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Old January 31st 08, 03:18 AM posted to,,alt.chess,
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Default Goichberg Plans to Eliminate Chess Life for Kids

This is the um-teenth time I have read here that
the USCF is "losing" hundreds of thousands of
dollars; please explain how it can be that all these
millions of dollars in combined losses have not
already resulted in bankruptcy. I can think of a
few possibilities:

1. the years in which they "gain" are not reported

2. the losses are not really losses, except on paper

3. they started out with many millions of dollars in

4. the reports are bogus

-- help bot

The USCF generally runs at a loss during the first half of the fiscal
year. This is because there are fewer big tournaments and people signing
up or renewing as members during the first half of the year than the
second half. The situation is supposed to reverse itself in the second
half, and break even by the end of the year. The nerve-wracking part is
that big scholastic tournaments which need to be successful for the USCF
to break even, are right at the end of the fiscal year.

Anyway, it was budgeted for the USCF to be showing about a $309K loss at
this point in the year. However, it is actually showing a $350K loss, and
it looks like things are not turning around for the second half, as much
as usual or as planned.
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Old January 31st 08, 01:12 PM posted to,,alt.chess,
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Default Goichberg Plans to Eliminate Chess Life for Kids

Is it possible that players tend to sign up or renew
their memberships more in anticipation of winter?

What sort of expenses, in general, are there that
suck up $300K in less than a year? Legal
expenses-- like defending spurious lawsuits, for
example? Printing Chess Lies?

-- help bot

The seasonality comes partly from the influence of scholastics which is a
major part of the budget. There is fewer scholastic tournament activity
during the summer months and the big scholastic tournaments tend to be in
the second half of the year. Scholastic memberships are very much driven
by tournament activity -- much more so than adult memberships where
renewals and the magazine are bigger elements of the equation. But there
are also fewer adult tournaments in the summer, and the seasonality
affects the revenue from adult membership categories also.

The USCF has a $3 million budget with over 25 staff people handling
memberships, ratings, and the magazines. Those are the main programs, the
magazines being the most significant. The personnel costs and the
overheads to support this staff (office space, phones, computers, etc) do
not vary significantly throughout the year. Printing and mailing Chess
Life and Chess Life for Kids are also significant costs (about 20% of the
budget), and this does not vary much throughout the year either. However,
the expenses overall are actually below budget so far this year, despite
professional fees (including more than just legal fees) being over budget
by $28K.

So the financial situation is (a) not a $300K loss at this point, although
there is certainly cause for concern; and (b) results from concern about a
shortfall in revenue and memberships not mainly from an increase in
expenses. At this point, it is fairly difficult to project what the
loss will be by the end of the year, since it involves guess work about
the membership and tournament revenue in the second half of the fiscal
year, which is still ahead. (The fiscal year ends May 31.) It is getting
late in the year to be able to adjust to the problems in time to prevent a
loss by fiscal year end.

Sam Sloan's comment about the year to date loss being over $300K is
technically correct, but it is somewhat misleading because most of this
loss is something that happens every year due to seasonal variation in the
revenue, and is expected and planned for. Polgar's going on about legal
fees, internet insurance, and web development costs, etc, is both
incorrect and misleading -- not to mention self-serving.

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