
[2003-11-29]Martin "Joey" Schulze

Appendix B: Approved Motions

Motion 2005-05-17.iwj.1:

That the Project Committee's charter be revoked and the committee be abolished.

Appendix C: BBB Report

I have reviewed the Better Business Bureau's `Standards for Charity Accountability' as available at http://www.give.org/standards/newcbbbstds.asp and considered them together with SPI's practices and history.

Reading the standards, I was struck by the fact that some of the criteria were hopelessly lax and made me think are there really charities that fail this?!'; on the other hand, some of the criteria are very specific and even tending towards rigid and bureaucratic. There's a lot ofmust have policy on right and wrong' and not so much `must not do wrong things'.

Having considered all of the requirements, I don't think we should attempt to meet them in full, but there were a couple of points that we could sensibly improve on, as follows:

We should definitely:

  • Fix our accounting procedures and keep them working properly. (Governance item 1, Finances item 11.)
  • Write a simple web and donations privacy policy.

We should consider:

  • Writing a formal `conflict of interest' policy. This ought to be very short and I can draft something if the board wants me to.

  • Asking Associated Projects who solicit donations on their webpages to provide `IRS Form 990' and SPI's proper details, etc. (Fund raising etc. 17.)

We should, in my view, remain noncompliant regarding:

  • The requirement for face-to-face board meetings. (Governance 3.)
  • We ought not to rule out the use of companies connected with Board members to provide paid services etc. to SPI. That would in my view often be preferable to using a third party. (Governance 5.)
  • The supposed regular review by the Board of our own performance and effectiveness is silly and bureaucratic. Rather, this should be done by the Contributing Members as they elect the Board ! (Measuring Effectiveness 6.)
  • We should continue to accumulate funds. (Finances 10.)
  • We should not attempt to write an annual budget. (Finances 14.)
  • We should not have a mission statement. (Fund raising etc. 16.)

On the remaining points we are, I think, already in compliance.

For my blow-by-blow analysis, and details for the points above, see below.

> STANDARDS FOR CHARITABLE ACCOUNTABILITY

>
> ---------------------------------------------------------
> GOVERNANCE AND OVERSIGHT
> ---------------------------------------------------------
...
> 1. A board of directors that provides adequate oversight
> of the charity's operations and its staff. Indication of
> adequate oversight includes, but is not limited to,
> regularly scheduled appraisals of the CEO's performance,
> evidence of disbursement controls such as board approval

> of the budget, fund raising practices, establishment of a
> conflict of interest policy, and establishment of
> accounting procedures sufficient to safeguard charity
> finances.

We don't have a CEO.  Our practices regarding conflicts of interest
are, I think, extremely sound even though we don't write them down.
The Board has good and explicit control over expenditure.  We could do
it if would help.

Our accounting procedures have been a mess but are improving.

> 2. A board of directors with a minimum of five voting
> members.

Yes.

> 3. A minimum of three evenly spaced meetings per year of
> the full governing body with a majority in attendance,
> with face-to-face participation. A conference call of the

> full board can substitute for one of the three meetings
> of the governing body. For all meetings, alternative
> modes of participation are acceptable for those with
> physical disabilities.

We have many more regular meetings but nearly none of them are face to
face.  In my view the costs of getting all of the board together face
to face would be troublesome.

> 4. Not more than one or 10% (whichever is greater)
> directly or indirectly compensated person(s) serving as
> voting member(s) of the board. Compensated members shall
> not serve as the board's chair or treasurer.

No compensated persons serve as voting members or as chair or
treasurer.  I would disapprove if any did.

> 5. No transaction(s) in which any board or staff members

> have material conflicting interests with the charity
> resulting from any relationship or business affiliation.
> Factors that will be considered when concluding whether
> or not a related party transaction constitutes a conflict
> of interest and if such a conflict is material, include,
> but are not limited to: any arm's length procedures
> established by the charity; the size of the transaction
> relative to like expenses of the charity; whether the
> interested party participated in the board vote on the

> transaction; if competitive bids were sought and whether
> the transaction is one-time, recurring or ongoing.

We have in the past used companies and employees of Board members for
administrative duties, but not often.  But we should not rule it out.

> ---------------------------------------------------------
> MEASURING EFFECTIVENESS
> ---------------------------------------------------------
>
> An organization should regularly assess its effectiveness
> in achieving its mission. This section seeks to ensure
> that an organization has defined, measurable goals and

> objectives in place and a defined process in place to
> evaluate the success and impact of its program(s) in
> fulfilling the goals and objectives of the organization
> and that also identifies ways to address any
> deficiencies. To meet these standards, a charitable
> organization shall:

Given SPI's purpose and role, there are relatively few active tasks
that the organisation ought to set itself.

> 6. Have a board policy of assessing, no less than every
> two years, the organization's performance and
> effectiveness and of determining future actions required

> to achieve its mission.

This would be a silly paperwork exercise.

> 7. Submit to the organization's governing body, for its
> approval, a written report that outlines the results of
> the aforementioned performance and effectiveness
> assessment and recommendations for future actions.

However, we do regularly report to Contributing Members (the Governing
Body if we view ourselves as a membership-controlled organisation;
although the bylaws probably still view the Board as the Governing
Body in law) at the AGM.

> ---------------------------------------------------------
> FINANCES
> ---------------------------------------------------------
...
> 8. Spend at least 65% of its total expenses on program

> activities.

Yes.  This should definitely remain the case.  (Only 65%?!)

> 9. Spend no more than 35% of related contributions on
> fund raising. Related contributions include donations,
> legacies, and other gifts received as a result of fund
> raising efforts.

