Bylaw proposal to update the Capitol Credits language
Please Note that voting will occur at the 2024 UPMA Member Summit.
Purpose: As UPMA was first envisioned, the mechanism for holding member account was in “Capital Credits” which has a specific legal meaning. For best compliance it was determined to use trust accounts instead of capital credits.
Therefore, the term “capital credits” is obsolete and needs to be updated.
Legend, changes in bold, removed language in strikeout, and inserted language in underline.
Article III. Members
1. Classes. There shall be four classes of members: people, merchants, charities (including other tax-exempt entities), and governmental entities. People shall elect by majority vote, from their own class, members to serve on the board of directors. Only those people who have maintained the minimum average capital credit account balance necessary to have been assessed member dues for six consecutive months immediately prior to the meeting at which a vote is taken shall be permitted to cast votes or be eligible for election to the board of directors. Each member of the people class shall have only one vote regardless of the number of the UPMA capital credits trust account balance the member has.
2. No change
3. Contributions. Member contributions shall be allocated, as directed by the member, into UPMA capital credit trust accounts denominated in currency units pegged to either the gold dollar or the silver dollar. All capital credit trust accounts shall be managed by general counsel under the oversight of the board of directors for the benefit of UPMA members. These capital credit trust accounts consist only of physical coins, the capital credit trust simply being the legal structure of the account.
4. Communications. According to the applicable terms and conditions of membership, UPMA’s general counsel shall provide confidential communications with members regarding their respective financial interests in the UPMA, including but not limited to a monthly electronic statement evidencing that member’s UPMA capital credits trust account and transaction activity. Such communications constitute privileged attorney/client communications.
5. Use of Shares. Members may transfer their trust account holdings capital credits to other members, deposit capital credits trust account holdings into escrow for the benefit of non-members and redeem capital credits trust account holdings by physically withdrawing their holdings from the UPMA in accordance with the terms of membership established by the board of directors. Transfers or withdrawal requests will also be honored on behalf of a member when UPMA or its agents are presented with a valid power of attorney, court order, transfer into trust, or similarly binding legal instrument. However, any such transfer or withdrawal shall be with respect to a member’s trust account holdings capital credits only; no person or entity may succeed to a member’s membership by operation of law or otherwise, nor is UPMA membership transferable.
6. Profits. No dividends or earnings based on capital credit trust account holdings shall be disbursed to any member or class of members; however, net earnings of the association may be applied to reduce or eliminate member liability for association dues, fees and costs.
Article VIII Holdings and Transactions
1. No Change
2. Functional Currencies. The monetary holdings of the UPMA consist exclusively of the currencies herein authorized for contribution into member capital credit trust accounts, including specie legal tender as defined in UCA § 59-1-1501.1.
Proposal Regarding member and officer Qualifications
Purpose:
1. To clarify the “people” class
2. Clarify voting member qualifications
3. Requirements to disclose possible conflicts of interest.
Currently the classes description of “people” is ambiguous in some cases. This proposal makes clear who exactly are in each class and who has, and doesn’t have, the right to vote.
The term “member in good standing” is used in several places but there is no process for determining if a person is in good standing.
In this proposal the phrase “in good standing” is moved to one location in the documents. It is intentionally left open as there are many ways an account or person might be “not in good standing”. This is meant to cover people with potentially fraudulent or suspicious transactions, who are trying to skirt laws or rules. By leaving the definition open the staff can identify such transaction and mark an account as “not in good standing” without having to wait for board action. This change provides an appeal to the board for the account owner to challenge the “good standing” status.
Currently there are no requirements to disclose potential conflicts of interests which are being added in this proposal.
Proposed Changes:
Legend: Changes in bold, deletions in strikeout, insertions in underline.
Article III. Members
1. Classes. There shall be four classes of members: people Natural Persons, Merchants, Charities (including other tax-exempt entities), and Governmental Entities. People shall elect by majority vote, from their own class, members to serve on the board of directors. Voting Members Only are only those people Natural Persons who have maintained the minimum average capital credit account balance necessary to have been assessed member dues have paid dues for six consecutive months immediately prior to the meeting at which a vote is taken and are in good standing. Members may appeal to the board for exceptions. Only Voting Members shall be permitted to cast votes or be eligible for election to the board of directors. Each member of the people class Voting Member shall have only one vote regardless of the number of the UPMA capital credits balance the member has.
