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NGAUS BOD

Webinar Meeting Minutes

July 13, 2016

MG (Ret) Deborah Ashenhurst

Maj Gen Daryl Bohac

BG Roy Robinson

Brig Gen (Ret) Ken Ross

Brig Gen Murray Hansen

Col (Ret) Steve Greco

BG Frank McGinn

Col Dave Fleming

Brig Gen Carol Timmons

MG Max Haston

COL Jimmie Cole

Brig Gen (Ret) Robert Hamrick

Col (Ret) Tony DeJesus

LTC Eric Leckel

Brig Gen (Ret) Jon Fago

BG John Lathrop

Maj John Brownell

Brig Gen (Ret) Dave Brubaker

BG (Ret) Daryl McCall

CPT Mark Timmons

Capt John Fesler

CW3 Lance Jenkins

Absent Members:

MG Stephen Danner

Maj Gen William Reddel

MG James Hoyer

MG Augustus Collins

COL John Mark Prine

MG Timothy Reisch

MG Jefferson Burton

Non-Voting Members:

Maj Gen (Ret) Robert Gruber

Col (Ret) Pete Renaghan

Mike Strum, NGEDA President

Mr. Chip Lunn, CAP (absent)

MG Glenn Curtis, AGAUS President (absent)

CMSgt John Harris, EANGUS President (absent)

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General Ashenhurst called the meeting to order at 1000. Brig Gen Hansen called the roll and

reported a quorum was on the call.

Gen Ashenhurst called for a motion to approve the minutes from the March meeting. Gen

Hansen so moved. Gen Brubaker seconded. Motion passed.

Gen Ashenhurst asked Gen Hansen to remind the members on the Roberts Rules of Order on

debate.

Gen Ashenhurst call for a report from Army Vice Chair, BG Robinson who had nothing to add

then Maj Gen Bohac, Air Vice Chair, who also had nothing to add.

Gen Ashenhurst made the following appointments:

1. Conference committee appointments:

a. Area I Caucus Chair—LTC Eric Leckel

b. Area IV Caucus Chair—Major John Brownell

c. Nominations Chair—BG John Lathrop

d. Rules and Credentials—Brig Gen (Ret) Robert Hamrick

e. Retire/Separated—BG (Ret) Daryl McCall

f. Resolutions:

Colonel Mike Morgan – Chairman, Joint Resolutions

Brig Gen Murray Hansen – Chairman, Air Resolutions

LTC Lance Englet – Chairman, Army Resolutions

g. Company Grade Committee - Captain John Fesler

Gen Ashenhurst entertained a motion to approve the appointments. Gen Hansen so moved. Gen

Brubaker seconded. Motion carried.

Gen Ashenhurst discussed the Selection Committee process upcoming for the replacement of the

upcoming NGAUS President position,

The timeline is as follows:

a. Announcement for the position will go out this month (July) and run for (1) month.

b. Need to make sure of the applicant’s prerequisites and experiences

c. At the end of August, first of September we will close that advertisement

d. The selection committee will be chaired by MG Frank Vavala, TAG-DE.

e. The Committee will be composed of former chairman of the board, retiree rep, executive

director, company grade rep and some at large people.

f. We are working to make sure there is diversity on the committee

g. The committee will have time to review the applicants and narrow it down to two or three

and those will be presented to the November Board meeting for selection.

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h. The selected person will be come on board mid-February; there will be an overlap

through February and March for Gen Hargett to orientate the new President to Congress

and other pertinent organizations up to the March Board of Directors meeting.

i. The hand off will take place after the March Board of Directors meeting and the selectee

will take over.

Mike Hadley—Legislative Update

Staff:

New staff, Elle Ross, Army Programs Manager, starts 18 July; Mark Malizia, Legislative

Assistant, will work on resolutions

Grace Washbourne, Joint Programs

Matt Pincus, Air Programs

Heather Bennett, Fellow for MS Guard

Legislative Calendar:

Last week Congress is in session until September 6th ; no Congressional activity during

this period

Looking at NDAA and expect nothing on this until September

House has named conferees but the Senate has not

Defense Appropriations: House passed theirs but the Senate does not; will probably have

and Omnibus bill at the end of the year; more to follow

Have legislation that falls under the Veterans Affairs Committee; got update yesterday

that the House VA Committee does not anticipate passing any legislation for the

remainder of the calendar year.

Working the conference resolutions; about 100 new resolutions; in the process of

reviewing those and getting NGB input

Working closely with the Task Forces to get their input on resolutions and get out prior to

conference

Gen Hansen said things being tracked specifically in the NDAA is a change to the definition of

joint matters and the ULB efforts fix to the missing 12304b mobilization authorization benefits.

Mike said they are in the process of putting together some talking points and recommendations if

anyone would like to contact their members and conferees. Those will be out in the next few

days.

