by Paul Edwards
It is the day before Halloween as I sit to write my December message. This is actually one of the harder messages I have had to write because it focuses on ACB’s need for more funding. ACB does many things well but fund-raising may not be among them. I am convinced that we make optimal use of the money we have and, considering the smallish budget with which we operate ACB, we get a great deal accomplished!
Perhaps many ACB members have not thought very hard about where the money comes from that keeps ACB afloat from year to year. This message will provide some of that knowledge. Some of what I have to say does not make for pleasant reading but it needs to be said, for the time has come for all of us to face some hard truths.
Let’s start with where ACB’s money comes from. Less than 3 percent of our budget comes from membership dues and, if we add affiliate contributions and individual gifts, we are still well below 10 percent. We earn $3 for most members and spend $19 (on average) for each “Braille Forum” recipient. This leads us to a rather strange circumstance: expanding membership actually costs ACB money.
Does this mean that we are suggesting that membership is not a good thing? Not at all! But it is worth noting that we spend nearly 20 percent of our budget producing a magazine that is a membership benefit, which our dues do not come close to supporting. Most other organizations, whether they are non-profit or not, do not include a magazine as part of the membership; instead they charge members a separate subscription price.
Over the past two decades, ACB has depended for most of its funds on the operation of thrift stores in various locations around the country. At one point, income from these stores constituted well over 80 percent of ACB’s revenue. The board and the national office have worked hard to diversify our sources of income over the past 15 years and now thrift stores provide about two-thirds of our revenue. This still means that we are seriously affected when things are not going well in the thrift field, as they now are not. Though I would certainly not classify myself as an expert economist, I believe that the better the general economy is performing, the worse thrift stores do.
And our success in thrift stores is affected by world trends as well. In the mid-’90s we were earning a substantial amount from the sale of rags. These were materials that we could not sell and that were exported to third world countries for remanufacturing into clothing. As Asian economies began experiencing difficulties, the bottom fell out of the rag market. We have also chosen to take less money out of our thrift stores so that ACBES could relocate some stores and open new ones. This year in order to meet the commitments that they had already made to ACB, our thrift stores had to dip into their reserves.
The American Council of the Blind Enterprises and Services is the separate entity that runs our thrift stores. It is run by a separate board of directors partly elected by ACB’s board and partly chosen from outside people with business experience. A majority of its members must be members of ACB’s board. ACB owes a tremendous debt to those who run ACBES out of our Minneapolis office. We also owe a lot to the managers and staffs of our 10 stores. Without their hard work ACB could not function. The ACBES board and management have taken some hard decisions this year and I believe that next year things will improve significantly on the thrift store front.
Other sources of income include a national telemarketing campaign, individual fund-raising events, foundation and corporate grants, income from our investments, and bequests. As you can see, then, many of our income elements are volatile. It is very hard to base the running of an organization on revenue sources that we do not and cannot control. We are constantly looking for alternative ways to raise funds and ideally these approaches will generate more predictable amounts over time.
Several years ago, the convention created the resource development committee which has worked hard to develop funding initiatives. The challenges are great for this committee, and the pressure is on! I urge all of you who may have suggestions to bring to the members of our resource development committee to do so!
Since his arrival at the national office, executive director Charlie Crawford has sought new fund-raising approaches and we are lucky to have someone with his skills on board. He has actually found funding for many of our specific initiatives and is constantly looking for other approaches to raising and saving money.
In spite of the generosity of ACBES, ACB will also have to dig into its reserves to pay for our operations this year. Before going on, I should perhaps say a word or two about our reserves. Those of you who have been around ACB for a long time will know that there was a period in the middle of the 1980s when ACB came very close to going under financially. Ever since then the board of directors has been insistent that ACB do its best to put aside funds so that we would have reserves available for just such a year as this one. We have done a good job and actually hoped to eventually reach a level of reserves large enough to run ACB off its interest. We are a long way from that point, and, since we must use reserves this year and next year, we will make a serious dent in our spare resources.
Clearly the board has done a good job of protecting ACB from itself. We did this in two ways. Each budget over the past several years, till now, has required us to take $50,000 off the top and place it in a board designated reserve fund. It also required us, till now, to place any funds received in bequests that exceeded $75,000 into our reserves. ACB owes a substantial debt to our board for requiring us to put these funds aside.
In the next paragraph I will talk about some of the things we might do to make things better. First, let me tell you how our budget gets adopted each year. It is just another indication of the democratic and deliberative approach that characterizes how we do things in ACB. It is up to the executive director, in consultation with the president and the chief financial officer, to develop a proposed budget. This goes to a budget committee elected by the board at its September meeting. That committee, which meets in December, this year will have the right to substantially amend our proposed budget before sending it on for adoption by the board in Des Moines in January. The board can change things that the budget committee proposes, and has done so in the past. However, the key thing to remember is that the budget is not official until it is adopted by the board of directors of the ACB.
Given our size and our resources, I believe that ACB does an outstanding job of making things better for blind people all over the world. We are very fortunate to have the staff we have in the national office who all wear a variety of hats to get the job done for us. In past years we had at least two more professional staffpersons than we now do and yet ACB remains at the forefront of championing change for people who are blind. Our work is not the issue here. The issue is how do we find ways to increase our resources so that we can do more and so that we do not have to continue to dip into our reserves.
Obviously, we could increase our dues but, when that has been proposed in the past, it has been soundly defeated by the convention. We could use our convention to make a little money. It loses money virtually every year. We could hope that our affiliates and our members will be more forthcoming with their support. Although our affiliates and individual members are often quite generous, and we appreciate that generosity, so far, that has not been the option that meets our financial needs. We can and will seek alternative ways to raise funds. Our work is too important for us to do anything else! ACB will continue to grow both in membership and in influence. That is a given.
It is also unfortunately a given that, unless some major miracle occurs such as the loaves and the fishes, we will not have enough resources to cover our costs next year and will once again dip into our reserves. Among the likely consequences of our current situation is that we will have to cut down on the number of issues of “The Braille Forum.”
We will also, of course, freeze our staff at its current low level. We will drastically curtail travel and will also look at other ways to save dollars. This is what prudent resource management is all about. Every step backward we take is a shame and a sin because there is so much yet to be done. I will pray about loaves and fishes and we will do as much as we can with less.
May your holiday season be filled with joy and, when you give, think about ACB. Every small loaf and tiny fish helps. ACB is our organization and together we must and will find a way!