Meeting called to order by CG 8:04pm (Powerpoint).

Roll Call

Trustees

Attendees: Kelly Shane (KS), Arthur Kowitz (AK), Brian Larrabure (BL), Luke Sayer (LS), Tim Terrell (TT), Mike Dixon (MD), David Rutherford (DR), Greg Tomlinson (GT), Carl Anderson (CA), Albert Newmann (AN), Al Anderberg (AA)

Absent

Absent: Fred Guidi (FG)

Staff

Guests:  Craig Grantham (CG – AHRMA Executive Director), Cindy McLean (CM – AHRMA Communications)

Minutes

  • Management Improvement – Tangible Results
    • Best for AHRMA long term
    • Solve for 2023 – think long term
    • Everybody needs to commit and contribute (lead by example)
      • Wisdom
      • Work
      • Wealth
    • Legacy of this Board
  • Recovery Plan Progress – to date
    • Identify and Reduce AHRMA Operating Expenses (get from Craig)
    • Streamline AHRMA Staff Operations
    • Foster a culture and community of true Volunteers
    • Effectively leverage AHRMA volunteer resources through Membership Coordinators
    • Maximize return on investment for AHRMA communications (magazine / advertising)
    • Reduce Road Racing Event Staff Travel Costs
    • Recruit New Members
    • Increase AHRMA event promotion
    • Membership Suggestions/Ideas Invited
    • Retire Debt (after above items implemented and posted as such)
  • Financials: H222 History, H223 Est’s, Expenses, Contractors (see Craig’s spreadsheets) 2023 lowest travel expense per RR event in over 5 years.
  • Revenue vs. Expense: Estimated 2023 (what is the $ estimated bogey)?
  • Thoughts / Business Management Concerns
  • Three Solution Options.
    • Maintain momentum
    • Balance our 2023 finances at “zero” or better
    • Create a working model we can sustain in 2024
    • Door #1 –
      • Cost Containment AND Revenue Growth
      • Revenue Growth
      • Membership Drive
      • Event pricing adjustment
      • Other ideas
    • Door #2 –
      • WE solve it
        • ED Deferred comp of 50% of H223 salary
        • Trustees each make $10k donation
        • Overage to be donated to AHRMA Benevolent Fund
      • Door #3 –
        • Return to our roots – be all volunteer organization
        • Trustees would need to assume the work
        • Volunteers would need to prove competency for the role
        • Volunteers would require majority BoT approval
      • LOC Discussion (see below)
      • Decisions for ACTION – Today
      • Next Steps, Depending on Option(s) chosen

