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Things beyond your control always occur. And no amount of planning and preparation can eliminate all risk of income dropping or projected revenue not appearing. So, what if:

Board meeting at XYZ corps and you are a member of the Board. The corps has planned a full national tour with 140 kids, 24 staff, four buses, 2 semi-trucks, you get the drift. Auditions and camps are well underway when in February the following is announced in the Board meeting by the corps administration: “The projected funding has not materialized; we have applied for multiple grants, engaged in other funding measures even outside of our bingo; we are pounding the pavement hours on eand to increase our revenue. Nevertheless, we have only hit 74% of what we need by this Feb juncture and the efforts to compensate are looking bleak. We will continue to try seeking out other resources but that will take time with no guarantees. The good news is that we are currently in the black. And we do have an emergency pool; but that is, well, in case of an emergency which is also in a restricted account. Moreover, even if we unlocked that account according to our figures we would still be way in the red after Finals in August”.

Question for anyone on DCP: What would you do? Risk what happened to Teal Sound? Risk what happened to Glassmen? Or would you do what you could to increase revenue while also finding ways to cut expenditures to stay in the black?

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getting??

so you have just transferred the costs to the members, where it would cost them individually more than having them all together with corps-provided housing and meals. This puts being a member even fur

The corps could save save some money by firing their attorneys, who clearly don't know the difference between "council" and "counsel". ;)

"...but then you cross over the International Date Line..."

Is this going to be on the final exam?

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1. "How much is in the emergency pool?"

2. "Do we have enough to continue on task until our June departure date? If not, what date?"

3. "Has the staff been paid to date? If not, how much is due them?"

4. "How much is required to pay staff and feed the kids until our departure date?"

5. "How much will it cost to cancel our transportation and food contracts?"

6. Define "way in the red" at the end of the season under current estimates.

Answers, please, Stu.

Edited by garfield
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Mind you all of this is hypothetical, but rest assured I have thought through this to be as realistic as possible:

> "My first question as a member of the board to the corps administration in that scenario would be: it's February, the tour starts in June - why are you first telling us about this now?"

At the September Annual Meeting the Board was informed that projections were on target provided xyz grant came through in January in which we had preliminary but not ‘final’ acceptance. The Board was informed at that time the foundation providing the grant was planning on giving out two grants to two different organizations provided that they could secure enough donations to support both grants. The Board wanted us to continue on the path we were on but also asked us to explore various outlets in case the grant did not materialize and report back to the Board at this February meeting. We did develop contingency plans to help compensate if the grant was not approved, including seeking funding sources outside of bingo; however those plans yielded somewhat smaller revenue than what was desired and bingo has not shown the same profit margin as this time last year. And, when the grant was subsequently turned down because the foundation did not meet their own projected donations and only gave out one grant to another organization, combined with our contingency plans falling somewhat short and bingo revenue being down, this has placed us in the current situation we are now in. We are currently still in the black, but our projections to August now place us in the red by the end of tour. So this potential situation should not have taken the Board by surprise.

> "How much is in the emergency pool?"

$30,000. This is the amount which was calculated to take care of all costs to get the corps home safe and sound from anywhere in the United States within 72 hours and still leave a buffer.

> "Do we have enough to continue on task until our June departure date? If not, what date?"

Everything is covered to take us to June 20, which is our departure date, and it does allow us to stay in the black.

> "Has the staff been paid to date? If not, how much is due them?"

Yes; again everything is current up to June 20.

> "How much is required to pay staff and feed the kids until our departure date?"

Everything is covered and allocated until June 20. The food cost is $32,740 and includes staff as well as kids; and the paid instructional staff comes to $27,300.

> "How much will it cost to cancel our transportation and food contracts?"

For the Bus lease (which is 4 charters): canceling up to 90 days out $23,200; 60 to 90 days $69,600; and if under 60 days $116,000.

For the 2 Semi-Tractors lease: canceling up to 30 days out $9,280; if under 30 days $21,600.

Food: Since we are getting periodic food deliveries approximately every two weeks to three housing sites while on tour, up to one week out per delivery cancel fee of $1,764; if canceled under a week prior $8,820

Note: But we have not actually examined the possibility of canceling anything because the advice you gave us was that we are to never cut anything but to 'only' peruse revenue; and that is what we have done in a diligent manner.

> "Define way in the red at the end of the season under current estimates"

Please note that the bylaws will not allow the administration to run the corps into the red without a direct vote from the Board. If the emergency fund 'is' unlocked current projection ($20,000) to ($30,000) upon arrival back home in August; if the emergency fund 'is not' unlocked ($50,000) to ($60,000) upon arrival back home in August. The recommendation from the administration is for us to continue perusing revenue sources, but to go ahead and redo the transportation and food contracts, shorten tour by either starting later or taking a break mid-season, possibly dipping into the emergency fund but only so far as the buffer percentage is concerned, and we can do that in a manner which will leave us slightly in the black after finals in August. However, the conundrum is that you as the Board have always told us to never ever ‘cut’ anything. So, what are the Boards recommendations at this juncture?

Edited by Stu
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