Gen Hargett commented that he is afraid that if the House does not pass anything on 12304b, it

will fall the same way the veteran’s effort did. He said he is worried about the 12304b efforts.

Mike said he also does not think anything will move with that this year.

Gen Hansen said we cannot take the pressure off the work on that issue.

Gen Hargett said he thinks most people will support it but the issue is will they pass anything.

Gen Hansen said he would be in favor in pushing back on the utilization of 12304b until the

equal benefits are laid-in. Gen Hargett agreed.

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Mike said Congress have been supportive but he does not think it will get on the docket this year.

Mid-Year Budget Update

Gen Ross commented on the overall financial condition of the organization. We are positioned,

well well as possible, to face any challenge. We are taking advantage of the time, after paying off

the building mortgage, to rebuild our reserves. Except for the NGEF, we are well reserved

across the board. There is about $24M total currently in reserves. He sees nothing that

challenges our organization financially over the short term.

Budget Update - Pete Renaghan

He reported on the decreases/increases in excess of $5000 (only) over the original budget.

Revenue:

Membership - decreased $100,000 based on year to date actual

Insurance Royalties - increased $4,250, based on our share of the 2016 projected

Insurance Trust net income.

Magazine - decreased $70,000 based on year to date actuals

General Operations - increased $29,000 based on 2015 dividends received in 2016

Overall decrease in revenue of $131,350

Expenses:

Overall decrease of $83,000

Furniture, Equipment and Depreciation - increased $5,000

Travel - decreased $51,000 based on 2016 requirements

Departments:

Membership/member benefits - decreased $25,000 based on BOD decision to return 25%

of dues to the states in the membership challenge program.

Magazine - decreased $51,000 based on magazine commission cost

Public Relations - decreased $6,000 based on BOD allowance for social media expansion

General Conference - increased $6,000 based on Distinguished Guest registration

expense

Industry Relations - decreased $7,000 based on reduced Industry Day expenses

Building Budget:

Revenue:

Proposed $4,056,053 for 2016 compared to $4,078,327 budgeted for Annual 2016. The

net result is an unfavorable variance of $22,274

Rental - unfavorable variance of $39,468 primarily due to the projected but unrealized

TVA lease removal

Parking - favorable variance of $5,183 due primarily to the more parking contracts being

signed than projected

Expenses:

Proposed $4,817,969 Midyear 2016 compared to $6,085362 budgeted for Annual

2016, result in a favorable variance $1,267,393

Utilities - favorable variance of $29.235 due to vacancies creating greater than

anticipated utility savings

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Management & Leasing Fees - unfavorable variance of $670,349 due to current

projections for a greater level of leasing activity (Amtrak)

Administrative - unfavorable variance of $81,241 due to greater than projected bank

charges ($60,000) and marketing expenses ($20,000)

Repair and Maintenance - favorable variance of $25,043 due to budgeted contingency

repairs not being necessary

Service Contracts - favorable variance $14,757 due to lower janitorial costs as a result

of vacancies.

Capital Expense - favorable variance of $1,952,166 which as a result of the proposed

Amtrak lease will result in lower that projected capital expenses in 2016 (but will also

shift these costs into 2017)

Net Cash - proposed $761,916 Midyear 2016 compared to $2,007,035 budgeted for

annual 2016 results in a favorable variance of $1,245,119 due to the aforementioned

explanations

Gen Ross made a motion to approve the proposed changes to the mid-year building and

NGAUS budgets. Gen Hansen so moved.

Discussion:

Gen Ross commented these are relatively small changes compared to the overall budget.

The Finance Committee has looked at all these changes. The question to ask is why there

is a $81,000 unfavorable variance in administrative cost. The reason for that is

significant because there was nothing budgeted against it which is primarily our

investment cost. This will be included in future budgets.

Gen Ross commented on the status of the building which is our single biggest financial

challenge. There are currently three vacant floors. We are in serious negotiations with a

potential contract with Amtrak and are into our fourth iteration of exchanges of offers and

counter-offers. They thought they would have that contract finished by today but it did

not happen yet. He is confident they will make an offer we can accept. The potential

contract will be for at least ten years. That contract will take all the vacant space

available to lease for more than ten years. The only downside is because of the size of

the space, we are looking at more than $11.5M for build-out. We would get into this with

about three or four years of negative cash flow to get our money back. He thinks this is a

risk we should take. He thinks overall we will net just fine with the result being a totally

rented building. He said in that arrangement, over the first 18 months for the $11.5M

build-out, we do not have enough money in the building reserves alone to do that. We

will need $3M or so worth of additional money. We have enough reserves NGAUS wide

and can move that around if needed. He recommends we borrow the additional money

from our brokerage account at a rate of about 1.5% to 1.9%. He said those are attractive

rates to short term borrowers that would be paid off with the rental proceeds and leave the

reserves intact and vested. We have averaged about 6% or better on our reserves over the

long term history of the association. He recommends we use all the money we have in

reserves for the build-out and borrow the remainder at about $1.5% and pay it off. He

said unless there objection from the Board that is what they intend on doing.

