Karen Dotson and Ellen Berz make a point of saying that I resigned before I completed a full term on the board of directors; in the case of AIDS Network terms being three years.  They are correct.  What they fail to tell anyone is that the issues that lead to my resignation had been made known to my fellow directors on several occasions in the prior months.

When I joined the board of directors I was hoping to become a part of a board that was intent on making decisions that were in the best interests of the clients the agency was chartered to serve.  Shortly after being appointed to the board, then Secretary Janet Poff resigned.  I was asked to serve as Secretary, a position that put me on the agency’s Executive Committee.

It quickly became apparent that the board was mired down in feuding, fighting and micromanaging the agency and not looking at the broader issues at play.

Foolishly thinking that I had joined a board of directors and not a “social club” I raised issues that made many uncomfortable.

A pivotal point in what became a several month period of introspection that ultimately lead to my resignation occurred on December 27, 2007 at a meeting of the AIDS Network board of directors. At that meeting Vice President Tim Lapp chastised me for “scaring the staff” with my use of the word “bankruptcy”.

It seems that a statement I had made at an earlier meeting that the agency was “two failed fundraisers away from bankruptcy” made some of the staff uncomfortable. In response to Tim’s concern, I sent an email to the board of directors on January 3, 2008—five months before my resignation.    Here is the email:

January 3, 2008

TO:      Larry Palm, Jim Berger, Ellen Berz, Tim Lapp, Daniel Guinn, Michael Bruno, Tamim Sifri, Gerry Haney, Mary Vasquez, Christina Ballard

Dear Fellow Directors,

I hope all are well and that the new year is starting off well.

I write today to offer clarification regarding something I said at last week’s board meeting that invoked the word “bankruptcy”.    It has been brought to my attention by a fellow officer who expressed concerns about my statements and a requested that I tone down the rhetoric.

I offer this clarification:

My comments last week were in the context of the report of the Cleveland AIDS Task Force regarding the current financial health of AIDS service organizations. It is an excellent report and points to the challenges not only confronting AIDS Network, but also many other ASO’s around the country.   It calls for creativity in addressing the issues and offers many suggestions.

As a backdrop, and particularly for the newly elected board members, I mentioned information last week that I had compiled for the Board of Directors perusal a couple of months ago.   In this compilation of information, I compared the last nine years of AIDS Network’s financial performance in key areas to other AIDS Service organizations throughout the US.

The information I provided showed the following:

1. Working Capital (as of the end of 2006) stands at 76,250.  This is down from a high of 287,627 in 1999. Working Capital is actual cash that can be accessed quickly for emergencies, loss of funding, etc. The formula to arrive at working capital is simply current assets – current liabilities. Working capital does not include other assets of the organization—i.e., real estate, furniture and fixtures, etc.. Ideally, an organization will have at least three months of working capital.
2. Current Assets (not including depreciable assets) stand at 241,138 at the end of 2006 and current liabilities at 164,888 (the difference is the working capital)
3. At the end of 2006 AIDS Network’s quick ratio was 68.37   The quick Ratio is a snapshot of the financial health of an organization. It is measured at the same time each year to eliminate the possibility of timing differences impacting the outcome. The lower the quick ratio, the better. For example, a ratio of 60.86 means that for $100.00 in assets, $60.86 is a claim against the assets of the organization

One conclusion I came to (my opinion only) is that AN’s reliance on two special events for its main source of unrestricted funds has put the organization in a very precarious position. My statement that we were “one or two large fundraisers away from bankruptcy” was meant to be illustrative and not predictive. I stand by that statement. In essence, the point I was making (and continue to make) is that if AN were suddenly to lose a major percentage of this income it would create incredible financial instability and could lead to our inability to function, especially since the money we are talking about are unrestricted funds that are used to fund operations.
With this background, please understand the following:

1.     Bankruptcy is non imminent and nothing I said was ever meant to imply that it was. If left that impression with anyone I apologize. It is clear to me that if we were to continue on the path of the last several years we would either be bankrupt or would have become nothing but a shell of an organization where all meaningful services had been stripped away. Thankfully, there has been a coming together of events and an increased awareness surrounding these issues that will serve us well as we put plans in place for the next chapter In the life of AIDS Network

2.   We do have significant financial challenges that we must confront. I submit that it is because of the reluctance of past staff leadership to bring these issues to the forefront and to present them in a manner wherein the board of directors could get a grasp on the declining state of financial health of AIDS Network that we find ourselves in the current financial position.    The challenges are real.  The first step in dealing with them is acknowledging them.

