Compass Correction Coalition Update( PIC Assessment Audit - Another Witch-Hunt!) February 16, 2012
Fellow Pilots,
Below you will find an Update from Jamie Weidner, PHL Vice Chairman/DDR for Eric Jordan. Jamie recently wrote an update explaining why he voted against yet another audit of the financing for the PIC (Pension Investigation Committee). To date neither USAPA Communications nor PHL Chairman Steve Szpyrka has allowed Weidner's update to reach the Pilots.
At the last PHL Domicile meeting we listened in person to Jamie's explanation of his vote. When he'd finished, not one Pilot in attendance questioned his facts or logic. Predictably, certain Pilots in attendance still told him that he should, “just vote the way the other two PHL reps vote." Blind loyalty to political allies over factual evidence, open debate, and critical thinking is SOP for USAPA these days.
Bill McKee, CLT Chairman / USAPA Presidential Candidate was also in attendance. From his seat of honor at the PHL head table, Bill McKee stated that with $5 million dollars in the bank, if a committee chairman wants an audit, I will give it to him! This is typical of Bill McKee; never think deeply and when frustrated, throw money at the problem.
At any rate, we want to thank Jamie for his perseverance and rational thinking.
Fraternally,
Dave Ciabattoni
PHL AB 320
Eric Rowe
PHL AB 330
_____________
Fellow PHL Pilots,
There seems to be a lot of what I would call misinformation going out to the pilot group these days concerning some of the actions of the BPR. The latest controversy involves the Pension Investigation Committee (PIC). During the PHL Domicile meeting of January 25, 2012, I gave my reasons for voting No on the proposed contract for a forensic audit of the Pension Investigation Committee Fund that was requested by the Co-Chairmen of the PIC. In case you were not able to attend, following is a summary of what I relayed at the meeting.
First a little background information. The Committee is attempting to compute the amount of financial resources they have going forward as the assessment will be ending this summer and they need to make sure they do not spend more than they have coming in. The revenue side is being questioned by the Co-Chairmen as they do not agree with the numbers provided by the Secretary Treasurer. The reason for some of the confusion is the fact that we have a single billing system in place. All of our money goes to one location and is assigned by a priority system to our various accounts. The priority order is USAPA Dues, Medical Assessment, and finally the PIC Assessment. For various reasons the monies coming into the PIC fund change from month to month, i.e. number of contributors change, late payments, medicals, etc..This is perhaps one area where they seem to have problems reconciling their estimated numbers with the Secretary Treasurer’s actual numbers.
The Secretary Treasurer has tried to work with the Committee but is unable to satisfy them as they think they are missing funds. The Secretary Treasurer continues to be willing to work with anyone to help get the matter resolved but no one from the committee is willing to work with him at this point. The Committee has requested the BPR to approve an audit of the fund. However, it should be noted that this is not a regular audit but a forensic audit, one that is much more expensive to perform.
Twenty minutes prior to the January 23 BPR meeting a copy of the proposed Consulting Agreement for a forensic audit was emailed to the BPR to be voted on. Anyone that has been involved in business knows better than to enter into an agreement with only twenty minutes review. Too many times in my short tenure on the BPR, as Eric Jordan’s DDR, I have seen attempts by some to rush the Board into making decisions. Needless to say, the red flag went up for me.
The agreement was to be approved by the BPR to investigate the PIC expenses and income from July 1, 2009 to present under the direction of the USAPA President and the two PIC Co-Chairmen.
The cost of the agreement was $3,500 to begin work for an initial review and preliminary work. Once the initial review was complete the Consultant was to report the expected cost of the full engagement. There was no hourly rate mentioned anywhere in the agreement, it only referred to standard billing rates which could mean anything. We would also be responsible for all reasonable expenses as a result of work performed.
The agreement came up during the Presidents’ report and a motion was made to accept the agreement without any mention as to where the funds would come from to pay for it. Prior board discussions had indicated that the PIC should pay for any audit that they requested, however, it was clear that this was coming out of the general funds. The motion to accept the agreement failed with a vote of 6-5. I voted with the majority and now I will give you the reasons.
First, USAPA has an annual audit performed on all of its funds on an annual basis. In fact this audit is already underway and will be completed in April for FY 2012. The PIC funds will be and have been part of this annual audit that is required by the USAPA CB&L’s. If we were to perform another audit, it would be duplicating work already done.
Second, the BPR has previously approved an audit of all legal billing to the association. If the PIC wants their legal bills audited they don’t need to ask the BPR. They need to ask the President and Secretary Treasurer who control that audit and it will be done. So again, we would be putting our PIC legal billing through a triple audit process if we were to approve this agreement.
Third, this audit would be very expensive. $3,500, or the monthly assessment of 77 pilots, just to find out what it was really going to cost.
Fourth, I believe as do others, that if the PIC wants an audit then it should come out of their funds. Not all of our pilots are included in the assessment, so what would be the justification for them being responsible for expenses related to it. I also believe it to be a waste of money and would prefer my PIC assessment be spent on investigating what happened to my pension and attempting to get more money from the PBGC for our pilots.
And last but not least, an audit deals with financial history only and will not bring in any new money. It will also not help project how much money the committee has to work with going forward. Those numbers will never be more than a best guess, but I see no reason why they should not be able to come up with an estimate within $20,000 of what the total income should be projected to the end of the assessment. Right now after reviewing the fund accounting my preliminary numbers show the fund averaging approximately $105,000/month in income looking back nine months.
So as you can see, my vote was a simple business decision after looking at the facts. When the Secretary Treasurer is willing to work with anyone to resolve an issue, we don’t need to start another witch hunt. I personally volunteered to work with the Secretary Treasurer and a member of the PIC to get this resolved but my offer was turned down by one of the Co-Chairmen. So one has to wonder, what is the real motive at play in requesting an audit?
I hope this leaves you with a better understanding of what occurred concerning the Pension Investigation Committee audit request. And you should also know that they are trying to bring it back to the BPR for reconsideration.
Respectfully,
Jamie A. Weidner
PHL Vice Chair DDR
Jweidner@usairlinepilot.org
PHL@usairlinepilots.org