Why are 501(c) organizations tax exempt? And, more important, why should they be? The only real advantage to being tax exempt is that you can accumulate the excess of revenue over expenses without paying taxes on that net income and therefore you have the additional dollars that you would have paid in taxes.

Isn’t it time tax-exempt organizations started paying taxes just like any other corporation? Giving up the so-called “non-profit status” wouldn’t be that big a deal. Dues would still be deductible as a business expense by members and everything would still go on as usual.

Organizations would still carry on the same programs and, as a matter of fact, would have more freedom in terms of lobbying and complying with regulations to prove they should be tax exempt.

With a national debt exceeding 14 trillion dollars, everyone is going to have to pay a bigger share. Shouldn’t associations and other 501(c) organizations be part of that equation as well?

I recognize that there is a psychological aura in being a “nonprofit” but in this day and age that seems to be somewhat of a shallow rationale without much logic.

If associations were to now come under the tax umbrella, it’s probably time for all 501(c) organizations to join the fold. That includes churches, unions and charities as well.

Certainly this new revenue alone will not solve our deficit problem, but maybe it should be part of a plan to start raising more revenue and eliminate all the loopholes. This could be a good start before we start considering tax increases.

It’s time for associations to step up — time for everyone to step up.

With the IRS counting some 270,000 501(c)3 and 501(c)6 organizations in the United States, you would think that by now, every possible interest and cause has at least one organization already working on its behalf. But the truth is, new associations and foundations are being launched every day. All it takes is an idea and someone with dedication and passion sufficient to overcome the inertia that often conspires to keep a new idea from going anywhere.
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At a recent event, for example, I talked with fitness guru Jake Steinfeld, a successful entrepreneur who has popularized a number of fitness products under his “Body by Jake” brand. Steinfeld serves as the chairman of the California Governor’s Council on Physical Fitness & Sports. Under his leadership, even in the midst of California’s severe budget crisis, the council has launched aggressive efforts to combat childhood obesity by forging partnerships with corporate sponsors so that the council’s programs can be run without tax dollars.
Steinfeld had just learned that he’d been reappointed to his position by recently elected Governor Jerry Brown. Steinfeld said he is excited that he’ll be able to continue two programs that he created: the Governor’s Fitness Challenge, which encourages children to be active 30 to 60 minutes per day, three days per week, and the Spotlight Awards, which reward unsung heroes in the educational system who help promote fitness. The fitness challenge has gone from reaching 10,000 youth in California in 2006 to involving more than 900,000 young people last year. And the schools that engage the most kids in the fitness challenge become eligible to win state-of-the-art fitness centers valued at $100,000 each.

Despite his achievements with the California Governor’s Council, Steinfeld is even more excited that his work on the council has led to the creation of a new organization called the National Foundation for Governor’s Fitness Councils. The new foundation will use the model established in California to promote physical activity among young people nationwide with the goals of providing a fitness center for every public school in the United States that needs one and eradicating childhood obesity.

The new foundation, which will also be funded by corporate sponsors, plans to accept grant applications from states with active governor’s councils for physical fitness that are promoting and implementing effective fitness programs. The foundation will also roll out an awards program spotlighting those schools and educators nationwide that are effectively promoting physical fitness.

“We can make change,” said Steinfeld, identifying one of the primary reasons any one would devote their time to helping establish a new organization. Not only does Steinfeld’s new foundation reflect the growing need for public-private partnerships to fill the gaps left in an era of diminishing governmental resources, it also serves as an example of how a program run successfully at the state level can be rolled out nationally once proven effective. Those are lessons from which association and foundation chief executives at all kinds of groups can learn.

Read the latest Association News magazine digital edition by clicking here or visit www.AssociationNews.com for more information.