My point in discussing the Cleveland report was to point to the fact that other organizations have and are confronting some of the same issues that we are confronting and that there are organizations that have become creative in addressing the issues.   The organizations that have become creative are thriving; those that aren’t are facing serious questions about their future viability.

3.     All options need to be considered at all times. For the record,   I am not a proponent of merger.  Likewise, I am not an opponent of merger. I know I stand in the minority in my feeling that we need to keep an open mind on this issue.    I feel that a stronger organization is built if we keep an open mind and perspective and keep at the forefront of our decision making processes the fact that whatever we do has one sole purpose:  to serve the clients of AIDS Network and to also have programs and services that also serve the needs of the wider non-client HIV Community.

Are there other organizations in Madison that are also going through similar issues that we could partner with? Are there ways of collaborating with ARCW that would free up resources (i.e., sharing office space, joint grant applications, etc.?)  Many things can and should be considered that do not even get us close to talking about merger, yet I feel that the fear of the “M” word often is used to push away creative discussions with others in the broader community; discussions that could serve to create a future we have never imagined.

What creative ways could we collaborate with other agencies or organizations?  Are there other Madison based CBO’s that have a complimentary mission where we could create shared programs?    The possibilities are endless, and can only be considered if we keep an open mind with the focus, once again, coming back to the basic question of whether or not we are serving our clients to the best of our ability.

Please know that I feel an obligation to speak my truth and I feel the obligation to do my level of due diligence in order to insure that I am an effective director and fulfilling my fiduciary obligations.   Others may agree or disagree with me.    Others bring a different skill set to the board than I do.    It’s all good. The diversity of thought is what makes for an effective and forward thinking board. While I apologize if the use of the word “bankruptcy” created unnecessary angst, I would ask anyone offended by this to also remember the rest of my comments where I stated:

1. We have incredible potential.   This is a very exciting time for AIDS Network.
2. We know where our vulnerabilities are and we can now address them from a position of strength
3. We realize that one of the key components in the candidate for the Executive Director will be to bring to the organization a strong business management skill set.
4. There are many untapped opportunities that we can pursue (grants, fundraising changes, etc.)
5. We need to keep an open mind to all possibilities and best practices vis-à-vis what it takes to create/revitalize an effective AIDS Service Organization.

Finally, please know that I recognize that  there may be situations where some may disagree with my choice of words or sense of urgency on this or other matters.  It is not in my nature to be quiet when I have strongly held opinions.  If I ever feel as though I am being asked to not speak my truth for fear of upsetting someone, I would have to reconsider involvement. To me this is an issue of personal integrity and not about concerns over sensitivities that may be offended by the information that I presented regarding my perspective on the financial status of AIDS Network.    Over the past twenty five years I have run several non profits and have served on many boards.   Those that have been most successful are those that have been willing to look at things from a realistic yet optimistic point of view.

I would ask that if anyone has any concerns that they contact me to discuss the matter rather than going through intermediaries. I would be very pleased to talk to anyone about this.   My phone numbers are below.   Please remember, we can disagree as long as we aren’t disagreeable

I apologize for the length of this email, but I felt it necessary to offer this clarification and make my position on this matter known to the entire board of directors.
All the best for a great 2008,
Greg

My concerns regarding the agency were brought to the attention of the board of directors on many occasions prior to my resignation. The above is just one of many examples that I will share as I continue the walk down “Memory Lane”.