Delegates to consider AVMF management, foie gras production, microchip standard
Posted June 1, 2005
Various AVMA constituent associations and in one case, the Executive Board, have submitted five resolutions for the House of Delegates to act on when it convenes its annual session July 15-16 in Minneapolis. May 1 was the deadline for receipt of resolutions. One of the five resolutions was submitted in 2004 and referred by the HOD to an AVMA committee for study this past year. Resolutions 1 and 3 were available in time for the board and House Advisory Committee to make recommendations on in April. When the board meets in June and HAC in July, they will make recommendations on the others.
"Preservation of the American Veterinary Medical Foundation"
The California VMA submitted Resolution 5, which asks that the AVMA Executive Board suspend its promotion of the American Veterinary Medical Foundation to AVMA members. The resolution states:
RESOLVED, that the Executive Board of the American Veterinary Medical Association (AVMA) suspend its promotion of the American Veterinary Medical Foundation (AVMF) to its membership until the expense-to-income ratio has been reduced from 79%, as reported in the 2004 Executive Service Corporation report, to the national average of 35% or below.
Dr. George W. Bishop, California's delegate to the AVMA, said a memo is being sent to members of the AVMA House of Delegates, explaining why the CVMA submitted Resolution 5. According to the memo, the CVMA Executive Committee was made aware of financial problems within the AVMF in July 2003, and the CVMA board of governors discussed it in closed session. The following June, when the CVMA board learned of the AVMF's expense-to-income ratio, it decided it could no longer promote the AVMF to its membership or contribute CVMA member dollars to the AVMF.
Dr. Bishop said the other states in AVMA District X were surprised to learn about the AVMF ratio during their district meeting at the Veterinary Leadership Conference in January, so the CVMA board thought it was time to bring the issue to the HOD floor.
"Basically, what we're encouraging the AVMA to do is discontinue promotion of the AVMF until they have their financial affairs in proper order," Dr. Bishop said.
The resolution comes after five years of increased contributions to the AVMF and on the eve of the launch of a $1 million cause-related marketing campaign (see article). AVMF chair Dr. Robert P. Gordon said that many of the statements in Resolution 5 and in the statement about the resolution rely on incorrect, undocumented, and/or third-party information.
Drs. Bishop and Gordon have disparate analyses as to how much of a donated dollar goes to the actual cause, or program.
"AVMA members would presume that about $70 of a $100 donation would go toward disaster relief or other programs," Dr. Bishop said, "but in reality, only $20 or $30 is, so it is somewhat disingenuous (to ask) our members to support the Foundation (when) a large percentage of that dollar is going to the operation of the Foundation."
The CVMA arrived at that estimation by taking the total revenue figure of $958,522 and total functional expenses figure of $1,096,721 on the GuideStar and Charity Navigator Web sites. Citing those figures, Dr. Bishop said that in 2003, the AVMF's "expenses were significantly higher than their revenue"—114 percent went for "administration purposes," he said. In addition, he said that the AVMF reports in the House of Delegates agenda books have shown an expense-to-income ratio averaging 83 percent over the past three years, and 43 percent in the seven years preceding that. Dr. Bishop noted that Charity Navigator gives the AVMF an efficiency rating of zero stars and an overall rating of only one star out of a possible four.
The breakdown of types of expenses on Charity Navigator, however, appears to contradict the 114 percent in administration expenses cited by Dr. Bishop. Charity Navigator reports program expenses (which includes grants awarded) at 51.3 percent, administration expenses at 14 percent, and fund-raising expenses at 34.7 percent. GuideStar is a national database of nonprofit associations but does not rate them.
Refuting Dr. Bishop's analyses, Dr. Gordon explained that the AVMF's single biggest "expense" is grants given, so to get an accurate representation of a foundation's record, the grants must be removed from the expenses. He considers it misleading to use a simple expense-to-income ratio.
"Anyone who's familiar with nonprofits understands that ratios are very easily manipulated and offer, on a day-to-day basis, a very inaccurate picture of any not-for-profit," Dr. Gordon said.
At a December 2004 meeting of AVMA and AVMF leaders, the Board of Governors asked the AVMF to establish an easily understood formula to calculate the ratios. The agreed-upon formula for the percentage ratio is: expenses minus grants given, divided by income.
Using that formula, Dr. Gordon was pleased to report that through April 30 of this year—a period during which the AVMF has given grants in excess of $2 million—the ratio is actually a negative number. For argument's sake, he refers to it as a zero percentage.
According to Dr. Gordon, the California Veterinary Medical Foundation has a 109 percent ratio if one applies the formula to the 2003 IRS Form 990 the CVMF filed, meaning that it spent more than its income. Dr. Bishop was listed as secretary-treasurer.
