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The Finance Committee submits the attached 2003 Proposed Budget with the following explanatory information.
- While the budget categories are evolving as the years past, they are still not being provided here at the detail level used for tracking actual expenditures.
- To budget for all programs, all Committee requests, and allocate 20% to lobbying would require the use of almost all of the Association’s reserves.
- The major change in building the projected expense side of the budget is found under Committees. This is the first budget year in which we are operating under a NCLA policy requiring committees to submit budget needs to the Finance Committee prior to the submission of the budget to the Executive Board. The columns, which include actual committee requests, are provided simply to present a picture of what those committees who submitted requests would like funded. All travel requests from committees were accepted in order to provide a clearer picture of how much it costs to run NCLA.
- With the exception of the reserves line, projected revenues remain the same in both Option A and Option B.
REVENUE:
- Carryover – The 2002 budget finished in the red and had to be balanced with reserves, so there is no carryover.
- Reserves – Amount required to balance the budget under this option.
- Conference Income – The 2001 conference profits of $15,648 were allocated for use over FY2002 and FY2003. For FY2002: 1) $5000 was allocated for Project Grants; and, a possible $4000 to balance the 2002 budget. While $3,394.10 was granted through Project Grants only $2015.69 of this was actually expended for that purpose. Thus $6984.31 of the FY2002 allocation from the 2001 Conference profits is available to either help balance the 2002 budget or add to the FY2003 allocation. The Committee recommends that $5,824.95 of this be used to balance FY2002 budget and the remainder be added to the FY2003 allocation and used for Project Grants for FY2003. NOTE: Any conference profit generated from the 2003 conference will be applied to FY 2004 and FY2005.
- Interest Income – This projection is based on current rates and amount invested.
- Leadership Institute – The next Leadership Institute is not scheduled until 2004 so this is not a budgeted item for 2003. Anticipated expenses for preparing for the 2004 Institute are listed under Committees. However, at this time, the Finance Committee wishes to note that this endeavor has not been the self-supporting one it was intended to be. Other than registration fees, most revenue for this came from Association sections and not from external sources. At a cost of $927.79 per attendee, we, as an Association, need to seriously consider the return for our investment.
- Membership Dues – Income from dues for the 2002 budget was projected at 800 members paying an average of $30 in dues. Being a conference year, we are projecting 925 members paying an average of $30 in dues. This projection was then revised to take into account a percentage of that membership total who paid 2003 dues in 2002.
- NCL Subscriptions & Ads – This revenue projection is based on the amount generated from this source in 2002.
- NCSL Projects -- Advice from the State Library is to project NCSL Project revenue at an average of the past few years. The years used in this projection were 1999-2002.
EXPENSES:
- Administrative Assistant (same in Option A & Option B) – an hourly rate of $11.25 was used for this calculation. This total is based on 30 hours per week, 50 weeks a year and includes benefits.
- Administrative Office – To cover possible increases in the costs of operating the office, this reflects an anticipated expenditure higher than that actually expended in 2002. Option A includes an additional increase to cover between $2100 and $2300 for replenishing the office supply of letterhead, envelopes, an expenditure that can perhaps be postponed.
- Affiliate Dues – Budgeted for the same amount as last year. Includes small donation to Freedom to Read Foundation.
- Board Meetings – Budgeted amount based on 2002 expenditures.
- Committees – Under a budgetary policy that takes effect this year, all committees/commissions were required to submit budgets prior to the preparation of the Association’s budget. Not all committees did so. In Option A. for those committees that indicated they are requesting no funds, a $0.00 allocation is the line. Those committees that failed to provide a budget request have a blank in their allocation line. For those committees that submitted requests, those requests that the Finance Committee approved are carried over from the Recommendation column. As can be seen from the committees that requested expenses, such expenses do add up. Option B represents a version of earlier procedures where a total sum was allocated to the Committee budget line. The change here is that the Finance Committee allocated a total of $3,000 to the Committee line and then subdivided it by committee, based on requests submitted and responsibilities of the committee. If the Committee submitted a budget requests, the purpose of the allocation is indicated in the Recommendation column.
- Lobbying – In Option A the amount allocated for lobbying, including the Legislative Day expenditure, is based on approximately 17% of anticipated expenses. In Option B, a flat $10,000, including the amount for Legislative Day, is allocated for Lobbying. Note: Since Lobbying cannot exceed 20% of actual allowable expenditures, this figure must be monitored.
- Project Grants – In Option A this amount is equal to what remains of the 2001 Conference profits. In Option B there are no Project Grants funds allocated from the annual operating budget.
- Publications – This figure is based on 2002 expenditures for NCLibraries and TarHeel Libraries. It does not include any funds for additional publications. However, some funds were allocated to committees for publications.
- Travel – This figure is based on actual 2002 expenditures.
In looking at the FY2002 budget, it required $23,812.38 from none FY2002 income (‘Carry over,’ ‘Past sales tax,’ ‘Reserves,’ and ‘2001 Conference profits’) in order to cover expenses. The FY2003 budget, Option A, still without many committee expenses, would require a possible $22,815.42 from non-FY2003 income in order to balance. While the Finance Committee would like to see Project Grant funds available, particularly since those funds could help add to the quality and quantity of conference programs, we do not see how they can be funded out of the FY2003 operating budget. The Finance Committee recommends the approval of Option B as the FY2003 operating budget. Furthermore, the Finance Committee recommends that the Association give serious consideration to how and where funds are allocated in future years. NCLA’s reserves, available for funding operations, are not limitless and cannot continue to be expended at this place if the Association is to survive.
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