Meeting of Section, Division and Forum Chairs
Friday, February 13, 2009
Boston, MA (on the occasion of the ABA’s Midyear Meeting)
Attendees: Karl Ege (Convener); Deborah Enix-Ross (SOC Chair); Alice Richmond
(ABA Treasurer); Gary Munneke (Chair, Board Subcommittee on Reserves); Hank
White (ABA Executive Director); Chairs: Aaron Schildhaus; Robert Zupkus; Guylyn
Cummins; Robert Rothman; Tim Bouch; Steve Akers; Jim Wilson; Chris Sprowls; Lizz
Acee; Bill Caprathe; Barbara Lynn; Russell Frisby; Jill Pena; Sue Daly; Bob Horowitz;
Joanne Travis; Paula Cleave; Michael Wynn; Lametrea Gray.
Approval of Minutes of Meeting of January 8, 2009 – Approval of the Minutes were
moved, seconded and unanimously approved.
Discussion of ABA Finances – ABA Treasurer Alice Richmond presented the
Treasurer’s report in detail and provided a copy that was subsequently forwarded to
all the Section Chairs (attached) and for posting to the SOC’s website (it appears on
the Chair’s page on the SOC’s website in the module entitled “Related Resources”).
Alice also reported that proceedings of the House of Delegates will be webcast for
the first time, including presentation of the Treasurer’s report.
The good news is that, as of August 31, 2008, the ABA’s revenues exceeded
expenses by $3.9 million, with the surplus funds transferred to the dues warehouse.
This ensures that there will be no dues increase for at least another year. It was also
reported that the Association is enjoying “clean audits” including the A-133 audit for
federal grants (non-compliance would have serious consequences). The ABA also
reduced its debt related to the purchase of the Washington offices, contributed
$500K to the Enterprise Fund (with good results), and transferred $14.5 million to
the permanent reserves. Additionally, the Association collected $70.2 million in
dues, with another $15.8 million in Section dues. And, the Sections generated $21
million in meeting fees; the ABA generated $7.2 million in the same category.
The not so good news is that the ABA’s long term investments decreased by $16
million, with continued decreases through January 31, reducing the Permanent
Reserve to $37 Million (well below the 50% target). The result will be less money for
association programs and services. However, Alice reported that due to prudent
financial management, the results are better than those experience by many other
organizations. Additionally, the Association’s operating expenses increased by 7% to
$204 million, notwithstanding a 19% decrease in the Association’s consolidated net
assets. Additionally, the Association's pension liability increased by $12 million due
to a decline in market values.
Alice commended the Sections and noted that they are a “model” with respect to
financial management for the Association. This can be seen in the 4% increase in
Section revenues, even in view of the $14% increase in expenses during the past
year, along with sustained growth in the non-dues category. Alice also noted the
large percentage of expenses dedicated directly to programmatic activities, noting
that about 80% of every dollar goes toward program support.
For more detailed explanations of the Treasurer’s report, please see the attachment.
Alice further noted that the Association expects to experience greater impact from
the current economic slowdown in the coming fiscal year and encouraged Section
leaders to urge their Section members not to drop their membership. Further, it is
projected that there will be $10 million less in Association revenue in the coming
Bob Zupkus expressed concern about the expected loss of GP Solo members, both
those dropping Section memberships and those expected to drop both ABA and
Section memberships. Bob stated that everyone in the ABA needs to “get on the
same page about what’s working” with a view toward implementation.
Impact of Recession – Executive Director Hank White reported that the Association is
currently down $1 million in dues revenue. Hank suggested some “out of the box”
thinking on ways to stave off membership losses and, in fact, to increase ABA and
Section membership. These suggestions include: 1) forming a for-profit organization
to manage smaller bar associations that would result in funds to the Association and
savings to the bar associations; 2) increased joint venturing; and 3) expansion of
affinity programs with bar associations and bar executives. Hank encouraged
Section leaders to be creative in trying to secure new members.
Hank reported that the Association has signed an agreement for marketing
consulting services with Leo Burnett and will be reaching out to all of the Sections to
develop an Association-wide marketing plan. The challenge will be to market all of
the various segments of the ABA in a coordinated fashion. Responding to a member
query, Hank stated that the services of Leo Burnett will be available to the Sections.
Currently Leo Burnett is in the first phase of its work (an analysis of current ABA
marketing programs) and that, for purposes of effective marketing, they will divide
membership into segments (as an example, it is thought that solos don’t always want
to be marketed as solos, but rather as business lawyers in a solo setting).
Hank also noted the change in the budgeting process by means of the Clarity system
that will allow the staff to know at any given time where the Association stands
Adriane Dudley asked if Hank would provide a few summary brief paragraphs each
month about the status of ABA activities, e.g., where we are with the budget, recent
developments, etc., that Section leaders can share with their members, in addition to
the more lengthy report that is already being distributed. Hank was also asked to
add his e-mail address in each of his reports for easy access by the members.
Hank encouraged Section leaders to contact him, to call him about matters of
concern, suggestions, etc.; with a view to increased communication with Section
Discussion of SOC Assessment and SOC Expenses – SOC Chair Deborah Enix-Ross
reported that the Board of Governors subcommittee on reserves is recommending
that all Sections that have reserves have a policy in place. Many of the Sections that
have reserves already have a policy (those policies were reviewed by the Board
subcommittee). The Committee has asked the SOC to develop guidelines for
appropriate language to be included in Section reserve policies. Deborah stated that
she will reach out to the Chairs, Chairs-Elect and the Budget officers to ask for
volunteers to be on an SOC committee that will develop the guidelines. They will be
sent to all Section leaders for review and comment before being sent to the Board’s
Deborah also reported that the recommendation of the SOC’s Operations/Policy
Committee regarding an increase in the stipend from the Sections to support the
activities of the SOC will be presented at the business meeting later in the afternoon.
The proposal has already been vetted with the Chairs and Chairs-Elect (during their
monthly conference calls), and thus far has received no opposition. The stipend,
currently at $200 per Section, has not increased since 1991, despite the increase in
activities and costs.
Discussion of Membership – Acting Membership Director Paula Cleave noted that in
terms of membership drops, ABA drops seem larger this year. Paula stated that the
drops will be analyzed very closely. Paula also noted that group billing is likely to be
an issue soon with law firms cutting back as well.
Section leaders discussed the suggestion of reducing the printing and mailing of
journals and magazines as a way to save money. Karl Ege noted that Business Law
has placed all of their committee newsletters online. One Section leader suggested
that Section members should be told that sending paper communications cost the
Bob Rothman from Litigation cautioned the Sections to tread carefully on cutting
paper communication. A survey conducted by the Litigation Section revealed that
many members continue to want paper communications and that if they converted to
an electronic format, it would cut their membership in half. However, Bob suggested
that Sections may want to consider changing paper stock selections as a means of
cutting costs, which is virtually undetected by the membership.
Karl Ege announced that the Business Law Section has created two new committees
(Emerging Trends, so that the Section can monitor changes in the practice of law and
respond quickly with new committees, products and services, and a new government
affairs committee, which will focus on the laws governing federal, state and local
lobbyists). These new committees are an outgrowth of the Section's planning process
that identified areas of business law not covered by the Section's current committee
It was announced that the Association is hiring a new Website Editor shortly.