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BNI & The Power of One
BNI 833: Chapter Dues and Chapter Checking Accounts
00:18:52
What is the proper procedure for chapter checking accounts? Should we raise/lower dues? Who makes these decisions? We answer these questions in this week's Power of One.
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Sam.
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Foreign welcome back to BNI and the Power of One Podcast. Thank you for joining me again today. Back with your show. Submissions Topics submitted@bni power of1.com if you ever have one go there. If you're finding value, please leave us a review Comment Apple Podcasts, Spotify, Google Podcasts. However you might be finding it, make sure you subscribe so you don't miss anything. Yada yada yada. Okay, today's question was submitted. It was not asked to be kept anonymous, but I am going to keep it anonymous. I don't want anybody to. The chapter will probably figure it out. It's just probably better to keep it that way. So here's the question. Very long one submit I'm going to cut it down to just the key elements as Secretary Treasurer, I've been looking at our chapter finances. We currently have about $6,000 in the bank and with 17 members paying in at about $40 after the standard monthly expenses are deducted, we're adding $138 to our bank account each month. In last month's leadership team meeting, I suggested that we drop the fee to $30 a month. We would still be able to cover monthly expenses and have an extra $10 or so. We still have the $6,000 for networking events, et cetera. The VP of the chapter shut it down, saying it would be hard to increase debt later down the road and that it's a very bad idea. I gotta skip there. Right now we meet in a room at a local hotel. It's only about $109 for the room and coffee, but the lobby can get busy. Etc, which is true with most of those locations. Sorry for the so I'm just trying to cut through some of the stuff to get really down to it. The chapter has a big goal for growth. Visitor Day is coming up in the summer, etc. So here comes down the question. First question as Secretary Treasurer, can I decide the venue fee amount? Am I making the correct decision reducing it to $30 a month? And my second question is, as a BI chapter, considered a nonprofit, I noticed that we're paying a commission every month on a tool they use to collect dues around $2. What's the most efficient way to run a chapter checking account? I've been promoting the podcast a lot this year. Glad to say that members are learning, which I really appreciate. Thank you so much and and for everybody. I hope you do share. My goal is just to help as many BNI members as we can. Okay, so question is around Chapter checking accounts, what's the right amount? Is BNI a nonprofit, etc. So first and foremost BNI. And by that I mean BNI Global, BNI Local, meaning your local franchise owner, your local director, your local managing director, so forth. We do not get involved in chapter checking accounts. If you are in a region where that is different, I highly suggest you reach out to somebody above whatever level that is. And I can say that from experience. When I was national director we ran into a couple issues where some franchise owners were involved in chapter checking accounts. And you can probably guess that that led to some not so good things. So B and I does not get involved. The chapter checking accounts are for things that are not required by B and I. So non B and I related activities. Now one thing that's not required by B and I is because we also don't, we have the right to refuse, but we don't really get involved in the selection of your meeting location, any kind of rent, rent negotiations, those kind of things. Those are not, that's not required to run a BNI chapter. Renting a place so it's not a BNI related expense. Networking events, you know, sending gifts to members, those kind of things. Anything that you might want a little account for as a chapter is all a chapter thing. So first and foremost, as we get into this, let me just read to you what the current newest form of the B and I chapter operations manual says about chapter checking accounts so that you get the official word on it because it does play a role in my advice around this. So I'm just going to pull up the. Pulling up the new manual and I'm going to get to the chapter checking account piece here. Let me just find what page it's on. Here we go. And it's literally titled bank accounts for Non BNI related activities. The BNI Weekly. This is a few paragraphs just. But I want to read it directly. The BNI weekly chapter meeting agenda contains all the elements needed to conduct a B and I chapter meeting. Additionally, there are other aspects of operating a B and I chapter that are also B and I related activities. Those things would be like visitor events, membership drives. Exactly. Meetings of the membership committee are B and I related activities as well. Chapters meet at various times of day, sometimes convenient to eating a meal. Let me just stop there. By the way, I'm personal preference. Don't involve meals in your chapter meeting if you can avoid it. If you absolutely have the meal, you need to have it really well organized in a way ideally where you're not taking orders. It's a distraction. It just is. People are eating while other