The One Meeting Your Church Must Hold

Written by Raul Rivera on May 26, 2015 in IRS Compliance

When Pastor Marco started his church 2 years ago, he knew that there were legal steps to take, but he was not quite sure of all that was required or of all that needed to be done. From his experience as a small business owner, he knew that he needed to obtain a federal employer identification number (FEIN) and incorporate the church with the state. These two acts would allow him to open a bank account for the church, but aside from that, he was at a loss. Like many other pastors, what Pastor Marco did not know is that opening a bank account is a decision that must be made by the board of directors.

Pastor Marco and his board were not only unaware that the decision to open a bank account was one that should have been made during a board meeting, but they were all together unaware that the decision should have been made during the church’s organizational board meeting.

Like Pastor Marco, many pastors and churches today are unfamiliar with the necessity of the organizational board meeting. There are even those who are unaware that board meetings in general are a must. For that reason, I want to spend some time explaining to you the importance of the organizational board meeting (and board meetings in general), what should be covered in the organizational board meeting, and how you can “make it right” if you have never held your organizational board meeting.

The importance of board meetings and board meeting minutes

The laws of all 50 states clearly require that at least one board meeting take place per year and that board meeting minutes be taken to document the decisions made. Understanding the importance of and the need for board meetings is absolutely crucial to properly operating your church and ministry. It is during these meetings that your church’s governing body (board of directors) discusses and determines important operating decisions for the church. Yet, in order for these meetings to have any legal meaning, you must record in board meeting minutes what was discussed.

Board meeting minutes are arguably the most important documents that your church/ministry must maintain. They serve as the documentation of the corporate acts of your organization. Without board meeting minutes, your organization cannot substantiate that your organization properly approved things such as board members, a constitution and bylaws document, policies, salaries, etc. Even if you have documents prepared beautifully, or have discussed issues at length and come to conclusions amongst the board members, unless you have board meeting minutes to back those things up, they hold no legal value at all. A board meeting without minutes is simply called fellowship.

Items to be covered in your organizational board meeting

The following items will allow you to understand the essentials of conducting a board meeting and should produce in you the confidence that your board meetings will be conducted and recorded correctly.

Though items may vary, some of the essential things to discuss at your board meeting are:

  1. Official appointment of the board of directors. Your board of directors does not become official until they are noted in the board meeting minutes. Depending on the requirements of your state, your initial board of directors will serve the “default” term the state mandates.
  2. Resolution to open a bank account. Believe it or not, it is required by state law that this resolution be passed before opening up a checking account.
  3. Approval of all corporate documents. Documents such as your church’s approved articles of incorporation, constitution & bylaws, and corporate policies should be ratified and approved during the organizational board meeting. If these organizational and governing documents are never officially approved by your board and recorded in board meeting minutes, then these documents are not the official governing documents of your church. If this was the case in the instance of litigation, your church would be subject to the state’s law rather than that of your constitution & bylaws, which is why it is imperative that your church, upon incorporating, write bylaws and have them ratified in the organizational board meeting.
  4. Ordination. If you plan on becoming ordained through the very church that you start then you will also want to include that in this board meeting.

What if my church has not held a board meeting?

If board meetings and board meeting minutes have been neglected by your church in the past, a meeting to approve prior acts may be necessary. While the ideal situation for any organization is to have perfect records of all meetings and all decisions made from the very beginning, this may not always be the case. Although there is no way to take minutes for a board meeting that happened in the past, there is a way to approve the decisions that were made in the past.

When holding a board meeting in order to approve prior acts, it is pertinent to research as much information about all prior acts as you can. The more information you can get, such as dates and names of board members who were present at the time, the better. During the board meeting, your board should discuss when past decisions of the board happened and take a vote to approve those acts retroactively. Use your best faith estimates of times and dates if they are not precisely known.

Remember, decisions that are made at board meetings must be noted in the meeting minutes to be considered official decisions of the church.

Conclusion

I know that the thought of conducting board meetings can seem overwhelming, especially given their importance in the pursuit of ongoing legal compliance. Yet, while there is a learning curve when you first begin holding board meetings, they do eventually become like second nature to you and your board.

If you need assistance with board meeting minutes, our Secretary’s Suite can be a powerful tool to help you and your church take and maintain accurate board meeting minutes.

Please feel free to comment. We always appreciate good dialogue. However, we do moderate each comment to ensure that it is on topic and not derogatory to other participants. We ask that you keep your comments brief and pertinent to the topic so that others may benefit.

Blessings,
Raul Rivera


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