2016-2018 STRATEGIC PLAN

Geoff McIntosh, C.A.R. Treasurer

STRATEGIC PLANNING PROCESS

DECEMBER 2014: BRAINSTORMING MEETING

Car Service Movie rentals

Publishing

Music Hotels Checks v. ePay

Gasoline v. Electric

Cars

JANUARY 2015: BUSINESS MEETINGS

MARCH 2015: OFFSITE MEETING: ENVIRONMENTAL

SCANComputer

History Museum

Tour of Move, Inc.

Redfin CEO

Tech Savvy Brokers

APRIL 2015: BUSINESS MEETINGS

C.A.R. Strategic Planning Books

AUGUST 2015: FINAL BUDGET REVIEW

PROJECTED 2015 YEAR END FINANCIALS

California Association of Realtors®2015 Financial Update

Projection Budget

Membership 181,000 180,000

Dues Revenue $19.8 Million

$19.3 Million

Non Dues Revenue*

$10.0 Million

$10.2 Million

Net Deficit $ (39,400)

$ (624,500)

* Investment income and Inter-company transfer are included.

MEMBERSHIP DUES

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

P

2016

B0

5,000,000

10,000,000

15,000,000

20,000,000

25,000,000

-

20

40

60

80

100

120

140

9.0

12.7

14.9

17.1

20.4

22.8 22.8

20.319.118.7

18.0 17.718.3 19.1

19.8 19.9

90

115115

Total Revenue ($ millions) Dues/member

Dues Per Member & Total Dues Collected

$ Millions

MEMBERSHIP FORECAST

MEMBERSHIP FORECAST(THOUSANDS)

2012 2013 2014 2015p 2016f 2017f

Renewals

140.3 141.7 150.5 153.5 155.0 156.5

YTY % Chang

e-1.1% 1.0% 6.2% 2.0% 1.0% 1.0%

New 19.9 26.7 25.2 26.1 27.0 27.9

YTY % Chang

e 4.7% 34% -5.6% 3.6% 3.4% 3.3%

NMSP 0.7 0.9 1.4 1.0 1.0

YTY % Chang

e n/a 28.6% 55.6% -28.6% 0.0%

Total 160.2 168.4 176.6 181.0 183.0 185.4

YTY % Chang

e -0.4% 5.1% 4.4% 2.5% 1.1% 1.3%

NEW 2016 PROGRAMS APPROVED BY SPF

COMMITTEE:

INCREMENTAL MEDIA PURCHASE

Funding to restore the general market media spend to the 2015 levels of $1,800,000, this will enable C.A.R. to increase the impact of consumer advertising via an expansion of the media buy in order to further optimize the new 2015 “Who’s Your REALTOR®” commercials.

Net Cost: ($775,000)

ZIPFORM® MOBILE

This augmentation provides zipForm® Mobile as a member benefit for the second year. zipForm® Mobile Web Edition has changed the real estate transaction experience for REALTORS®, buyers, and sellers across the state with innovative technology that has streamlined the transaction process and elevated customer service.

Net Cost: ($274,300) 

ZIPFORM® TRANSACTION MANAGEMENT SYSTEM

This program provides the resources to deliver the zipForm® Transaction Management System (TMS) to all C.A.R. members. It is an easy-to-use Internet tool for managing real estate transactions online. It provides a convenient space to manage all transaction activities from listing through closing. Available for both individuals and brokerages, zipForm®TMS can easily track and retain all transaction documents. Checklists ensure activities and best practices are repeated in every successful closing. Users can create and view color-coded activity lists, reminders and never miss a deadline or skip important details using an integrated zipForm® calendar.

Net Cost: ($230,000)

WEBSITE REDESIGN

Provides funding for a complete redesign as well as an updated content management system for car.org. In order to enhance the user experience, a new front-end interface, responsive design features and functionality will be implemented. Website hosting and consulting is expected to be around $108,300 per year with a total operating cost of $200,700. In addition, the capital budget for this website redesign is $446,800, which will be amortized over a period of 5 years at $89,400 annually.

Net Cost: ($200,700)

LATINO INITIATIVE

The Membership Development Program contains objectives for the purpose of reaching out to diverse groups and specialties within the association membership. This augmentation provides additional emphasis on Latino REALTORS® and the Latino community given the evolving demographics in the state. Research and studies have showed that Latinos strongly aspire towards homeownership. This program seeks to develop a Latino Network that will bring successful prominent Latino REALTOR® members face to face and help them make valuable connections with other fellow REALTORS® in their business community. It is also designed to work with Strategic Partners to collaborate on initiatives aligned with housing.

Net Cost: ($102,600)

INSPECTOR VETTING & CERTIFICATION

This program programs the resources to explore establishing minimum screening and requirements for home inspectors and creates a central place for the list of vetted inspectors. It includes gathering data and conducting survey research to create the appropriate criteria for property inspectors in California including: criminal background checks, general liability insurance minimums, civil litigation/liability history, licensing disciplinary history (there is no inspector license but they may have been disciplined by other licensing entities), registered as a sex offender, insurance requirements, fingerprinting, etc.

Net Cost: ($77,600) 

NAR CORE STANDARDSThis program provides the resources for C.A.R. to continue to assist local associations of REALTORS® in meeting the annual requirements to be in compliance with the NAR Organizational Alignment Core Standards. These requirements fall into six categories:1. Code of Ethics 2. Advocacy3. Consumer Outreach 4. Unification Efforts and Support of the REALTOR® Organization 5. Technology6. Financial Solvency

REALTOR® associations must certify compliance with the standards by June 30 every year—or be subject to revocation of their charter. The purpose of the new standards: to raise the bar for REALTOR® associations and ensure high-quality service for REALTORS®.

