Live Wire

Why is it that when some one want to know how many claims are made and how much is paid out it Is like the white house ( One big smoke screen) the dues are not bad if we new where they are going, or that they will be put to good use. Some of the monies are acconted for but the big question remains in the dark!!!!!

J_R

As soon as a lawyer gets involved, you can forget ever seeing the settlement. SOP is to get a non-disclosure agreement.

If you really want to see how the dues money is spent, the Audited Financial Statement is in the Member's Only Section on the AMA site.

JR

Live Wire

Finding any thing on the ama site is like pulling teeth on a gator.

J_R

I can't disagree there. The Member's Only Section is reached by the button on the left side of the main page and is easy to find. Getting in is another matter. All I can suggest is that you follow the pop-up directions. Once in, the Financial Statement is easy enough to find.

Of course, the alternative is to pull out about a years worth of Model Aviation and look at each months column by the EVP.

Live Wire

Theres where my problem is the pop up blocker, and the need to know.

mongo

My Feedback: (15)

kinda funny, that they use something, most web surfers try to block.

like they just don't get it

P-51B

My Feedback: (5)

As members of the organization involved in a settlement, I would think we would be privy to the information, but not allowed to release it to the media and such. But I'm no lawyer...thank goodness.

excaliber

P=51b, as a member you enjoy the benefits. but not privey to certain areas, you are not a stockholder,
But if you want the secret word it is "litigation" thats why no details of settlements are published.

MustangFan

Just a thought .....

The dues are almost $10 million a year ... there are donations totalling ???$$$, the mag. ad. income $$$ etc. .... (i know the actual numbers are in the members section of the financial report ... also ... don't believe the cost of the mag ).

Has the AMA Insurance Company ever thought of becoming a self insured insurance company ??? [X(]
( I know ... I've heard the hype ... the AMA is more than an insurance company .... but no-one has really proven that statement to the majority of insure'ees).

If the secondary insurance pays out little ... then wouldn't it be profitable to operate this way ??? All insurance companys make good money.

Then ... maybe .... RCOutlaw will get an answer ... but don't bet on it !


stir ... stir .... stir !

J_R

I suppose that, for the last two years, it has been technically incorrect to claim that the AMA is not an insurance company. A captive was created and sits, unfunded. The captive is a separate corporation. Where it would be based has never been determined. There are substantial tax advantages to taking it offshore, but, then there are other problems with that. Last year, it looked like the captive might have to be funded and used, when no insurance bids were received until the last minute… literally the last week before the existing policy was to expire.

Several years ago, the AMA was self-insured. That situation was precipitated by an accident that made commercial insurance financially unfeasible. As soon as commercial insurance, again, became available, the AMA returned to it.

Substantial reserves are required to get commercial insurance… or to activate the captive, in addition to funding it. That is the purported reason that the funds were put into Muncie. The AMA had to have something to show the insurance company that the AMA was capable of self-insuring itself to the extent of the $250,000 SIR (self-insurance reserve) that the AMA has under the current insurance scheme. In other words, the AMA covers the first $250,000 of a claim, then the commercial policy kicks in, the way it is now. The current coverage is for $2.5 million. Again, in other words, the commercial policy only pays on very large claims.

An insurance company must keep an amount equal to the policy available for each past year it has open claims. Over the last several years, that has averaged 4 years, although it is not limited to 4 years. The years are, sometimes, not sequential (i.e. iIt may go back a couple of years, skip a year, and include two more years). That amount would be $10,000,000 based on the average, just held in reserve, after being in operation for that amount of time. That does not include any operating expenses or other costs involved with servicing the policies. So, each year, starting with the first year of operation, it would require setting $2.5 million aside in the captive, until all claims were settled for that year. That does not include any of the funds necessary to meet other legal and business requirements, which are substantial.

If the captive were to be activated, it would require substantial costs, including, but not limited to, obtaining certification by each state and territory it operates in. All of these costs would, obviously have to be funded by the current corporation, and the current expenditures, other than insurance would continue to go on.

Unfortunately, the claims would still , ostensibly, be covered under non-disclosure agreements, and the membership would know no more than they do now. Although there are currently some reserves that could be used to fund the captive, there would be a shortfall, and I will leave it to your conjecture where that might come from.

JR

MustangFan

JR
I'm impressed with your reply.
You have a handle on a lot of the inside activities and efforts!

