To say that these are unprecedented times is an understatement. On the second Saturday of each month, the PPBSO Board of Directors meets. As we were reviewing the minutes from March, we were all astounded by just how much has changed in the last month. It was a month ago today that the Government of Ontario announced the closing of the schools, and it’s been about three weeks since businesses were ordered to shut down and physical distancing requirements put in place. So much has changed in so little time, and yet it somehow seems so long ago. The rate of change within our own association and with our partners with the highland games has caught us all by surprise. Within the past month, the PPBSO and its branches have cancelled all branch amateur indoor contests, the Toronto Indoor Games, the Western Branch Kiwanis Festival, the Agnew-Harrison, the Livingstone, the Glengarry Cup, the Ottawa Indoor, the budding PPBSO professional piobaireachd contest the day before Georgetown, and all educational and professional development events. Within the past month, the following highland games have been cancelled: Georgetown, Cobourg, Kingsville, Embro, Kincardine, and Fergus. The list is just staggering. Your Board of Directors and the Executive have been busy discussing all of these events and their impact on the PPBSO. Please understand that this is still very much an ongoing assessment, but I would like to share the information we have so far. In the interest of transparency there’s a lot of detail below, but we believe that it’s important that you – as our members – understand the current state of your PPBSO.
At the beginning of each month our Treasurer John Allen circulates a financial update to the Board that contains the year-to-date revenue and expenses, a comparison of those numbers to the previous year, and a list of all outstanding payables and expenses. Two weeks ago the Executive did some scenario planning using the end of March numbers to estimate what the financial impact on the PPBSO would be if there were no games held at all this summer. The good news is that the Society’s emergency fund is large enough to see us through this crisis for 2020, but the bad news is that a significant portion of the fund will be drained. We started by assuming that we would receive no additional revenue from membership dues, no revenue from band or solo entry fees, and then used last year’s expenditures to calculate a worst-case loss for this year. Once we remove some expenses that we incurred last year that we’re not incurring this year (including some cost savings initiatives already in place), we were able to determine that in the worst case the PPBSO will lose about $45,000 this year. At the end of the last fiscal year (ending in September 2019), the PPBSO had $76,316 in capital assets (cash, prepaid expenses like rent, and our short-term GICs). So that means that as a worst-case scenario, the PPBSO will have $30,000 cash and liquid assets on hand at the end of September. Based on some additional savings opportunities, we believe that we can trim several thousand off that amount, which could reduce our loss to around $40,000, which would leave $35,000 in the accounts at the end of the current fiscal year.
I know that many of you will find that number shocking and surprising given the worst-case scenario that we have no highland games. Some of our operational costs are fixed and many of our expenses occur during the winter. A large portion of the membership dues go to support the branches in all of the incredible events that they run throughout the fall and winter months – events that have already occured or were cancelled near to their event dates. The PPBSO also has many fixed expenditures that have either already been paid or are pending, such as insurance (both D&O and commercial liability), banking and credit card merchant fees, rent, AGM expenses, contract expenditures, internet hosting services, telephone costs, and the cost of the external financial review by our auditors at the end of each fiscal year. This means that the bulk of our spending has already occurred before we start to receive registration fees for the summer games. Although that number represents our worst-case scenario, the Board of Directors will be continuing to look for additional opportunities to save money over the coming months to bring that loss down. As well, the Board has dedicated itself to performing an 18-month worst-case scenario planning exercise where we assume that all games are cancelled for both 2020 and 2021. While I can’t even imagine two summers without highland games, I don’t think that any of us imagined that what’s occurred over the past month would ever have happened. We want to make sure we’re prepared for the worst, and will examine all possible avenues available to us.
With the majority of the games in our calendar now cancelled, I know that there are questions about the refunding of membership dues. In short that’s not something that we’re able to do. Last year membership dues constituted 55% of the Society’s operating revenue, and this year to date membership dues account for $44,000 of the PPBSO’s revenue. Given the numbers above, to refund the dues would put the PPBSO about $15,000 in the hole – which is to say that we would be bankrupt. Those dues go to support your local branches and cover basic costs for running any corporation (insurance, external audits, general meetings, and general operating expenses). Membership dues help finance the ongoing work of our main committees like the Music Committee, which is responsible for grading, education, and developing and improving the quality of our contests. Membership dues also allow our members to participate in the running of what is ultimately your association – it allows members to contribute to discussions about rules, to sit on boards and committees, to elect your representatives at both the branch and parent body levels to make the PPBSO the organization you want it to be. Membership is a critical part of the functioning of our organization. Having said all of that, the Board is cognizant of some people’s feelings that they aren’t receiving the complete value for money that their dues would normally bring, and the Board is considering mitigating options for the future.
I’m a big believer that we plan for the worst, but hope for the best. In times like these, hope is hard to come by and almost feels naïve. Nonetheless, I choose to be hopeful. It’s true that most of our events have been cancelled, but not all. We look to support the remaining highland games in whatever decision they make, and for any games that proceed – as long as we can do so safely, we’ll be there. If the last month has taught us anything, it’s that we don’t know what the next month will bring. I don’t expect that we’ll be back to normal anytime soon, but I’m hopeful that we can start to recover a little of our lives. Many bands are practising virtually, many students are receiving online instruction. I find it inspiring that many are choosing to take this time to learn new music and to brush off old tunes. Even in isolation, we continue to play music and keep up our skills. It’s easy when we’re feeling down and isolated to let things go – I’m happy that many of you are not. I’m also hopeful and excited that we as an organization can take this time to reflect on what we do and what we offer to our members. A number of us have been talking for a while about the need to do a full strategic review and engagement with the members. What is it that we want to do? How can we grow? What should we look like a decade from now. Always our operational needs get in the way of really reflecting on those questions. This horrible situation allows us an opportunity to delve into those questions. We have unexpected time that we won’t waste. The Board of Directors is starting that review – please stay tuned over the coming months for more information and a chance to participate.
Finally, I want to thank all of our volunteers. Your Executive, Board of Directors, Music Committee members, the Chief Steward, and the branch executives are all volunteers. Throughout all of this and the impact on all of their personal lives, these volunteers are focused on getting your association through this. The Music Committee continues to meet, review and approve upgrade requests, plan future contest needs, work on developing professional development material for the adjudicators, work to integrate and promote material like the PDQB exams to our members, modernize our framework for recruiting adjudicators, and planning for the future. Our officers and directors manage the Society on your behalf, look for opportunities to save money, investigate government programmes that will allow non-profits like the PPBSO to receive special funding throughout this crisis, and are working tirelessly to guide us through these troubled times. These people do this for free and at great sacrifice to their own time. I thank them all. We couldn’t survive without you.
While we don’t know what this summer will bring, I do know that one day we’ll be back at the games, performing and competing, catching up with old friends, and embracing our musical art. I truly hope that some of that will still occur this summer, but if it doesn’t then I know it will one day soon. In the meantime, continue playing. As we have more information on all of the items mentioned above, we’ll post updates and let all of you know what’s going on.