President's Perspective
Dave Brown, AMA president
The Weak Signals Show in Toledo, OH is over and the Sun ’n Fun event is upon us, so it must be spring. Why is it snowing outside? Oh well — that’s life in the Midwest.
The Internet is a wonderful tool for gauging the moods and desires of the membership on a nearly immediate basis.
The recent scuttlebutt on the Internet shows that many members do not understand the need for AMA to become involved in income-producing activities. This is understandable, as most members see AMA strictly as an organization providing services to its members—principally insurance coverage.
In reality, AMA is much more than that.
I am sure the vast majority of members would be surprised to learn that there are 16 purposes listed in the AMA Bylaws and the words “member” and “insurance” are not in there once!
The Bylaws outline the public purposes of AMA, and it is the public purposes upon which the nonprofit status of the organization exists. Fulfilling those functions takes effort, focus, and funding.
Typically, the members want to see their dues spent on programs that benefit them directly, with little thought to the other side of AMA. If AMA is to give its members the most services for their membership dollars, it must look toward sources of funding beyond dues revenue.
To give you an idea of the magnitude of the situation, it’s commonly held that a membership organization, such as AMA, should depend on dues for no more than 60% of its income, with a 50–50 split between dues income and non-dues income being the ideal.
Historically, AMA has been dependent on dues for roughly 85% of its income.
At a strategic-planning session two years ago, we set a five-year goal of lowering this to 75%. This is still a long way from the ideal, but it is also quite a challenge. To meet that goal will require an increase of approximately $750,000 in non-dues income.
What are the alternatives? There really aren’t any worthy of serious discussion. Any option I am aware of would involve either less service or increased dues for the members.
Please understand that I am not priming anyone for a dues increase in the near future; I am saying that in the long run, dues will have to increase if we are unable to generate other sources of income.
If we do not continue to increase the amount of resources dedicated to the public purposes, it will threaten our nonprofit status, which could have a “double whammy” effect: we would have to pay taxes on our income, and we would not be eligible for tax-deductible donations.
If we do continue to increase the amount of resources dedicated to these public purposes, without increasing income it would result in less money available for direct member services.
Please understand that most of the public purposes do benefit the members, but those benefits are usually indirect, and not restricted to members.
Frequency issues are an example. AMA fights for frequency availability or protection, yet those frequencies would be available to all people, whether they are members or not.
The bottom line is that AMA’s affiliation with various service providers who are willing to pay AMA for the right to promote their services to our members does benefit the members. AMA becoming involved in some income-producing ventures will also benefit the members.
In both instances, every dollar of income generated by those activities is a dollar that will not have to be raised through dues. Those programs are the best way to keep your dues down, and that is a priority of the organization.
’Til next month.
Dave Brown AMA president [email protected]
Transcribed from original scans by AI. Minor OCR errors may remain.