Maybe It's difficult to be self-insured ... but every time I think about $10 million PER YEAR ... it just seems that more could be accomplished with it.
Investors love opportunities, anyone think of reaching out to them ?

Maybe we need to hire a good business consultant.

Maybe if we were self-insured we could take more calculated risk with Jets And Helicopters .... and get off their backs !

Why can't the magazine be self supporting like others ... business plan ?

Well as you can see ... I have more questions than answers.
But $10 million plus dollars PER YEAR .... and SECONDARY insurance ... and people working for free. WOW
I know businessmen that have a small business GROSSING approx $1 million per year, and they managed to become multi-millionairs.

The AMA seems to be a status-quo organization from the outside. They are not representing the modeler as WE would like ( derived from all the comments here and elsewhere).

Our pastime needs to be organized and have a governing body ... something to call our own, thats for sure. And we can all agree that It has accomplished some things. But what better things can be accomplished with the money. I think most people agree that $50.00 per year is manageable considering the cost of hobbies. Lets just not throw it away ! Agreed ??? ( Responsible Spending )

Live Wire

I think I figured this one out ?????? Some one , give some one money as long as they keep quiet about it and give them a , well I thought i had it figured out could be they might not get caught!!!

J_R

That's why you have auditors. It is also the reason that a lot of political action has been focused on accounts and auditors in the last couple of years. If you have the answers, write to your Congressman. I am sure he would love to know what the answer is.

F.Ciccarello

My Feedback: (60)

The answer is smoke and mirror's

NdFrSpeed

My Feedback: (1)

I think you better check again,someone made the mention of not being a stock holder,you better check the laws that govern a NON PROFIT CLUB.You are the stock holders,and your intitled to all information with in the non profit club as well.There are very strict guide lines a non profit club has to follow, AMA included.

NdFrSpeed

vpresley

My Feedback: (162)

Well the answer is usually a legal one. Non-Disclosure aggreements are a standard for almost all settlements. You really "Dont Have A Right to Know". As for secrets, the old "you can tell me and I wont tell anyone", is not a workable legal concept. Most guys I know couldn't keep a secret to save their lives, just human nature as it is. So that wont work either.

Vince

Matt Kirsch

My Feedback: (21)

...and that's why everything they can legally tell you has been made available to all members. All you have to do is ask for it, or look it up in MA or on the AMA website.

michpittsman

My Feedback: (11)

I don't want to know too much about how sausage, legislation, and non-disclosure settlements are made. If that were public knowledge, there wouldn't be room on RCU for a post about anything else. Just let me fly my little airplanes and tell me when dinner's ready...JIM

J_R

A lot of the information is straight out of the EC minutes posted on the AMA website. Some is from questions that were raised in my mind from those minutes. Questions that were answered from time to time as the opportunity to ask them of the AMA leaders arose.

Keep in mind a couple of things. The AMA is a non-profit corporation. Although it can keep some of the excess income, it must have some pre-planned use for it. There is a fine line between not losing money and making a profit.

The EVP position has, over a period of time, evolved into the position of a CFO, rather than a secretary/treasurer that it was. One of the things some people would like to see is for the position to become that of an unpaid volunteer instead of an elected unpaid volunteer. Doug Holland, who holds the position now, has an accounting firm and is in a position to spend a lot of time doing the work of the AMA. He has proved to be very effective at investing the funds the AMA has, in spite of one down year. How many that have that kind of mindset want to go through the political process of being elected? Of course, the other way is to hire someone to fill the position. People like that don't come cheap.

That could go either way. It might be more restrictive. Ultimately, the risk must be determined and managed. Keep in mind that the captive would be a separate corporation with a separate board of directors, NOT responsible to the EC. That is as it must be by law. Some members of the boards could be one and the same, but they must do business at arms length. If the captive determined risk for an activity was high, the AMA would have the same situation it has now and have to find a way to reduce risk or pay the higher premiums.

I have seen the business plan changed several times. The problem seems to be that the magazine has to serve some very diverse interests. At the same time, it must act as the AMA's newsletter, which is apparently not conducive to advertising. All those pages are cost without potential revenue.

So do I... that is the reason that I occasionally call or e-mail the questions to those that have the answers. Some have said that is non-productive, but, I would like to think that I can tell when someone is telling me the truth or a story that masquerades as truth. If you feel that you can tell the difference, give it a try.

