February 2025

What’s Hot

Why Every Private Club Board Should Use a Board Portal

Private clubs are celebrated for their deep-rooted traditions, strong community ties, and commitment to providing outstanding experiences for their members. Effective governance is at the heart of this success, a vital responsibility resting with the Board of Directors. In this fast-paced, technology-driven era, embracing tools like online board portals is no longer optional; it is essential for enhancing governance, fostering collaboration, and protecting sensitive information.

Here are three convincing reasons why every private club board should adopt a dedicated club-specific board portal:

1. Boosted Efficiency and Time Management

   An online board portal consolidates all meeting materials, schedules, and communications into one secure platform. 

   • Effortless Access: Board members can easily find crucial documents without digging through emails, printed packets, or three-ring binders—everything is merely a few clicks away on a user-friendly platform or mobile app.
   • Instant Updates: Agendas or documents can be updated in real-time, ensuring all members stay informed and ready with the latest information accessible through the app or online.
   • Significant Time Savings: Administrative staff save valuable time by eliminating the need for printing, mailing, or resending materials, allowing them to focus more on strategic initiatives.
     
     
2. Enhanced Communication and Collaboration

   Effective governance thrives on open and clear communication, and board portals elevate collaboration and informed decision-making. 

   • Discussion Boards and Secure Messaging: These features support continuous dialogue and decision-making outside formal meetings within a dedicated, encrypted space.
   • Efficient Polling and Voting: Secure, quick decision-making on critical issues is streamlined for maximum effectiveness.
   • Clear Task Management: Assigning, tracking, and following up on tasks ensures accountability and progress between meetings, keeping everyone aligned.
     
     
3. Robust Security and Compliance
   
   Board documents often contain sensitive financial, legal, and strategic information. An online board portal enhances security compared to traditional methods.

• • Data Encryption: This ensures confidential information is protected from unauthorized access.
  • Monitor Documentation Trails: Tracks document access and changes, providing a clear record for compliance purposes and monitors director engagement.
  • Role-Based Permissions: Restrict access to sensitive materials based on individual roles, protecting the integrity of club information.

Implementing a board portal equips private club boards with the tools for efficient governance, enhancing member engagement, and safeguarding vital information while adapting to modern expectations. Make the switch today for a more effective and secure board experience.

Insights Contributed by John Schultz, CCM, CCE, CMAA Fellow

Insights

Cultivating Club Prosperity: Board Governance, Communication, and Leadership Strategies for Thriving Clubs

Clubs thrive when they establish strong governance, foster effective communication, and cultivate skilled leadership. These elements are not mere ideals—they are the foundation for navigating the competitive landscape and ensuring long-term success. This framework's core is the collaboration between the board and the CEO/COO, a partnership that shapes a club's future.

This chapter explores three critical components that define club prosperity: the importance of clarity in board governance, the art of effective communication, and the pivotal role of the CEO/COO as a thought partner.

The Keystone of Board Governance

Good governance begins with clarity. Every member must understand their role and responsibilities for a board to lead effectively. Titles alone are not enough; detailed job descriptions are essential. For instance, a treasurer’s duties might include overseeing financial reporting, articulating the club’s financial health to stakeholders, and collaborating with the CEO/COO to ensure fiscal strategies align with the club’s goals.

Governance policies provide the structure within which the club operates. They cover everything from financial controls to member inclusion and operational standards. To remain relevant, they must be reviewed regularly and adapted as needed. The board is critical in ensuring these policies are updated and effectively implemented in collaboration with the CEO/COO.

Education is another cornerstone of effective governance. Board members must stay informed about legislative changes, industry trends, and best practices in club management. Whether through workshops, webinars, or expert consultations, continuous learning ensures that the board can lead confidently alongside the CEO/COO.

The Art of Communication

A thriving club is built on communication. Internally, transparent and consistent communication fosters trust among board members, staff, and members. It creates an environment where collaboration can flourish, and everyone feels aligned with the club’s mission.

Technology can streamline communication efforts. Member portals, internal newsletters, and other tools ensure stakeholders have access to timely and accurate information. Additionally, open dialogue through board meetings, staff feedback sessions, and member town halls creates opportunities for proactive problem-solving and reinforces a sense of community.

