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Money Matters

On Budgets and Budgeting for the Year 2000

Jeffrey H. Altschul

Fall connotes different things to different people, but at SAA, it is the time to deal with the budget. Our fiscal year ends on December 31st, and it is at the fall meeting of the Board of Directors that the budget for FY2000 will be passed. Much of this board meeting will focus on the budget. If past fall board meetings are any indication, it will be lively, sometimes contentious, and certainly not passive or disinterested.

The fall board meeting actually represents the end of a budget planning cycle that began six months earlier at the spring board meeting. At the Annual Meeting in Chicago, the Board approved a series of budget assumptions developed by SAA staff. These assumptions related to both revenues and expenditures. On the expenditure side, the assumptions fell into three groups. The most basic group included line items whose costs were known or predictable. These included price increases for paper, printing, and capital improvements. The second group consisted of budget categories for which we have good reason to believe will increase or decrease, but the magnitude of the change is difficult to predict. Costs for many items in the second category are quite volatile. Postage, for example, increased 23 percent last year, and 33 percent since 1997. Another item of concern is health insurance for SAA staff. Fortunately, we have been able to control our health care costs for the past few years, but these will rise, and when they do, chances are likely that the increase will be substantial. Even though costs for items in the second category are not known, we budget for them conservatively. There are times when we have a shortfall in one of these line items, such as postage last year, but these are generally offset by surpluses in other categories.

Line items in the first two categories tend to represent essential services of the Societyjournals, meetings, newsletters, and so forthservices, and products every member has come to expect. The Board decided in 1998 to change its approach to cost-of-living increases. Instead of allowing these costs to build over a number of years, triggering a large dues increase, SAA would raise dues to cover these costs on much shorter intervals. This is the exactly the type of dues increase that is going into effect for FY2000. For FY2000, dues will be increased by $5 in all categories. This increase is less than two cents per day, a small increase designed to cover the increased cost of doing business over the past several years.

Beyond essential services, there is a third category of expenditures. These involve changes in member services that come to the Board not as budget requests, but as long-term planning initiatives from SAA committees. In FY1999, the Board approved two such long-standing requests: additional pages for Latin American Antiquity and computer hardware for the SAA Bulletin. For FY2000, we are confronted with at least three immediate initiatives: staff support for the Public Education Committee, media relations support, and increased staff support for the World Wide Web and information services. It is the Board's responsibility to evaluate each request, determine its financial impact, and assign it a budget priority. Of course, these are just three of numerous initiatives that would contribute to the growth and development of SAA. As is often the case, in Chicago, the Board was not in a position to calculate the costs of these specific services, and so directed the Public Relations Committee to determine the financial impact of the media relations support at the Annual Meeting and SAA's executive director to examine the other initiatives, and, if they fall within certain parameters, to include it in the draft budget.

To determine the financial impact of new initiatives requires a reasonable prediction of the other side of the budget ledger; that is, SAA's revenues. In previous "Money Matters" columns, I have written that SAA is economically a membership-driven society. Although we have other sources of revenues (and are actively engaged in creating new ones), there are two revenue streamsmembership and the Annual Meetingthat shape our budget, and determine whether we have any discretionary funds. For FY2000, we anticipate a good meeting in Philadelphia and a healthy membership. Even so, projected revenues are not sufficient to fund all new initiatives; they rarely are.

Over the summer, the executive director and I, along with other members of the Executive Committee, the Board, and key committee chairs, have struggled to craft a budget. As with all SAA budgets, it is a compromise. During the course of the process, we have heard from some of the membership. We welcome the input. I encourage you to let me know how you feel about where you would like your money put to work. You can email me at the Society headquarters via the executive director using the address tobi_brimsek@saa.org. There are a variety of ways in which the membership can affect the budget processthe crux of which is getting involved in SAA and communicating with SAA officers and the Board. Each member's voice is important, and working together we can build a financially sound, vital, and dynamic SAA. ·

Jeffrey H. Altschul, treasurer of SAA, is president of Statistical Research, Inc., in Tucson, Arizona.

 

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