NAME: Finance & Compliance Committee

DATE:
December 14, 2015 / Time:
10:00 a.m. to Noon / Presiding:
Cheryl Marks Young,Pete Scerbo, Co-chairs / Recorded By:
Julia Schneider
PRESENT: Cheryl Marks Young;Pete Scerbo, Anthony DeFabio; Deb Hartel, Greg Speed, Alan DeStefano, Lou Schwarcz (on phone); Mary Jo Buchanan (on phone)
Staff:Julia Schneider, June Noto, Debra Wentz
AGENDA ITEMS/ISSUE / DISCUSSION / ACTIONS TAKEN/OUTCOME / TIMEFRAME / WHO’S RESPONSIBLE
Approval of the September 21, 2015 meeting minutes / Cheryl Marks Young welcomed everyone and a motion was made to approve the minutes from the previous meeting. The minutes were seconded and approved. / The minutes were m/s/p. / N/A / N/A
Financial Issues / Julia Schneider presented the October financials and stated that NJAMHAA is on target with revenues and where we expect to be at this point; however, we will continue to monitor closely our financial position over the remainder of the fiscal year as there may be shortfalls in two revenue lines: Business Contracts and Conferences.
Discussion ensued in regards to the conference line and how to possibly increase its revenue. Julia noted that in analyzing our conferences over the last several years, we have seen a drop off in number of attendees per agency. Cheryl stated that agencies need to be committed to losing money by sending multiple people. Pete asserted that the loss in NJAMHAA’s attendees is a product of what the state is doing to the system. Anthony DeFabio suggested that we may want to consider expanding our Annual Conference, possibly to more days with additional tracks, noting that the target audience and location are important factors to consider. As an example, he suggested adding a case management track, thereby eliminating a separate Case Management (ICMS) Conference. June cautioned that while we might consider expanding, we have to realize that there are many logistics to consider. She noted that the Case Management Conference revenue would likely not support the venue expenses of the Annual Conference, as the ICMS committee had agreed to lower their registration fees this past year. Anthony noted that registration revenue is only one part of the conference and that membership should not be relied upon to carry the conference, but that we need to tap into other sources to be profitable.
Discussion turned to the Business Contracts line which largely consists of Approved Vendor program revenue. June noted that this program is not heavily supported by NJMAHAA’s members, for example Chorus Communications, which provides a reduction in telephone expenses. Anthony noted that his organization is already receiving percentage discounts on his phone usage and therefore has no incentive to make a change. Deb Wentz addressed the fact that a trade association such as ours by its nature does not always get the support of its members since the providers are in competition with the association.
Discussion then turned to the Projected 3-5 Year Budget prepared by Julia Schneider. Julia explained that this analysis reflects an average over the next 3 to 5 years, versus a year by year budget. At such, it includes two scenarios. Both budgets are essentially the same with the exception of the Dues revenue line and the Publications, Dues and Subscriptions expense lines. Scenario A includes $80K in dues expense to the National Council for Behavioral Healthcare. This is the target the National Council has for NJAMHAA over the next 3 to 5 years. The revenue line includes an annual dues surcharge net of a 25% uncollectible rate in addition to a 5% dues increase. Julia explained that even with such a budget increase (of close to $53K),NJAMHAA would still incur a deficit of approximately $50K, as a result of the very steep increase in dues paid to the National Council. Scenario B reflects that a balanced budget could be achieved with a one-time 5% dues revenue increase and no surcharge going forwardif NJAMHAA no longer maintains its 100% state membership in the National Council. As such, the Publications, Dues and Subscriptions line is reduced by a little more than $75K. Instead of $80K to the National Council, the budgeted amount would be $4,825 (the annual Association member rate for non-100% Association states). Upon review of these budgets, the committee members asked that these budgets be revised. They asserted that they would like no revenue increases to be reflected as well as more realistic salary increases so that we can see true projected deficits going forward and can make decisions accordingly based on these deficits.
Cheryl commented that revenue contraction due to the upcoming change to fee for service should approximate 15%. Also as a result of this change (to fee for service), Deb Hartel commented that the Dues Worksheet will need to be revised to reflect the loss of contracts.
The committee then reviewed the Additional Dues Ranges spreadsheet prepared by Julia, which include additional ranges within the $15M to $100M budget categories. In this analysis, Julia explained that net of an estimated 5% hardship discount, NJAMHAA could increase its annual dues revenue by close to $13K, due to this restructuring. The committee members tabled any further discussion regarding additional ranges until the impact of a possible dues increase is determined.
Lou Schwarcz posed the question of the possibility of strategic alliances with other organizations. Deb Wentz noted the need to first get current NJAMHAA Board members to agree as their interests are divided, but that such alliances with other trade associations could benefit NJAMHAA’s members financially in the form of reduced membership dues. Deb suggested this be added to the February 2016 Executive Meeting agenda.
The committee discussed the fact that two current Board members (Tony Comerford and Jim McCreath) should be on either the Governance or Finance and Compliance Committee, but have thus far not been listed on either. / Revised 3 to 5 Year NJAMHAA Budget to be prepared and presented
Revised NJAMHAA Dues Worksheet to be prepared and presented
The two Board members noted will be added to the Finance and Compliance Committee lists, based on their choosing. / January 12, 2016 Governance Committee meeting conference call
January 12, 2016 Governance Committee meeting conference call
March 2016 F&C Committee Meeting / Julia Schneider
Julia Schneider
Shauna Moses
Other – Rutgers Economic Impact Study / Deb Wentz reported that as of this meeting, the study is still in process and is expected to be completed very soon.
The most recent NJAMHAA investment policy, created in 2003, was reviewed. Cheryl noted that the wording of “Investment Subcommittee” needs to be updated to “Finance and Compliance Committee”. / Follow up with Will Irving at Rutgers for progress of the study.
Update the investment policy to reflect the Finance and Compliance Committee language. / N/A
N/A / Deb Wentz
Julia Schneider
Cheryl Marks Young motioned to end the meeting / M/S/P / N/A / N/A

Next regular meeting date–March14,2016 at 10am at NJAMHAA Headquarters.