Want to acquire a Chapter House?
Some thoughts and ideas on how to proceed.
If a chapter or colony has a long-term desire to build a house, or simply to have an ‘emergency fund’, what is required is development, dedication, discipline, and direction.
This strategy was used by a very young chapter (implemented in year 3 after being chartered) and resulted in the establishment of a five-figure savings account which the chapter uses every few years to support travel across the country to host a chapter retreat at the Levere Memorial Temple.
Development – A group must develop and maintain sound, efficient, and accurate financial management. If a chapter isn’t using a collection company like OmegaFi, then they should get one. This will help the treasurer to focus on financial management rather than being a bill collector. These companies also help to itemize expenses and revenue, useful for the Form 990 submission and for fiscal planning. By knowing exactly what is collected and what is spent, a group can properly budget and know where they stand financially. Also, the purpose behind the development of the fund must be established, and specifically what it can be used for by the chapter. Writing out specifically the process, who has access, what it can be used for, and minimum payments annually are essential. This leads to dedication.
Dedication – A group must be dedicated to achieving this goal. In other words, budget for it annually. Specifically, have a line item in the chapter’s budget where a certain amount of money per semester is transferred to a totally separate savings account. The purpose of this account is to strictly build this nestegg and should not be touched. This is often the hardest part, but will lead to long-term success of the group. The chapter’s budgeting practice should mirror what a person’s should be. In other words:
1)Pay the bills that must be paid (for a person, rent or other things to keep the lights on, for a chapter, national or local required payments to keep the organization operating),
2)Save for long-term growth (transfer to that savings account, whether you are an individual or a chapter)
3)Invest in future professional development (as an individual budget for things that will make you happy and healthy and make you better, as a chapter, leadership training for individuals and officers like Leadership School).
4)Then budget for your fun.
This leads us to discipline.
Discipline – By discipline we don’t mean to discipline those that are wrong, but rather the discipline to continue on the chosen course. Have discipline in:
1)Maintaining the strategy that is in place from year to year. If the chapter does not keep this in place, then it won’t achieve the goal.
2)Maintain your financial management practices. Changing them or only doing them so-so will result in so-so results. If you can’t measure what you’re taking in or spending, then you cannot have a strong budget and you cannot invest in the future.
3)Avoiding temptation to rob the savings account for a one-time huge ‘party’. It can be difficult to avoid this temptation, and is the modus operandi of a Brother Nero. The body of the fund and the integrity of the fund must be in tact.
Finally, there is direction.
Direction - Chapters which can implement this strategy have a strong financial adviser to provide direction and institutional memory. It is recommended that for this savings account a chapter requires two signatures – one being the EA and the other being the financial adviser. This requires trust in the adviser by the chapter (and the adviser must ensure that he remains trustworthy). Having a financial adviser as a signer/authorizer on the account prevents the fund from being tapped by the chapter unless the adviser agrees with the expenditure and the expenditure is in line with the purpose of the fund.
Lastly, there are always fundraisers that chapters can perform in order to raise money, and these should not be overlooked or abandoned. This strategy reflects one that can be maintained year-to-year, while fundraisers can often be hit or miss. Perhaps most importantly this strategy, if explained to the entire chapter, can help to teach the essentials of good budgeting and saving for the future.
Thanks to James Irvin
Director of Educational Programs
Sigma Alpha Epsilon Fraternity