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Gen Hargett commented that is assuming they use all the build-out funds in the first year.

He said there is a possibility this could be spread out over a period of time.

Gen Ross agreed it would be spread out over a period of time. The earlier the rent comes

in the more of that rent can be used for the build-out. It is a bit of a debate of when that

cash will be spent. It might mean that there will be some rent to offset it, to the extent we

have to go past our cash reserves for this purpose. It seems to him a really good business

move to borrow 1.5% money on our brokerage account. The worst case scenario is that if

we change our minds later we will just cash in some of the investments and pay off that

loan. We have plenty in reserves to do it and it just means it will take everything out of

the market in order to meet a short term cash deal.

Gen Ashenhurst commented that is exactly why we have reserves.

Gen Robinson asked if it is prudent to use our reserves with the interest rate environment

we are in right now. There is a likelihood that the returns on the investments will well

exceed the interest expense on any borrowed money. From a long term perspective, he

wonders if it would make sense to consider additional borrowed money as opposed to

dipping into the reserves.

Gen Ross said that is the consideration and that is exactly why he does not want to sell

off investments. The reason he is proposing that we use our cash is that we are aware

that we will get a tenant with a significant build-out. He said we don’t want to get

ourselves into a position where you have to sell off long term investments. He said he

wants to use the cash we have on hand (that we are getting little return on) and build the

building out. Anything we need beyond that, we borrow money so that we don’t

liquidate true equity investments.

Gen Ross asked Col Renaghan, what the current investment rate is? The current rate is

1.59% and if we decide to lock in the note it would be 1.93%. Col Renaghan said

basically (over the last five years) our net return has been 8.07% annualized.

Gen Ross said that is why they are thinking that with an invested interest is less than 2%,

let’s not liquidate anything. He said he does not want to incur too much debt and keep a

balance between keeping us debt free and investing reserves. He thinks we should use

our available cash to keep the balance so that at any time we can pay it off, if the market

and the economy starts to go bad and we have the reserves on hand to pay off that loan.

Gen Brubaker asked if there would be some safeguards written into the contract with

Amtrak so that they cannot just walk away after we have spent all that money on the

build-out?

Gen Ross said there are no escape clauses at all. Amtrak is an entity would have a lease

they are obligated long term, for ten years plus. The risk would be if the Amtrak

Corporation went insolvent which would entail the government deciding they would no

longer subsidize them, which then yes, they are taking that risk. He said he can’t say it is

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totally without risk, but the Building Board members agreed that the government will

continue to support Amtrak and that way they will have no way to get out of the contract.

They could sublease the space which is really no concern to us.

Col Fleming asked about EANGUS intent to rent space in the building.

Gen Ross said they want to, but they have not leased any space to date. The proposal

with Amtrak will take all the available space in the building. He said there are some

small spaces that come up from time to time and by the end of the year there may be an

adequate vacancy, but right now Amtrak is taking all available space. EANGUS has not

leased any space and if they called the day after the Amtrak lease, there would be no

space for them.

Gen Ross said he has had numerous discussions with EANGUS and told them we cannot

keep space off the market for them.

Gen Hansen said EANGUS may be having an issue with selling or renting their building.

Gen Hargett commented that we have consistently told EANGUS we are trying to lease

our space. He said to least to them space would be a deal-breaker with Amtrak. We do

have some other leases that expire in December and not sure if they will renew their

leases. He said EANGUS still has their building up for sale and there is a possibility we

will have space before they can sell their building.

Gen Ross said he is not thrilled with having three floors vacant, but when there is a

possibility of an almost 11 year lease, he does not think it’s the wrong thing to take a sure

deal.

Gen Hargett commented there are presently two new building sitting on both side of us

(NGAUS) that are less than 50% leased. There is a brand new building at 440 First Street

that is less than 10% leased. There is a lot of vacant property around us.

Gen Ashenhurst called for the vote to approve the changes as submitted by the Finance

Committee to the Building and NGAUS mid-year budgets. Motion carried.

Gen Ross reported on the upcoming contracts.

Thompson Greenspon Auditing Company has accomplished our audits for several years.

The policy is that we send out a RFI or RFP to check the market. We are pleased they

came back the best quote. The Finance Committee recommends that we accept their

proposal and contract them for another two years.

Gen Ross made a motion that we the Board approve the contract with Thompson

Greenspon. Gen Brubaker seconded. Motion carried.

