This is the first of a two-part
summary of the Board of Trustees meeting. This email
details the proceedings of the Board of Trustees
meeting from May 2nd. Because the Governance
Committee report and discussions of Bylaws was so
large, I am sending that as a stand-alone section in
Part Two.
The Board of Trustees of the U.S.
Naval Academy met in
Annapolis, MD, 1-2 May 2008. Committee
meetings were held on Thursday May 1st, while the
entire Board met Friday, May 2nd.
The Board meeting was called to order at 0800, 2 May
2008, in Alumni Hall at the U.S.
Naval Academy. It bega n with remarks from
our Chairman, ADM Carlisle Trost '53, followed by
role call, and a moment of silence for our fallen
shipmates, review and approval [vote] of minutes of
our December 2007 meeting. The Board voted to
re-elect The Alumni Associations Officers, George
Watt '73 Pres/CEO, Terry Murray '68, COO, Hank
Sanford, Treas/CFO, and Skid Heyworth '70, Board
Secretary. This is an annual requirement.
The Superintendent, VADM Fowler '78, was expected at
9am, so we skipped ahead in the reports until he
arrived. VADM Haskins '66, Chairman of the Council
of Class Presidents, briefed his meeting with the
COCP. He talked about how the new head football
coach came and met the class Presidents. But his
final comment was about the proposed by-laws changes
many of you have hear about (By-Laws #2). He
indicated that 54 of 55 Classes represented at the
council of Class Presidents supported adoption of
all proposed changes to the by-laws.
CAPT George Zeberlein '54 represented the Board of
Tellers who count the votes for Trustees, and have
done so for many years. He reported out that the New
Vice Chairman is LtGen Jack Klimp,
USMC (Ret.) '68. Central Region Trustee is
CAPT Robert Jones,
USN (Ret.) '64, and Eastern Region is CAPT
Bill Rentz,
USN (Ret.) '55. CAPT Zeberlein reported that
using electronic voting, we received
more than 13,000 votes in this election. That was
nearly 31% of the membership. The previous high was
about 10,000 votes. He pointed out that this
election cost about $23,000 to run, while previous
elections cost $2,500, nearly an order of magnitude
difference.
Tim Kobosko '80, of the Alumni Assoc. staff spoke to
the vendor the election process was outsourced to,
and the security methods used to ensure its
accuracy.
The Governance Committee report (the 800 lb Gorilla
in the room) was put off until after the
Superintendent's report to give maximum time to
debate proposals. For the sake of your inbox and
reading, I will discuss this in a separate email.
The Board then addressed the Joint Finance and Audit
Committee and voted for the Budget; Voted to
reauthorize Hank Sanford and Gerry Farmer to conduct
business on behalf of the Association (an annual
requirement); and voted to approve the Joint
Investment strategy. The budget is in good shape.
The Association added $1 million to Reserves, taking
reserves over $9 million. That means that if
investment income failed, the Association could
operate at normal levels for 4.5 years off reserves.
Despite the slowing economy and the volatility owing
to the credit crunch and energy prices, the
investment portfolio is still returning on
investment, albeit, not as crisply as it has in
previous years. In FY 07, support to USNA was $11.7
million. In FY '08, it was $17.5 million. Since
inception, it has been $162.8 million. That is money
that is providing the Margin of Excellence at the
Academy.
The Superintendent came and spoke for about an hour
about things at the
Naval Academy. There is lower attrition rate
in the Brigade (about 15% vice 33% in the old days)
so Service Assignment goals were exceeded in all
categories. Nearly 23% of the graduating class is
going into the Marine Corps, and that may get up to
25%, owing to the needs of the service (Editorial
note: I am very
pleased that the Academy is producing more Marines,
especially in time of war.) The Supe sought to do
some rumor control. First, he mentioned that he has
not abandoned sailing at the Academy as reported in
some newspaper. Previously, all midshipmen were
required to become sailing skippers or YP craft
masters. Because of other competing needs, he
removed the "requirement" that every
midshipman qualify as a skipper or craft master.
