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Cburkhardt

Convene Council Planning Committes to Re-Evaluate Plans

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Council Strategic Planning Committees should re-evaluate their current plans.  The combination of lost summer camp revenue, lost FOS (usually raided in the spring) and diminished fall projected popcorn sales is hastening bankruptcy/COVID-caused financial deterioration of even well-run councils.  Significant contributions and bequests are on hold until donors can assure themselves that contributions will be part of a businesslike recapitalization and not lost to pay either costs of bankruptcy or briefly-extended operation of unsustainable councils.  A positive development has been the ability of councils to apply for the federal Paycheck Protection Program (PPP) grant to temporarily extend the employment of personnel.  In most councils a PPP grant would have assured operation of summer camps this year, but camp operations are beginning to be cancelled in what seems to be the start of a cascade. 

The combination of the bankruptcy and virus is a potentially-existential moment for councils with pre-existing financial difficulties.  And, most small and mid-sized councils without significant endowment income will be severely tested in any case.  This is not a one-year issue, it is a re-setting of some fundamental conditions of any council's operation.  This is the time to re-convene council planning committees to update long-term strategic documents and make serious recommendations to local executive boards.  

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Posted (edited)

Has any Council received a PPP loan? 

The NonProfit Times reports that more than half of non-profits that submitted PPP loan applications were accepted.

I suspect Council submissions in either PPP round were based on staffing summer camps as 75% of the requested loan amount must go towards wages.  As summer camps are being canceled during the second PPP round, well...try again in round 3 with only full time payroll figures?

IMHO, Councils should now insure their representation at the upcoming National Annual Meeting (May? June?) and set the Fall application process and registration fee now! No repeat of the last minute form confusion and fee hikes of last year.  I am sure there is other Council feedback to "gift" National .

My $0.02,

Edited by RememberSchiff
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A large number of councils applied for and received PPP grants.  This is goin to save a lot of DEs heading into the fall and help preserve the summer camp season for councils able to open-up.  The grant must be used to pay wages and is calculated by using the 2.5 times the average 2019 monthly payroll.  

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Posted (edited)

I searched again but found only one council -  Pee Dee Area Council (SC).  If there are more, I would have expected more disclosure as an aid to other councils considering PPP loans.

Typically, this time of year the Pee Dee Area Council is “headstrong into its annual fundraising campaign Friends of Scouting,” Michael Hesbach, Scout Executive said. He said the local council receives 39 percent of its annual income from this campaign, and to date it has only raised 29 percent of its $285,000 goal. 

Hesbach said normally the Scouts would have raised twice that amount by now.

He said they have only one-third of their operating expenses for April.

“We have a PPP loan to cover May and June,” he said. “I don’t know about July. We are working on some ideas.”

Pee Dee Council's Camp Coker Summer has been canceled.

 

Edited by RememberSchiff
typo
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1 hour ago, RememberSchiff said:

Typically, this time of year the Pee Dee Area Council is “headstrong into its annual fundraising campaign Friends of Scouting,” Michael Hesbach, Scout Executive said. He said the local council receives 39 percent of its annual income from this campaign, and to date it has only raised 29 percent of its $285,000 goal. 

Hesbach said normally the Scouts would have raised twice that amount by now.

 

Many are realizing that over-staffed councils provide little value to unit level scouting.  The financial gravy train is over.

@Cburkhardt, I understand your point, but generally speaking, are council strategic planning committees up for the task?  It seems to me that many of the folks on the committees, well-intentioned they may be, will be more interested in preserving the status quo. 

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My experience is that those who volunteer executive board members who serve on the planning committees are often the more nimble-minded board members.  They usually come up with some pretty good ideas on endowments, property management and program, but do not typically focus on personnel.  The plans often get shelved.  Some planning committee members may wish to preserve the "status quo" on some matters (for example, retaining a camp property or certain unit-serving executive positions), while others might be more concerned about the "status quo" on matters further from program (for example, upgrading a council headquarters or retaining support positions).  The importance or retaining the status quo simply varies on the matter or issue at hand.  The one thing everyone seems to realize is that there will indeed be great change.  What will vary from council to council will be the degree and breadth of volunteer engagement in the change decisions.

