Report to the Members
by Bill Goichberg
To make wise choices in this
Executive Board election, the members of USCF should know more than they have
been told in Chess Life magazine and on www.uschess.org. This report and its
links of documentation are intended to provide a more complete picture of events
related to Federation management since the summer of 2003.
Background
For seven consecutive years, USCF
operated in the red. After the latest round of huge losses were revealed in
August 2003, many feared bankruptcy. About $450,000 to $500,000 was owed to
creditors, it was difficult to meet payroll, and even paying the US Open prizes
had to be delayed. The new Board which took office that month took drastic
action, laying off 17 employees. This was controversial and two Board members
voted no, but it was necessary.
To help the Federation’s cash flow, I
paid in advance for $16,000 worth of Chess Life advertising, mostly for ads to
be submitted several months later. The New Jersey State Chess Federation also
helped out by paying $5,000 in advance for USCF’s anticipated share of profits
from the Amateur Team tournament to be held six months later.
Office Manager and Chess Trust
By November, things had improved
somewhat, but the Federation still owed about $400,000 more than it could pay. I
volunteered to be in charge of the New Windsor office, and in the middle of that
month was named Office Manager.
One of my first problems was an
invoice from the US Chess Trust requesting payment of $63,000 to the Trust based
on various past transactions, most of which were poorly documented. This amount
had already been placed on the Trust books as accounts payable, and I was told
by a Trust representative that my predecessor had agreed with this sum. I
conducted a lengthy investigation of each Trust claim, spoke to many people that
had been involved in the issues involved, and concluded that USCF’s indebtedness
was actually much lower than we are being invoiced for. After several months of
negotiation with Trust officers, the matter was settled at a cost to the
Federation of less than half the amount originally billed.
Executive Director Application
At the Board’s January meeting, my
application to be Executive Director was approved. Previous holders of this job
had generally been paid about $100,000 per year, but I offered to work for the
entire year 2004 without pay if necessary. I asked that at its August 2004
meeting, the Board consider whether or not USCF could afford to pay me, and that
if it could, I would be satisfied with about 25% of the usual Executive
Director’s salary. If the Board decided in August against paying me, I would
complete the year anyway.
I thought this was an extremely
reasonable offer, especially as USCF was still deeply in the red, and no one
else was willing to work without guaranteed and immediate payment. However, the
Board neglected to place the agreement to consider a salary in August 2004 in
its minutes, and eventually (after failing to consider the matter in August as
promised), after they decided to pay me $25,000 in December 2004, the co-chair
of the Finance Committee charged that I had “entered into a secret deal to be
paid for his ‘volunteer’ services.”
Book and Equipment Sales Outsourcing
The major issue anticipated for the
upcoming January 2004 Board meeting was the outsourcing of USCF’s book and
equipment business. This had long been one of the Federation’s two major sources
of net income (adult dues being the other), but had been mismanaged in recent
years and was actually losing money. In October, before I became Office Manager,
the Board had received an offer of 5% of sales to outsource this business and
seemed about to accept. I was appalled that this valuable asset might be let go
for such an inadequate amount and called the President and VP of Finance to
object and express my opinion that far better bids could be obtained, but they
sounded anxious to move immediately and grab the first offer. Fortunately,
shortly before the Board meeting at which I feared the 5% proposal would be
accepted, another bid came in offering a minimum of 12%, and the Board decided
to delay their outsourcing decision.
VP of Finance Tim Hanke, on behalf of
a Board Outsourcing Subcommittee, was in charge of negotiating with outsourcing
bidders. The Board declared the 12% offer to be best, but authorized Hanke to
negotiate with other bidders as well. As the January meeting approached, I
wondered why the Board had not received any report on the bidding. With less
than a week to go, I called Hanke and found that he had negotiated only with the
one bidder who had made the best preliminary offer. And the negotiations had not
improved that offer from USCF’s standpoint, but actually made it slightly less
favorable.
Two years before, a different Board
had considered outsourcing book & equipment sales, and the best bid at that time
was made by ChessCafe. So I asked Hanke if ChessCafe had been contacted this
time around; he replied negatively. (About a year later, Grant Perks told me
that while in charge of the office about October 2003, he had contacted Hanon
Russell of ChessCafe to inquire about USCF outsourcing; Russell felt he had not
been treated fairly two years before and was no longer interested.) I asked
Hanke if he would mind if I called Hanon Russell to see if he was interested.
Hanke said he had no objection to this, but it sounded like he was anxious to
quickly sign a contract with the other bidder.
I called Russell, and he was very
interested, but it was only a few days before the Board meeting and he said he
couldn’t submit a bid in time. He asked me to tell the Board that given one
week, he would submit a proposal, and that he was confident that it would be the
most favorable one for USCF, just as it had been two years before.
