I want to start by saying thank you, to each of you, for being here today and for what you do every day for our members.
I also want to thank General Vice President Tucker and his staff for the good job they do daily for our members.
We have received about 60% of our lodges Weighted Average Hourly Earnings reports and so far, we are at 2.40%.
I also wanted to mention that the 2008 Union Industries Show will be held in Detroit, Michigan, May 16th, 17th, & 18th, 2008 and I look forward to seeing you there.
Just to get an idea, could I see a show of hands to know how many people here were at the National Staff Conference in August?
Thank you.
Well, you took part in a historic gathering.
There are always ways to recognize a historic meeting. Sometimes it’s obvious, like a founding convention, or a large affiliation, or some type of restructuring that changes an organization’s name or basic structure.
The election of new leaders, a major announcement, or the first move in a new direction, one that could shape that organization for years and years to come.
Our staff conference in Orlando was such a meeting.
During the conference, I gave a financial presentation that was longer and more detailed than any I’ve given in some time.
And you will be pleased to know that I don’t plan to go over all the things that were discussed in that report. But some points deserve repeating.
In less than a year, we’ll be back in Orlando and hopefully by then, we’ll all be more familiar with what was being proposed, why it’s necessary, and where it will take us.
After what we’ve been through during the past six years, you would think we’d be used to bad news, but the hard fact is that our financial base continues to erode at a greater rate than ever before.
It’s true that our losses have leveled out, and it’s true that some of the steps we’ve taken have begun to bear fruit:
- Copy Machines -- $4.5 million dollars in 5 years.
- Telephones –Zero dollars for long distance dialing within the system and $0.04 per minute for other.
- Janitors Headquarters - Work done in house, with IAM members.
But, since 2001, the IAM’s General Fund balance has decreased for six consecutive years with an accumulated loss of $32.8 million dollars.
This union, our union, is simply not going to wait for declining membership numbers and finances to overtake our ability to function on behalf of our current and future members.
When the current dues structure was crafted, more than 30 years ago, there were nearly 2,500 delegates at the IAM Convention. The IAM had 1,860 local lodges. And we had over 900,000 members.
At the current rate we’re losing members, approximately 1,000 per month, our projected membership will be about 365,000 dues paying members in 2009. Let me add, the Eastern Territory is organizing new members.
If we do not act decisively, we will be approximately forty percent of what we were when the current dues structure was approved.
That’s the stark reality.
As I mentioned before, we haven’t been sitting by and watching these losses climb.
We established the organizing fund that’s grown by more than $6 million dollars; now $36 Million.
We’ve reduced staff and merged operations of a number of locals and districts.
We’ve looked at every expense and searched for ways to cut costs and still maintain the quality of services our members have come to expect.
But it hasn’t been enough.
In the last year alone, we’ve seen the General Fund reduced by $6.7 million dollars.
And that’s an improvement over our 2005 loss.
But year after year, we have watched our core financial strength slip away.
And that trend is simply unacceptable.
Our renewed focus on organizing has yet to make up for the financial losses we’ve experienced, and frankly, we can’t afford to wait any longer for membership numbers to turn our fortunes around.
53% of people polled said they would vote for a union.
Make no mistake, organizing remains the single best answer for a union facing a financial crunch, but organizing must be a long range answer and we have some very acute issues that cannot wait for this ship of ours to gradually right itself.
One of the issues I mentioned during my report was the likelihood that, thanks to George Bush’s administration and the new ERISA regulations, the pension holiday that we’ve been enjoying for several years will almost certainly come to an end before long.
The cost savings from those pension holidays totals forty-eight million dollars.
This means to District Lodge 60 - $122,608.51 that they would have paid.
Local Lodge 2848 - $110,208.31 would be what they would have paid for their part of pension contributions.
15% of salary for each Rep is paid for pension – cost to grand lodge same.
As I said, it’s not a matter of, if those holidays will end, it’s a matter of when. Before the Pension Protection Act we are funded at 146% - now it will be at 118%. The first part of 2008 we will be okay.
Our situation will go from serious to grave almost overnight when that happens.
In the months to come it will be our job as leaders to explain to our members the seriousness of the situation.
The very worst thing we can do - is nothing at all - and hope the problem will correct itself or just go away.
If that is the course we take, the only thing that will go away is us. I know none of you want that.
Since 1976, we have worked under a dues structure of two times the hourly rate-calculated under five different methods.
It worked for the past 30 years but it won’t work for the next 30.
The time has come to look at moving toward a straight percentage of gross salaries to determine the individual’s dues rate.
Right now, the average dues a member pays is right at $510.00 dollars a year.
Our lowest dues rate is $13.00 per month and the highest is $157.00 per month.
Under a percentage formula, your dues would increase as your hourly rate increases.
The individuals at the top of the pay scale would pay their fair share.
Those members on the bottom of the scale would not have to carry a disproportionate share of the cost of running this organization.
Changing the dues structure is not a magic bullet to solve all our problems but it will give us time, time we desperately need to increase our more important numbers, member-ship numbers through organizing.
Let me thank you for the good job the Eastern Territory is doing on organizing.
Such a change will also require a degree of education and outreach we haven’t had to undertake in at least 30 years, maybe more.
So I’m here today partly to drive home the hard numbers that we’re facing, and more importantly, to ask for your help in the job ahead.
Any proposal of this magnitude will inevitably draw questions about how it will impact districts, locals and individual members.
They all deserve to have their questions answered. And that will take time.
We will need, however, to remember that part of this union’s strength and its appeal to potential members is our ability to provide services fairly to both large and small bargaining units.
By changing to a dues structure to a straight percentage of pay, we will restore financial stability to our organization, and we will do so in the most fair and even handed manner possible.
I actually look forward to the debate and to answering questions on this subject.
I have little doubt that if our members and representatives understand the full picture of what we are facing, they will welcome a plan that will move us into the future as a first-rate union – as we are today.
Like anything else we do, we’ll be more effective if we’ll all pulling in the same direction.
Some of the services we are looking at are dues check off -- going directly to Headquarters with a turn around of approximately 72 hours back to District & Local Lodges. We could assist in the filing requirements of LM’s, 990’s, and possibly do payroll for District & Local Lodges.
That goes for addressing our financial obligations as well as meeting the challenge of the upcoming elections.
The two are intertwined more than I can possibly say.
Well, let’s shift gears.
We blew the doors of Congress in the last election, but until we have a president who doesn’t think union members are terrorists, we’re going to have an uphill battle getting the kind of legislation we need.
It will take time to undo the damage that’s been done by 8 years of Bush, Chaney, and company.
But if their approval ratings are any indication, somewhere about even with O.J. Simpson, I’d say the American public is ready for a change too.
Those of you who were in Orlando had the pleasure of listening to the leading Democratic contenders fight for our support.
The endorsement was not a choice of the lesser of two evils for a change, but a choice between candidates who passionately believe that unions are an important part of this country and that we deserve to be respected and even honored for what we’ve done and for what we do.
You’ll hear much more between now and November, so I won’t pile it on now.
I want to close by thanking you once again for everything you’ve done and for everything you’ll do in the future.
Thank you.
