Dear AAR Board of Directors,

          I hope this letter finds you well and having a great summer. We are looking forward to seeing all of you at our upcoming AAR Board of Directors meeting on Tuesday, August 29, 2023, at 10:00 am at the Alabama Association of REALTORS® Building at 522 Washington Avenue, Montgomery, AL. Sign-in will begin at 9:30 am.

The purpose of the meeting will be to pass the 2024 Budget; consider a 5% ($11) increase in dues to keep up with record inflation; consider governance proposals; discuss economic trends affecting our members’ businesses; environmental scanning of legal challenges; update the Board on pending Association projects; get feedback on future Association business; and conduct other Association business. More information will be published closer to time. The resource page for the 2023 Board of Directors can be found here. Here is a brief overview:

• 2024 Budget: The AAR 2024 Budget is based on projected revenue of $4.5 million and projected expenses of $4.4 million.  Revenues reflect an adjustment from the 2023 Budget and stronger than expected membership numbers. The 2024 Budget is based on a membership of 18,670, which represents a 3% decrease from projected end of year membership. (The 2024 Budget Notes and 2024 Budget may be found on the BOD Resource Page)
• Motion 1: Dues Proposal Inflation: The Finance Committee and leadership have taken a measured approach and sought input from the Board on how best to address the historic impact of inflation on our Association. As discussed at previous Board of Directors meetings, inflation has a degrading effect on both the revenue and expense side of the Association. AAR’s current dues of $206 were set in 2016. Due to historic inflation from 2016 to 2023, those dues are worth $163 in 2023, a decrease in value of 23%.

As the AAR building ages, we must be prepared financially to replace building components and systems as they reach the end of their expected life cycle. That requires both planning and setting aside financial resources to meet those needs. The expected building maintenance and replacement costs between 2024 and 2032 are approximately $2,029,410.  This does not include the pending roof replacement project scheduled to begin in fall 2023, which will cost approximately $1,050,000. These costs must be accounted for in the financial decisions of AAR.

As a result, AAR is proposing a 5% ($11) dues increase to help mitigate the impact of inflation on the Association and ensure that AAR can provide the same level of services to members in the future.  

(Motion 1, along with a full analysis of the AAR Building, the life cycle of all building components, and a schedule of estimated maintenance and replacement needs by year and decade, can be found on the BOD Resource Page)

• Motion 2:Update to Travel Reimbursements: This proposal amends Section 7.4 to update current guidelines with respect to travel and reimbursements in light of increased costs of travel due to inflation for Association leaders. (Motion 2 can be found on the BOD Resource Page)
• Motion 3:Update to Insurance Coverages: This proposal amends Section 7.7 to outline an annual review of policies, along with periodic insurance audits, to guarantee the organization's sustained protection against potential risks and liabilities. (Motion 3 can be found on the BOD Resource Page)
• Motion 4:Policy for Inflation Planning: This proposal creates Section 7.9 to ensure that the Association's dues remain responsive to economic changes while allowing for careful consideration of financial and economic conditions. The proposed addition outlines the use of the Consumer Price Index (CPI) as a guide for recommending annual dues amounts to the Board of Directors. (Motion 4 can be found on the BOD Resource Page)

          Please let us know if you are unable to attend the Board of Directors meeting. This meeting is for the 2023 AAR Board of Directors. Space and overflow seating is limited. Parking will be available in the Association’s parking lot at 502 Washington Avenue. The attire for the meeting is business casual. We will have lunch following the meeting for the AAR Directors in attendance.

            Please make sure to stay updated by following Real Estate Alabama each week for more information or visit our Newsroom on the AAR website. If you have any questions, comments, or suggestions before the meeting, please reach out to me, CEO Jeremy Walker, or Melissa Williams.

Thank you for your leadership, support, and service on the Board!

Warm regards,

RaJane C. Johnson                                                                    

2023 President                                                            

Alabama Association of REALTORS®