I reported what Russell said at the
Board meeting, expecting that since a lot of money was involved (possibly over a
million dollars) and USCF was still heavily in debt, the Board would surely want
to make the most of this opportunity and maximize our revenues. But amazingly,
most Board members placed a higher priority on completing a deal immediately
than on finding the best deal!
They were considering a proposal with no minimum guarantee to USCF. Instead,
there was a clause giving USCF the right to cancel the contract after a year if
annual sales were less than $1.8 million. Hanke seemed to think this was just as
good, but the right to cancel wouldn’t have produced any revenue, only allowed
us to start the bidding over again under less favorable conditions (poor sales
do not promote good bids) after a year of inadequate revenue. I argued that we
should insist on a substantial minimum guarantee and that we could obtain one.
I suggested that I be put in charge
of the negotiations and allowed to contact any potential bidder, telling the
Board I was sure I could do much better than the bid they were considering.
There was strong resistence, but finally they agreed.
The day after the meeting, I called our current high bidder and said that his
bid was unacceptable, and that we wanted a minimum guarantee, cost price rather
than free advertising, and an outsourcing partner who would not run other book
and equipment sales businesses competing with us. His response was that he would
submit an improved bid within a few weeks. I felt pleased that my negotiating
had gotten off to a good start and informed the Board.
But the next day, I received an email
from President Marinello informing me that I was removed as negotiator and the
Hanke committee was back in charge! This was bewildering, especially since Hanke
had stated at the meeting that he would be uncomfortable asking for improvements
to our current best bid.
I called Beatriz, and it turned out
she was worried that I was going to try to kill B & E outsourcing completely! I
assured her that even though I had previously supported USCF staying in the
business and running it better, that was no longer my position and in any event,
I recognized that the Board was going to outsource and that my job was only to
obtain the best deal. She accepted this and restored me as the negotiator.
Incidentally, on previous Boards, the
President could not have removed or restored the ED as the negotiator; only the
full Board could have done that unless it had specifically authorized her to
make the decision. Later, I found that Beatriz would make many more decisions
without consulting or even informing the Board. She was able to do this because
the majority of the Board tolerated it. I don’t think this is the proper way to
run the organization, and if I am elected to the Board, will object if our
President acts like this.
To return to the B & E negotiations,
I contacted many vendors and obtained three bids that were far superior to the
one considered at the January meeting. That bidder did improve his bid, but it
was only third best behind ChessCafe and another bidder. Compared to the bid the
Board almost accepted, the ChessCafe bid provided a $350,000 minimum annual
payment vs. no minimum, a percentage commission higher by 1.5% to 2%, cost price
for Chess Life advertising rather than 72 pages free annually, and an
outsourcing partner who merged his existing business with that of USCF and
doesn’t compete with us.
A negative of the ChessCafe deal is
that the outsourcer has the right to sell at national tournaments (paying their
usual percentage) unless a local vendor has bid to hold the event. If their
annual sales including these events don’t generate payments of over $350,000,
then in effect USCF obtains nothing extra for these tournaments and would be
better off selling these tournament sales rights to others and still collecting
the $350,000. These rights could probably be sold for at most $50,000 to
$60,000, though, so the worst case scenario is for USCF to net in effect
$290,000 per year, still vastly better than having no minimum payment and the
other disadvantages mentioned above. In ChessCafe’s first outsourcing year, they
were too busy getting set up and chose to sell at few Nationals, but this is
changing in their second year beginning 4/1/05.
Also, USCF must pay for the mailing
(but not printing) of catalogs in Chess Life, roughly a $40,000 annual expense.
However, no bidder offered to cover this cost.
And in a separate subsequent deal,
ChessCafe agreed to sponsor the 2004 USCF Grand Prix, providing $10,000 in prize
money plus $5000 in merchandise prizes (the first corporate sponsorship of the
Grand Prix since 1998). This sponsorship was later renewed for 2005.
Stan Booz
Shortly after the Board’s outsourcing vote, I was astonished to see a
post on
the chess newsgroup by USCF Finance Chair Stan Booz which included the
following:
“At the last board meeting Bill then
took over the meeting and wouldn't let anyone else get a word in edgewise. So:
the board was swayed to accept the Camaratta's company's bid. One more instance
of people with vested interests having inside information and a vote to SELF
DEAL.”
The Chairman of the Finance Committee
is appointed by the Executive Board, and is generally one of the Board’s most
trusted advisors. The Board might consult him and his committee regarding a
major business deal like B & E outsourcing, but whether consulted or not, he is
an insider, and provides advice in confidence to the Board. Yet here we have a
chairman who is screaming to the whole world, without providing a shred of
evidence, that the Board has just voted in a corrupt manner!
Plus, of course, my arguments could
not possibly “take over” a meeting and the Board was quite capable of rejecting
them (and almost did). And ChessCafe is not a “Camaratta’s company,” as Frank
Camaratta had sold his 2% interest in ChessCafe (and resigned from the Board)
before the outsourcing vote.