I think it is a good time to reconvene these local executive board planning committees because it would place the resource and personnel reallocation issues on the table in a very direct way -- and consequently involve a larger number of volunteers in the process.

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4 hours ago, RememberSchiff said:

He said the local council receives 39 percent of its annual income from this campaign,

I wonder what a healthy percentage is. 39% just seems like a lot these days. Just my opinion but basic costs like staffing and camp upkeep should be covered by the customers - scouts. If it's too high a cost then it's time to cut costs rather than lean on families and the community to bring in more donations.

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Generally I like to see top-level FOS results, as that usually is an expression of confidence in the local community on what the district and council are providing.  A high percentage on popcorn for a council is what is most risky.  A good portion of FOS is lower-level business giving, which this council must be doing a great job with.  With all that salesmanship, I'll bet they have a reasonable endowment.

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On 5/3/2020 at 3:22 PM, Cburkhardt said:

Generally I like to see top-level FOS results, as that usually is an expression of confidence in the local community on what the district and council are providing.

Given the recession we're about to enter depending on community confidence might not work for many councils.

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Looking at my council, United Way is the top revenue source … hopefully that doesn't drop.  Outside of that, FOS (I expect will drop), investments (will drop), product sales (will drop), camping (frozen), activities (frozen), special events (frozen) … 75% of their revenue is either frozen or will see substantial declines due to COVID-19 and the economy.  I don't know their cash on hand but their cash flow will go negative this year without substantial cuts.   I hope they don't simply take the easy way out and sell a camp or two. 

While I pushed back on immediately looking at council mergers as strong councils may tie themselves to high risk ones, I think COVID-19 and the resulting economy is a perfect storm that could permanently injure BSA if councils don't aggressively act together.  Hopefully the national BSA bankruptcy will provide the abuse protection and councils can evaluate mergers based upon ongoing operations vs risk.

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5 hours ago, Eagle1993 said:

 Hopefully the national BSA bankruptcy will provide the abuse protection and councils can evaluate mergers based upon ongoing operations vs risk.

I agree.  Now is the very best time to evaluate council combinations to preserve Scouting as we have generally understood it.  Few are failing to recognize that the combination of the bankruptcy and virus is the thing that could extinguish the Scouting program as we generally know it --  unless there is collective and informed action at a multi-council level.  This is because we are heading into the bankruptcy with our expected future cash flows being cut-off (at least temporarily).  What a great circumstance for the lawyers who want to put Scouting out of business and liquidate every last basketry kit in the trading post!

This will be among the most complex bankruptcy proceeding in American history due to the inter-relationships between the many independent organizations that cooperate to offer Scouting.  At the right time councils will be given the opportunity to participate financially in the bankruptcy proceeding.  If they contribute toward the victim's trust fund, they will get the bankruptcy discharge and be immune from suit for claims related to pre-filing events.  Rational council combinations can take place when councils reveal and deal with their potential liabilities prior to a combination.  This can happen and good combinations can allow quality Scouting to continue in your area if the council volunteers involved assert proper leadership and take actions in the interest of the present and future youth participants.

This is a difficult needle to thread.  Councils that want to "hold on to everything we have" and "ride it out on our own" will fail unless they have a tremendous endowment to rely on and have no claimable abuse incident in their history.  If I were still a council president I would not take that risk, because I would not know what horrible behavior might be alleged to have happened by a log-ago deceased person.  It will only take one successful claim to wipe everything away.  I would be pulling together a deal to keep essential properties and unit-serving structures with my fellow council board volunteers and those of nearby councils.  Everyone will have to contribute something in the process (cash, property, etc.).  And, do not allow the provincialism of individuals or groups that have personal interests to prevent progress.

 

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