USCF DELEGATES MEETING
Harmony at Cherry Hill
The annual meeting of the USCF Board of Delegates concluded today in Cherry Hill, New Jersey. It was a relatively harmonious affair, with the Delegates generally showing strong support for the efforts of Executive Director Frank Niro and the Executive Board to turn around the federation's perilous financial situation.
The audited financial statement for operations for the fiscal year ended 5/31/02 showed a loss of $348,025. However, this included adjustments of prior year annual statements, dating back as far as 1996, totaling -$320,280. The portion of the loss due to the recently concluded fiscal year was only $27,745, an excellent achievement for Niro, who took over in midyear when the loss for the year was more than $160,000.
An unusual line on the statement provoked questions: Sponsorship, -$12,600. Someone asked whether this meant that USCF had to pay sponsors to sponsor its activities! The explanation was that 1) For the fiscal year ended 5/01, $13,000 in sponsorship from AmericInns was mistakenly recorded twice. 2) $5000 in sponsorship from John Hancock Insurance for the 2002 Cherry Hill US Open was mistakenly recorded for the year ended 5/01 (the new fiscal year ending 5/03 would seem the appropriate place for this). Also, under the previous ED, the federation had failed to provide John Hancock with the publicity agreed on in return for its donation, so the company declined to contribute the $5000! Fiscal Year 2001 was the year in which President Redman insisted on a surplus at all costs, and he and ED De Feis boasted of making a $14,000 profit. But almost $100,000 in missing accounts payable were previously discovered, and it seems that the more this fiscal year is scrutinized, the more errors are found, and the mistakes invariably are in the direction of overstating income or understating expenses.
The USCF auditor was present, and stated that the federation did not yet have a "going concern" problem because of its Life Membership Assets balance of approximately $500,000 plus the USCF building in New Windsor, NY. The latter has been depreciated and is listed on the balance sheet for only $152,628, but has been appraised for over $600,000, and the federation recently received an offer of $600,000 for it, which is being seriously considered.
The Delegates discussed the possible sale of this building, and authorized the Executive Board to proceed with this sale if the Board decides this course is correct. There was also discussion of moving USCF Headquarters to the Sid Samole World Chess Hall of Fame and Museum in Miami; ED Niro stated that favorable terms were likely for a move to the Miami site.
The Delegates enacted the first major dues raise in eight years. Beginning January 1 or possibly slightly earlier, dues will be as follows:
Adult: $49, with an affiliate commission to be determined by the ED. It is generally believed that this commission will be $4. The current adult dues are $40 with no commission.
Youth: $25, with a $2 affiliate commission. This membership, for age 20 or below at expiration, includes a monthly subscription to Chess Life.
Scholastic: $19, with a $2 affiliate commission. This membership, for age 15 or below at expiration, will include Chess Life every two months, probably with a special "School Mates" yearbook issue replacing the Chess Life for October. Currently, Scholastic members pay $13 with no commission, and receive School Mates quarterly.
The general feeling, with which I strongly agree, is that School Mates has been an expensive failure which has few readers and has contributed little to the cause of converting scholastic players into eventual adult members. The savings that will be created by reducing School Mates from four issues to one per year was estimated at about $90,000.
Scholastic without magazine: $13, with a $1 affiliate commission. A number of major scholastic organizers indicated that they needed a low cost option of this type to be able to hold rated scholastic tournaments. These members would receive only the annual "School Mates" yearbook issue in October. However, they will receive three USCF catalogs per year, and I believe that every four months, they should receive a Chess Life catalog issue (or the Yearbook/catalog), which can be done at little extra cost to USCF. Past history indicates that members who do not receive a regular publication are especially poor prospects to eventually become adult members. Whether they will receive any issues of Chess Life, though, is uncertain and will be determined by the Executive Director.
In general, I am disappointed to see the "without magazine" option established. I would like to see all scholastic players become either youth members, or scholastic members with a publication. The latter costs only $19, and many affiliates will not keep their commission and will charge only $17. As Niro stated before deciding to compromise with the scholastic people, "I took my daughter to the beach recently and the parking cost $12!" The idea that a significant number of kids will not compete in an event because USCF dues are $19 or $17 for a year seems silly, but many scholastic organizers believe this. It is the unwarranted fears of these organizers, not player/parent price resistance, which cause a real problem for USCF whenever an attempt is made to raise scholastic dues.
Affiliation: $45. A special rate will be offered for multi-year affiliations.
Senior: No figure was mentioned, but other categories were supposed to be in proportion to the adult increase, so I would guess $36 with a $3 commission.
The dues raises were part of a Strategic Plan presented by Executive Director Niro. This lengthy, detailed document warned that this is a "critical junction in USCF history" and that the federation is "closer than ever to the edge." It also stated, "Service is more important than growth" and "Improve service/perceived value and growth will follow." His plan was enthusiastically endorsed by the Delegates, and his policies (dues increases, reduction of School Mates to one yearbook issue, abolition of mandated stenographer, request to Ratings Committee to study a new title norm system) that appeared on the agenda were approved.
Niro also reminded the Delegates of the USCF Mission Statement, indicating that following it is generally the right course. The Mission Statement was listed in his plan, and includes "USCF offers discounted chess books and products." Niro is a big believer in the USCF sales program, and plans to keep expanding it. What a breath of fresh air compared to the previous ED, who last year actually stated to the Delegates at Framingham, as part of the justification for his absurd decision to get out of the book and equipment business, something like "The USCF Mission Statement does not say that we have to sell chess books and equipment." When I then privately approached him on the platform and placed the Mission Statement in front of him, he said, "Well, it's not a big part of the mission."
In a long overdue move, the Delegates removed the requirement that all Board meetings be recorded by a stenographer. An audiotape will be made of each meeting instead and posted on the internet. This change is expected to save USCF about $17,000 per year.
The content of the 5th Edition of the USCF Official Rules of Chess was approved without controversy.
USCF regions were re-established. There will be 12 regions, identical to those existing when regions were discontinued a few years ago.
The Professional Players Health and Benefits Fund balance, about $126,000, will be transferred to the USCF Charitable Trust at some time during the coming year.
A motion to enable trustees of the Charitable Trust to appoint other trustees, removing this power from the USCF Executive Board, was withdrawn.
A motion to have the Delegates appoint USCF's FIDE Delegates, another function always handled by the Executive Board in the past, was also in effect withdrawn, being changed by its makers to a motion of commendation.
A motion to ask the Ratings Committee to consider a new lifetime titles system was accepted. A previous lifetime titles system was confusing and unpopular, often awarding titles well above the players' abilities, but the new system would have a more accurate formula plus a rating requirement, the latter being similar to FIDE's GM and IM titles. The Ratings Committee is expected to report back next year, and no quick implementation is expected, but a process has begun that I believe holds much potential for promoting tournament activity, if the pitfalls encountered on the last try are avoided.
Another part of the Niro plan is to restart the Membership Appreciation Plan, the successful membership drive that was unwisely cancelled in early 2000. It was announced that Shane Samole of Excalibur, sponsor of the World Chess Hall of Fame, was donating $5000 for prizes for those MAP particpants who bring in the most members. We don't know what time period will be covered by the next MAP but look forward to an announcement shortly.