Maj Gen (Ret) Dan O’Hollaren - By-Laws report

The Executive Council of the TN NGA has proposed a limitation of Board

membership

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This change would bar Separated and Retired Guardsmen and women from being

on the Board of Directors as an Area Representative, a Company Grade Officer

representative or a Warrant Officer representative

Proposal:

• Proposed Bylaws Language – Article V- Board of Directors, Sec. 5.02 (cont.) – (a)(II) Amend to read, Two Directors who are Company Grade

Officers and currently serving National Guard members. Further,

…the Army officers shall nominate the currently serving Army

representative; the Air Officers, the currently serving Air

representative.

– (a)(III) Amend to read, One Director who is a Warrant Officer and a

currently serving member of the Army National Guard.

• Proposed Bylaws Language – Article V- Board of Directors, Sec. 5.03 • (e) Add, Each Director, with the exception of those specified in

Sec. 5.02 (a) (IV), shall be currently serving members of the

National Guard. “Currently serving” or “currently serving

member” is defined as those with a status of M-Day, Technician

or Active Guard & Reserve (AGR) member and not a Retired or

Separated member.

(f) Add, If a Director shall become Retired or Separated while

serving in a position elected under Section 5.02 (a) (I) through

(III), the Director shall serve the remaining balance of his or

her term, but may not be eligible for re-election while in a

Retired or Separated status. NGAT Rationale:

• Currently serving members will possess a stronger situational awareness of issues

relevant to the National Guard

The By-Laws Committee reviewed the proposal and overwhelmingly recommended that

we do not accept this change. The Committee agreed that the bottom line is; area

caucuses should continue to vote in the members they chose to serve.

Committee Questions:

• What event or circumstance precipitated the request for such a change request?

• Why was this limited to Board members and did not include Officers of the Board

as well?

Gen O’Hollaren reminded the Board that per Article XI, Section 11.01b, the Board can

only vote to support, oppose or take no position on the proposed amendment This action

by the Board shall be advisory only and shall be reported by the Chairman of the By-

Laws Committee to the General Conference for consideration.

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Discussion:

COL Cole asked if the earlier questions were presented to the proposal presenters. Gen

O’Hollaren said they did not.

COL Cole said there should be clarification in the By-Laws to address when someone

leaves the Board. Gen O’Hollaren reminded him that is already in the By-Laws.

COL Cole said with the area representation, company grade, retiree/separated and

warrant officer we capture all the constituents on the Board. He wondered if we already

have specific Board members in all those categories as well as retiree/separated

representation membership, then why have other retirees on the Board from the areas.

That would possibly mean that retirees in an area may lose situational awareness what is

currently happening on the ground.

Gen Hansen commented that the areas should decide by voting for who they want to

represent their areas concerns. For the BOD to limit that further, is out of our lane.

Gen Brubaker said he totally agrees. He said that if the By-Laws Committee looked at it,

he totally supports their conclusion.

Gen Hansen made a motion that they accept the recommendation of the By-Laws

Committee. Gen Brubaker seconded.

Gen Ashenhurst clarified the motion to state that the Board will accept the

recommendation of the By-Laws Committee in opposing this By-Laws change.

Gen Hargett commented that a vote “yes” is a vote” no” to accept the recommendation.

Gen Ashenhurst called for the vote. A voice vote was needed.

Seven members voted No. The Ayes have it. Motion carried.

Maj Gen Daryl Bohac - General Conference Committee Update

The Committee met via teleconference on June 30th,with nine members attending plus

Jake, Patty and Mike Sturm.

Two items discussed:

1. Spargo Inc, proposed an increase of $100 per exhibitor category. The committee

unanimously approved to recommend to the Board of Directors to adopt the increase

beginning with the 2017 General Conference.

Chip Lunn said the CAP is fine with this going forward.

Gen Ross moved we accept the recommendation of the General Conference Committee.

Gen Brubaker seconded. Motion carried

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2. Increase in registration fee for 2017: Kentucky inquired if the committee would

consider a registration fee increase. An increase would normally be voted on at the

March meeting, the SOP is ambiguous in its guidance about timing and source of

request. Therefore the committee discussed it and agreed to consider an increase of

$15 in the registration fee from $165 to $180. He said we continue to have a

consolidate industrial base (meaning fewer potential donors) and we need to

recognize this. There has been a 35% increase in food and beverage cost over time.

It was approved and the committee recommends the Board adopts the increase of $15

in the registration fee beginning in 2017 General Conference.

Gen Brubaker seconded the motion on the floor. Motion passed.

Gen Robinson commented that at the last Board meeting the final vote was to accept an

increase with a delayed implementation. He asked how this affects that action.

Gen Bohac said if his memory serves him correctly, we ultimately voted after significant

discussion to return the action to the committee for further review.

