Sunshine Weekly Weeder Newsletter
13 April 2017
www.sunshinecommunitygardens.org
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All Gardeners Meeting - Mark your calendar
Saturday, May 20th - 10:00 am
Agenda:
- Election of new officers.
- Rate Increase discussion and member ratification vote.
- Other site change rules discussion and member ratification vote. More details to come.
All Gardeners Ice Cream Social - Save the date!
At SCG - Sunday, May 7th, 3:00 pm
Celebration of:
- Say goodbye to longtime gardener Nancy Siebert. She has been at Sunshine over 20 years, serving as president, vice president and chairperson of the plant sale. She was also instrumental in establishing the Micah 6 food bank garden. Her contributions and hard work have contributed to the success of Sunshine.
- The success of our plant sale. Financial info.
- To meet the nominees for President, Vice President and Secretary for the 2017-2019 term.
- For gardeners long time and new to meet each other.
Rate Increase
In order to provide more information and opinions on the rate increase this week's Weeder includes:
Please feel free to submit your opinions to the Weeder at pporter_scg@austin.rr.com.
Points against the SCG Rate increase by Kay McMurry
First, let me say that I appreciate all of the hard work that the Sunshine board does on behalf of our garden. While I do disagree with the board on this topic, I do thank them for their efforts. I do not agree with their plan to raise fees and respectfully offer up the following arguments against the plan in the form of questions.
Q: Don't we need to raise our rates?
A: We're being asked to vote to increase our fees at a time of record surplus for our organization. We have $110,000 in savings and $49,500 in checking as of 3/31/17. It's been estimated that our savings represents 2.5 years of operating expenses. Before we vote, we need to really examine why we're being asked to raise our fees given such large cash reserves.
Q: What about the issue of financial security mentioned in last week's Weeder?
A: Two and a half years of operating expenses seems like a good deal of security to me. We have two main sources of revenue, plot fees and plant sale revenue. Plot fees are exceedingly stable. Our plots are fully rented year-round and collect roughly $17,000 annually from membership fees. The waiting list has mostly been steady at roughly 60+ prospective gardeners at all times. We have had a robust waiting list for many years. The annual plant sale has been making a steady profit for years. This year, we took in roughly $47,400. Our net last year was roughly $21,000 and we'll probably do about the same this year. We've had some rough weather around the plant sale, but we have still managed to make a sizeable profit each year. Even if we had a couple of bad years or more, we would still not run out of money, and if we did, we could do something about it then.
Q: Why is the argument about "the time for a fee increase is when times are good not after there is a crisis" invalid in your opinion?
A: The comment that it's always better to raise money during good times is not relevant to our situation. Increasing profits in a for-profit business is inherently a good thing. For example, a business can continue to raise prices as long as there is strong demand for its products, but raising prices when there is not drives away customers. This is not relevant to our situation since increasing profits in a non-profit business is not the inherent goal. Actually, nonprofits do well raising money during crises. Witness any fund drive after a major catastrophe.
Q: What could Sunshine do if we had large unexpected expenses?
A: If Sunshine did have a financial crisis, the board would have several possible ways in which it could weather it. It could dip into its large cash reserves and make up the deficit in the operating budget. There would then be the option to raise fees during the next year to replace any reserves. Alternatively, or in conjunction, it might ask the members for permission assess a one-time fee to raise money from its members immediately. The board could ask for donations from its members or the general public. Lastly, the garden could hold a fundraiser or reduce its contribution to other entities. I'm sure that you may be able to think of other ways that we could bring in money if we suffered a financial crisis severe enough to warrant action. If we did have a financial crisis and ultimately needed to raise fees, I am sure that everyone would agree that it would be appropriate to do so. Raising fees with 2.5 times our annual budget in the bank now just doesn't make sense.
Q: What is unprecedented about the proposed rate increase?
A: The unusual step to this proposal is that rates would go up in August of this year and then again two years from now, assuming that the general membership approves this measure. That action makes it harder for the next board to eliminate the second rise because they would have to go back to the membership and ask to not raise fees. Why step on the toes of the incoming board?
Q: How much reserves is recommended for nonprofits to have?
A: From the Knowledge Base FAQ of Grantspace.org:
A commonly used reserve goal is 3-6 months' expenses. At the high end, reserves should not exceed the amount of two years' budget. At the low end, reserves should be enough to cover at least one full payroll.
