An Act To Limit the Compensation of Officers and Directors of Nonprofit Corporations
Maine Legislature, Session 123, LD 1792
Committee: Judiciary
Sponsors: SCHNEIDER, COURTNEY, BEAULIEU, PRESCOTT, SAMSON
Amends: 13-B MRSA §103, 13-B MRSA §701, 13-B MRSA §710, 13-B MRSA §1105

Legislative Document 
S.P.636 
An Act To Limit the Compensation of Officers and Directors of 
Nonprofit Corporations 
Reference to the Committee on Judiciary suggested and ordered printed. 
No. 1792 
March 29,2007 
JOY J. O'BRIEN 
Secretary of the Senate 
Presented by Senator SCHNEIDER of Penobscot. 
Cosponsored by Senator: COURTNEY of York, Representatives: BEAULIEU of Auburn, 
PRESCOTT of Topsham, SAMSON of Auburn. 
Printed on recycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  13-B MRSA §103, sub-§8 is enacted to read: 
8.  Limitation on compensation.  A nonprofit corporation that receives at least 25% 
of its total funding from one or more municipal, county, state or federal sources and is 
organized under this Title or to which this Title applies may not provide compensation to 
a director or officer that exceeds the limits established in section 701 or 710. 
Sec. 2.  13-B MRSA §701, as amended by PL 1991, c. 85, is further amended by 
adding after the first paragraph a new paragraph to read: 
The corporation may not provide compensation in excess of $250,000 per year for 
any director.  The compensation limit includes all remuneration and benefits for carrying 
out the responsibilities of being a director, excluding the provision of a motor vehicle, 
insurance and housing allowance.  The housing allowance may not exceed $20,000 per 
year.  The compensation limit does not include compensation a person receives for 
employment by the corporation in a position other than a director or officer. 
Sec. 3.  13-B MRSA §710, sub-§3 is enacted to read: 
3.  Compensation.  The corporation may not provide compensation in excess of 
$250,000 per year for any officer.  The compensation limit includes all remuneration and 
benefits for carrying out the responsibilities of being an officer, excluding the provision 
of a motor vehicle, insurance and housing allowance.  The housing allowance may not 
exceed $20,000 per year.  The compensation limit does not include compensation a 
person receives for employment by the corporation in a position other than a director or 
officer. 
Sec. 4.  13-B MRSA §1105, sub-§3, as amended by PL 2001, c. 550, Pt. C, §24 
and affected by §29, is further amended to read: 
3.  Complaint. Upon complaint by a corporation to have its dissolution continued 
under the supervision of the court; and 
Sec. 5.  13-B MRSA §1105, sub-§4, as amended by PL 2001, c. 550, Pt. C, §24 
and affected by §29, is further amended to read: 
4.  Liquidation of affairs precedes entry of decree. When an action has been filed 
by the Attorney General to dissolve a corporation and it is established that liquidation of 
its affairs should precede the entry of a decree of dissolution. ; and 
Sec. 6.  13-B MRSA §1105, sub-§6 is enacted to read: 
6.  Excessive compensation.  Upon complaint by any person that compensation paid 
to a director or officer of the corporation exceeds the limit established by section 701 or 
section 710, subsection 3, respectively. 
T 
SUMMARY 
! 
This bill seeks to ensure that the nonprofit corporate miSSion of a nonprofit 
corporation is not overshadowed by excessive compensation to directors and officers. It 
applies 10 nonprofit corporation:; that receive at least 25% of their total funding from one 
or more municipaL C<lllllty, stare or federal sources 
This bill prohibits nonprofit 
{1 
corporations from compensating "HI officer or director in excess of $250.000 per year. 
i 
Excessive compensatioll of a direclor or officer is added as a ground to dissolution of the 
nonprofit corporation pursuant to COUli order.