8. Quorum. A quorum at any member meeting shall consist of the lesser of the 50% of those people qualified to vote Voting Members or 50 members qualified to vote Voting Members, as determined at any time from the beginning of the meeting until the time a vote is called; once a quorum is determined to be present for a meeting, that quorum is deemed to remain, even if some members are no longer present when a vote is called. Voting by proxy shall not be permitted.
Article IV. Board of Directors (subsequent sections to be renumbered)
1. Composition. The UPMA board of directors shall consist of up to 21 members. Each member of the board of directors must be a member of the people class in good standing. Each director shall serve for a three-year term. The board seats shall be divided into A, B and C groupings of seven seats each so that as nearly as possible one third of the directors may be elected annually by a majority vote of a regularly constituted quorum of the people class members Voting Members present at the annual members meeting held in the month of September of each year. The newly elected directors shall take office immediately after election.
2. Qualifications To be nominated, elected, or to serve as a board member a person must:
a. Be a Voting Member, and
b. Disclose immediately to the Executive Committee if he or she is
i serving as a manager, officer, or director of any UPMA vendor or affiliated organization.
ii convicted of, or have been notified that they are the currently under an investigation for, a felony
5. Nominations. Candidates for director positions may be nominated by the Nominations Committee or by petition signed by twenty or more Voting Members members of the people class eligible to vote. All nominations shall be submitted to General Counsel at least one week prior to the annual meeting of UPMA members.
Article V Officers
1. Officers, qualifications, and duties. The officers are a Chair and Vice Chair.
a. To be nominated, elected, or to serve as an officer a person must
i Be a Voting Member, and
ii Be a current member of the Board of Directors, and
iii Have served at least three years on the board
iv Only members of the board who have served at least one full term (3 years) on the board are eligible for election as officers. Only UPMA members in good standing may continue in office.
Article VI. General Counsel
Conflicts of Interest. In the event of a conflict of interest between the UPMA and a member or director, the conflicted member or director shall be afforded the opportunity to retain independent counsel at his or her own expense. The fact that general counsel performs the same or similar services for both the UPMA and for individuals or entities other than the UPMA shall not in and of itself constitute a conflict of interest. The General Counsel must disclose immediately to the Executive Committee if he or she is serving as a manager, officer, or director of any organization offering goods or services within the precious metal sector of the economy.
Proposal Increase in the Executive Committee Spending Authority
7/5/24
Purpose:
Now that we have put the financial approvals in place there is a flaw in the bylaw.
Currently the Board sets a budget, and then the Executive Committee can spend the money according to the approved budget. But right now the Executive Committee is limited to approving expenditures of only 10 gold dollars (500 USD).
This is not really a practical limit. For example, the board just approved 100 gold dollar budget for online presence. If the marketing committee now comes back with a plan to spend $1,300 on a media buy or a project, you would have to wait until the NEXT BOARD meeting to approve it. As the board only meets three times a year, this spending limit seems quite restrictive and limits the ability to take advantage of opportunities that arise.
This proposal raises the Executive Committees ability to disburse money from $USD 500 to $USD 5,000 but only within the budget that is already approved by the board.
Proposed Changes:
Legend: Changes in bold, deletions in strikeout, insertions in underline.
Article IX. Financial Procedures
3. Disbursements. General Counsel shall make all disbursement of UPMA funds. Disbursement of funds may not exceed available funds on hand, and must be within the budget. The budget is not authorization of disbursement of funds. Authorization of disbursement must be in writing, as follows:
a. Any two members of the Executive Committee may authorize disbursements of budgeted funds if the disbursement amount does not exceed the value of ten one hundred gold dollars.
b. The Board of Directors may authorize disbursements of any amount.
Bylaw Proposal to set a standard for financial reporting
Purpose:
In maturing the UPMA financial processes we should begin regular financial reporting as any organization would expect under GAAP (Generally Accepted Accounting Principles).
At present the number of transactions is small and it should be simple to create a standard Income Statement and Balance Sheet quarterly.
This responsibility is given to the Executive Committee so it can determine the best way of fulfilling this requirement.
Proposed Changes:
Legend: Changes in bold, deletions in strikeout, insertions in underline.
Article IX. Financial Procedures
5 Reports. The Executive Committee shall ensure that an Income Statement and Balance Sheet shall be created quarterly according to Generally Accepted Accounting Principles and delivered to the members of the Board of Directors within in 30 days of the end of each fiscal quarter.