In response, Dr. Bishop said that in 2003, the CVMF did have an "overexpense" because of animal disaster relief it provided for victims of the southern California wildfires. He maintained that the expense-to-income ratio was 0.76 percent for 2002, 0 percent for 2001, and 2.6 percent for 2000. From a dollar standpoint, he considers the comparison irrelevant.
Resolution 5 cites 79 percent as the AVMF's current expense-to-income ratio. That figure came from a 2004 report conducted by an outside managing company the AVMF hired for an overall self-evaluation, but that report was never validated or audited. The AVMF's year-end audit found the correct 2004 ratio to be 71 percent. That was not calculated using the formula developed in December, so it does not differentiate between administrative expenses and funds spent on programs.
"Maybe after it was audited it was 71 (percent)," Dr. Bishop commented, "but that's still just as bad."
"Unless you've been involved in not-for-profit management, (data are) very easy to misunderstand or misinterpret," Dr. Gordon observed, "because a business model says, 'You want to make money; you want to put money in reserves'; a foundation model says, 'We raise money from donors to do good work; we should be spending money,'"
The same principle comes into play with another financial question raised in Resolution 5: the Auxiliary Student Loan Fund. In its HOD memo and in the statement about the resolution, the CVMA cites the Auxiliary to the AVMA as raising questions about a lack of adequate investing and "serious neglect" by the AVMF in its management of the student loan fund since 1999.
Dr. Gordon points out that the administration of the Auxiliary Student Loan Fund had been under the direction of a Student Loan Fund Oversight Committee composed of AVMF and Auxiliary members since 2002. "So, any decision that was made regarding student loan fund activity was half Auxiliary and half Foundation," he said.
Dr. Bishop acknowledged that the CVMA has not investigated the reasons for the alleged AVMF financial problems. "That's really the AVMA's purview. We can guess, but why their administration's expenses are so high, I don't know."
According to the foundation's bylaws, however, AVMF finances do not come under AVMA jurisdiction.
"We realize that the AVMA has taken steps to urge the AVMF to resolve the financial issues," Dr. Bishop said, "but little has been accomplished. ... We realize also that the AVMF is a separate entity and the AVMA has no direct authority over it, but we also feel that the AVMA, as a respected organization, must maintain a higher standard.
"Basically, we are trying to preserve the foundation, not trying to destroy it or anything of the sort. As the resolution (title) says, 'Preservation of the American Veterinary Medical Foundation' is our goal."
Dr. Gordon sees the potential outcome differently. "Certainly that title is a joke, because if you do what is called for in the resolution, you have now removed a massive amount of income and promotion, and the ratio gets worse. It's like a self-fulfilling prophecy, except that the title shouldn't say preservation—it should say destruction."
Production of foie gras
Two possible position statements on foie gras production will be considered by the HOD.
This animal welfare issue emerged in the HOD in 2004. Foie gras is a delicacy made from the livers of ducks and geese. The term is French for "fatty liver." Birds are force-fed mostly corn to create lipidosis that expands their livers to several times their normal size.
The 2004 HOD referred a resolution opposing this practice to the Animal Welfare Committee for study. The resolution had been submitted by petition of at least 50 active AVMA members. Since then, the AWC reviewed the scientific and ethical aspects of the practice and developed a recommendation for Executive Board consideration.
At the Executive Board's April 2005 meeting, Dr. David L. McCrystle, who represents District X, recommended that the board forward the AWC's recommendation to the HOD, so that delegates could decide this issue that originated in their chamber. The board agreed to this plan of action.
Because neither councils nor committees may submit resolutions, the position statement drafted by the AWC will be sent to the HOD as Resolution 3, submitted by the Executive Board. The resolution states:
RESOLVED, that the AVMA opposes the practice of mechanical force feeding of ducks and geese to produce foie gras because of the adverse effects on the birds' health and welfare associated with this practice.
The Executive Board recommended that the 2005 HOD disapprove the 2004 resolution, which had been referred to the AWC for study. Now called Resolution 1, it states:
RESOLVED, that the American Veterinary Medical Association hereby opposes the practice of force feeding ducks and geese to produce foie gras.
The House Advisory Committee also recommends approval of Resolution 3 and disapproval of Resolution 1.
During the Executive Board discussion, Dr. McCrystle noted that one of the key differences between the two proposed versions is inclusion of the word mechanical in the one developed by the AWC. Later, he explained that by specifying mechanical, the position seeks to eliminate the animal's stress in having a tube forced down its esophagus, but it does not rule out the feeding of a high-energy ration. Dr. McCrystle said that feeding a high-energy ration would never result in as fatty a liver as can be produced mechanically, but the liver would still be fattier than normal.
