We often get calls from members that proudly start with something like “…we are the oldest club in the state….”. Sometimes, the caller is bolder and states that “…we are the oldest club in the country…”. This is wonderful to hear. We certainly congratulate all clubs for long life regardless of actual years…but it got us thinking…which is the oldest in each state, and then the country…and what are their stories…how did they do it?
Well, we plan on finding out. Later this month (November 2022) we’ll be sending out the Annual Flying Clubs Survey and this year we’ll also ask for the year that your club was established, and we’ll let you know our findings!
As regular readers well know, we, your loyal flying clubs team, spend a great deal of time helping new flying clubs get started. We actually spend an equal amount of time working with existing clubs. In fact, this is a two-way street…we provide experienced-based solutions for typical problems faced by clubs as they go through various life-cycle phases, but these clubs also provide us with practical ideas and solutions that have helped them weather many storms. We then add their experiences to our repertoire of tips and tricks for new clubs. Nice.
I recently attended the Reading Aero Club’s 90th anniversary. Yes, 90th…and what is amazing about this club is that it has been in continuous operation, even during war years when club members flew U-boat spotting patrols. We’ve also recently heard that the Camas Washougal Flying Club is celebrating 60-years of operations, along with T-Craft Aero Club and Sky-Hi Flying Club both celebrating 50-years.
Now, we know there are many maturing clubs out there and we can’t feature all of them, but going forward we will recognize, in the News from Headquarters section of our Club Connector newsletter, those clubs that achieve 10, 25, 30, 40, 50, 60…years of continuous operation, so please let us know by sending an email and a photo or two, to [email protected]
In other sections of this edition of Club Connector, we chat with a number of mature clubs to piece together how they actually survived the ebb and flow of long-time member-based organizations, and we also ask what advice they would give to new clubs, but here, I’ll share some tried and trusted ways for clubs to position themselves for long-term survival and success.
Flying clubs are first and foremost social clubs—member owned, member operated, equal in access, responsibilities, and obligations. Even more so than its airplanes, members are central to a club’s survival. The members determine club culture, operations, leadership, safety program, and yes—choice of aircraft—but members make the club tick…or not.
I’ve written about member and management responsibilities in a several recent Club Connector articles, so have a quick review of the Question of the Month archives, here.
In a nutshell or two…members are all different, as are club leaders, and as we all know, whenever two or more people get together, you’ll end up with multiple opinions, ideas, sometimes egos, and…innovation. Also, as time marches on, not only will the membership itself inevitably change, but so too will “the times”. That is, the way that people think about flying, what they (want to) fly and why they fly…and so what they expect from a flying club. We discovered some of these tides-of-change earlier in the year when we held a focus group with several young pilots. More details are here, and here, but in another nutshell, modern-day prospective members look for professionally run flying clubs, but with flexibility to encompass their desire for involvement and learning, as well as their life style.
Involvement and learning can easy be accommodated in a flying club as there is always work to be done and the need for people to do it. Allowing new members to “get involved” is probably the best investment in keeping them (and so the club) around…the converse being more of a closed shop where “we’ve always done it like this” will likely result in member turnover…so the club continues to age itself into dissolution. Adapting to different lifestyles is a bit more challenging as they are often generational…you know, the differences between Baby Boomers, Gen X/Y/Z, but the reality is that your club will have a mix of these either now or in the very near future, so taking a look at club operations through the eyes of these different groups will go a long way to keep the club progressing. Even better, form a cross-generational committee to really run the gamut when reviewing bylaws, equipment and operations.
