Does Ohio Law Permit Compensation of any Type for HOA Directors?
The Act is silent as to compensation of board-members and officers. However, among the permitted “powers of owner’s association” that an HOA may exercise “through its board of directors” are “powers…conferred by the declaration or bylaws…permitted to be exercised in [Ohio] by a nonprofit corporation…[or] necessary and proper for the government and operation of the owners association.” O.R.C. §5312.06.
Ohio’s Nonprofit Corporation Law permits a nonprofit corporation to adopt regulations for the governance of the organization either within 90 days of the date of incorporation or, if later, by majority vote of the voting members. O.R.C. §1702.10. “The regulations, whether designated a constitution or rules, or by some other term, may include provisions with respect to…the titles, qualifications, duties, term of office, compensation or manner of fixing compensation, and the removal, of officers.” O.R.C. §1702.11(A)(9) (emphasis added).
Thus, a board can provide compensation to officers but only if the compensation is provided for in the declaration or included within regulations properly adopted by the association. If the declaration specifically provides that officers shall not receive compensation, then compensation can only be provided through amendment of the declaration.