Externally, communication defines how the club presents itself to the world. A strong narrative helps attract and retain members, forge partnerships, and engage the broader community. Strategic branding, public relations efforts, and outreach initiatives highlight the club’s value, ensuring it remains relevant and appealing.

The CEO/COO as a Thought Partner

Among the many relationships within a club, few are as impactful as the partnership between the board and the CEO/COO. This dynamic is the bridge between strategic vision and operational execution.

The CEO/COO offers insight into day-to-day operations, industry trends, and emerging opportunities, helping the board make strategic decisions. When the CEO/COO is treated as a thought partner rather than a subordinate, their expertise can significantly enhance the board’s ability to govern effectively and ensure the club’s long-term prosperity.

Building a Thriving Future

A club’s success depends on combining sound governance, effective communication, and visionary leadership. Clear roles and responsibilities ensure that board members can act decisively. Transparent communication builds trust and fosters collaboration. A strong partnership with the CEO/COO drives innovation and ensures alignment between the board’s vision and the club’s operations.

By embracing these principles, private clubs can navigate challenges, seize opportunities, and create an enduring legacy of excellence. By committing to solid governance, thoughtful communication, and shared leadership, clubs can unlock their full potential and thrive for future generations.

Insights Contributed by Lawrence J. “Skip” Avery, CCM, CCE, CMAA Fellow, Stone Group Architects

External Influences

Could No Tax on Tip Proposals Impact the Future of Tipping in Private Clubs?

A notable 63.2 percent of clubs have transitioned away from traditional tipping models to service charges for member dining. However, with new legislative proposals aiming to make tips tax-free, clubs may soon find themselves reevaluating their approach.

What Could the Legislation Look Like?

Recent legislative proposals from may provide insight into what the final language under the new Congress and Administration could look like. 

1. No Tax on Tips Act (2024 - S 4621/HB 8941, 2025 - HR 482) – This proposal allows an above-the-line deduction for cash tip income, meaning employees could reduce their taxable income based on tips received. However, these earnings would still be subject to payroll taxes, which means clubs and employees would not see a full tax relief on tip income.
2. Tax-Free Tips Act of 2024 (HR 8785) – A more aggressive approach, this act proposes that both income and payroll taxes on tips be fully exempt. This would significantly increase take-home pay for employees and reduce the payroll tax burden on clubs.

These proposals have sparked discussions on whether clubs should reconsider their transition to service charges, given that a return to a tip-based system could become more financially attractive for both employees and employers.

Service Charges v. Tips

In shifting towards service charges, many clubs found that:

• Service charges provide greater financial predictability, ensuring a stable revenue stream for employee wages.
• Tipped wages vary significantly, leading to income inconsistency for employees.
• Several states and municipalities have been considering eliminating or increasing tipped minimum wages.

Tips are defined by the Internal Revenue Service (IRS) as “the payment must be made voluntarily by the customer and cannot be previously agreed upon,” among other restrictions.

Potential Impact of Tax-Free Tips Legislation

If similar proposals become law, private clubs may need to reassess their compensation models. A fully tax-free tipping system could potentially:

• Make tipping more lucrative for employees, encouraging them to advocate for a return to a tip-based model.
• Lower payroll tax obligations for clubs, potentially making tips more cost-effective than service charges.
• Improve recruitment and retention, as tipped positions would offer higher take-home pay compared to salaried or service-charge-based compensation.

However, reverting to a tip-based system also introduces challenges for clubs and employees:

• Add an administrative burden for managing tips and ensuring compliance with IRS regulations.
• Increase greater variability in income for employees.

Could Clubs Reverse Course?

If employees begin pushing for a return to a tip-based system due to perceived increased financial benefits, clubs may feel pressure to comply to maintain their workforce. Additionally, recruitment dynamics could shift with competing local restaurants and hospitality businesses. Whether clubs reverse course will depend on the final legislative outcome.

Insights from the CMAA Legislative Report blog. For more information, please contact Melissa Low, CAE.