ABA Finances: So Far, So Good—and No Dues Increase #ABAChicago
All things considered, the ABA is moving into its new budget year on a solid footing.
Not all of the financial news for the ABA is good, Alice E. Richmond cautioned in her report to the House of Delegates on Tuesday, the closing day of the 2009 ABA Annual Meeting in Chicago. She has the daunting task of serving as ABA treasurer at a time when much of the legal profession is being pounded by the recession.
But even the bad news isn’t quite as grim as it might be, said Richmond, principal at Alice E. Richmond & Associates in Boston. For the fiscal 2009 ABA year ending Aug. 31, revenue from dues and other sources is down, but not by as much as originally projected. And the association will be able to keep expenses more than $12 million under budget for the year.
As a result, said Richmond, the fiscal 2009 budget, which totaled just under $114.5 million, will finish the year with a modest surplus of between $3.2 million and $3.5 million. “And for those of you unfamiliar with not-for-profit speak, a surplus is like a profit,” she noted. The surplus funds will go into the ABA dues warehouse, a fund that helps to offset dues increases.
“These are not economic times for the fainthearted, and there are, and will continue to be, many challenges for both the ABA leadership and the professional staff,” said Richmond in a written report that accompanied her presentation to the House. “But we will finish this fiscal year in better shape than we might have expected given the economic conditions around us.”
There appears to be reason for at least cautious optimism about the ABA’s budget for fiscal 2010, as well.
Richmond reported to the House that the Board of Governors had approved a balanced general revenue budget of $107.4 million for fiscal 2010, which starts Sept. 1. Accomplishing that will require most ABA entities to absorb 10 percent reductions in their operating budgets and some $6 million to come out of the dues warehouse. (The amount in the warehouse should reach at least $19.1 million by the time the books are closed on fiscal 2009.)
“The best news of all,” said Richmond, is that there will be no dues increase for any membership category in fiscal 2010.
But the ABA’s current stable budget picture is no reason to be complacent, Richmond cautioned in her written report to the House.
“We cannot and should not assume that, when and if the market recovers and the economy begins to show signs of improvement, we can return to the ways things were always done,” Richmond’s report states. “The upheaval caused by the economic turmoil of the past year may encourage us to think differently about how we finance the important work we do both for our members and for the public. However, one thing is certain: To do nothing is to insure that we are neither ready nor able to prosper in whatever new economic order comes from the current disarray.”
More on the Annual Meeting ‘09 here:
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ABA Journal’s Annual Meeting coverage at this link.
Flickr Slideshow: ABA Journal snapshots from Annual Meeting.
