Article V - Expenditures - Authorization
Union money can be spent only with proper authorization. Authorization should be given only for expenditures that serve a legitimate union purpose. It is the duty of all union officers, including the Executive Board, to exercise adequate monitoring of all authorizations to ensure that funds are spent only for legitimate union purposes. Officers and staff have a fiduciary responsibility to see that the union’s assets are managed prudently, ensuring that any and all expenditures are for the exclusive benefit of the affiliate and its members. Proper authorization is accomplished by the following methods:
Payments required by law need no further authorization. Examples include taxes on property owned by the union, federal or state income taxes withheld from salaries and allowances of union officers and employees, Social Security taxes, Medicare taxes, unemployment and/or Worker’s Compensation taxes, and other federal, state, and local taxes or license fees.
Payments required by a union constitution (constitution may be the International, Council or Local Union Constitution) to which the affiliate is subject need no further authorization by either the Executive Board or membership. Examples include International Union and Council per capita taxes established by the respective constitutions, and payment of fees for bonding of officers and employees as required by the International Constitution. (This may also be a requirement of federal law.)
Payments to meet contractual obligations, provided proper advance authorization of the original contract or policy was obtained from the membership (or delegate assembly) or the Executive Board, may be made without further authorization. Examples include payments made pursuant to leases on office or meeting space, automobiles, and equipment; salaries for employees covered by a collective bargaining agreement; payment of fringe benefits or into a retirement fund covered by terms of a contract; and payments being made on a time-payment contract for property of any nature.
Payments may be authorized by vote of the membership, Executive Board, a committee of the Executive Board, or other delegate assembly as outlined in the constitution of the affiliate. Examples include:
- By motion properly made and carried authorizing the expenditure of a specific amount (or "not to exceed a specific amount) for a specific purpose. The motion in its entirety should be entered in the minutes.
- By motion properly made, carried and entered in the minutes authorizing regular payment of recurring obligations (example: rent for a meeting hall once each month). Having once been made, such authorization will stand indefinitely unless canceled by motion made, carried, and entered in the minutes at a subsequent meeting.
- By motion properly made, carried, and entered in the minutes authorizing the officers to enter into a purchase or service contract. Once signed, the contract becomes a recurring obligation, and no further authorization is needed. A copy of the contract must be attached to the minutes of the meeting at which it was approved and must also be made a part of the financial officer’s records.
- By motion properly made, carried, and entered in the minutes approving a budget for the coming year. This budget shall set forth the anticipated income and the sources thereof, and the anticipated expenditures and their purposes. While it is recommended that all AFSCME affiliates adopt annual budgets, all Councils and any local having 2,000 or more members are required to adopt an annual budget in advance of their fiscal year.
Standing by itself, a budget does not authorize any particular expenditure. No payment should be made or costs incurred until the proper approvals for the expenditure have been made. Some affiliate constitutions may authorize certain officers to spend up to the budgeted amount for line items. Other constitutions may require specific Executive Board approval for each expenditure.
In general, financial officers have authority to reasonably reallocate amounts within budget line items as long as the bottom line remains unchanged. Any such changes should be presented to the Executive Board. Should the income or expense budget require modification, the revised budget must be submitted to the Executive Board for review and approval. All changes to the budget must be clearly recorded in the minutes.
The budget must be attached to the minutes of the meeting at which it is presented and approved, or revised and approved, and made a permanent part of the affiliate’s records. All Councils and those locals having 2,000 or more members are required to file a copy of the affiliate’s adopted budget, and any major modification or revision to such budget, with the International Secretary-Treasurer within ten days after its adoption. (See the Appendices for further budget information.)
Since all such authorizations are entered in the minutes, the minutes themselves are to be considered a part of the financial records and must be retained for a period of six years. The authorizations remain in effect only as long as the minutes are retained.