Tim Schneider
Schneider Publishing Company

Natural disasters and Middle East civil wars notwithstanding, there continue to be good reasons to be optimistic about the future with regard to the overall economy and to the fortunes of the association community: The Dow Jones Industrial Average – volatile as ever on a day-by-day basis – nevertheless has gained more than 2,000 points since last July, and PKF Hospitality Research recently updated its forecast for the year to indicate that average revenue per hotel room would increase 7.1 percent in 2011 compared with 2010.

Perhaps most encouraging to those of you who live and die by the periodic reports on registration for association meetings and conventions, research from Meeting Professionals International indicates that meeting planners are beginning to see longer lead times for attendees making decisions about whether to attend meetings. To association executives and meeting planners who have experienced sleepless nights during the last couple of years worrying about attendance levels and attrition penalties, that news is welcome relief. However, is it sufficient cause to breathe a sigh of relief and declare everything is back to normal?

Of course not. A recent essay by association consultant Ed Rigsbee titled “Why Today’s Associations Must Prove Their ROI” points out that the days when people joined a trade association or professional society because “they believed in supporting the industry that provided them with a living” are over.

While it is difficult to make sweeping generalizations about the impact of the recent economic recession on the association community because the impact varied so much from industry to industry, it is easy to see that association executives must pay more attention now to financial metrics. That is in large part because their members are paying more attention themselves to the dollars-and-cents reasons for why they should belong to an association. Over the last couple of years they’ve learned to question assumptions concerning just about everything.

But wait, there’s more: As the Baby Boomers begin to gradually fade into the background – taking their passion for associations and their yearning for community with them|–|the Millennials are bringing with them new ways of thinking. Research indicates that when Millennials go looking for solutions to problems, they’re more likely to look to their peers for advice than to experts for definitive answers. They’re more apt to pose an open-ended question via Twitter than to raise their hand during the Q&A portion of a conference session. According to researchers, Millennials consider themselves collaborators who are not particularly prone to classifying themselves as either leaders or followers.

To many association executives – a profession predominantly populated by people who enjoy being in control – this new demographic can sound terrifying. For those associations hoping to thrive in the future, however, this demographic change is a key part of the much-talked-about “new normal” and one which savvy association executives need to embrace.

For more information on the expectations of the next generation of association members, please visit Ed Rigsbee’s website, www.Rigsbee.com.

Tim Schneider
Schneider Publishing Company

For most associations, meetings are a central part of their core purpose and a primary way to make membership in the association tangible. For many groups, the revenues derived from meetings, conventions and trade shows are a critical source of funds that help advance the mission of the association. Two years ago, a consortium of 14 groups that serve the association community and meetings industry under the umbrella of the Convention Industry Council joined together to commission the accounting firm PricewaterhouseCoopers (PwC) to conduct the most thorough study ever to quantify the real impact of the meetings industry. The Destination & Travel Foundation, which I chair, was one of the largest funders of the landmark study.

The PwC study is the first to apply the United Nations World Tourism Organization’s definition of a meeting to the United States meetings industry. The WTO defines a meeting as any gathering involving 10 or more participants lasting more than four hours that uses a contracted venue. Data was gathered from more than 6,000 meeting organizers, including associations, venue managers, destination marketing organizations, meeting attendees and trade-show exhibitors.

According to the PwC study, 1.8 million meetings were held in the United States in 2009 and contributed $263 billion in direct spending to the U.S. economy. The meetings industry accounts for a total of 1.7 million jobs, $60 billion in U.S. labor income, $14.3 billion in federal taxes and $11.3 billion in state and local taxes.

When indirect and induced spending are included, the total economic activity resulting from meetings is a staggering $907 billion. This larger measure of impact reveals that indirect supplier and induced attendee spending creates a total of 6.3 million jobs and $271 billion in labor income, $64 billion in federal tax revenue and $46 billion in state and local tax revenue. Had the study not been completed during 2009—one of the worst years on record for the meetings industry—it’s likely that total economic activity related to meetings would have exceed one trillion dollars.