Net Cost: ($72,400)

STRATEGIC THOUGHT CONFERENCEBased on the success of the 2014 and 2015

conferences, it is recommended that a Strategic Thought Conference be held in Southern California in 2016. The conference is conducted to assist the Association Leadership and Association Executives, as well as C.A.R. Leadership, Executive Committee, SPF Committee, Regional Chairs/Vice Chairs, Committee Chairs/Vice Chairs, and MLS Executives for the purpose of entering into a lively, dynamic discussion of what associations will look like in the future in order to survive and succeed.

Net Cost: ($62,400)

COMMERCIAL-INVESTMENT FORUMResources are provided to staff the Commercial-

Investment Forum at the C.A.R. business meetings. The Forum will focus on providing networking and educational opportunities for REALTORS® interested in commercial/investment real estate. A survey of commercial practitioners will provide valuable data on their activities, productivity, and needs.

Net Cost: ($22,100)

SUMMARY OF NEW 2016 PROGRAMS

  Revenue ExpensesOverhea

d Total

Incremental Media Purchase - 775,000

-

(775,000)

zipForm® Mobile - 273,000 1,300

(274,300)

zipForm® Transaction Management System - 228,600

1,400

(230,000)

Website Redesign - 197,700 3,000

(200,700)

Latino Initiative - 99,900 2,700

(102,600)

Inspector Vetting Certification - 75,500

2,100

(77,600)

NAR Core Standards - 70,500 1,900

(72,400)

Strategic Thought Conference - 61,200

1,200

(62,400)

Commercial-Investment Forum - 21,500

600

(22,100)

Total 2016 Proposed Augmentations - 1,802,900

14,200

(1,817,100)

PROGRAMS NOT APPROVED BY

SPF COMMITTEE

ZIPFORM® ONE-ON-ONE SUPPORT

This program would have continued the One-on-one zipLogix Digital Ink® Support Line created in 2014– a personal training session conducted over the phone with a digital signature expert. If it is after hours or we are experiencing high call volume, the member may choose to schedule a future appointment online. The call is $24.95 for a maximum of 30 minutes. Net Cost: ($48,300) 

CHAMPIONS OF HOME AWARDSCreated in 2013, this program was established to

recognize those members who have gone to extraordinary lengths on behalf of their profession or for their clients’ benefit. Through honoring members who exemplify the highest standards within the profession, this program seeks to inspire the membership at large and highlight the integral values of the organization.

Total Net Costs: ($57,300)

2016 CAPITAL BUDGET:APPROVED BY SPF COMMITTEE

2016 PROPOSED CAPITAL BUDGET

Description Cost ($)

Website Redesign

446,800

Building

212,000

Computer Hardware/Software

143,500

Furniture/Equipment

37,000

New Staff Setup

7,500

Total $ 846,800

BUDGET ACTION ITEMS:APPROVED BY SPF COMMITTEE

2016 BUDGET ACTION ITEMS

1.            ACTION ITEM OPERATING BUDGETTo approve a 2016-2018 strategic plan and 2016 budget with the following criteria: A.           C.A.R. Operating Revenue: $30,109,900

C.A.R. Operating Cost: $31,085,200Net Deficit (After Investment Income): $975,300

 B.           Issues Action Fund                *Direct IMPAC Contributions: $487,900

Issues Action Fund Program Allocation: $1,255,000

2016 BUDGET ACTION ITEMS (CONT…)

C.           Political Activities Fund               *Direct IMPAC Contributions: $253,000               Political Activities Fund Program Allocation: $1,489,900 D.           REALTOR® Action Assessment               *Direct CREPAC, CREIEC, and IMPAC Contributions: $8,010,000               REALTOR® Action Assessment Program Allocation: $530,300                * Estimated amount of Members’ direct contributions to the respective PACs as a percentage of the Issues Action Fund (28%), the Political Activities Fund (14.5%) and the REALTOR Action Assessment (93.8%).

2016 BUDGET ACTION ITEMS (CONT…)

E.            134.5 budgeted C.A.R. staff positions. F.            Membership dues, including $115 for operating programs, $10 for the Political Activities Fund, $10 for the Issues Action Fund, and $49 for the REALTOR® Action Assessment are set at a total of $184 per member (predicated on 2016 year end membership of 183,000) G.          New member fee set at $30 per new member. H.           A 2016 Capital Budget (funded with Association reserves) totaling $846,800. 

2016 BUDGET ACTION ITEMS (CONT…)

 2.            ACTION ITEM To approve for members in areas not serviced by local associations an additional $30 in membership dues. This amount would be in excess of the dues approved for members coming through the local associations.

2015 BUDGET ACTION ITEM

3.            ACTION ITEM That $633,000 be approved for an additional 5 percent retirement contribution to the C.A.R. and REBS employee retirement plan for 2015, augmenting the previously approved budget of 10 percent.

OTHER ITEMS

SMALL AOR ASSOCIATION GRANT PROGRAM

• Purpose: To provide assistance to small associations without the means to participate in the C.A.R. meetings.

• Priority: Associations not currently sending representation

• $1,500 per meeting/$4,500 max per year.• Maximum of 6 grants available in 2016.• Deadline to apply: November 15, 2015

THANK YOU!