Few businesses would allow an officer
to retain his post who publicly and without evidence accuses the Board of
Directors and Executive Director of corruption, but this Board does not follow
accepted business practices, and Booz was not removed as Finance chair as he
should have been.
Click here for some
prior internet
posts by Booz which should make you wonder why the Board ever appointed him to
be a USCF representative in the first place.
Staff Cuts
In February, a financial meeting was
held at the US Amateur Team East, which included three Board members, three
former USCF Presidents, and the Finance Chair. One former President predicted a
loss for the fiscal year ending May 31 of $400,000, while the other two former
Presidents expected a $300,000 loss. I was not ready to predict a profit, but
could see that things were improving and did not expect a six figure loss.
We actually ended the fiscal year with a $285,000 audited surplus, the largest
in USCF history!
At this meeting, everyone agreed that
further staff cuts would be necessary, especially after we were no longer in the
book and equipment business. The consensus was that payroll had to be reduced to
a certain amount, but it was up to the Executive Director to decide how to make
the cuts. The target for total payroll was later revised, but Beatriz reiterated
to me what she and others had said at the meeting- I had to cut so much money
out of the payroll, but it was up to me where to cut.
I accepted this instruction
literally, which I guess was a mistake. Our Events Manager, Diane Reese, was
very busy during the Scholastic season and a lot less so during the summer and
early fall, so I called her to discuss the possibility of shortening her work
year. She didn’t like the idea, and shortly after our discussion, Scholastic
Chair Ralph Bowman sent out an email to many people blasting me for allegedly
wanting to remove Reese from her National Scholastics work. I replied that my
idea was to keep her for that work and save money on the rest of the year, but
he followed with another highly critical email.
Of course, at this point I expected a
response to Bowman from Beatriz explaining that we had a financial crisis and I
had been instructed to make staff cuts. I also expected that if Beatriz was
against shortening Reese’s work year, she would tell me this privately, in which
case I would have given up the idea. Instead, what happened was a public reply
from Beatriz to Bowman, criticizing me for considering cuts in the vital area of
scholastics. What happened to “it’s up to you who to cut?” I guess she forgot to
tell me that not only were scholastics off limits, but people who work in the
scholastic field are also immune even when doing other work!
I spoke to Beatriz after this,
complaining that I had been publicly chastised for doing what I was told to do,
and asking her to send an email of apology to the same people who received her
other email. She apologized to me and agreed to send such an email to the
others- but never followed through on the latter promise.
Adult Memberships
Adult membership decline is a
longstanding problem. From 3/1/95 through 2/29/04, we lost 11,794 regular
members. I then initiated a three-pronged attack:
1) "Activity Means Members," an
affiliate-friendly program to encourage more tournaments.
2) A $38 promotional adult membership
for new and long-expired members.
3) Better expiration mailings.
Adults had been receiving only one notice before expiration, a confusing small
print form listing many member categories. No message, not even "Your
membership will expire soon!" This was replaced by a series of four
low-cost postcards- adult dues only with an appropriate expiration warning, in
larger print.
Dramatic improvement has resulted.
In the twelve months following the above changes, adult membership with Chess
Life actually INCREASED by 47. And recent numbers are even better- up
each month 11/04 through 2/05, total gain 722- best four-month period since
1994!
Sponsorship
For USCF to survive and
prosper, sponsorship is critical. Our leaders have been hostile to the
Federation's best sponsor ever, America's Foundation for Chess. We once
spent $100,000 annually on the US Championship, but AF4C has held four without
USCF cost, more than doubling prizes to over $250,000! They have expressed
interest in discussing other projects, but the Executive Board has been
unresponsive.
ChessCafe
On April 1, the ChessCafe outsourcing
began, and shortly after, USCF’s payroll declined dramatically. Hanon Russell
has been a cooperative partner in many ways: voluntarily making his first
payment early to help USCF cash flow, filling USCF back orders without requiring
speedy payment, recruiting advertisers for Chess Life, recommending potential
sponsors, and sending catalogs to 40,000 schools at his own expense.
Unfortunately, his sales have been poorer than expected, not nearly enough to
cover his $350,000 guarantee. It is important to the Federation that ChessCafe
makes money, as their three year contract ends in 2007 and if they don’t pick up
their renewal option due to poor sales, it will be difficult for USCF to find a
comparable offer. The sales operation, even though outsourced, remains a
valuable USCF asset, and poor sales decrease the future value of this asset.
Chief Financial Officer
In late April, with the Board pushing
for more staff cuts, I replaced USCF’s CFO with Ken Thomas, a New Jersey chess
organizer and former controller. Ken worked three days per week with a salary
less than half of the old CFO. He saved USCF quite a bit of money, even
though in his final month or two he fell behind doing bank reconciliations and
this caused some apparent profit, that was never reported to the public, to not
really be there. He also improved our accounting procedures, revising our
tournament reporting which was responsible for misleading financial reports in
the past (for example, income from the US Open in August 2003 was not reported
until February 2004).