Dr. Holly Cheever, a member of the Association of Veterinarians for Animal Rights, which helped generate the AVMA member petition for the 2004 resolution, said, "Yes, if you feed a high-density ration ad libitum, the birds will get a slightly infiltrated liver, slightly larger. A premigrating bird who's doing this naturally might expand the liver to not quite twice normal size for the migration, but you're not going to get a liver that's 10 to 12 times normal size. A liver that's only twice normal size might not really have the appeal for people who want to eat foie gras."
At press time, Dr. Cheever expressed interest in withdrawing Resolution 1 because she and various supporting groups interested in this initiative are "very delighted" with the Executive Board's wording in Resolution 3. "We wish that word 'mechanical' wasn't in there, but we don't really think it makes any material difference," Dr. Cheever said, "so we do support the Executive Board's resolution statement." Procedurally, it may be difficult to withdraw Resolution 1 because it was submitted a year ago by petition of AVMA members and has been acted on by the House of Delegates (referred to the Animal Welfare Committee).
Speaking before HOD Reference Committee 2—Public Matters in July 2004, Dr. Cheever denounced foie gras production, based on what she witnessed during investigations of a New York production unit in 1991 and 1997. The unit had changed hands by 1997, and management wanted to convince Whole Foods Market to carry their product.
The 1997 investigation was producer invited. Whole Foods asked Dr. Cheever to accompany their representatives on the visit.
"Long story short, the production was just as awful as I had seen before," Dr. Cheever said. "The plant was filthy; the animals were filthy. The first two days they're on the production line, the ducks will look fine. By the time they've been there a week, they look pathetic. Their feathers are bedraggled, and they can't preen themselves. The birds become so metabolically ill that the first thing that goes is their ability to walk, and you find these poor birds dragging themselves across the pens with their wings. The second thing that goes is essentially their normal brain activity."
At the 2004 reference committee meeting, Dr. Cheever read a letter she was copied on by the chief marketing executive at Whole Foods, addressed to the producer after the invited visit. The official called foie gras production a "brutal practice," expressed anger over being "lied to" about the humaneness of the practice, and vowed never to do business with the producer.
While noting that the reference committee voted to support the 2004 resolution, Dr. Cheever added, "The House of Delegates, understandably, felt that they needed to know more, (rather than) automatically rubber-stamp something that they knew really nothing about."
After the HOD referred the resolution to the Animal Welfare Committee, Dr. Cheever spoke to the AWC about the issue last November and this April, sharing her observations, the Whole Foods letter, and videos of the investigations.
The industry defends foie gras production for three reasons, each untrue, according to Dr. Cheever. First, it claims that force-feeding mimics natural premigration behavior in which ducks gorge themselves. In reality, the Mulard duck used for foie gras is a hybrid of Pekin and Muscovy ducks, neither of which migrates. Moreover, natural premigration gorging would not enlarge the liver to the extent of making the birds ill.
Second, the industry's defense of the metal gavage tube is that it doesn't hurt the ducks because of their naturally cornified esophagus. Third, producers say it doesn't hurt the birds to insert this tube down their throat three times a day for three weeks because their esophagus is also distensible. According to Dr. Cheever, ducks do not have a cornified esophagus, and the Mulard, which eats grass and not frogs or fish, does not have a distensible esophagus, either. Moreover, the esophagus could not be both cornified and distensible, as the industry contends.
"When they feed them with this rough pipe jammed down their esophagus, many times the esophagus is actually blown wide open, because the worker isn't paying attention and overstuffs them," Dr. Cheever added.
Three farms in the United States produce foie gras, two in New York and one in California. This past September, California Gov. Arnold Schwarzenegger signed legislation prohibiting the force-feeding of ducks, geese, and other birds to produce the delicacy. When the law takes effect July 1, 2012, it will also outlaw the selling of foie gras products in California.
National Animal Microchip Standard
In the past few years, the AVMA has been involved in efforts to resolve the lack of standardization in radio frequency identification microchips for companion animals in the United States, but manufacturers and distributors have been unable to arrive at a consensus agreement.
Now, in Resolution 4, the Florida and Colorado VMAs—with the endorsement of the Connecticut, Iowa, New Mexico, and North Carolina VMAs—are calling for the AVMA to step beyond its efforts as mediator and, according to the statement about the resolution, become a catalyst for change. The resolution states:
RESOLVED,that the American Veterinary Medical Association takes an active role in defining, recommending, endorsing, and implementing a national microchip standard (for companion animals, birds, and equids) in the United States to include:
Using political, legal, and media campaigns to form a consensus among manufacturers to use this national standard,
Advocating for the industry-wide adoption of open technology microchipping systems that benefit animals rather than individual companies,
Identifying corporate funding to support national distribution of dual and backward compatible global scanners as quickly as possible, build linkages among acceptable databases, and undertake a public education campaign about the benefits of permanent identification based on a national standard.