I won’t pick nits, but the AMA has about 175000 members, about 35,000 of which are kids. These numbers are approximations. 140,000 adults paying $58 is a little over $8 million. Out of that, before you even start, you have to subtract the cost of the memberships for the kids. Remember, the kids are subsidized by the adults. I no longer have a good estimation of the “hard cost” of a membership. It used to be about $38 when the dues was $48. If we assume it went up to say, $45, that means that the income of 8 million is immediately reduced by 35000 kids at $44, or $1,575,00 million. The amount that can be spent is not nearly as large as it appears at first blush.

The insurance, even secondary insurance, averages something on the order of $20 year per adult, including the SIR. I can not imagine what the premium for a primary policy might be per member. UMA might give some clue, but part of what UMA charges is profit, so it’s hard to guesstimate. It is also a $1 million policy as opposed to $2.5 million.

Although the EC is unpaid, we have something on the order of 60 people that are being paid in Muncie.

I have wondered if the AMA could, indeed make money, if it were not a non-profit corporation. I suspect it could.

It is almost impossible to have any idea of what the membership truly wants. This forum has under a hundred diehards and probably a couple of hundred occasional lurkers. I recently ran a poll in the Clubhouse, asking if the members there were interested in AMA discussions without the politics and personal attacks. The poll showed almost 90% wanted no part of AMA issues. It is the same thing that happens at most clubs and fields. A very few have interest in the goings on of the AMA. Most just want to fly. The AMA elections show the same thing.

I don’t see the AMA as maintaining the status quo. That is what is causing all the nastiness now. If the status quo was being maintained, most of the complaints would no be made. Some, like the magazine or Muncie, are the exceptions and have been issues forever. I see it as a matter of direction for the AMA, with the question being, where should the AMA be headed. Are we still an organization that should have competition as one of it’s highest priorities, or should that priority be lowered? Those are the types of issues that I see.

Agreed. Intelligent discussion, rather than attacks and innuendo, might lead to some ideas that bear fruit.

JR

MustangFan

Concerning the general membership .... Maybe MichPittsMan said it best

But that would mean supporting us ... Jet people Included .... and make it possible for us to advance the hobby ( a big complaint here).

J_R .... your answers are good ... to the point ... from a knowledgeable stance. But why can't the mag. cover some of the questions here. They seem to bury their head in the sand. It's OUR Newsletter !

Also ... what does a non-profit org. do with profits from the stock they buy/sell. Is it under the Stated PLAN?
What are the donations about ? ( was for the building fund in the past ... correct).

I have questions, but will never hold office .... I'm the general member stated above.
However, I do have an interest in the org. I belong to. We rely on active/informed people like yourself to keep things on the straight and narrow. Then maybe we can cast our votes (when called upon) with a more informed decision.

FHHuber

Another reason the $58 X membership = $XXX doesn't work...not only are there the $1 youth members (and the youth members with magazine at ? $18 ? There's the CD's who have had free (now 1/2 cost) membership and the Life members who don't have to pay, and the senior citizen discount... (and a good portion of members are senior citizens.) That estimate of $10 milion in annual dues could be off by 50%. easilly. (Before looking it up. That information should be on the AMA website.) [:-]

Still think all that money is wasted?

Don't llike the cost of the "National Flying Site" with headquarters building? One reason they bought the place was to quit tossing money down a tube paying office rental. The leasing fee for equvelent office space would cost just as much as the mortgage payments on the building plus its land. (assuming a mortgage exists...) and you'd have NO equity to show for it. Many clubs OWN the land they use for thier flying sites.

Whats wrong with the AMA owning a site and saving vs cost of leasing an equivelent location for 6 weeks a year to hold the NATS? (which would cost almost what they are paying for the land. Again, we have equity to show instead of money down a dead hole.) When the US Navy quit sponsoring the NATs... the AMA suddenly had a problem with where to hold the contests. Can't blame the Navy for dropping it... it was a big security problem for the host base for a week in the 1960's. Want to essentially shut down an installation for 6 weeks? (not even considering the security issue of the searches that would be needed now [:'(] )

There is no problem with having a decent museum either. You may not see the purpose now... but if you still support the hobby in 30 years, you'll wish the museum was BIGGER.

