April 15, 2003

 

 Officers on the road - April 15, 2003

Posted on April 1, 2003
 
Officers on the road is a monthly feature of the JAVMA News, designed to let AVMA members know about the issues their leadership is addressing.

Officers on the road

Peddie on AVMA finances

What is the likelihood that dues will increase?


 Dr. James Peddie,
AVMA treasurer,
responds:

The preliminary budgetary work shows a high probability that we're going to have to increase dues by $25 for the year 2004. Roughly 40 percent of AVMA revenue comes from nondues sources, primarily classified and display advertising in JAVMA and interest from our invested reserve accounts. Both those areas have suffered a major financial hit, because the economy has gone into a recession. We have controlled expenses very well, but in spite of that, if we're going to continue to offer the services and programs that the membership expects and wants, we'll need more income. If we don't, the AVMA will be prevented from funding some current projects and will not be able to fund new projects.


How has the economy affected the interest on our reserves?

Three years ago, at the direction of the Executive Board, we invested $1 million in a selection of mutual funds. This was at the time the stock market was still going crazy. We have taken a slight loss from the original invested amount on this investment. But all of our other investments, totaling approximately $21 million, are in governmentally insured or backed vehicles, so we have not lost any of this corpus. What has decreased is the interest rate we are now receiving from these investments, which is less than half of the return we were receiving prior to this recession.


What measures have you taken to avoid the dues increase?


For the fiscal year 2003, we recognized that difficult financial times were coming, and, in response, we instituted a hiring freeze. We also went back through the 2003 AVMA budget, which was being developed, and pared back just about everywhere. By doing this, we reduced expenses by about $1 million, which was necessary to hold the line and avoid raising dues for 2003. It's my opinion that additional cuts in the area of expenditures would have a severe negative impact on AVMA operations.



Is the AVMA trying to find other sources of nondues revenue?


Yes, we just started using an advertising technique we call "bundling." This resulted from the recognition that the Convention and Meeting Planning Division, for example, was competing with the Publications Division for sponsorship and advertising income—they were both approaching and tapping into the same sources. To eliminate this competition, several AVMA divisions have joined together and bundled advertising and sponsorship opportunities and are now marketing them as a package. We also recognized that timing is important, and that the best way to obtain money from companies is to approach them when they are forming their budgets, so we can get in on their budgetary line items for advertising and influence them in our favor. We feel that bundling will help us in this endeavor as well.