Gen Robinson said he does not quite remember it that way. He said he thought the final

passage was to approve the increase with delayed implementation.

Gen Fago said he was the one who recommended that we increase it last time and the

committee gave the figure of up to $195 and when discussed the first time, it passed and

then he remembers Gen Robinson said we need to consider our Airmen and Soldiers.

Then they did a reconsideration and it was voted it down and returned it to the committee

for a new proposal and that is where we are now.

Gen Robinson asked if it can be considered to add to the SOP so that there will not be a

request every year for a registration fee increase. He suggested every four or five years.

Gen Fago said a way to do that is to tie it to some kind of cost index or on a periodic

three or five year rotation and do it as a review and that would be the recommended time

to consider an increase instead of having to address it every year. He said that would

require due diligence and a vote from the Board.

Gen Ross agreed with Gen Fago. He recommends we index it to inflation and have it in

$5 increments so that every time the inflation rate goes up there will be a $5 change. He

said that way everyone will be able to anticipate the change and be able to calculate it.

Gen Ross said it is difficult to address the fee change because it is not changed in 5-8

years and then there is a $50 increase all at once and no one wants to deal with that. He

suggested his proposal be considered by the committee, with his support of an index fee

increase. He asked if Gen Bohac and committee would take that on.

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Gen Brubaker recommended that we not try to solve it on the fly today but have it go

back to the committee. He said there are several ways to attack that to make it more

palatable.

Gen Robinson said we need to reinforce it with the states that when they bid on the

conference that we are tied into a kind of rate structure so that we won’t have to

constantly move things around based on the states saying they can’t do it with that

anymore.

Gen Hansen agreed. He asked for a comment from Captain Timmons on the perspective

from the Company Grade.

Captain Timmons he did not see the increase of $15 as a burden for the Company Grades

as opposed to the previous proposal.

Gen Ashehurst called for the vote on the motion on the floor to increase the registration

fee by $15 from $165 to $180. Motion carried.

Awards Committee Report - John Goheen

John is reporting for the Chairman of the Awards Committee, COL Paul Caviness.

The awards approved today will be sent to the states by end of July and those will be

presented at the Conference in Baltimore.

John said they received 89 nominations which was the most received since 2012. The

selection rate was 80% this year.

Some of the problems they see each year is that some of the nominations lack sufficient

depth of detail. Also noted was that some of the awards were written as if they were

federal awards. We need to see more contributions to the Guard and NGUAS. The

committee will provide that information to the states next year when the call for

nominations goes out.

Committee Recommendations:

Truman Award

US Senator Barbara Mikulski Maryland (moved to Montgomery Medal)

General Mark Welsh III Texas

Gen Bohac made a motion to award the Harry S. Truman award to General Mark Welsh.

Gen Brubaker seconded.

Discussion followed to move Sen Mikulski to the Montgomery Award

Motion Carried.

G.V. “Sonny” Montgomery Award

Northern Nevada Int’l Center Nevada (moved to Patrick Henry)

US Senator Jon Tester Montana

US Senator Mazie Hirono Hawaii

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US Senator Barbara Mikulski Maryland (moved from Truman Award)

Gen Hansen made a motion that the Montgomery Award be given to all three Senators. It

was also suggested that Northern Nevada International Center be moved to the Patrick

Henry Award category. Gen Fago seconded. Motion carried.

Charles Dick Medal of Merit

State Senator Sue Crawford Nebraska

Governor Maggie Hassan New Hampshire

Governor Susana Martinez New Mexico

US Senator Brian Schatz Hawaii

Governor Eddie B. Calvo Guam

Governor Lawrence Hogan Maryland (attending our conference)

Governor Rick Scott Florida

Patrick Henry Award Sean Callahan Hawaii (staffer for Mark Takai)

Chaz Johnson Minnesota

Neil McKiernan Connecticut

Glenna Smith Nevada

Representative Chris Whitmire North Carolina

Leigh Leilani Graham Guam

William Kraus - Mission BBQ Maryland

Superintendent Jillian Balow Wyoming

Congressman Joe Heck Nevada

BG Robert Herbert Nevada

Northern Nevada Int’l Center Nevada (moved from Montgomery Medal)

