The State of the Union’s Finances
Financial Vice-President's Report
Volume CVI, No. 11November, 2006
The recently completed audit of the Local 802 finances — which can be read on pages 22 to 25 — would lead one to believe that our union is in good financial health. And it is. But the audit report is merely a snapshot of our financial condition on June 30, 2006 and can only tell us what has happened — not what will happen.
Of course we can’t predict the future. But we can analyze the current financials and make some educated assumptions based on these numbers. The positive numbers in the financial report are reflective of the many staff positions that remain unfilled at Local 802. Because many of our large union expenses are payroll related expenses (employee wages and benefits), unfilled positions have a particularly positive effect on the numbers in the financial report.
The open positions at 802 are a combination of voluntary and involuntary departures. (Two former staff members left to attend law school while others have advanced to positions of greater responsibility at other labor unions.)
I have asked Controller Ira Goldman to project what next year’s budget will look like if we fill all the open positions at 802 — and his projection gives rise to serious concerns. When the controller and I shared our concerns with the Executive Board, the board — very responsibly — decided to look closely at the future needs of the union before committing to filling any positions.
The budget process requires making both income and expense projections. Anecdotally, members have indicated that work has diminished. This has a direct correlation to the amount of work dues generated for the union. Although the work dues income has generally been positive, the trend through the end of the year is projected downward. Just as a reduction in offers of work causes our members to tighten their belts, so too must the union economize. Simply put, I believe we must learn to do more with less.
While easily said, it is decidedly difficult to carry out. We must be ready to make critical decisions that will meet our union’s future needs while remaining cognizant of our fiscal realities. Many of our challenges can be solved creatively but others may require change. The Executive Board will discuss this issue fully in the context of the 2007 budget.
So while we can all rejoice in the positive numbers reflected in the June audit, we must understand that the “business as usual” mindset cannot continue. If we fail to address this issue now, it will be extremely difficult and painful to contain our costs later. I urge, in the strongest terms, that we act responsibly now.
I am also pleased to report that the Local 802 financial policy has been approved and adopted by the Executive Board. This policy is now in place and is printed on pages 25 and 26 of this month’s Allegro. As you can see, it is a rather comprehensive policy addressing union expense reports, oversight, check signing procedures, travel, per diem, cell phones, etc. Please take a moment to review it.