They still may do so if they want to, it's just not
a mandatory qualification. Second, he addressed the
food issue. He pointed out that the Brigade is fed
on about $7 per Mid, per day. That made ends
meet when Mids bought their own pizza's, etc. He
felt that the Mids should not, in essence, subsidize
food service through outside purchases.
In a meeting with the Supe's of the other service
academies, they are working to double that amount
per person to provide three squares a day with the
quality and variety many of us remember.
When the Supe left, we took a break then started the
governance Committee report. The governance
Committee report went up to, and after lunch, and
debate and discussion lasted around three hours. (To
be addressed in Part Two).
After the Governance Committee report, we had
Communications Committee, House Committee,
Admissions Committee, membership Committee, and
Other Chapters Committee.
House Committee chaired by Al Davey '67 talked about
the $2 million renovations to Alumni House. It
includes a new addition for an elevator and
restrooms so Alumni House is ADA compliant . not a
requirement, but a moral imperative with our Alumni
who may be wounded warriors, and seniors with
mobility issues. Their Alumni House is fully open to
them.
For daily operations, there is a state-of-the-art
HVAC system, which will keep Alumni House habitable.
The kitchen and taproom are being fully renovated to
bring them up to code and allow better events and
catering in Alumni House. He noted that being an
historic building, pulling a string can lead to
surprises, and things that passed code inspection
two years ago were found to be out of code today
(wiring, fire alarms, etc.) But Alumni House is
better than ever, and will be even better still when
all renovations are complete.
Dave Paddock '77, Chairman of Communications, said
his committee is working on a communications policy
and pro cedure, to include Trustee use of Alumni
Association email. Such a policy was shot down last
May, but the issue is being revisited. ADM Trost
directed the Communications Committee to follow a
similar approach that Governance used over the past
18 months, to have open meetings and
periodic reports to the Board so we can gather and
discuss inputs from all sources.
Bill Rentz '55 briefed the Admissions Committee. He
had a good meeting with the Dean of Admissions,
Bruce Latta. Dean Latta will come to our next Board
meeting to brief the Committee fully on the
challenges and innovations in recruiting for the
Academy, especially minority recruiting.
Perry Martini '71 briefed the Membership Committee
report. He noted that there was a glitch in numbers
of associate (non-voting) members of the Association
vis-à-vis the operating manual, and that he will
make recommendations to the Governance Committee to
address. In a nutshell, ther e are more associate
(non-voting) members of the Association than
anticipated when the program was
expanded in the late 1990s, and so percentage
allowable under the Operating Manual needs to adjust
accordingly.
Lawrence Stovall '84 briefed out The Other Chapters
Trustee Selection Committee report. The term of the
Houston Chapter Trustee, Len Wegner '65 expired at
the end of the Board meeting, and the Houston
Chapter did not send a replacement. Mr. Stovall is
contacting the Chapter President to tell him that if
no replacement is named, the seat will be offered to
the next Chapter in line on
the list. In addition, Mr. Stovall briefed the
procedures for chapters to gain a seat on the Board
of Trustees through the "Other Chapters" (not the
largest). He is contacting all chapter presidents to
get them application information and timelines.
The Chairman, ADM Trost, then made closing remarks.
The outgoing trustees were given a token of
appreciation for their service. Vice Chairman,
Corbin McNeil received special recognition. Mr.
McNeil '62, was a regional vice chair for six years,
and when the new position of Board vice Chairman was
created, he became vice Chairman. Some folks
squawked that this violated term limits, but when
the new positions were created, it was made
explicitly clear in debate and discussion that the
term limits clock was set at zero with the creation
of the new positions, so Corbin's service in a newly
created position did not, in fact, violate any term
limits.
Mr. McNeil has served with distinction on our Board.