By vocation, aviators are smart, detailed-and-goal oriented and, well opinionated. It is not surprising therefore that members expect club leadership to run a tight ship and for that vessel to be shipshape and Bristol fashion. This is why we say run it as you would a business—even though—especially though—it is a club of equals. In fact, given everyone’s equal standing in the club, it is perhaps even more important to have open and transparent operations. Many clubs post their documents, meeting agenda and minutes, budgets, month-by-month “actuals” and so on, on a shared site such as Google Docs or Dropbox, and such openness probably avoids the need to send out emails answering questions about where the money goes, and what happened at the latest meeting. Keeping members informed is indeed a duty of the leadership team, but members need to do their bit and attend meetings, rather than expecting to be spoon-fed. As I wrote about a few months ago, the leadership team has plenty to do, but mollycoddling members is not one of them, so the next time someone asks for a club newsletter to keep members informed, thank them for the idea and sign them up as editor—and remind them to attend their club meetings!
Nevertheless, good management and effective housekeeping shouldn’t become so fussbudgety that it gets in the way of the main point of a flying club—having fun with others who enjoy your hobby. I know from my Silicon Valley days that over-zealous management can lead to leadership toxicity that will quickly erode an organization’s effectiveness. Although rare in our experience, the idea of “power corrupts” has raised it head in a few clubs we have worked with, so elect your leaders wisely…and get rid of them if they go beyond their station, for the longer they stay, the more it becomes “their” club, which will completely turn-off prospective members and so highly limit a club’s permanence. In fact, the democratic process of removing poor leaders is as important as the process of electing good ones and is a wonderfully clear differentiator between a “business” that imposes management upon its employees, and that of a member-based social club that elects its leaders.
Continuing the theme of board positions…just because we can, doesn’t mean we always should. I’ve written a lot about the advantages of having term limits on board and officer positions to get more members involved, to encourage new ideas, and to limit the possibility of a long-term “Politburo”, but the one position that perhaps should be excused from this is that of the Treasurer. Managing the club’s books, bank accounts, and the timely and accurate filing of taxes and returns is absolutely critical to a club’s long-term success. Indeed, I’ve recently worked with two clubs that had to essentially disband and start over due to a history of poor financial reporting. Obviously, checks and balances should always be in place for this very important position, but continuity and accrued knowledge are truly essential facets of this board position and should be weighed heavily against change for change’s sake.
Let’s now sidestep and talk about financial viability. Along with no members and no airplanes, a flying club isn’t going to last long if it doesn’t have a solid financial basis. I’ve taken several calls lately from clubs that are worried about their financial health. All were “mature” clubs (30-plus-years) which often means that the club’s planes are paid-off and they have a member base comprising a typical trifurcation: an approximately equal spread of active flyers, occasional flyers (2-hours a month or less) and non-flyers who are still on the active list rather than being moved to social memberships. Anyway…the club’s concerns are usually very similar…” we are no longer making ends meet and are eating into our maintenance reserves just to stay afloat”.
Operational accounting is Survival 101, and, given today’s economy, if you haven’t adjusted your dues and usage rates lately, then it is almost certain that you are running at a loss. Think about it—fuel has increased by 25% (from $5:80 in January 2022 to $7:25 in September 2022 at KFDK) insurance continues to increase year-on-year by around 15% (assuming no claims), supply chain issues and inflation have conspired to increase the cost of parts and labor. As a club member and ex-club Treasurer, I fully understand the desire to balance realistic rates, dues and fees with the “propensity to fly”—that is, members’ financial ability to stay in clubs and to fly airplanes. Nevertheless, not obeying the cardinal rules of flying club accounting will inevitably result in dipping into reserves just to pay the bills.
What are these cardinal rules, you may ask? Why…thank you for asking!
Very simply, monthly dues must cover all fixed costs…those costs (bills) that must be paid even if the airplanes do not fly (for example, insurance and hangar payments), and that the hourly usage rate must be set at the actual costs incurred per hour of operation, including fuel (if it is a “wet” rate), per-hour contributions to the engine, propeller and other time-limited expenses, things like magneto overhauls, preventative replacement of vacuum pumps, and so on.
