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Privacy and Private Status Board Education

Many new directors come from business backgrounds where they are continually challenged to increase sales and profit. They naturally think that this is one of the roles they are going to play on the club board. As they start out, they want to share their expertise to help grow the club, suggesting “new” ideas like membership advertising, to-go food, outside catering and car detailing. While these services would likely be very popular with members, they fall into a nontraditional business category that makes them bad ideas in 501(c)7 clubs.

As seen in this edition of Club Director, NCA is your “go-to” resource on legal and regulatory issues. This covers the areas you need to know as an operator, like H-2B visas, the new overtime rule and OSHA regulations, but also the more nuanced aspects of club structure, private club status and IRS restrictions. There is often a lot of confusion on these topics, even among industry veterans, so be sure to make the most of NCA’s informational resources.
It’s critical to educate board members from the start. Don’t think that because someone was elected to your board that they have an intimate understanding of private club status. In fact, expect that they don’t know much about it at all.

Make a tutorial on privacy one of the foundations of your board orientation program. While a great orientation is crucial to building a better board, it is an excellent opportunity to educate board members on what is and isn’t permissible in services, marketing and communications. Instead of saying no to all the ideas that new directors are likely offer in the weeks following their appointment, set the record straight from the beginning. Shooting down new ideas all the time gives the impression the club executive isn’t entrepreneurial enough. Reminding them of what you told them in the orientation is a much easier and effective way to say no and keep your club on the straight and narrow.

Frank Vain is president of McMahon Group, Inc., a premier full-service, private club consulting firm serving more than 1,900 private clubs around the world. He also serves as secretary of the NCA board and chairs the Communications Committee. He can be reached at [email protected]. For more information, visit