PRINCIPLES OF PRODUCT STEWARDSHIP



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PSI FINANCE COMMITTEE

CONFERENCE CALL MINUTES

May 8, 2009

Board Participants: Jack Price, Scott Mouw

PSI Staff: Scott Cassel, Bill Honohan, Brian Korby (PSI Accountant)

Absent: none

• Minutes from the April 7, 2009, Finance Committee conference call were unanimously approved.

• Scheduled date/time for Finance Committee call in June call was reviewed and agreed upon (see date/time below).

CASH FLOW UPDATE

• BH gave a quick update on projected cash flow through September. He noted that the adjustments were made to reduce expenditures based on the discussions/recommendations from the Finance Committee, meetings with SC, and SC’s discussions with Mage. The lowest the cash balance should drop to would be about $52K, occurring in August 2009. The recommendations made to limit expenses included: laying off Jim Schrack, reducing Mage’s monthly retainer from $4K/month to $1K/month, reducing contracted hours with Erin Linsky, Brian Korby, and reducing the payment from the Forum net income to NAHMMA .

REVIEW FY10 DRAFT BUDGET: An overview of the proposed FY10 budget was discussed. The following was noted:

• BH reviewed the FY10 projected income of $934,836 and each revenue source contributing to this amount, eg, Corporate, Federal, State/Local, Member/Partner Fees, etc.

• A total of $70,631 in “carry over” income from contracts/grants secured in FY09 and before is projected.

• A total of $864,205 is projected to be secured in new income in FY10. SC noted this was the best estimate of income for the coming year, and is based on funds secured in FY09 and potential projects/grants that may be secured over the next several months.

• SM noted that North Carolina’s membership payment may be delayed and possibly not paid due to financial restraints and budget cutbacks this coming fiscal year.

• SC mentioned the potential decrease in income from local/state membership fees due to budget restrictions would be offset by the possibility of securing additional income from the new strategy of combining statewide memberships with local communities at $15K/state. Currently targeted states are FL and NY.

• SC mentioned that companies who were members under the now phased-out Corporate Adjunct Member structure will have to be contacted as their membership year ends and informed about the new corporate partnership structure and advised of the new fees. They can then determine if they would like to continue their relationship with PSI.

• A total of $885,447 is projected to be expended FY10.

• Due to financial constraints and keeping the expense budget at a minimum, no pay increases are planned/budgeted for staff.

• JP mentioned that even with this minimal budget, we still have to keep open to the idea of additional budget cuts if income goals are not met. Until substantial income is realized and the cash balance has increased substantially, a monthly review of cash flow will be necessary.

• Payroll Administration fees will increase due to contracting payroll and human resource services with Administaff, but this cost will be offset with savings on health, dental, life, disability insurances and workers compensation. There will be a net savings on all payroll expenses by using Administaff’s services.

• SC requested that services with Mage be budgeted at $2K/mnth for the first three months of the FY and be increased to $3K for the remainder of the year. JP mentioned it is important to maintain an ongoing relationship with Mage and not to terminate the relationship so quickly. There is value in maintaining this ongoing relationship.

• All agreed the projected income and expenses were reasonable and that no significant updates/revisions were necessary prior to presenting the budget the Board for their approval in June.

• JP requested BH create a pie chart to present to PSI members at the Forum showing the $’s and percent breakdown of income sources in both FY08 and projected income for FY09. This will demonstrate the increase in funding and how funding sources have shifted over the past two years.

• JP requested BH format the FY10 budget agreed upon by the Finance Committee to present to the Board for their approval similar to how the revised FY09 budget was presented to the Board in January, 2009.

|Future Finance Committee Calls |

|Date: Monday, June 8 | |

|Time: 2:00 ET | |

|Dial-in Number: 1-270-696-2525 | |

|Participant Access Code: 754907 | |

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