1Amending Titles 10 (Charities), 15 (Corporations and
2Unincorporated Associations) and 40 (Insurance) of the
3Pennsylvania Consolidated Statutes, providing for nonprofit
4organizations; and further providing for compensation of
5directors, for definitions, for prohibition, for definitions
6and for board of directors.

7The General Assembly of the Commonwealth of Pennsylvania
8hereby enacts as follows:

9Section 1. Title 10 of the Pennsylvania Consolidated
10Statutes is amended by adding parts to read:

11PART I

12PRELIMINARY PROVISIONS

13(RESERVED)

14PART II

15NONPROFIT ORGANIZATIONS

16Chapter

1721. Preliminary Provisions (Reserved)

1823. Boards of Directors

19CHAPTER 21

20PRELIMINARY PROVISIONS

1(RESERVED)

2CHAPTER 23

3BOARDS OF DIRECTORS

4Sec.

52301. Scope of chapter.

62302. Definitions.

72303. Prohibition.

8§ 2301. Scope of chapter.

9This chapter relates to boards of directors of nonprofit
10organizations.

11§ 2302. Definitions.

12The following words and phrases when used in this chapter
13shall have the meanings given to them in this section unless the
14context clearly indicates otherwise:

15"Board of directors." The group of persons vested with the
16management of the business and affairs of a nonprofit
17organization irrespective of the name by which such group is
18designated. The term does not include an other body.

19"Director." A person designated, elected or appointed, by
20that or any other name or title, to act as a director, and his
21successors. The term does not include a member of an other body.

22"Nonprofit organization." An entity listed under section
23501(c)(3) of the Internal Revenue Code of 1986 (Public Law 99-
24514, 26 U.S.C. § 501(c)(3)).

25§ 2303. Prohibition.

26No director shall receive compensation for his services as a
27director of a nonprofit organization.

28Section 2. Section 5730 of Title 15 is amended to read:

29 § 5730. Compensation of directors.

30[Except as otherwise restricted in the bylaws, the board of

1directors shall have the authority to fix the compensation of
2directors for their services as such, and a director may be a
3salaried officer of the corporation.] No director shall receive 
4compensation for his services as a director.

5Section 3. Section 6101 of Title 40 is amended by adding
6definitions to read:

7§ 6101. Definitions.

8The following words and phrases when used in this chapter
9shall have, unless the context clearly indicates otherwise, the
10meanings given to them in this section:

11"Compensation." Anything given or received as an equivalent
12for services. The term shall not include reimbursement for costs
13and expenses reasonably incurred by the independent officer,
14director or trustee in the course and support of services.

15* * *

16"Independent officer, director or trustee." An officer, 
17director or trustee of a hospital plan corporation who is not 
18serving as an employee, or the equivalent of an employee, of the 
19hospital plan corporation.

20* * *

21Section 4. Title 40 is amended by adding a section to read:

22§ 6128. Prohibition.

23No hospital plan corporation shall provide compensation to an
24independent officer, director or trustee for services as an
25independent officer, director or trustee.

26Section 5. Section 6302(a) of Title 40 is amended by adding
27definitions to read:

28§ 6302. Definitions.

29(a) General rule.--The following words and phrases when used
30in this chapter shall have, unless the context clearly indicates

1otherwise, the meanings given to them in this section:

2* * *

3"Compensation." Anything given or received as an equivalent
4for services. The term shall not include reimbursement for costs
5and expenses reasonably incurred by the independent officer,
6director or trustee in the course and support of services.

7* * *

8Section 6. Section 6328(b) of Title 40 is amended by adding
9a paragraph to read:

10§ 6328. Board of directors.

11* * *

12(b) General medical service corporation.--

13* * *

14(7) No general medical services corporation shall
15provide compensation to a director for his services as a
16director.

17Section 7. This act shall take effect in 60 days.