If you haven’t done so recently, run your numbers through the Cost of Operations spreadsheet to see what the clubs rates should be….the spreadsheet can be found on the Flying Clubs Downloadable Resources webpage. When doing this, resist the temptation to “blend” costs between dues and hourly rates. Some clubs set the monthly dues lower that actually required in order to keep the occasional flyers happy…they then inflate the hourly rates to compensate, so penalizing members who fly a lot. This is really risky accounting, since if the planes are down for maintenance or a string of bad weather keeps them grounded, then the combined (dues + usage) may not cover expenses and, again, the treasurer will have to dip into the bank account in order to stay afloat.
Whilst the Cost of Operations spreadsheet will give you “12-month averaged” numbers for monthly dues and per-hour rate, another club-killer is cash flow…that is, the month-by-month ins (income) and outs (expenses) from the bank account. Now, expenses, particularly the big ones like insurance, annual inspection, database subscriptions and so on, are generally paid-up front, rather than spread over the 12-months of the year. This will mean that, on some months (income - expenses) may dip negative, but as long as the bank account can absorb that difference, no problem. Even so, you’d be wise to distribute the big-ticket items throughout the year—for example, try to avoid having to pay for the insurance premium and the annual inspection in the same month.
Problems will occur, however, if the club has been drawing from the bank account and cannot now pay a bill, which will result in an assessment on all members to pony-up the shortfall. As you can imagine, this will not go down well with members—especially if it starts to happen regularly, so it is really important for the Treasurer to create—and openly share—a cash flow budget. An example to help you get started can be found on the Downloadable Resources webpage. As you’ll see, there is an income section and an expenses section. All sources of income are entered for each month and all known expenses are also listed in the expected month. The second from last line shows the monthly difference between income and expenses, and the literal bottom line shows the state of the bank balance month by month. It’s easy to plot the bank balance by month…and if you see a general downward trend, you’re in trouble!
By the way, this example cash flow budget is for non-equity clubs—those that lease airplanes…it is easy enough to modify it for an equity club. In the non-equity case, the club itself should not be keeping reserves for the engine, ADs, etc., as that should be on the owner of the aircraft—see the March 2018 Question of the Month for more on leasing. True, the club will collect a per-hour amount to cover such expenses, but this will be paid, per month, to the owner. So, if everything has been captured in the spreadsheet, a non-equity club can plan to have a relatively small bank balance at the end of the year to cover wear-and-tear maintenance and other responsibilities detailed in the lease agreement. In other words, the income tax burden for non-equity clubs should be quite small, so reducing the advantage of applying for tax exemption under 501(C)(7). Not so for equity clubs, of course, where reserves can be quite substantial and, unless a club has been granted tax exemption, there could be a significant tax obligation at both the federal and state levels.
The true bottom line to this part of the discussion is that fees, dues and rates must be adjusted to keep the club viable. Yes—the club may lose some members, but unless the club pays its way, it will eventually go under and then all members will suffer, and remember, shared-ownership like in a flying club is always going to be cheaper than sole ownership, and renting, if you fly a reasonable and safe number of hours, per year.
Longevity will not happen by accident. As we’ve seen above, times change, members change, generational opinions change, and a club’s financial situation can change instantly if a plane is involved in an incident or accident. I’ve stated before that a good leadership team should cater to its current members but should be focused on new members, for without them, a club will never survive the relentless march of time. So, what does “focus on new members” actually look like?
Rather than just regurgitating previous articles, here are some that are worth a review:
All of this requires an active board that understands and accepts that their legacy depends on the club continuing during and beyond their tenure. Now, such a board will be faced with pressures. You may recall an earlier article where I wrote about a club where some original founder-curmudgeons were trying to force the club to close so they could get a pay-out...even though the new management team was beginning to attract more members. Fortunately, sense prevailed, the motion was defeated, the curmudgeons huffily left the club, which opened-up slots for the next generation of active members. Win-Win.
The moral of this story is to be alert for selfish assertions of (a limited subset of) members. “I’ve been paying into this club for 30-years, and now it is time for me to get something out”. Oh, no, matey…you have been a member for 30-years and as such have enjoyed the many benefits of being part of a flying club, including the best-possible access to aircraft at the best-possible rates.