However, each nonprofit should set its own reserve goal based on its cash flow and expenses. Organizations that have contracts or fees with regular and reliable payments don't need as much in cash reserves as organizations that rely on periodic grants, fundraising events or campaigns, or seasonal activities.
Citation: http://grantspace.org/tools/knowledge-base/Nonprofit-Management/Sustainability/operating-reserves, accessed 4/12/17.
Q: How does our income and expenses in the 2016 budget compare to the actual values?
A: We are very good at estimating our income (1% difference), but we are not so good at estimating our expenses. We spent $9500 less than we budgeted. We seem to have overestimated expenses in several categories. In fact, we typically spend less than we take in, which is why we have such a large reserve.
Q: Why do you think our budget is as high as it is?
A: I question the need to raise fees when we have been using our substantial savings as justification for spending more money. For example, when I was on the board, our substantial savings were used multiple times as justification for funding projects such as sending people to the annual ACGA conference. In fact, the board decided last year to sponsor members of another community garden to attend the conference. I can't help feeling that our spending is definitely influenced by our large savings account. While I support such educational projects, it seems unfair to raise fees to pay for projects that get approved because we are feeling flush due to our savings. We should spend some of our savings to finance projects, not raise fees.
Q: Will raising the fees for our members hurt them financially?
A: Probably mostly no, but definitely yes for some people. Many of our members are retirees living on fixed incomes. Others are young people just getting started. I am the plot coordinator, and as such, I often communicate with people who are either leaving the garden membership or becoming members. I can tell you that we are definitely losing some current and prospective members due to financial difficulties. While the number may not be high, it seems unfair to raise prices when some members are having trouble paying our fees. Some prospective members have not been able to come up with the money needed to join.
Q: Can't we make exceptions for people in financial need and waive their fees?
A: We currently more or less automatically waive fees for a handful of needy gardeners. However, if people have to ask for waivers, they are not very likely to do it because it is humiliating. Do we automatically grant the waivers, or make them prove their income? It very quickly becomes a sticky situation. If we don't raise our fees, there will be less of a need to grant waivers. I realize that most of us will be able to afford the increases, but I ask that you please consider those on a fixed or low income and vote against the fee increase. Additionally, we largely did away with paying seasonally to reduce the workload and raising fees can make it even harder for people to come with the full amount at one time. Let's make Sunshine more inclusive and not less inclusive
.Q: What about the graph in last week's Weeder? That was a pretty steep slope!
A: A minor point, but the graph presented in the Weeder is misleading in terms of the magnitude of the deficit because it does not start at zero on the Y axis. Here's a graph that uses the appropriate Y axis:
Q: What have you heard about Sunshine from other community gardeners?
A: One, that it is impossible to get a plot here or, at least, takes years (not true). Two, that it's full of people who can't garden in their yards because they're too shady (mostly true). What a great problem to have! Many other gardens are full of people who have no other place to garden. A sizeable portion of our members also have no other place to garden. If we raise our fees, we are making ourselves less inclusive and perpetuating our image of exclusivity.
Q: What is our real insecurity, if not financial?
A: Our real issue is land security, not money. If TSBVI ever asks us to move, the extraordinarily high cost of land in Austin would seemingly prevent us from buying land near our current location. Renting is also probably out, as land prices would put pressure to develop any currently undeveloped land. I can see that we might be able to work with Austin's community garden coordinator to locate city land within the floodplain to locate a suitable piece of land, but hopefully, that is at least a few years down the road. If we were to end on up city property, we would likely be restricted to what we could do to alter the property, so it's unclear how much money we would need. However, I do not see the wisdom of raising our membership fees now to pay for a nebulous future.
Answers to questions in last weeks Weeder on rate increase from the SCG board
While we recognize that all members love Sunshine Community Gardens and want it to be sustainable into the future, we know there are dissenting opinions about the rate increase. Please feel free to submit your opinions to the Weeder at pporter_scg@austin.rr.com so that we can have a frank and open debate. With the intention of being as transparent as possible, more financial information is available on the web page.
Q: We have gone decades without a rate increase. Why now?
A: In the past, we have either been sponsored by another organization or have had multiple financial crises. Now that we are a stand-alone non-profit, we must take care of ourselves. A part of financial stewardship is to look forward to make sure our revenues are keeping up with expenses and we are not caught off-guard. This is a responsibility shared by the board and the members.
