Public Employee Press

2005 Budget
Union on solid financial ground

By MAF MISBAH UDDIN
Treasurer, District Council 37

It’s my privilege to report to you on District Council 37’s current financial condition. As you may recall, I previously reported that there was a shortfall of $840,000 in the 2004 budget due to the decline in membership. I assured you that this shortfall should not be a cause for worry. I also stated that by taking the necessary steps in controlling expenditures we have placed the union on the road to a balanced budget.

Eight months later I am pleased to announce that our steps to contain expenses have enabled us to close the gap and finish 2004 with an $85,000 surplus. This means that for 2004 we have done better than budgeted by $925,000 and compared to 2003 we have actually improved the financial condition of the council by over $1.2 million!

This year, we have handled the budget process more expeditiously than in the past. First, we deliberated over the operating budget. And then we dealt with a separate capital spending budget. The DC 37 Executive Board approved the 2005 operating budget of $35.5 million (see graph) on Jan. 11 — the earliest in recent memory — and the new $734,000 capital budget on March 9. This is the first time the union has established a capital budget, a fiscally prudent step that I am proud to have advocated.

The capital budget helps us plan for long-term outlays and expenditures on fixed assets like facilities and equipment. It includes computerization of services and some mundane items like modernizing cubicles and office space and covers purchasing equipment to help the union improve its existing services, membership outreach, and political activities.

Among the highlights of the capital budget:

• an automated phone system, which will allow our Political Action and Legislation Dept. to improve its phone bank work and generate up to 30,000 calls an hour (up from 3,600) for lobbying and member mobilization;
• a new “tabbing” system for our mailing operations, which will save on postage and get newsletters and other items to members faster;
• a postage-stamping machine that will reduce the cost of mailings;
• computer equipment to help the union’s field staff with grievance handling, organizing, and mobilizing, and
• upgraded software and two new fileservers for the union’s Information Technology Dept., which will help the union implement new Web-based computer systems, increase productivity, and provide for recovery of electronic information in the event of a disaster.

A lot of hard work went into the budget process. I would like to express my appreciation to the Executive Board members, who carefully and tirelessly put the proposed budget under scrutiny and helped us narrow our spending priorities. Division and department leaders also provided crucial input.

The 2005 operating budget increases spending by $1.8 million (5.4 percent) over the previous year. The union projects that it will add 2,000 members under job training programs to its ranks this year, which will provide additional dues income to help the union keep the budget in balance.

During the last two budget deliberations, I have brought many ideas to be considered which would have saved substantial amounts of money. Ideas such as: eliminating the allocation in the budget for post-retirement liabilities and the step-by-step ending of the absorption by DC 37 of a per capita dues increase that our parent union, the American Federation of State, County and Municipal Employees, imposed on locals in 1999. The latter has cost DC 37, so far, more than $8 million. These two items alone cost the council over $3 million per year! It’s my fervent hope that these and other ideas will be revisited by the council as the need arises.

Throughout the year, the union will continue to follow practices implemented in 2004 to monitor and control spending. These include greater administrative scrutiny of day-to-day spending, prior approval of all expenditures over $2,000, holding down the costs for conventions and conferences, limits on contributions to political and community organizations, and a continuance of strict hiring controls.

Spending controls
With over $13 million in short term investments and firm spending controls in place, the union is on solid fiscal ground. The operating budget projects that we will conclude the year with a net gain of $97,400. We will, of course, revise that projection as our anticipated expenditures or income change over the course of the year. And we will continue to report on the union’s fiscal health regularly to the DC 37 Executive Board and Delegates Council.

In an important political year in which New Yorkers will be choosing their mayor and the union eyes negotiations for a new contract, we are happy to have a balanced budget in place that will help us to preserve and expand our services and improve our outreach to union members.