He served a full career in the Navy before retiring
and starting a second career in public utilities. He
became Chairman of Excelon corporation; one of the
nation's largest energy companies, and sits on
numerous corporate boards. He has brought enormous
heft to this Board and will be sorely missed. LtGen
Klimp, will hav e big shoes
to fill, but we know he is up to the task.
The Board adjourned. After a short break, the Board
re-convened with the new trustees. They included:
--Jerome Smith, Jr. '61, 60s Decade Trustee
--Richard Pace '63, LA Chapter Trustee
--Bob Jones '64, Central Region Trustee
--Jack Klimp '68, Vice Chair
--William Ruch III '68, Richmond Chapter Trustee
--Stephen Frederick '72, Atlanta Chapter Trustee
--Aaron Fielder '01, 00s Decade Trustee
We had welcoming remarks by ADM Trost. The Board of
Trustees then voted for the proposed Executive
Committee membership, the proposed Standing
Committee membership, and the proposed Nominating
Committee membership.
George Watt '73 President/CEO gave his remarks about
the role and duty of Trustees. The date for our next
meeting was announced. It will be in
Annapolis
December 4, 2008. The floor was opened to
questions from the audience. There being no
questions from the audience, the meeting adjourned
at approximately 1515, and proceedings were
concluded with the singing of Navy Blue & Gold, led
by Art Bryant '66.
Mike Collins '84
Mid Atlantic Trustee
This is Part Two of my summary of the May 2, 2008
meeting of the U.S. Naval Academy Alumni
Association's Board of Trustees.
The Governance Committee was tasked by the by ADM
Trost, in September 2006, with reviewing our
governance documents to ensure they complemented
each other and aligned with Maryland law. This was
prompted by the ugliness surrounding the 2006
election for Chairman. The Governance Committee used
a two-step process. Step one was doing the easy
stuff last year, in what was called Bylaws Set #1.
We saved the tougher proposals for Bylaws Set #2.
This allowed us mo re time to work the tough issues,
and vet them with our colleagues.
A summary of our proposed Bylaws Set #2 went on the
Alumni Association Web site in December 2007, and
was shared in a red-line copy with members of the
Board of Trustees. It was subsequently emailed
around quite a bit and numerous comments were
received.
Simultaneously, the first-ever contested election
for Vice Chairman of the Association was being held.
This proved to be an important data point.
The Governance Committee met in
Annapolis in April to review the proposed
by-laws and make any final changes to incorporate
input received. Most input was grammatical-better
phrasing for things, questions of intent, points of
clarification, etc. Several Alumni Association
members emailed us simply saying don't make any
changes for any reasons. Seldom was any alternative
offered besides "I say no." Differing opinions were
considered and issues raised by se lf-proclaimed
"dissidents" were addressed, albeit, perhaps not in
the manner they would have chosen.
The final, final changes were sent out to Board
members to review. There were no substantial changes
from what was posted on the website in December.
At the May 1st Governance Committee meeting, all
Trustees were invited to attend and comment on the
Bylaws. Joe Moreno '93, Lawrence Stovall '84,
Russell Puppe '66. Jim Bethmann '77, and Steve
Andres '67 attended. At their recommendation, the
proposed Bylaws were broken into seven separate
resolutions. The idea was to isolate and group
proposals so they could be more easily debated and
discussed. They felt it was easier for members to
vote cleanly, rather than being forced to accept a
proposal they did not like in order to get a
proposal they did like. The original plan was for
five resolutions, but the resolution #3 with
discussion of board-selected chairman and Vice
Chairman was thought too important to tie elsewhere,
so the Committee broke that out separately.
Before review and discussion of the voting began,
RADM Pierce Johnson '66 proposed a motion to table
action on the Bylaws until the next Board of
Trustees is seated. There were arguments for and
against. But there was a consensus that this Board
had worked for nearly two years on these proposals,
and we should not abdicate our responsibilities. It
was our job to pass or reject the proposals. The
motion to table was defeated (22-6).