Distinguished Service Medal BG William D. DeHaes Iowa

CW5 John C. Vitt Arizona

COL Felix Castagnola Nevada

MG Augustus Collins Mississippi

Meritorious Service Award

BG (Ret) Harold (Hal) Keistler Illinois

COL (Ret) James A. Smith Illinois

MAJ Neils C. Barner Oregon

1st LT. Ashley Klase Ohio

CPT Matthew B. Schneider Illinois

MAJ Jeffrey Zetzer Ohio

COL Glenda Mathurin-Lee Virgin Islands

MG (Ret) William Cobetto Illinois

LT COL Mayb Sersland Maryland

CW4 (Ret) Jack Scarbrough Arkansas

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Meritorious Service Award

MAJ Steve Bohl North Dakota

CPT Linden E. Allen Illinois

Valley Forge Cross for Heroism

1st LT Jonathon W. Morales Indiana

SMSgt Jeff Ginther California

PV1 Jesse Hernandez California

SGT Kyle Stephens Nevada

SPC Michael Knight Nevada

SFC Michael G. Long California

TSgt Erich Sanford Wisconsin

SPC Jonathan M. Sweeney Oregon

Valley Forge Certificate

CW3 Nathan Champion California

MSgt Terry Kots Nevada

Theodore Roosevelt Leadership Award for Company Grade Officers

Capt Brandon Cochran Iowa

Capt Joseph Smith New Hampshire

1Lt Joshua Sprague Iowa

Capt Jennifer Vogt Kansas

Capt Mathew Blackburn Ohio

Capt Christopher Blair North Carolina

Capt James M. Bunyard Mississippi

Capt Donald Crandell Nevada

Capt Eric R. Dunford Wisconsin

Capt Janelle T. Guillebeau Arkansas

Capt Jeff Hovdenes North Dakota

Capt Robert R. McCoy Arkansas

Capt Michael Schiemer Nevada

1Lt Dominic J. Thornberg Oregon

CPT Ubaldo Nieves Wisconsin

CPT Phillip Patti Ohio

Garde National Trophy

Lt Col Eric A. Schadler Oregon

Eagle Rising Award for Warrant Officers

CW2 Travis Jacobs Kansas

CW3 Lloyd Allen Nevada

CW2 Linda Horton North Carolina

CW3 Galen Roness North Dakota

CW2 James L. Stanley Arkansas

CW2 Sarah L. Smith Mississippi

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CW3 Bernard L. Aguon Guam

John said the Board could add names at this time that they deemed worthy.

Gen Hargett reminded the Chairwoman that it is customary to award one Truman and one

Montgomery Award. He commented that Gen Robinson might nominate Gen Collins for

the highest award we can give him. Gen Robinson said he would do that.

Gen Brubaker asked Gen Hargett his thoughts on why we are giving those extra awards

this year. Gen Hargett said the Board will vote to give only one of each award.

Gen Ashenhurst entertained a motion to accept the slate of awardees as amended. Gen

Hansen so moved. Gen Brubaker seconded. Motion carried.

Gen Ashenhurst entertained an amended motion to accept the slate of awardees with the

inclusion of adding MG Leon Collins to the awardees for the Distinguished Service

Award. Gen Bohac seconded. Motion carried.

Brig Gen Murray Hansen - Resolutions Update

Gen Hansen reported they are working as they do this time of year to get all the inputs

from the states. There are a few more states who have not had their conferences but they

have advanced copies of their resolutions to meet the July timeline.

They have encountered over the years that the resolution lists get too large, so

conversations have been started to review these resolutions and to try to thin out the ones

that are no longer relevant or applicable to make the list more credible.

The intent on the Air side is to look at the resolutions with the Task Force Chairs and Leg

Staff to bring those recommendations to the committee at conference. Grace is also

doing this on the Joint resolutions side to also present at the conference.

They are on track with no big issues.

Audit Committee Report - Brig Gen (Ret) Robert Hamrick

Gen Hamrick met with Auditors, Rick Castro and Natalie Anzzolin on June 24th here at

NGAUS from Thompson Greenspon. Committee members attending teleconference;

COL Leckel, Major Brownell; Gen Hoyer was not able to participate.

Overall Audit results:

• Audits are “risk-based,” focusing on areas with the highest potential for risks and

items to be corrected, i.e., investments, cash, etc.

• Unqualified/”clean” audit opinion

• 5 reports issued

– NGAUS (membership association and building operations)

– Building operating expense audit

– NGAUS Insurance Trust

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– National Guard Educational Foundation

– Consolidated Financial (all entities)

-- Accounting department prepared for audit

– Audit progressed smoothly

– TG prepared tax returns, awaiting approval

Required Communications:

• Internal control letter: no weaknesses noted in internal control that require

communication

• Governance letter: standard communication - no issues

Looking Ahead:

• TG noted “revenue recognition” is an emerging issue among non-profits and will be

an item to consider/address in coming years

• TG suggested NGAUS Staff ensure separation of duties within our internal controls

continues to be emphasized when we bring on-board our new employee within the

finance and accounting department

Final Remarks:

• Third consecutive year where the overall NGAUS audit report has yielded

“Unqualified/“Clean” audit opinions”

He asked Mr. Castro how we compared to other Non-Profits?