If you haven’t yet discovered them, please do sign up for sessions 2 and 3 of the 2022 Flying Clubs Workshop series. I presented this year’s first session on October 29th which was entitled “Flying Club Management and Pilot Proficiency for Clubs”, where I spoke about strategic planning for flying clubs as well as the advantages of adopting a safety culture that will keep members safe and will very likely result in insurance discounts. Sorry…no…these sessions are not recorded as we value open interaction and we don’t want to leave too much evidence! But…if are a current club board member and you ask nicely(!)…I will send you a PDF of the slides and would be pleased to discuss them with you. We will repeat the series next year, so keep a look out for the emails.
As a “heads-up”, the remaining two sessions in 2022, with registration links, are
Session 2: Growing Your Club and Engaging Your Members:
Saturday, November 19th, 2022, 12:00 PM—3:00 PM EST
Session 3: Maintenance Considerations and Insurance for Clubs:
Saturday, December 10th, 2022, 12:00 PM—3:00 PM EST
I’d like to spin-up a tangential approach to pilot proficiency, in addition to the usual (and truthful) “proficiency keeps you alive” narrative. This occurred to me in early 2021 when the insurance market “hardened” following several high-profile accidents involving celebrities, and of course the Boeing 737-Max calamity that cost aviation insurance companies many millions of dollars. Due to this, insurance underwriters, of which there are just a handful, looked for ways to claw back profits and the non-commercial general aviation sector (us), which for years has been a fairly small contributor to overall profits, was affected in the same way as other areas of aviation. So, we started to see stepwise jumps in insurance premiums, even for individuals and flying clubs that had not made any insurance claims or had not changed in any other way across the thin divide between the end of one insurance year and the start of the next. Premiums increased because insurance companies could do so and the only choice we had was to pay, or not. It was “purely a business decision”.
The calls from members started coming thick and fast…why have our premiums gone up…why are insurance companies discriminating against perfectly fit and able pilots when, tick, they turn 75 years of age…why are insurance companies claiming the people who fly under BasicMed are all of a sudden riskier than those with class-3 medicals...and, what is AOPA doing about it?
Remember from earlier that club insurance is a fixed costs and should absolutely be covered by monthly dues. Increasing premiums results in increased monthly dues which could stretch a club’s viability and hence longevity. In our flying clubs survey a couple of years ago we asked clubs to tell us about their insurance hikes—numbers as high as 50-percent were reported (but often this was a result of making a claim), but the average was around 15-percent. We asked again on last year’s survey…and the average increase was again 15-percent. This type of year-on-year increases is clearly worrisome so “someone should do something” …a phrase that always tickles my ire!
Drew and I were initially as outraged as others and the good ol’ “egregious” word was unsheathed for a while…but then we started thinking. Now might be a good time to re-listen to Flying Clubs Radio editions 3 and 14…”Insurance Woes” and “Insurance Woes Part 2”, to get the background, but we quickly converged on the notion of taking back some sort of control—essentially, what is our sphere of influence when it comes to controlling the cost of insurance? Alright, the premium increases were for business reasons, but what can we do, as individual pilots and collectively inside flying clubs, to illustrate that we are “safe” and so pose lower risks than those suggested by the actuary’s spreadsheets?
Long story short, we rolled out the idea of WINGS for Clubs, where we encourage flying clubs to adopt the FAASTeam WINGS program as the basis of their proficiency program. Our reasoning is simple. If all members participate in the same program, they are not only safer, but members are more proficient so reducing errors such as taxiing into lights or other planes whilst messing with the GPS, or forgetting to put the gear down, or the ultimate unforgivable sin, running out of fuel and then not managing the off airport landing due to lack of drilling and practice. If you are not familiar with the WINGS program or it has been a few years, take a look here.
