Dick, Marty et al,
To make certain I wasn’t smoking pot while attending
an A&F meeting that discussed the financial aspects of Life Memberships, I
asked Jim McCobb if he remembers the same thing I think I remember – i.e.
we now lose money on Life Memberships. He said he has this same
recollection.
As is true of reviews and projections of financial matters
of this type, conclusions of meager profitability, breaking even and small
losses are based on more factors than I, as a simple, non-finance person fully
understands. I accept that this means also that there will likely not be
unanimity in thought among all experts who may review our LM situation.
When it comes to fiscal health I am likely to be a “the
glass is half empty” kind of guy, as I am on this issue. In this
case I put more weight on the pessimistic side of the discussion than on the
neutral side. My takeaway from this discussion may not mean the sky is
falling; however, it certainly means we may want to carry sturdy, steel-ribbed
umbrellas and prepare for rain.
Thinking strictly of my contribution to ARRL dues through
life membership, I feel pretty certain that the LM dues I (and many of my
friends) paid have been spent quite some time ago. With the exception of
donations we make to the League, we and many others are drags on the budget.
Jim
Jim Weaver, K8JE,
Director
ARRL
E-mail: k8je@arrl.org; Tel.: 513-459-0142
ARRL -
The Reason Amateur Radio Is!
Members -
The Reason ARRL Is!
From: Marty Woll
[mailto:n6vi@socal.rr.com]
Sent: Wednesday, June 25, 2008
8:56 AM
To: K8JE; arrl-odv
Subject: Re: [arrl-odv:16864] ARRL
CONTEST UPDATE
Dear
Jim et al.,
I
have heard nothing up to now about the League losing money on life memberships,
and I find it difficult to believe that would be the case. When a member
pays a lum sum of 25 times the annual dues rate, that money is earning a return
every year. At today's $39 annual dues amount, that lump sum of $975 is
earning about $49 annually - more than the annual dues amount - using
our recent average return rate of around 5%. Even if dues later go
up 20%, we're still better off with the up-front lump sum. A higher
investmet return would only make this an even better deal for the League.
We
should also consider the actual incremental cost of serving a life
member. Most of ARRL's overhead and operating costs would be the same
whether Joe Ham is a non-member, annual member or life member. Our added
out-of-pocket cost for a member - life or otherwise - consists primarily of
printing and sending twelve issues of QST per year. I recall Harold
estimating that cost to be less that one dollar per month, or under $12 per
year. I saw a much higher cost-per-member number in an actuarial study
done several years ago, but I never saw any basis for that cost number.
If, as I suspect, it included allocated overhead and general operating
costs rather than true incremental cost, I believe that's the wrong
basis for decision-making unless we risk having the majority of our members
becoming life members, which is not the case. In fact, an evaluation using
incremental costs would likely support the introduction of a discounted
life-member rate for seniors. [And no, I don't buy the argument that
younger members would be subsidizing older ones; actuarial calculations don't
work that way.] By the way, the same member-cost assumption affects the
amount transferred from the Life Member reserve to the operating account each
year, probably another matter that warrants revisitation.
Finally,
consider that a life member is a guaranteed set of eyeballs for our
advertisers, a guaranteed part of our constituent count when we go to
Capitol Hill, a member who does not require our incurring the cost of annual
renewal solicitation, and possibly a more loyal supporter of ARRL. Let's
promote the heck out of Life Membership!
73,
Marty
Marty
Woll N6VI
Vice-Director, ARRL Southwestern Division
ADEC, ARES-LAX-NW
BCUL 15, LAFD ACS
CERT