• He said TG provides similar services for ~ 70 Non-profits … would rate NGAUS

internal controls in the top 10% - if not top 5% - of that group

• Thanks to COL (Ret) Patty O’Connell and Ms. Cheryl Young for their pre-audit

preparations and diligent efforts in our on-going accounting processes

Gen Hamrick said in the March Board meeting he was identified as the Compliance Officer. He

took the opportunity while here to introduce himself to as many folks as he could in various

offices at NGAUS.

Gen made a motion to accept the report as submitted. Gen Ross seconded. Motion carried.

Gen Ross commented that it is the duty of the Board to always pay close attention to the audit

reports. He said the audit is where there is a potential for problems, like lawsuits and complaints,

will arise. It is the responsibility of the Board to make sure an organization is independently

reviewed and clean financially which requires a lot of work. He commented that the audit

committee is doing a great job and are taking a lot of responsibility to make sure we get a clean

and unqualified opinion.

Membership Update—Laura Roznosky Laura reported membership is currently at 49%. Between July and September we usually have

an uptick of about 2%. There is a possibility we will get back to where we were last year at 52%.

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Gil is currently working some additional memberships that will most likely add to the percentage

Gen Hargett said this year we have 120 more members that at this point last year.

Laura said the Active Life and Retired Life members have gone up. The Active Annual

membership is slightly lower. We are up members as well as our strength.

Gen Hargett said our strength has not gone up. He said the numbers we are using to calculate

percentages are based on what people from the states are sending us and in almost all cases they

are wrong. He said they go the SIPERs to get their numbers. He will be addressing that with the

ED’s this year to see how we can clean that up. He said our target number is probably way down

than what is reported.

Laura said the Membership Committee also has concerns about the strength number also. She is

interested in revamping how we collect data submission.

Gen Robinson asked if there is a way the Bureau could give us the overall point in time of

officers and warrant officers in the National Guard.

Gen Hargett said SIPERS is the problem. He said the problem is when someone is discharged

they do not get dropped for 12-14 months. He said when we do a cut-off date on Dec 31 and we

use SIPERS and if you don’t go back and scrub that list at the state level then all those numbers

will be included in that. He said we have to figure out how the states and ED’s scrub their list.

He said we also have to look at how to get the new accessions on the list.

Laura said ND was the only state to drop from the 100% state list.

Some states have opted out of using the online process for membership

Gen Hargett said the people who have increased their memberships are full participants in our

system. He said the only one who is a non-participant that has increased is Utah.

Gen Hargett gave Gen Bohac credit for his state membership increase as well as New Mexico.

Gen Hargett commented at the importance of looking where our upcoming conferences will be

over the next three out of four years plus the membership difference now and when they were

selected to host the conference. He said he has always been opposed to putting a percentage on

how we award the conferences, but we ought to look seriously at who is awarded the conferences

and their ability support the association.

Laura said they have talked about a date type of fee that could contribute to the overall

membership percentage. CA, NY and TX are all on the decrease list which hurts the overall

number as well.

Gen Hargett commented that if you look at where the division Head Quarters in the ARNG are

located, and look at the worst states we have as far as membership, with the exception of IN and

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KS, you will find the worst membership in the Guard in those division states. He thinks there

may be a correlation to that.

Gen Brubaker asked who makes the decision as to whether the states do the full or partial

participation. Gen Hargett said the state association makes the decision.

Gen Brubaker asked how we influence that.

Gen Hargett said he would like to look at a state that is marketing NGAUS membership and if

they refuse to participate, with a Board decision, we should market membership and potentially

bypass the state association. We have to figure out how we reach all eligible members.

Gen Hargett asked Laura to give him a list of every General Officers who were members last

year but are not this year. He sent personal emails to those people. Almost everyone has

responded that either no one told them their dues were due or they did not know they weren’t a

member, or thought they were a member or that they had paid their association. He said there

were two states every GO in those states were not members of the association including the

TAG’s; when he reached out to those TAGs both had paid their dues. He said we have cleaned

up this week most of those GO’s. It is only because he sent them emails, otherwise it is not

happening in the states.

Gen Robinson said he is convinced there are some states where the association is just not

functioning. Gen Hargett agreed. Gen Robinson said that in those states with big numbers, he

doesn’t know that we can do anything to help those states get themselves back together in the

short term. He said he would be in support of going directly (in some selected) states to work

membership. He said we couldn’t do any worse than the state associations are doing right now.

Gen Hargett said that is his thought and we should be selective with the states we want to reach

out to, as well as talk to the state associations.

Mike Strum said they have tried to change the focus in NGEDA. Their number one priority is to

build the NGAUS membership. They want to meet with Laura, Gen Hargett and the

Membership Committee and make that the focus at NGEDA in Louisville, in January.