The study also revealed that of the $263 billion in direct spending generated by the meetings industry, 43 percent (just under $113 billion) was devoted to travel costs. The remaining 57 percent (just over $150 billion) was spent on meeting planning and production and venue costs. In other words, nearly $3 out of every $5 spent on meetings is spent in local communities on things such as printing, shipping, signage and equipment rental.

The PwC study also shows that, based on its contribution to the U.S. Gross Domestic Product and the number of people it employs, the meetings industry is considerably larger than the auto industry. Perhaps with this data in its arsenal, the U.S. meetings industry can finally make the case that it deserves the vocal support of political leaders at every level of government. Indeed, every association that plans meetings should incorporate the impact revealed by this study into its legislative talking points since each industry or profession represented by an association plays a role in creating the impact the study quantifies.

For more detailed information on this landmark research as well as a tool-kit for putting the study’s findings to work, please visit meetingsmeanbusiness.com.

Timothy Schneider
Schneider Publishing Company

The good news revealed by Meeting Professionals International’s annual FutureWatch study for 2011 includes the findings that the number of meetings, meeting attendance and overall spending on meetings will all increase in the coming year. According to the study of 459 MPI members, the overall number of meetings planned in 2011 will increase by 8 percent and the average amount spent on those meetings will increase a healthy 5 percent. The study, which surveys both meeting planners and industry suppliers, also revealed that the role of business meetings will continue to face tough scrutiny.

In the current environment, strategic meetings management and providing return on investment are critically important. Even as the economy continues to recover, the study predicts meeting planners will still be expected to make a compelling ROI case for every event they plan.

The “right sizing” of meetings means continued growth of smaller gatherings. During the economic downturn, many organizations discovered the strategic advantages of smaller, regional or local meetings. According to FutureWatch 2011, that trend will continue even as some meeting planners experiment with re-combining events with site selection criteria that keeps the specific meeting purpose in mind.

Meeting planners need to be highly attuned to their events or hold multiple events at the same time and in the same place. The study indicated that associations are likely to continue to seek out alliances. While groups that have attempted this in the past report that cultural differences among organizations oftentimes undermine potential synergies, the times demand that such partnerships continue.

Meeting planners need to continue to advocate within their organizations for the strategic importance of business events. According to the study, meeting planners continue to feel that they often have to battle with their organization’s senior leaders to convince them to hold meetings. For them, educating their employers on the importance of meetings and events is a critical part of their job.

Both meeting planners and industry suppliers agreed that weathering the economic storms of the past few years has lead to greater collaboration between planners and suppliers. For further details or to order a complete copy of FutureWatch 2011, please visit mpiweb.org.

Tim Schneider
Schneider Publishing Company

Lesson 1

A little bird was flying south for the winter. It was so cold the bird froze and fell to the ground into a large field.

While he was lying there, a cow came by and dropped some dung on him.

As the frozen bird lay there in the pile of cow dung, he began to realize how warm he was.

The dung was actually thawing him out!

He lay there all warm and happy, and soon began to sing for joy. A passing cat heard the bird singing and come to investigate.

Following the sound, the cat discovered the bird under the pile of cow dung, and promptly dug him out.

Moral of the story:
1. Not everyone who dumps on you is your enemy.
2. Not everyone who gets you out of dung is your friend.
3. And when you’re in deep doo, it’s best to keep your mouth shut.

Lesson 2

A turkey was chatting with a bull.

“I would love to be able to get to the top of that tree” sighed the turkey, “but I haven’t got the energy.”

“Well, why don’t you nibble on some of my droppings”? Replied the bull. “They’re packed with nutrients.”

The turkey pecked at a lump of dung, and found it actually gave him enough strength to reach the lowest branch of the tree.

The next day, after eating some more dung, he reached the second branch.

Finally after a fourth night, the turkey was proudly perched at the top of the tree — where he was spotted by a farmer, who shot him out of the tree.

Moral of the story:
B.S. might get you to the top, but it won’t keep you there.