Questions / Discussion

  • LS – question – slide on door #2 – Craig explained in more detail.
  • AN – travel expenses savings, what are the current Off-road travel expenses –
    • CG Off-road generates almost no expenses. Generally self-funding.  Current cost for 2023 $3,600 (negligible), and a potential $15K for the year (estimated.
  • KS – regarding membership increases – we need to be realistic. The economy is circling the drain, people are just not going to renew memberships or join.  Membership expectations should be around 2500.  Most that are leaving aren’t racing and if they aren’t racing they aren’t going to renew their memberships.
  • CG – Understood. It’s hard to tell what might happen. There are serious challenges with the economy but must believe that it will improve. We recently have had a shortfall on memberships.  Bottom line, we are down about 12% – seems to have stabilized in the last few months.  Currently at 2900 from 3300 same time last year.
  • DR – I looked at the G&A expense from 2022.
    • Handbook – $9819 in postage and printing – put it online and eliminate.
    • Magazine – $85.77k – go digital. Renegotiate remaining issues.
    • Board meetings.
    • Membership cards.
    • Storage – reduce by 2/3.
    • Phone Expense. Awards – reduce by 25%,
  • CG – No question we can get to zero – but can we do it for this year?
  • DR – Astounded that RBC requires a unanimous vote of the board. Should only require a simple resolution.  Need to avail ourselves of the opportunity to get the tool at this point and it would be a huge mistake on our behalf not to.  A tool we should and need to take advantage of.  Message from RBC not a good one.
  • CG – haven’t gone back to RBC to discuss. Offer is still on the table.  Wants this LOC as an option which is controlled by the board.
  • AK – not going to vote for a line of credit. We need to stay ahead of the flashpoints.  Magazine committee – why are we still talking about this?  Eliminate membership cards.  Not getting membership numbers – would like to see those.  Biggest expense is the staff – we’ve done the least about it.  What are the hours for each contractor – do we need these positions? Without staff surveys we don’t know what we are paying people for.
  • LS – (regarding LOC) If we have an easy out, it will tend to be used. $100k won’t get us to zero at year end.  We need to take drastic measures to get there.  Is worried we will start out next year with zero reserves and expenses we can’t afford.
  • CG – Not suggesting we use a line of credit to zero our balance. This is a cash flow tool and we need in order to manage big dollar events.  It will bight us when we least expect it…let’s not get surprised.
  • LS – thinks we will be using the line of credit instead of solving the problem.
  • CG – We have a lot of options, and we aren’t suggesting we simply borrow and let it be. This is needed as an event management tool.  Maeny businesses need an option like this including AHRMA.
  • KS – in favor of nearly everything David came up with. Concerned about the members and their reaction to things like cutting the magazine, cutting awards and jackets – will be more palatable if we make other cuts so that we are not just taking away from the members but cutting the cost down.  Magazine needs to go away for the balance of the year.  It’s been in a hole since May.  Make member cards go away.  Get sponsorships for the jackets.
  • CA – Carl agrees with everything KS said – after 26 years in this club, and I think I can prophesy how things will go. We have had a good participation for the AAR – don’t see it getting much bigger than that.   A membership drive and good numbers from new members is a pipe dream.  Better plan on sustaining and overcoming attrition.  My semi-pessimistic belief.  We are a niche market – don’t see it happening.
  • CG – compared to other organizations, we are not activating on revenue generation and growth. We need to be aggressive in this area, think of new options and do whatever it takes to expand our membership, our sponsorships, and our club.  Example:  Baggers (MotoAmerica) are one of the biggest attractions now, and a money maker for the OEM’s and the race series. We must think of ways to grow the club that don’t pen us into a niche where growth is unavailable.  We need to start thinking of ways to grow new membership through INNOVATION.  We should not accept “managing decline”, and we should constantly seek growth.
  • TT – Agrees with Arthur – reached out to Faynisha – question concerning volunteers at Laguna Seca.
  • CG – Showed the last membership tally report provided by CM.
  • KS – Would like to see new memberships vs. lapsed / renewed.
  • MD – Have people that will be working at Laguna Seca have signed an NDA? And is our proprietary information secure?
  • CG – Anybody who works with AHRMA proprietary information will have executed NDAs.
  • AA – go back to a volunteer basis – what we are doing is not working. I wish I have a crystal ball.  Hopefully we can get some support going forward.  We will have to spend some time on it.
  • AK – Asking Carl a question – is this the place to make motions to take action? Or do we do that at our table meeting in California?  I am ready to vote.
  • CA – This is a fully convened meeting of the board. If we can’t vote we are pretty ineffective.  If you’d like to make a motion this would be the place to do it.
  • DR provided a list of savings – discussion – CM explained the current situation with the AHRMA MAG contract.
  • BL –
    • magazine – if we pause it, we have the data showing how many individual people are looking at it – it should assuage advertisers. They shouldn’t be upset that we aren’t producing a hard copy of the magazine.
    • Membership card – Other organizations, he signs up and gets an email and that’s his membership card. Will be providing this info to CM.
  • LS – proper perspective – list is good, but 2/3 of the way through the year, the savings would be significantly less through the end of the year.
  • MOTION: KS go through David’s list 1 item at a time and vote. DR secondedUnanimous yes.
  • MOTION: KS motioned board review in detail staff costs with intentions of making cuts of whatever is possible or necessary – BL second

Unanimous yes.

  • AK – Want to see staff surveys in the next few days.
  • KS – Albert – can you fill us in on the handbook and online printing.
    • AN we will bill $10 for handbook – Amazon gets their part, we get $5 – KS – do any of those $ values change depending on size?
    • KS – Does the size of the handbook make any difference?
    • MOTION: KS Motion to have the handbook go to Amazon print on demand AN secondUnanimous Yes
  • MOTION: KS motioned to do away with printed monthly magazine for the rest of the year – Ask the committee & Steph how to change the magazine away from a printed version to digital.
    • AN – Expressed a concern – that there are risks in doing that. Maybe cut back on the number of issues.
    • Asked CG – Can we put a hold on the current magazine?
    • CG said we are on a 3-year contract but can’t give you that answer right now.
    • DR – multiple components to this issue – one of the things we announced was a 3-tiered membership rate. If we go to an all-digital, we will need to refund members who paid extra for magazines.
    • DR would like to see a copy of the contract – CG agreed.
    • MOTION: DR based upon components with respect to the magazine we should get more info this week including review of the contract as well as the membership implications we defer further discussion until Laguna Seca next week. KS second.Unanimous Yes