The resolutions were:
Resolution #1: Remove the Mission Statement from its
position at the head of the Bylaws.
Why the change needed: The change resolves an
ambiguity. The Mission Statement is not part of the
Bylaws. Bylaws are a requirement of the
Maryland Corporate Code; the Mission
Statement is not. The Mission Statement serves a
separate and distinct role and will continue to
appear on the Associ ation's website, the Shipmate
masthead, etc. The resolution was passed on a vote
of 26-1.
One of the nicer moments of the meeting occurred
after Resolution #1 was received. The Board received
an affidavit from Capt. "Murph" McCarthy '00, He
could not attend the meeting in person or
telephonically because he is in a combat assignment
in
Iraq. We normally do not have proxies. But
under the extenuating circumstances, he asked that
Dave Paddock '77 be able to vote in his stead on all
resolutions. His affidavit said he supported all
resolutions. ADM Trost brought it to the Board, and
there were no objections. I was proud that we could
accommodate a warrior who, even in combat, is
thinking of his alma mater. BZ to Murph!
Resolution #2: Approval to strike the position of
Past Chair from the Board of Trustees.
Self-explanatory. The change is effective
immediately, however, the current occupant of that
position, will complete the remainder of his term
per Section 4.3 of the Bylaws. This position will
not be filled after the
May 2009 Board meeting. The resolution passed
on a vote of 28-0.
Resolution #3a: Approval of the single slate
candidacy for the Chair and Vice Chair position and
election of those positions by the Board. Since this
was the 800lb Gorilla, I will address after the
other resolutions. The resolution passed on a vote
of 22-6.
Resolution #3b: Approval of the nominating
procedures for the Regional Trustee:
What this resolution does: It requires that
signatures for a petition candidate come from
regular members in good standing who actually reside
in that
candidate's region, and that those petitions be
received by the Secretary 30 days prior to the
December meeting, and the petitions are submitted to
the Board for final approval. This change also
clarifies that the position of Regional Trustee is
the only position on the Boar d of Trustees that can
have petition candidates.
This resolution had some discussion because one
member felt that the provision would be used
arbitrarily and capriciously by the Board. Another
member noted that the entering argument presumes
that the rest of the Board are not persons of honor,
and have nefarious intentions. The Board passed the
resolution by a vote of 23-5.
Resolution 3c: Approval of the clarification of the
nominating and approval procedures for
Board-selected Trustees, the procedures for filling
vacancies, term limits, and all other miscellaneous
changes to Article IV.
Term limits received some discussion. The term
limits say that a trustee may only serve six years
in an eight-year period. There is an exception in
case the Vice Chairman is near the end of his term
and has to fill the Chairman's term due to an
unforeseen loss of the Chairman. Because the terms
of Chairman and Vice Chairman overlap , the
possibility exists that the Vice Chairman could be
at the end of his six-year term when he is required
to "fleet up." This exception provides a safety
valve for continuity of operations purposes.
One member voiced objection to this safety valve.
Discussion of all perspectives occurred and the
resolution passed on a vote of 26-2
Resolution #4: Approval of changes to Section 8.5 on
indemnification for all claims made on or after
May 15, 2008:
What the resolution does: It expands indemnification
to the full extend of Maryland law to which trustees
and officers are entitled. It also includes board
approved committee members.
One member of the Board wanted the Bylaws to specify
that liability insurance would be purchased.
Discussion alighted on several indemnification
options, and it was felt that it was better to
require indemnification without specifying the
method in case there were more cost-effective
methods available. The resolution passed on a vote
of 28-0.
Resolution #5: Approval of miscellaneous
administrative changes.
One member opined that the proposals exempted the
Executive Committee and the Board from compliance
with the Operating Manual. That specific provision
was read aloud and it was clear that the only time
the Board and Executive Committee are exempted from
the Operating Manual is when those provisions
conflict with the by-laws. The term is a legalistic
phrasing to say that if the two documents conflict,
the Bylaws take precedence.