Most of the more than 2 million electronically identified dogs and cats in the United States are implanted with an AVID (American Veterinary Identification Devices) or a HomeAgain chip (Digital Angel Corp., distributed by ScheringPlough Animal Health Corp.). When scanned by an appropriate 125 kHz scanner for the implanted microchip, a unique identification number is read. Some microchips have their information encrypted. This results in not all scanners in the United States being able to read all the chips used in this country.
Dr. Larry G. Dee is Florida's delegate to the AVMA House of Delegates and president of the World Small Animal Veterinary Association. Over the past decade, the WSAVA has watched small animal microchipping around the world progress from the 125 kHz chip to chips operating at 134.2 kHz, the standard set by the International Standards Organization.
"As the technology evolved, everybody (exclusive of the United States) went to an ISO chip," Dr. Dee said—Canada, western Europe, and Australia, among them. "About eight years ago, the WSAVA endorsed the ISO chip when everybody in the world was switching over to it."
Along with the WSAVA, the AVMA, AAHA, and ASPCA have also been promoting adoption of the ISO standard in the United States.
Countries using the ISO chip have global or forwards-and-backwards scanners that read microchips operating at both frequencies. Scanners used by most U.S. humane societies, animal control agencies, and veterinary hospitals, however, are designed to detect only the 125 kHz chips and also cannot read some of the chips whose numbers are encrypted.
"Almost every major national veterinary association has worked with ISO manufacturers and, basically, set a standard, and the manufacturers are required to meet that standard," Dr. Dee said.
"In the U.S., while we have nationally recommended an ISO standard, we haven't done anything to implement it. We've allowed the manufacturers to do whatever they wanted to do. ... It's finally time for the AVMA to step up to the table and say, 'Here's the appropriate standard, it's going to be the international standard and we need to bring the manufacturers to the table and resolve these issues.'"
Resistance from industry is possible because of their concerns over market share, but Dr. Dee said the AVMA must do the right thing, even if it means hiring attorneys. "Everywhere else in the world, there was resistance, too, but they were all able to come to the table because of national associations."
Ralph Johnson, executive director of the CVMA, said, "Colorado indicated to Florida that we would be happy to co-sponsor this effort with them. ...the current system gives pet owners a false sense of confidence because it truly is not a well-functioning system."
Johnson serves on the Coalition for Reuniting Pets and Families, formed in 2004 to try to get the companies to resolve their differences. He represents the American Society of Veterinary Medical Association Executives on the coalition. The other members are the AVMA, American Animal Hospital Association, American Kennel Club - Companion Animal Recovery, American Humane Association, American Society for the Prevention of Cruelty to Animals, Society of Animal Welfare Administrators, Humane Society of the United States, and major animal shelters.
"The coalition's significant progress to date has been in getting the national leaders engaged in conversation and exploring what's a very difficult challenge," Johnson said.
Johnson sees this initiative as a broad effort encompassing standards not only for a comprehensive and functional pet recovery system but also public education efforts and linkages between databases. He considers the coalition and Resolution 4 complementary efforts. "Hopefully, the success of this resolution will empower the AVMA to take a stronger leadership role on this issue," he said.
Might the resolution involve the AVMA pursuing introduction of national legislation? Johnson said, "Yes, it could well be that a preferred strategy would be to achieve a national standard through national legislation or regulation."
Venue for leadership conference, delegates' assembly
Resolution 2, submitted by the Nebraska and North Dakota VMAs, calls for the AVMA to hold its annual Veterinary Leadership Conference and House of Delegates Informational Assembly in the Schaumburg, Ill., area beginning in January 2007. AVMA headquarters is located in Schaumburg. The resolution states:
RESOLVED, that beginning in January 2007, the American Veterinary Medical Association holds the annual Veterinary Leadership Conference/House of Delegates Informational Assembly in the Schaumburg, Illinois area.
Attended by more than 400 AVMA members each year, this event has become an important part of the Association year.
Before the event was moved to downtown Chicago, it had been held in the Schaumburg area. Returning there would enable participants to tour nearby AVMA headquarters once again. One possible venue is currently under development and within walking distance of AVMA headquarters. The Renaissance Schaumburg Hotel & Convention Center is scheduled to open in summer 2006.