AVMA Answers: AVMA finances
Q: As Indiana state veterinarian, you're responsible for a multimillion-dollar agency budget. How has this prepared you for your position as AVMA treasurer?
Dr. Bret D. Marsh, AVMA treasurer, responds:
A: The preparation has been great. It's given me an opportunity to understand the important role of budgeting, staying within budgets, establishing priorities for projects, and having quality personnel to carry forward the goals of the Association and meet the objectives of the membership.
In my experience, understanding the fiscal side of an organization is extremely important to its overall success. Here at the Indiana Board of Animal Health, it's the underpinning of our operation. Knowing where the dollars are coming from and how they can best be used is the critical part of the overall operation. I felt I could bring that to the table at the AVMA, and also, having served in the House of Delegates for 10 years and on the House Advisory Committee for four, it was an opportunity to continue to serve and bring some of my skill set to the Association.
Q: What have you observed about the Executive Board's dynamics when deliberating on recommendations that involve a cost?
A: I've been struck with how much thought the board gives to matters that require a dollar amount, recognizing that not everything can necessarily be funded. There are a lot of worthwhile projects out there, and the board does a good job of establishing priorities for the projects that come before them.
Before these recommendations go before the full board, we go into board reference committees to explore each of those items in a smaller group. There is careful consideration about where the item fits within the overall goals of our organization, how it fits from a fiscal standpoint, and how it can be properly funded.
Q: Has the board been willing to cut back on certain programs to accommodate higher funding priorities?
A: Indeed they carefully evaluate whether initiatives meet the short- and long-term goals and objectives of the Association. Some projects may be nice to do as opposed to those that need to be done to advance the goals and missions of the Association. The board's passage of a fiscal policy requiring a three-quarters vote for funding requests over $25,000 is another indication of how serious it is about being fiscally prudent.
Many of our members may not be aware of how many items with a fiscal impact come before the board. During the course of the November meeting, there were 27 such items—some representing a savings, some with a cost, and some being revenue items that projected beyond 2006. Through its careful deliberative process, the board looks at each of these items, trying to determine which ones should be funded and which ones need further evaluation.
Q: How do you see your role as the AVMA's fiduciary watchdog?
A: My role is collaborating with the AVMA staff in concert with the Executive Board and advising the board as we project in the budget where, for example, challenges and opportunities may be and how they need to respond in their approval or disapproval of fiscal actions. It should give us all comfort that we have a quality staff in the Business Division who work and watch these things on a day-to-day basis.
It's important for our membership to know what's going on with our long-, intermediate, and short-term assets. We're in the first year of a new investment strategy, and it's coming along extremely well. It's been a good move on the part of the board. In summary, we're watching our assets more closely on a daily and year-to-year basis as we put together a reasonable budget that can be met, that meets the expectations of the membership, and that advances the goals and missions of the Association.
Q: As the new fiscal year begins, describe the Association's financial picture.
A: As an association, we're in great shape. I'm filling some big shoes left behind by Dr. (James) Peddie and his predecessors. Looking at the Association's fiscal status, we clearly have a year's worth of reserves. We're working hard to maintain that core value so that if we have a catastrophic event, we have the reserves in place to support the Association. And we've instituted investment strategies to expand those reserve opportunities. Over the past few years, we've also done a good job with our physical assets—the building in Schaumburg, Illinois, and the upgrades and improvements needed there to support our membership. We've acquired a quality facility in Washington, D.C., not only for our staff but also for hosting individuals from Capitol Hill who are important to our overall mission through the Governmental Relations Division.
Altogether, those things have established an environment that our membership can be proud of—one of fiscal responsibility that still provides flexibility for new initiatives that come down the line. For example, there are monies available that can be tapped into as we launch into new arenas with the Communications and Animal Welfare divisions.
One final thought: the board's approval of an initiative to fund an AVMA-led National Animal Disaster Summit this spring (see page 174) is important and timely. Our membership recognizes that their Association has played an important role in supporting the tsunami relief effort and in providing the AVMA Veterinary Medical Assistance Teams to help with major national disasters such as Hurricane Katrina. In November, the board set aside some money for the summit. This is an opportunity for the AVMA to step up and bring private parties and governmental agencies together, and potentially to expand the relief network.