J_R

I asked the same question some time ago. The answer is that they do what we want. The membership does not want the VPs to write about AMA issues. The membership wants pictures of friends and their planes, and information about clubs. Each of the VPs told me that after they were elected, the first order of business was to be better communication. The wrote a column or three about things they belived the membership wanted to know. Within weeks the complaints come in, wanting pictures. As a result, the VPs give their district members what they want. I even ran a poll in this forum a year or so ago, asking what people wanted. It showed they wanted pictures and club info, not AMA info. There really are very very few of us that care about how the AMA is run.

Don’t forget that the AMA is a non-profit EDUCATIONAL corporation. Education, in one form or another (things like a build and take for kids at a trade show), can always use more money. The building fund retirement plan is still in force (have you bought your brick?), to name a couple. Of course, some donations have specific use attached to the donation. Certain projects at Muncie are always in the works and generally run behind since they appear to be the first projects cub back when there is a financial strain. LOL, not amazingly, there is NEVER enough money. The ongoing day to day business of the AMA is also budgeted into the mix.

The only difference between you and I is that I spend $2 a month on phone calls to the AMA leadership. The rest of your description fits me to a tee.

JR

MustangFan

I guess your correct about what the members want in the mag..

I find myself looking through it with interest about what the other members are doing/building.
But a portion (one article) of the mag. could deal with issues.

To HHHuber ... I think the $10 million may be conservative ... the club insurance(santion fees) were not accounted for in that estimate along with mag. ads. and donations and other misc. ( selling of watches patches, shirts, caps, ... you get the idea). We just take $58 * 170000 members for a rough guess. Gets us in the ball park, and shows how much money is really at issue.

And I'm not sure the money is wasted, I'm just not sure the money is being used to it's greatest potential ... hence the questions.
Many people seem to have this opinion ... hence all the forums/questions.

J_R .... information please .... as Johny-Five said in the movie Short Circuit .... Input, more Input !
Guess most of us are too lazy or too stupid to look through a bunch of numbers for answers.

By the way J_R ... how do you think the AMA is doing on a scale of 1 to 10 ???
I would probably give them a 6 or 7.
I gladly pay my money to be with a great bunch of guys in a sport I love. Just want a good org. behind us.

J_R

MustangFan

The last audited financial statement is from 2002 and is getting long in the tooth. The 2003 statement should be available at the end of March, from previous experience. Having said that, in 2002 the total revenues were about $7.8 million and the total expenditures were about $8 million. If you want more details on the numbers, you’re going to have to take a look at them on the AMA page. Everyone has their own opinion of what they mean.

It is not often anyone has to solicit my opinion, but… since you did…

I would give the AMA a passing grade, maybe a 7+. Actually, that is my rating of the leadership. I view the Headquarters Staff as doing a great job. Certainly there are inefficiencies, as there are in any business. The EC has been reduced to management by crisis. In the last several years, rather than being able to look forward, they have been reduced to taking remedial action. The current one is turbines, but there have been several over the last few years. The Safety Code and it’s concept need review. Each member of the EC is in agreement with that statement, but, each time it comes up, the allotted time has been used for more pressing issues. Each member of the EC knows that micro-managing the membership with a new Safety Code rule for the issue is not the right answer. The same can be said for an overhaul of the AMA by-laws… something long overdue. My personal favorite is the CD program. Although not in the same class with the Safety Code and by-laws, the CD program reaches down to most members and needs an overhaul.

I have questions about where the AMA has been and it’s ability to go forward into the future. As an example, there was a time when the membership was very competition oriented. In the RC community, that interest appears to be waning. Should the AMA be reducing it’s commitment to competition and redirecting resources towards the fun-fly mind set that seems more prevalent? Turning the AMA has been likened to turning a battleship… it takes time. At the same time, I wonder if the members involved in indoor, ff, or control line do not feel that competition is more of an attraction now than ever. Is it time for a new President, with a different vision, or should we keep the one we have? MustangFan, like you, I have a lot of questions… the answers to which I do not have.

JR

MustangFan

Thanks J_R

I had guessed your rating would be in line with mine, but you have more than a gut feeling.

I suppose it's not bad to enjoy what we have but look to a brighter future.
It may get frustrating sometimes to have to wait.

My daughter just gave me a Christmas ornament of the Handymans prayer.

Lord grant me serenity
To accept the things I can't fix
Fix the things I can
and the wisdom to know the difference.

I sometimes (most times) have trouble in the wisdom area.