people doing their weekly presentations and stuff becomes a nightmare. So that's just a personal preference. And note on that. All right, Chapters may meet and Fits back to the Manual Chapters may meet in facilities that have a rental fee or other charge. From time to time. Chapters may wish to buy flowers for a sick or grieving member or contribute to a local or other charity in the name of the chapter. These however, are not B and I related activities. They are not required for the conduct of a B and I meeting and ongoing chapter activities, are not coordinated by a directordirect or consultant and are solely at the discretion of the individual members. Some chapters have decided that for the convenience of the members, it is useful to have a non B and I related activities bank account to handle these non B and I related activities. They may also be used to aggregate payments for meals, make gifts to members and others, have holiday parties for the chapter, etc. Since these are not official or required B and I related activities, this is at the sole discretion of the members of the chapter and they take sole responsibility for the operation of the bank account. If you choose to have an account for such purposes, we highly recommend never accumulating more than your current needs or at most two months worth of aggregation of expenses to be paid on non B and I related activities. Over the years, BI Global LLC has been asked to provide information on best practices and for opening and operating such accounts. While we provide such information, please bear in mind that having a bank account for non B and I related activities of the chapter is completely voluntary. Does not mean that you have formed a separate business entity. Again, we emphasize that you should only collect enough money to meet the cash outlay needs of your non BI related activities for a maximum of a month or two in advance. Okay, then the manual actually walks through some steps that you should take to open a very simple interest free like no interest bearing checking account. Okay and one of the things they recommend in that is that Those accounts should be 2 signatured required on all checks which I also highly highly highly agree with on that. So a couple key parts. Number one, do most chapters have a chapter checking account? Yes. Yes, it's probably useful to have you are not creating a new entity so you should not be creating a new business. And no, B and I chapters are not nonprofits. You'd have a very hard time explaining how you would be a nonprofit so you do not want to be established as such or take the steps to Try to establish as such. These should be very simple. Again, non interest bearing chapter accounts, much like a bridge club or whatever might have for similar purposes. Okay. So there should be no tax event on it or anything like that. That's step one. Step two, it's the chapters account. The leadership team is charged with maintaining it, but it's not any individual leadership team's members account. So the secretary treasurer is often in charge of setting like the budget for the chapter for the year for rent and that kind of stuff. And should be one of the signatures on the chapter checking account. But it should be two signatures for every check. So usually that would be the president and the secretary treasurer and that will change each year as you change leadership teams. Okay. When you put one person solely in charge and nobody pays attention, you open up the opportunity for bad things to happen. And unfortunately we've seen that, we've seen that happen. And usually they're caught well after the person who did it is gone. Okay, so this is the chapter, meaning every member in that chapter is a part of this chapter's checking account. You need to have very open transparency on what's going on with that. So your chapter should and can share a financial statement each month with. Here's where our chapter checking account is at, here's what we brought in, here's what we spent, here's what's left. So everybody is aware because then the room do conversation should come up and it's not the decision of any one leadership team member, it's a decision of the entire leadership team. There should be a vote on that and all aspects should be taken into account. To the question that was asked or the statement in it where the person says it's it's hard to go up after you've gone down. That is true. That's not an unfair point. However, you shouldn't have to go down in this chapter situation for two reasons. One, you're currently exceeding your expenses right now. So the only reason you would have to go down is if you dropped members. And number two and which you would have to go anyways if you drop because you're only exceeding by about 10 bucks. So if you drop your up anyways. But even more importantly, you have way too much money in your chapter checking account. Your chapter should not have thousands of dollars in the chapter checking account. There's no need for that. I mean that is. There's no party you're throwing with that kind of balance. I mean you can but it'd be a ridiculous, irresponsible thing to do. So you could even in theory stop collecting rent for a period of time to bring that balance down. But it is way too high and as this manual says, should be a month or two out. You should not be running large sums in these accounts anytime there's