This is almost how we do things at Psych Central, with the only exception being that moderators are allowed to participate in any discussion they see fit. They are also encouraged to wield their power *very* conservatively and, when in doubt, discuss possible actions to take in the private administration forum.

I find people work best as moderators and administrators when they are internally motivated to do the work rather than externally (e.g., money). When people feel it's their "job" to do the moderation duties, it can be a good and a bad thing. Good in the sense that they have a different kind of motivation to do the work on the board, but bad in the sense that that motivation is harder to maintain.

I think both systems can work, I just think you need to be *really* savvy about online communities in order to understand the dynamics and complexity of the power structures and responsibilities before delving into it.

DocJohn