In our first meeting this year, your new Executive Committee discussed three key areas of immediate focus: science, membership issues and the budget. I’m going to talk about each in my next three columns, but I am starting backwards with the budget, as it is the most pressing area of concern.
My goal in this column is to write about how AAPG is faring financially during the industry downturn. In doing so, I want to make sure you understand I do not elevate the importance of AAPG financial needs over the impact the COVID-19 virus and related economic downturn is having on society – on you. AAPG members are suffering from many economic issues, such as loss of job, underemployment, career anxiety and retirement worries. More troubling is that many suffer from critical issues like health, prejudice and loneliness. Again, our thoughts and prayers go out to those who are hurting during these times, especially those who have lost loved ones.
A few members ask me, “Why does the Executive Committee worry so much about money all the time?”
Well, actually we prefer to focus on science and members’ needs, but as Woody Allen once said about the importance of money, “It is better than poverty, if only for financial reasons.” The primary reason I am discussing money in this column is to let you know changes are coming. We cannot afford to do everything we have done in the past. Some programs will be reduced or cut. We will let you know as this happens.
So how do we determine how much money we need? Each April and May, the current treasurer and the incoming president and treasurer meet with the staff and “worry” about money. It’s called “the annual Budget Review.” I once heard that a budget is a mathematical way to confirm your suspicions. That’s usually true. Last year we were looking at a significant surplus, until the pandemic hit and now we expect a significant loss. We are “suspicious” of future revenue. In fact, looking forward into the next fiscal year (starting July 1 this year until June 30, 2021), we expect to have an approximate 40-percent decrease in annual revenue.
That’s a big hit that your Executive Committee will deal with this new fiscal year. AAPG does have an emergency fund: through the good management of the AAPG Investment Committee and staff we have a savings account roughly equal to our current annual expenses. Plus, the AAPG Foundation supports many programs, such as the Distinguished Lecturer, Visiting Geologist, Grants-in-Aid, etc. In addition, companies and vendors support many programs like the Imperial Barrel Award, the annual meetings like the Annual Convention and Exhibition and the International Conference and Exhibition, the EXPLORER, etc. but that support is lessened as companies deal with their own budget crises. The reality is we must make major changes to avoid major deficits.
So what do we do?
Dues account for 15 percent of the budget. As you can imagine, dues payments are down, so we are asking the House of Delegates Membership Committee to contact members and remind them about dues and ask if they need support with graduated dues.
The reality is that the bulk of AAPG income – about 65 percent – is derived from conferences and meetings. AAPG and sister society staffs are very efficient at running these programs but, as you know, all major meetings were canceled or postponed this year. These include key revenue-generating conferences like the Offshore Technology Conference, GEO in Bahrain, and, of course, AAPG’s annual meeting. In addition, many of the section and region meetings were canceled or postponed as well.
Adapting Through Virtual Events
So now we are working to survive financially and even grow in a virtual world. One benefit of this new model is that we are reaching both members and non-members around the world with online luncheons and webinars. As I am writing, the first virtual Unconventional Resources Technology Conference just concluded. The new virtual registration for this conference was $350, with lower rates for one-day passes and students. We have met the original targets for registration and sponsorship and many of the speakers agreed to give virtual talks. So, we have our first financial test of the year.
We also just announced the postponed AAPG 2020 meeting will be held virtually Sept. 29-Oct. 1 in conjunction with the Gulf Coast Association of Geoscience Societies GeoGulf hybrid (virtual plus face-to-face) meeting in Lafayette, La. Our goal is to make this a real experience for participants, not just another Zoom meeting, and I hope you will join us. These two virtual conferences, URTeC and ACE2020, will give us the data points we need to know if we can meet the budget this year. We are still planning for a face-to-face ACE meeting next year in Denver, if we can do it safely. It is important for us to protect our members, so it will most likely be a face-to-face meeting with a virtual component.
Finally, as the saying goes, “We cannot cut our way to success,” so we also are evaluating new revenue ideas for the Association, both short-term and long-term. If you have any great ideas for revenue growth, please let us know.
So, this is my column on the budget. As Shaq once said, “I’m tired of hearing about money, money, money, money, money. I just want to play the game, drink Pepsi, and wear Reebok.” I understand. I promise future columns will be more interesting and more fun.
Thank you in advance for supporting these new online meetings. We will try to get back to face-to-face as soon as possible but in the meantime we will become the best virtual society possible.
It’s an exciting time to build a new AAPG with new opportunities for members.
Thank you for your patience. Thank you for your support.