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SUBJECT: MEC Budget Formula

STATEMENT OF QUESTION:

Should the BOD increase MEC Budgets by modifying the MEC Budget formulas?

SOURCE AND DATE SUBMITTED: UAL MEC - May 9, 2008

BACKGROUND INFORMATION:

The primary sources of assistance and information for our members are the Local Councils and their Master Executive Councils. Yet they continue to struggle with budgets that do not reflect the reality of today’s costs of doing business. One of the benefits of the AFA-CWA Merger was that it would create synergies between the two organizations, and would allow for more financial resources to be directed to the Local and MEC levels.

Now that the merger has been finalized, it is time to start allocating the resources towards this goal. The approved dues increase will help soften the impact on the International Office budget as it transitions to its final administrative merger with CWA and as we shift our focus back to the Locals.

PROPOSED RESOLUTION:

THEREFORE BE IT RESOLVED that Section IV.G.2 of the AFA-CWA Policy Manual will be modified to read as follows:

2. Master Executive Council Budget Formula

1. Master Executive Council budgets are based on a percentage of each carrier’s adjusted dues. A formula is used to determine the exact percentage for the individual carrier. Should any carrier experience growth, the International Secretary-Treasurer will recalculate their MEC budget based on actual growth in order to provide the appropriate increased funding. The timing of such review will be twice annually, at 4 and 8 months into the budget year. At no time will the current MEC budget be reduced during the calendar year.

b. The carriers are divided into four (4) groups:

(1)  Group I will be based on a projected dues income over $549,648 and will be assigned a base factor of ten percent (10%).
(2)  Group II will be based on a projected dues income of $219,780 - $549,648 and will be assigned a base factor of eleven percent (11%).
(3)  Group III will be based on a projected dues income of $45,936 - $219,779 and will be assigned a base factor of twelve percent (12%).
(4)  Group IV will be based on a projected dues income under $45,936 and will be assigned a base factor of fourteen percent (14%).

c. Factor weights, determined by the number of members on a Master Executive Council plus the three (3) Master Executive Council Officers, are added to these percentages.

Factor weights will be as follows:

(1)  Master Executive Council members representing only one (1) council will be two and a half tenth of one percent (.0025).
(2)  Master Executive Council members and the three (3) Master Executive Council Officers representing a council outside the United States will be forty two hundredths of one percent (.0042).
(3)  All other Master Executive Council members and the three (3) Master Executive Council Officers will be three and a half tenth of one percent (0.0035).

d.      The total Master Executive Council factor weight added to the base factor is the Total Factor. This Total Factor is then applied to the carrier's adjusted dues to determine the Master Executive Council budget.