As a related aside, in presentations given at several AOPA events this year, I introduced the phrase “brainiac flying”. By looking at the way our ground-dweller brains work when subjected to “an event” in the air (generally, we freeze), and recognizing that a leading cause of loss of control accidents is “the inappropriate responses to unexpected events”, and, by surmising that improper responses could be:
…I proposed another definition of proficiency, namely:
Now, the flight review is gift #1 from the FAA so treat it seriously, but even flying a comprehensive flight review with a CFI every 24-calendar month is not likely going to move the needle very much. Even worse, “one hour of ground and one hour of flight” is never going to move you forward. At best…at best…you will stay where you are, but more likely, skills will have decayed to dangerous levels. Gift #2 from the FAA is the FAASTeam and the WINGS program. WINGS is a pilot proficiency program for general aviation and is provided, endorsed, and supported by the FAA…yes…that FAA, so why would we not use it? Well, that’s a question that insurance companies may well ask when you make a claim…but let’s beat them to it. Make the WINGS program the basis of your club’s safety program. Have all members earn a phase of WINGS every year, which requires flying three time a year with a CFI following WINGS flight activities and attending three knowledge seminars, webinars for self-paced courses.
Wait…WINGS has flight activities? Yes indeed, and this is what makes the WINGS program so beneficial. Use the “activities” menu to see more details, but this handy link will take you to a PDF of all available flight activities. Select an activity, paste the “Activity Number” in the activities search area and you’ll see the full details. Take a look though the list…you’ll soon see that pretty much every flight you take with a CFI can—and should—be validated for WINGS credit. In fact, make this a goal—very time you fly with a CFI get them to validate the flight.
Send all WINGS transcripts with your insurance renewal…and enjoy the benefit of insurance discounts, which could quite possibly move monthly dues back to previous levels. It did with my club.
One last note on WINGS. Yes, the faasafety.gov website is a bit challenging to initially navigate but come on…we’re pilots! Also, the FAA has invested greatly in the program over the past few years, so don’t be putt-off by earlier exposure to the program. Please do contact me if you would like to know more about the WINGS and how your club can benefit from it.
By the way, using a club-wide safety program will also help reduce the “weakest link” effect. That is, club insurance is often based on pilots with the least experience, so if all flying members participate in the club’s program, there will be a “levelling” of experiences. One other “by the way”…one of the best things individual members can do to reduce the club’s insurance premium is to get an instrument rating.
More on WINGS for Clubs can be found here: How Can Flying Clubs Encourage Members to Stay Proficient?
Rather than list all the presentations, courses, quizzes (and more) on the faasafety.gov website, we encourage to you spend an hour and see what is there and to customize the material for your club’s safety program. While you are at it, head over to the AOPA Air Safety Institute website where you can also earns WINGS credits for other courses, videos and so on.
One other really essential component for club longevity is whether or not we retain our liberty to fly at all. Clubs and individual pilots in the USA enjoy immense freedoms compared with those in other countries and we all must push back on any actions that would change that, including profiteering, privatization, user fees, and other unnecessary interference. The best way to do this is through the power of numbers. What can clubs do? Well, we know from our survey results that (only) 61-percent of flying club members are also AOPA members—meaning that 39-percent are not. Help us protect “Our Freedom to Fly” by encouraging all club members to join AOPA to ensure we continue to fight the good fight!
So, bringing this edition to a close, only a club’s members control sustainably and the ultimate legacy and longevity of a flying club. Be flexible and inclusive; be willing to resize the club (members and planes) to accommodate changing times; enjoy the club as a shared-ownership hobby, but run it efficiently and professionally; all fees, dues and rates must reflect the actual operating costs for the club and should be changed as needed; continuously take the pulse of the club and reject applicants—and remove existing members—who just want to “rent” rather than be engaged participants; plan and replan as though your club’s future depends on it…because it does; take control of the things that you can—member assisted maintenance, the skills of members, and especially instill a safety program that keeps all members safe, reduces claims and earns insurance discounts; support your pilot-membership organization and help us keep general aviation viable and vibrant.
We are looking forward to hearing about your club’s 90th anniversary sometime in the future!
As always, fly lots and fly safely!