Q: Why do the rate increases begin in August?
A: Since this is a decision that affects all of the membership, we want to schedule the vote at the annual All-Gardeners Meeting on May 20 to get maximum participation. August 1 is the start of the Fall season. If the new rates are approved by the membership, they will be effective at the start of the next season. Only new gardeners will pay the increased rates until the Spring annual billing which is due on February 1, 2018.
Q: What expenses will increase for us in the future? Why doesn't the analysis detail the line-item expenses to justify the increase?
A: We agree that it would be very helpful to know what our costs will be in the future. It would also be helpful to know how much rain will fall and when. All we know for sure is that the Consumer Price Index is 3% and that we need to be prepared for our costs to increase by at least that much. If we wait until we know about cost increases on a line-item basis, it will be too late to increase revenues from our annual billing. That said, we do know that we have had rate increases this year in the trash contract and trailer utilities. The City of Austin raised the commercial water rate in November of 2016, and there is a strong probability those rates will increase again in the next five years. The water and utility expenses are over 40% of our budget.
Q: Why do we need a large reserve?
A: We are fortunate to have about 2.5 years of expenses in our reserve fund ($110,000). The guidelines for non-profits suggest reserves of 2-3 years, especially if revenues depend on only one or two fundraisers during the year and expenses are heavily influenced by weather. The rate increase will help maintain those reserves. Small organizations like ours have more risk and are more vulnerable to uncontrollable factors. One or two adverse events could wipe us out if we do not have an adequate cushion.
Weeder Content
Should you have any content to add to the Weeder email your articles or suggestions to pporter_scg@austin.rr.com.
Officer and Zone Coordinator Contacts - Sunshine Gardens
Officers
- President - Jeff Monks garden@jeffmonks.com
- Vice President - Jim Willmann jhwillmann@gmail.com
- Secretary - Polly Porter pporter_scg@austin.rr.com
- Treasurer - Caroline Limaye scgtreasurer1@gmail.com
- Director - Bill Cason wccason@gmail.com
- Director - Lori Dobbin loridobbin@gmail.com
- Director - Randy Thompson jartdaht@gmail.com
Email the board.
Zone Coordinators
- Zone 1, Martin Morales marmoral512@gmail.com
- Zone 2, Katy Davis katydavis@austin.rr.com
- Zone 3, Ludmila Voskov lvoskov@austin.rr.com
- Zone 4, Ila Falvey ila.falvey@gmail.com
- Zone 5, Mary Gifford mgifford@austin.rr.com
- Zone 6, Charlotte Jernigan charlotte@cybermesa.com
- Zone 7, Maria and Philip Wiley m.stroeva@gmail.com, philip9wiley@gmail.com
- Zone 8, Shannon Posern sposern@hotmail.com
- Zone 9, Kerry Howell casonhowell@gmail.com
- Zone 10, Christopher Schroder
christopher.s.schroder@gmail.com &
Karl Arcuri karl.w.arcuri@gmail.com
Other Personnel
- Weekly Weeder Newsletter - Polly Porter pporter_scg@austin.rr.com
- Plant Sale - Randy Thompson & Janet Adams jartdaht@gmailcom
- TSBVI Liaison & Volunteer Coordinator - Janet Adams jartdaht@gmailcom
- Plot Assignment - Kay McMurry scg.plots@gmail.com
- Compost Coordinator - Janet Adams jartdaht@gmail.com
- Education Committee - Shannon Posern shannonposern@gmail.com
- Carpentry & Repairs - Robert Jarry r.jarry@sbcglobal.net
- Water Leak Repairs - Steve Schulz sschulz784@aol.com
- Tools & Wheelbarrows - Bob Easter beaster1@austin.rr.com
- Kitchen Supplies - Anita Keese
anodekraft1@msn.com
(If supplies are needed for events, contact by email or at 512-773-2178) - Compost Tea - Jennifer Woertz jen@enjeneer.com
- Micah 6 - Dana Kuykendall kuykendall@austin.rr.com
- Micah 6 - Mary Gifford mgifford@austin.rr.com
- Website Coordinator - Sharon Rempert scgardenweb@gmail.com
Record Service Hours Online - Green Binder