In the previous discussion of this question, I reported on the events that led me to interview for a position with an association in Southern California. Now it was time for a second meeting with the association’s executive committee.

The interview started in the usual manner and after the introductions, the president turned it over to Bob Bratton, who apparently was the “hammer.” His interrogation went on for 45 minutes or so.

I tried answering his questions as best I could. He was aggressive and a little brusque. Sometimes he interrupted me and his manner was beginning to get under my skin.

Everyone else in the room appeared to be getting a little uncomfortable as well. Then he hit me, “okay,” he said. “What is your definition of management?” Wow, now we were getting academic. I took a deep breath, realized I didn’t have an intelligent response and was about to tell him and the committee in the most measured tone I could muster that I didn’t think that this was going anywhere.

The association principal I had met with in Phoenix, perhaps sensing my irritation, interrupted and said, “I think we have all the information we need.” Fortunately everyone agreed, especially me.

Truth be told I didn’t have a clue about a definition of management. Fortunately, I was saved by the man who became my mentor, Ed Myers.

The committee asked me to step outside and about 15 minutes later they called me back in and offered me the position. We chatted and I agreed to give them a decision within three days. I spent the next day and half visiting with several members of the executive committee and then returned to Phoenix to consult with my wife and my former boss, Dick Reucker.

I couldn’t wait to see Dick and ask him for a definition of management. Without blinking an eye and looking at me with a certain amount of disbelief, he said, “That’s simple, management is planning, execution and control.”

I never forgot Bob Bratton’s question or Dick Reucker’s simple answer. My only regret was I never got to know Bob Bratton. He was promoted and transferred back to his company’s corporate staff before I moved to Los Angeles.

I stayed with the association as executive vice president and it was my first client when I started my association management company and with me for more than 10 years.

What is your definition of management?

Recently, I was asked to interview two candidates for a position as a trade-show conference manager. The staff had already met with both people and now wanted an outside and perhaps more penetrating appraisal.

It had been so long since I had done any interviewing, I’m not sure how penetrating — or even cogent — my skills were. I tried to prepare as best I could, trying to remember what I used to do in interviews.

During this process I was reminded of an interview incident early in my own career: I was in Phoenix working for KTAR-TV, the local NBC affiliate, as a sales executive when I got a call from my former boss at the Electric League of Southern California. He told me he had been contacted by a management consultant who had been retained by the Electric League to find candidates for their executive vice-president position. He told them he wasn’t interested in moving to Los Angeles, but they should talk to me.

The consultant called. I sent him a resume and subsequently had an interview with him. When one of the association principals was attending a meeting in Phoenix I had the opportunity to meet with him as well.

The next step was to visit to Los Angeles and a meeting with the Electric League’s executive committee. Everything seemed to be okay and then I didn’t hear anything for a while. Growing a little impatient I called the management consultant and told him that if they were interested in me I would need to make a decision in the next month.

He got back to me in a week or so and asked if I could come back to Los Angeles for another interview. Sure, I said and we set a date. Two days before the meeting I got a call from the consultant to ask if I could meet him at the Phoenix Airport the next day while he was changing planes on his way to Tucson and could I also bring my wife.

I didn’t understand the wife part, but figured I would go along. So we went to the airport the next day and waited. The plane from Los Angeles was late and all we had time to do was walk from one gate to the next. He never did talk to my wife and told me that I should dress conservatively, maybe get a haircut and be prepared for a tough interview. They were bringing in someone who would press me hard on a number of issues.

This seemed a little peculiar. It was now 5 p.m. and there was no time for a haircut even if I thought I needed one. I picked out the loudest madress jacket I had to wear and was ready to go….

In discussing the mix of information we present in Association News, our readers often tell us that selecting sites for their meetings is
one of the most colorful and exciting aspects of association management. That does not mean, however, that all aspects of meeting planning are colorful and exciting. Indeed, thanks to forces at play in the economy and recent trends in the travel industry, a case could be made that meeting planning is more complex now than it ever has been.