The rest was pretty much wordsmithing. The
resolution passed on a vote of 27-1.
Resolution #3a was the most debated issue. It
attempted to codify the Board of Trustees tradition
of selecting its chair and vice chair. This was
traditionally done through the use of the
"single-slate candidate."
In this method, the Board seeks out the candidate it
wants as its leaders, and that candidate is the
only name on the ballot for that position. Through
the years that method has been criticized as a sham
election (or worse).
In the 1998-1999 Governance Study Group effort, the
study group determined that single slate was the way
to go in order to get the best candidates possible
for Chair and Vice Chair. The thinking of the
committee was that those positions are special; that
they should be occupied by incumbents who can talk
to military, government, and corporate leaders at
the highest levels, and have
their calls answered.
Candidates like that are rare. They usually command
six-figure salaries for serving on boards, and our
Board is unpaid and has no perks. They serve for the
love of their alma mater. The Governance Study Group
felt that conteted elections for these positions
would either be beauty contests or potentially get
nasty, and thus serve as a disincentive to the
candidates we want to attract.
The Board of Trustees adopted the recommendations of
the Governance Study Group in 2002, but modified one
word. Instead of saying that the positions of Chair
and Vice Chair "shall be' single slate, it was
changed to say that they "may be" single slate. As
we have seen, some have misinterpreted that to mean
they "must be" competitive elections. That
misinterpretation led to the acrimony in
2005-2006 over the 2006 re-election of the Chairman,
and the failed lawsuit in 2007 to overturn the
results of the 2006 election.
At the beginning of the process, the proposals for
single-slate and Board-selected Chair and Vice Chair
did not have the 19 votes to pass-including my own.
But the "partisans" in the election did more to sway
votes to the single candidate position than
anything. The resolution garnered 22 "yeas."
Fortunately, most of you have been spared the
vitriol of the election. Sadly, some of us have not.
In my original drafts of this summary I included
some of the emails we have received. Stuff that
called candidates liars and a disgrace; notes that
compare the Board to Nazis and communists.
Candidates had their honor and integrity impugned.
One candidate's daughter even received unseemly
emails at her work. I shared the draft with a couple
friends, and cooler heads suggested I leave the
notes out: Probably good counsel.
It was the abuse hurled at candidates in 2006 and
2008 that swayed a number of Board members from the
"no" to the "yes" side of this discussion-including
me-that led to the ratification of the Governance
Study Groups' recommendation for single-slate
candidate for Chairman and Vice Chairman, and for
the Board to take the responsibility of casting the
vote, rather than have the veneer of an
election by having alumni vote for one candidate.
I am sure a few misguided souls will continue
to vilify the Board of Trustees. Look for scorching
emails about "disenfranchisement," and references to
Soviet-style elections, military dictatorships, and
other such rot. This is what seems to pass in
some circles for discussion, and it is a large
reason why this resolution passed. Our Association
should be above this type of stuff. We should not
have our Association matters turned into the
"Hillary vs. Obama" acrimony. Our Association was
founded with a noble goal, to support our Alma
Mater.
You elect your regional trustees. You elect your
class presidents who elect the decade trustees. You
elect your chapter trustees. They can appoint two
other members to the Board. Together, your elected
trustees will choose their chairman and vice
chairman.
A friend recently asked me what my goal is for the
Board of Trustees. I told him I have one goal: To
keep this Association, which has become increasingly
successful and relevant, from being torn apart for
petty self-interest. My goal is to keep us focused
on our mission, and that is supporting the alma
mater we love. A better
Naval Academy and Brigade of Midshipmen is a
legacy worth
working for. As
John McCain '58 says, it is about being part
of something bigger than our own self-interest.
Mike Collins '84
Mid Atlantic Trustee |
