On April 1 I received a check in the mail for $175.00 from the Competition Division of the Balloon Federation of America. Approximately 400 other members in good standing also received such a check. This was no April Fools joke. The division was distributing more than $70,000 to its members.
And to what did I owe this largess? Seems the division had excess funds which it chose to distribute. Wow! Extra money. A benefit of membership. Isn't that special!
Can the Balloon Federation of America legally do this? That is the focus of a special investigative report by Balloon Life. The legality of such a giveaway is in question and the money may have to be returned. See Balloon Life's report beginning on page 14.
Several aspects of this giveaway, beyond the legal ramifications, are disturbing.
First, why couldn't this money have been put to better use in promoting the charitable purpose of the BFA? Part of the BFA's mission statement is to promote the advancement of ballooning. If $70,000 was excess money in one part of the organization, why couldn't it be used in another area to further the charitable mission?
In a 1995 editorial, I wrote, "...there will be two `BFA sanctioned' championships that will award $175,000 in prize money. Less than 10 percent of the organization's membership will have any chance to partake in these events. Wouldn't it be better to take $100,000 of that money to fund education and safety, membership development, landowner relations, government relations, and an Executive Director?"
The BFA as a tax exempt 501(c)(3) corporation has a duty to use its resources to foster the sport of ballooning, not enrich a small percentage of its members.
Think of all the good programs $70,000 could provide. Programs like pilot training materials, promotion of a national landowner relations program built on Neville Wallace's marked-up map system, educational programs that help pilots use and evaluate new weather-gathering sources, materials for youth programs in schools, and a program for introducing new people to ballooning, to name a few.
The second disturbing aspect is that very few individuals knew this cash dividend was going to happen. On the Saturday before the checks began arriving in mailboxes across the country, David Lowe, Competition Division Chairman, stood before the full BFA Board and gave a report on the Division's activities. Not one word was mentioned about these checks. Checks he had recently signed.
In that 1995 editorial I chastised the BFA Board for lack of control and communication with the Competition Division. While the Competition Division was created to give "serious" competitors more autonomy over their activities, this cavalier distribution of funds places the BFA's tax exempt status in jeopardy. It is time for the BFA Board to get serious about stewarship of the entire organization. The by-laws state that there is only one treasurer. A division may have flexibility over the handling of its finances, but the BFA treasurer should be required to review and sign-off on expenditures.
A few individuals have already argued that these funds are the competitor's and nobody else is entitled to them. That's fine as long as the organization accepting them operates as a private corporation, paying taxes and filing reports as a small business. But, the funds to the Competition Division are exempted from taxes. In fact, the original purpose of sanction fees was to generate money to help fund the chartiable purpose of the BFA. If all aspects of the organization can not communicate and work together effectively, the organization and the sport are both comprised.
The BFA is now examining the legality of this distribution as a direct result of Balloon Life's investigation.
What did I do with my check? I endorsed it back to the Balloon Federation of America, mailed it to Indianola, and asked the President to use these funds for the charitable purpose for which they were intended.