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June 15, 2010
By Remmert Wolters
CYC Treasurer
We are at a stage where we need to start seriously addressing the club's financial situation and determine what we need to do to go forward. After two very difficult financial years in 2007 and 2008, last year was one of recovery. We instituted much stricter financial control of our expenses and benefitted from not having to fund the very expensive Leschi based clubhouse. We ended up with a surplus that allowed us to replenish our financial reserves. Due to the economic situation, we did budget for some loss of membership and race income and it proved to be a fairly good indicator. Since there were signs of economic recovery last year, we budgeted for our membership and race income to be flat for 2010. That proved to be overly optimistic.
For 2010, we probably started out with the best financial reserves in years but we have to monitor the trends. Our membership dues income is down by 10% and our race fee income is down by 20%. Bar income is on target and, even though the clubhouse rental income is a modest category, it is down substantially. On the expense side, we are more or less under control, although payroll is over budget. Our situation is not unique, as other yacht clubs are struggling with the same issues of declining membership and participation. Our financial situation is a little different however since most yacht club's expenses are facility dominant while our race expenses are the big ticket item. Since we now have to go in cost cutting mode, we need to determine where and how we can make up for the income shortfall. Here is a listing, in percentages, of what our income and expense categories represent of the total:
| Membership Fees: | 50% |
| Race Fees | 30% |
| Bar Income | 15% |
| Rentals | 5% |
| Payroll & Taxes | 40% |
| Race Expenses | 15% |
| Overhead | 15% |
| Clubhouse | 15% |
| Bar Expense | 10% |
| Leschi Clubhouse Fund | 5% |
As you can see, membership and race fees represent 80% of our income. Since we are falling short on both, it has a significant impact. On the expense side, payroll & taxes are the most significant contributors and they will therefore get the most attention when we start discussing our cost cutting efforts. However, this will also impact the way we do business.
In conclusion, CYC's financial situation is better than it has been but is trending downwards. We have to re-roof the Shilshole clubhouse and these are large expenses that have not been budgeted for. We therefore have to make every effort to make sure that we do not get back to a point where we have to worry about the financial viability of the yacht club. The membership committee will be extensively meeting this summer to figure out what we need to do to stabilize our membership numbers and try to grow them again. If you have suggestions or interest in participating in those efforts, I would strongly suggest that you contact Rusty Lhamon, who is heading up the membership committee. If you have any questions on the CYC finances, please send me an email and I will see what I can do to get you an answer. My email address is listed on the web site.