an expense of any kind that it should require outside the normal already approved like hey, we've got rent. So the rent, you know, leadership teams voting knows we have rent. Like that's an ongoing thing that doesn't take a vote or communication each month. But if there's an additional expense like hey, we want to send flowers to this person, awesome. No one person should just be running rogue on that. Then there should be a discussion of vote in agreeance on what that means. So the who, how what? Who's going to buy the flowers, what's the budget for the flowers, who's sending the flowers and how are we reimbursing? And then that should all be discussed and agreed to because what you don't want is the chapter say yeah, we need to do that. Somebody say I'll take care of it. And then they go out on their own and they're making decisions now. And some people may not agree with the decisions they're making, but you kind of charge them with the making the decision because there wasn't a good enough conversation. It leads to miscommunications, it leads to frustrations, it leads to all kinds of problems. You need to take these chapter checking accounts very seriously. There should not be a lot of money. So it's not a serious thing because we have tens of thousands of dollars and you should not have $6,000 but it should be taken seriously enough to where there's open honest reporting and checks and balances on any expenditures. So again that goes to the two signatures per check votes for any outside expenditures outside of the pre approved like rent. So anything like hey, we want to throw a party needs to be voted on. What's the budget for the party? Hey, we want to send a gift. What's the budget for the gift, who's doing it? How are we reimbursing? Hey, we want to do this all needs to be discussed with the leadership team. And when I say leadership team, I would include everybody on the leadership team. But at minimum you're talking president, vice president, secretary, treasurer, But I would be including more membership committee, visitor hosts, et cetera. Because again, it's the chapter's money, it's not the leadership team's money. Same thing with collecting payments. That says they use a tool and it costs a fee. I get the ease and you know, Today's World, Venmo, PayPal, whatever. I would not be setting up any kind of account like that because again it's who owns the account, who controls it, what happens if that person leaves, etc. Just it opens up, just potential conflicts, check or cash. I mean that's the way I would do it and really I'd be doing checks and just make a deposit. When a member pays, it's non refundable at that point it's part of the chapter checking account. So if somebody's like hey listen, I'm going to pay a year out and they leave six months. I mean that's the risk they took. That's usually the way we ran it, just trying to see if there were any other questions about it. So and the question was am I making the correct decision to reducing it to $30 a month? I would say yes, maybe even lower it more in this case because how much the chapter has, it's not a non profit and the secretary treasure cannot decide the venue fee amount solely. It has to be a team discussion. So I think we caught everything with that. It's, it's a big deal. It's a big deal and it shouldn't be overly complicated but it's important and, and you we all want to trust all our members and believe that nobody would do anything crazy. But it happens. But it happens. So you can avoid them happening by following those pieces of advice. Open communication, checks and balances, two signatures, all that fun stuff. I hope this answered your question. I hope it helps others who have been thinking about it especially I know we're kind of in the midst of leadership team change over now for the next couple months going into an October 1 start date. So keep your questions coming, keep the comments coming. Appreciate you all ready for the day.
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With hard work and passion we pave the way Every little task it builds and it grows in this world of business it's the heart that shows Dedication shines in everything we do Together we climb it's me and it's you we all work hard to make our dreams alive with strength of spirit we leave the average behind the power of giving lifts us high and wide that's why we are proud to be a part of BNI from early mornings to late at night night we hustle and we strive Keep our vision bright through every challenge we stand tall and strong together as a family we can't go wrong the bonds we're building they take us far in the game of business. We're shining light a star? We all work hard to make our dreams come true? With strength of spirit we all pull through? The power of giving lifts us high and wide? That's why we are proud to stand side by side? Being as a place where connections thrive? Uniting our hopes, keeping dreams alive? Together we network, inspire and share? With every referral we show that we care? We all work hard to make our our dreams align? With strength of spirit we're truly on the grind? The power of giving lifts us high and wide? That's why we are proud to stand side by side? So here we are Lifting each other high? With dedication and pride we're ready to fly? Take together we'll grow through every stormy night in this journey of ours we're shining bright.