We spend no money on fund-raising and I agree that this should
continue.

> 10. Avoid accumulating funds that could be used for
> current program activities. To meet this standard, the
> charity's unrestricted net assets available for use
> should not be more than three times the size of the past

> year's expenses or three times the size of the current
> year's budget, whichever is higher.

It is the purpose of SPI to accumulate funds to be used (amongst other
things) as a reserve by our Associated Projects !

> An organization that does not meet Standards 8, 9 and/or
> 10 may provide evidence to demonstrate that its use of
> funds is reasonable. The higher fund raising and
> administrative costs of a newly created organization,
> donor restrictions on the use of funds, exceptional
> bequests, a stigma associated with a cause and
> environmental or political events beyond an

> organization's control are among factors which may result
> in expenditures that are reasonable although they do not
> meet the financial measures cited in these standards.

This appears to allow get-outs for 8 and 9 but not for 10.

> 11. Make available to all, on request, complete annual
> financial statements prepared in accordance with
> generally accepted accounting principles. When total
> annual gross income exceeds $250,000, these statements
> should be audited in accordance with generally accepted
> auditing standards. For charities whose annual gross

> income is less than $250,000, a review by a certified
> public accountant is sufficient to meet this standard.
> For charities whose annual gross income is less than
> $100,000, an internally produced, complete financial
> statement is sufficient to meet this standard.

We should make sure that we can produce this for each financial year.

> 12. Include in the financial statements a breakdown of
> expenses (e.g., salaries, travel, postage, etc.) that
> shows what portion of these expenses was allocated to
> program, fund raising, and administrative activities. If

> the charity has more than one major program category, the
> schedule should provide a breakdown for each category.

Quite so.

> 13. Accurately report the charity's expenses, including
> any joint cost allocations, in its financial statements.
> For example, audited or unaudited statements which
> inaccurately claim zero fund raising expenses or
> otherwise understate the amount a charity spends on fund
> raising, and/or overstate the amount it spends on
> programs will not meet this standard.

Quite so.


> 14. Have a board-approved annual budget for its current
> fiscal year, outlining projected expenses for major
> program activities, fund raising, and administration.

Our expenditures from non-earmarked funds are directed by the board at
the time and we have shown a good ability to control costs.  An annual
budge would be pointless.

Regarding earmarked funds, it is not for us to prepare a budget
(should one be needed).  We should definitely keep an eye on our
Associated Projects' activities and let them know if we think that
they ought to be making a formal budget.

> ---------------------------------------------------------
> FUND RAISING AND INFORMATIONAL MATERIALS
> ---------------------------------------------------------
...
> 15. Have solicitations and informational materials,
> distributed by any means, that are accurate, truthful and
> not misleading, both in whole and in part. Appeals that

> omit a clear description of program(s) for which
> contributions are sought will not meet this standard.
>
> A charity should also be able to substantiate that the
> timing and nature of its expenditures are in accordance
> with what is stated, expressed, or implied in the
> charity's solicitations.

SPI does not launch appeals.  Our member projects do, and that clearly
identifies which `programme' is involved.

> 16. Have an annual report available to all, on request,
> that includes:

>
>  a. the organization's mission statement,

We don't have a mission statement.

>  b. a summary of the past year's program service
>     accomplishments,

This doesn't make sense for SPI due to our umbrella nature.  We
shouldn't attempt to summarise our Associated Projects' activities and
our own activities are not `programme service'

>  c. a roster of the officers and members of the board of
>     directors,

This is on our website and ought to be in the Presidents' report to
the AGM.

>  d. financial information that includes (i) total income
>     in the past fiscal year, (ii) expenses in the same
>     program, fund raising and administrative categories

>     as in the financial statements, and (iii) ending net
>     assets.

This is the financial report asked for earlier.

> 17. Include on any charity websites that solicit
> contributions, the same information that is recommended
> for annual reports, as well as the mailing address of the
> charity and electronic access to its most recent IRS Form
> 990.

This may or may not be sensible.  I'm not familiar enough with the US
tax etc. systems for me to be able to comment.

> 18. Address privacy concerns of donors by
>

>  a. providing in written appeals, at least annually, a
>     means (e.g., such as a check off box) for both new
>     and continuing donors to inform the charity if they
>     do not want their name and address shared outside the
>     organization, and

We do not share donor names and addresses.

>  b. providing a clear, prominent and easily accessible
>     privacy policy on any of its websites that tells
>     visitors (i) what information, if any, is being
>     collected about them by the charity and how this

>     information will be used, (ii) how to contact the
>     charity to review personal information collected and
>     request corrections, (iii) how to inform the charity
>     (e.g., a check off box) that the visitor does not
>     wish his/her personal information to be shared
>     outside the organization, and (iv) what security
>     measures the charity has in place to protect personal
>     information.

We should write something simple and reassuring.  (`Privacy policies'
are an invention of the incredibly lax US data protection regime.  I
hope that SPI would hold itself to considerably higher standards.  It
would be good for SPI to promise to abide by European data protection
principles.)

> 19. Clearly disclose how the charity benefits from the

> sale of products or services (i.e., cause-related
> marketing) that state or imply that a charity will
> benefit from a consumer sale or transaction. Such
> promotions should disclose, at the point of solicitation:
...

We do not benefit in this way.  If we were to get into this game (eg
because a Project wanted to) then we would have to think about the
proprieties, of course.

> 20. Respond promptly to and act on complaints brought to
> its attention by the BBB Wise Giving Alliance and/or
> local Better Business Bureaus about fund raising
> practices, privacy policy violations and/or other issues.

Clearly we should respond to complaints sensibly, and I think we do.

Appendix D: Meeting Log