Gen Hargett said he thinks NGEDA is making some strides, but we have to be in it together. He

said there may even be states where NGEDA in not connected to the state.

Laura said we do not have the option to contact the non-participating states to ask them to join.

Gen Hargett said he was asked why we do not send out reminders and the person asking was

shocked we have the ability to do that.

Laura said she understands why some people are reluctant to join and she has no interest in

involving a 100% state. What is frustrating is not being able to reach out to the states like TX,

CA, NY without permission from the state.

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Laura said the Joint function is finally online. They are still working out some of the kinks and

getting follow-up done. They are developing an Icon and a banner on each state’s website. They

are also working on a renewal notice for all participating states.

Conference Update - Jake Jakubek

Jake said the Business sessions and expo are on the same floor and the meeting rooms are on

level 300.

He said the schedule of events is on the website, which is kept up to date.

The Board of Directors meeting will be Friday September 9th. More information will follow on

this.

Gen Ashenhurst said that because we hold the meeting at the conference, NGAUS will pay the

way for the board members. They will be paid for two hotel nights and their registration fee.

She said if members do not attend the meeting, NGAUS will not pay for them. She reminded

members to book the airfare NLT 30 days in advance.

Jake said Saturday is the Ribbon Cutting, opening of the Exhibit Hall and the first business

session. Sunday is the second business session and Monday the third session, with the States

Dinner that evening.

Jake said the schedule will be fluid with the possibility of both Presidential candidates attending.

Jake said at this point, registration is low but sholud pick up after some of the suspense dates are

met.

Baltimore is working any/all security issues, to include the hotels.

Jake said they are working to hold the host state responsible for the terms they agreed to when

the accepted the bid to host the conference.

John Goheen - Speaker Update

John said the Secretary of the Air Force is scheduled on the first day, along with the Chief of

Staff of the Army. They are dissuading any presidential candidates from speaking that first day.

John said Gen Hargett has spoken with Gen Kadavy and the ARNG was a clean sweep in some

of the major soldier competitions this year. Gen Kadavy will try to get the recipients of these

awards to come to the conference that first day, or a representative group of them to be

recognized by the new CNGB.

Gen Lengyel will speak on the second day to the town hall meeting. He will speak first to the

company grade officers on Saturday morning.

Gen Punaro will speak on Sunday or Monday.

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John is working on putting together a congressional panel like last year with Senators Graham

and Leahy, if they can’t make it. Senator Ernst would like to attend as well. The panel will

consist of one Republican and one Democrat.

The new Chief of Staff of the Air Force has also been invited, as has the new Commander of

NORTHCOM and EUCOM.

John said in past years, we have worked with the Presidential candidates but do not know if they

are coming until a week or two weeks out. We have had a Presidential candidate every year

since 1992. John said the candidates are aware of that fact. He said the September 11th weekend

should be a coveted spot, and should be some place they would want to come. In past years what

happens is we let them know our business sessions schedule and they choose the date. We are

expecting Governor Hogan to speak also.

John said for the Army Breakout we have invited the two star representative to USERA, who

will come to speak.

Gen Abrams, FORCOM Commander will also come to speak. Gen Kadavy will speak at one of

the business sessions as well.

John said they will have the NGAUS conference ready to go by 15 August.

Gen Hargett said we have received some emails from our members from both political sides to

discourage us inviting one or the other party candidate. Our answer to that is that we are a non-

partisan organization and we listen to both sides.

Gen Robinson asked about the NGB Conference letter. Gen Hargett said it is the same as last

year but based on money not people to manage within the states money.

Taskers:

Conference Committee will ensure that SOPs are developed for conference activity -

Complete for 2016 (remains as a reminder)

Ask the Conference Committee to look at new cost-saving models for the conference.

o TAG & LDL Reception – Ongoing (Gen Bohac not ready to report) He will assist

in working that task to completion.

All NGAUS SOP’s should be reviewed and updated as required and suggest they report

every November - Reminder

Complete a NGAUS Staff salary review – Ongoing

Gen Ross said the salary review has been completed. They talked to three different companies.

They will brief it in November. He said there is nothing dramatic and we are in pretty good

shape.

Gen Fago asked if it has been completed and implemented.

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Gen Hargett said it will not be implemented until the next budget. All the new standardized job

descriptions have been done and implemented. The study and ranges have also been done but if

there are people who are on the low end, the money is not available at mid-year to implement

those salaries. The Finance Committee recommended we will address it in the next budget.

Gen Ross said there were no huge problems and everything was manageable.

Gen Ashenhurst thanked the members for their participation and look forward to seeing them at

the conference.

Gen Ashenhurst reminded the members the Insurance Trust meeting will began at 1400 and the

NGEF meeting begins at 1500.

Gen Hansen made a motion to adjourn. Gen Brubaker seconded. Motion carried.