My moderators do it because they want to help the site. I have people asking me to be moderators & not once has one asked for a handout.. I've rewarded people who are especially supportive (not necessarily just moderators) w/ a t-shirt, decals, gear from sponsors, etc.
Yes, very true. I am also associated with a dozen forums and the moderators are contributing to help the community.
I am concerned as moderators are responsible guys and should be awarded something for their hard work. How about sharing the adsense money? Say rotating adsense based on their contribution to their thread. This is not only for moderators but also for members.