Chief among the trends that associations and their meeting planners will be dealing with in the coming year is the fact that people who travel are making their plans much closer to their anticipated date of departure than ever before. According to research from Y Partnership, 25 percent of leisure travelers took a last-minute vacation—a trip booked within a week of their departure—during the past year. Meeting planners have seen this trend reflected in the number of attendees who decide at the last minute to register for their events. Several meeting planners I’ve spoken with report that as many as half of their attendees don’t sign up until the last four weeks prior to the event.

There are plenty of explanations for the emergence of this trend. Economic uncertainty has caused business people to delay—sometimes until the last possible moment—decisions about whether certain trips are necessary. On both the business and leisure sides of travel, online travel agencies and travel websites have helped create the impression that there may be a financial benefit to waiting until the last possible moment to book a hotel room. Hotel companies and airlines offering “flash” sales on last-minute travel bargains have further fueled that perception.

None of this is good news for associations and meeting planners who must book a hotel and negotiate room rates far in advance, sometimes many years ahead of when their events occur. The traditional cut-off date allowed in hotel contracts for group discounts—four weeks in advance of the event—is now laughably anachronistic. So, too, is any hope that the hotel will provide an accurate report of your group’s pickup when much of the positive impact of your presence at a property will be lost if a guest room is booked after your cut-off date or at a lower rate outside your room block. The trend toward last-minute registrations also complicates matters when it comes to estimating food, beverage and room set-up needs, whether you’re meeting at a hotel, convention center or some other venue.

In this volatile climate, the best protection for meeting planners is to address these issues in the hotel and meeting-facility contracts they negotiate. Ideally, these provisions would include a guarantee that your attendees will receive the lowest possible room rate, a cut-off date that’s closer to the event’s dates and an in-person audit of the hotel’s entire housing list so that your group receives credit for the room nights it generates.

Additional suggestions for successfully negotiating hotel contracts can be found in the recently released second edition of “The Legal Guide for Association Board Members.” For more information, please visit SchneiderGuides.com.

Tim Schneider
Schneider Publishing Company

1. I’d kill for a Nobel Peace Prize.
2. Borrow money from pessimists – they don’t expect it back.
3. Half the people you know are below average.
4. 82.7 percent of all statistics are made up on the spot.
5. A conscience is what hurts when all your other parts feel so good.
6. A clear conscience is usually the sign of a bad memory.
7. If you want the rainbow, you’ve got to put up with the rain.
8. All those who believe in psycho kinesis, raise my hand.
9. The early bird may get the worm, but the second mouse gets the cheese.

10. I almost had a psychic girlfriend … but she left me before we met.

11. OK, so what’s the speed of dark?

12. How do you tell when you’re out of invisible ink?

13. If everything seems to be going well, you have obviously overlooked something.

14. Depression is merely anger without enthusiasm.

15. When everything is coming your way, you’re in the wrong lane.

16. Ambition is a poor excuse for not having enough sense to be lazy.

17. Hard work pays off in the future; laziness pays off now.

18. I intend to live forever … so far, so good.

19. If Barbie is so popular, why do you have to buy her friends?

20. Eagles may soar, but weasels don’t get sucked into jet engines.

21. What happens if you get scared half to death twice?

22. My mechanic told me, “I couldn’t repair your brakes, so I made your horn louder.”

23. Why do psychics have to ask you for your name?

24. If at first you don’t succeed, destroy all evidence that you tried.

25. Experience is something you don’t get until just after you need it.

26. The hardness of the butter is proportional to the softness of the bread.

27. To steal ideas from one person is plagiarism; to steal from many is research.

28. The problem with the gene pool is that there is no lifeguard.

29. The sooner you fall behind, the more time you’ll have to catch up.

And an all-time favorite:

30. If your car could travel at the speed of light, would your headlights work?

Happy New Year