Even though Beatriz had suggested to
me that the CFO be replaced as long ago as November 2003, the whole Board backed
the move, and it was planned a few weeks in advance, Stan Booz posted the
following on the newsgroup:
“Audit committee. There were three
actions. One of which had to do with the ED considering a request from employees
to do something illegal. When I informed the ED he said the employees asked him
to do it. As if somehow that would make it legal. The next day he fired the
whistleblower.”
Stan later posted:
”You'll recall that I reported that he was intending to conspire with some
employees to defraud the unemployment compensation board in NY.”
Stan is referring to a discussion of
the possibility of employees working half time in our slow season to reduce
payroll. Some employees suggested that if they were reduced to 20 hours, they
would maximize unemployment benefits by doing two days of ten hours each. The
CFO did not object to this, but Stan said that it would be improper. The
suggestion was never implemented. There was no “whistleblower,” and nothing to
blow a whistle on, but Stan managed to use the words “illegal,” “conspire,” and
“fraud”!
Mike Nolan
One of the biggest steps forward for
USCF during my tenure in the office and since has been the great work of
programmer Mike Nolan, who rewrote the Federation’s membership, ratings, and
other software, at a salary of less than half of what he would usually charge
for such work. For many years, the Federation struggled along with obsolete and
hopelessly inefficient software, and efforts to correct the situation only
caused money to go down the drain. Mike has long been a member, organizer,
delegate, and USCF Parliamentarian, and it turns out that the answer to the
longstanding software crisis was to find someone who is part of the chess world
and really cares about USCF. Now many tournaments are being rated the same day
they are completed! Thank you, Mike!
The President takes over as ED!?
On September 10, I
was startled to read in an email that apparently continued a discussion of the
possibility of relocating to Louisville that the President of USCF was going to
apply for Executive Director. I had been leaning towards continuing as ED
in 2005, even though I expected a move out of the northeast, and after the
spectacular financial improvement during my tenure, it never occurred to me that
the Board would call for new Executive Director applications.
Two days later on September 12, Steve
Shutt moved at a Board conference call that a search be conducted for applicants
for Executive Director, as well as Scholastic Director and Editor. This
passed 4-2, with Beatriz Marinello in favor. I wondered whether the Board
was doing this so that Beatriz could get the job, and felt it was improper for
her to promote and vote for such a motion.
It was also questionable whether a
Board member should be allowed to go directly from the Board to a job in the
office. The USCF Code of Ethics prohibits Board members from benefiting
financially from business arrangements they may make with USCF for two years
after their tenure in office, but this wording has a gigantic loophole- a Board
member could use his or her insider status to line up the votes to become ED (or some other position) and then resign right before the vote, so the "business arrangement"
would not be made during the person's tenure. I favor revising the code of
ethics to change "tenure" to "scheduled tenure," so the limitation would last
until two years after the scheduled completion of the term, regardless of
whether or not the Board member resigned.
At the Board meeting two weeks later,
I asked whether the ED search reflected Board dissatisfaction with my
performance, and was assured it did not and my application to continue would be
welcomed . Board members said the search was necessary because I had been
appointed without a search, but I reminded them that prior to my appointment,
four consecutive issues of Chess Life had invited ED applications.
Subj:
Re: New Louisville bid
Date: 9/10/2004 11:46:27 AM Eastern Daylight Time
From: Beatchess
To: Chessdon,
knudson1@sio.midco.net,
Randy.Bauer@iowa.gov
CC:
mrcarr@pacbell.net,
timothyhanke@comcast.net,
elizabethshaughnessy@hotmail.com,
Chessoffice,
nolan@gw.tssi.com,
LWDubeck,
jon@bocachess.com,
ilyag@mindspring.com,
execassist@uschess.org,
bradyfm@email.msn.com,
stephenshutt@yahoo.com
Dear All:
Considering our current situation, I decided that I will apply for the Executive
Director's position. I am willing to relocate to any place that the USCF
decides to move the USCF office.
The interesting thing is that I never spoke with De Knudson about this, I
appreciate her vote of confidence. Also, I believe we should open a national
search for the position and evaluate the best candidates, of course I will
exclude myself from this process.
In fact, I may even have to step out as President and from the Executive Board
once I submit my application. I do not intend to be in a position of conflict.
All the best,
Beatriz Marinello
Executive Director's Job Description
Later in September, it was
becoming clearer that some of Beatriz' allies were trying to write the rules to
maximize her chances of becoming Executive Director. Elizabeth Shaughnessy
proposed that the Executive Director's job description include the phrase, "Work
or living experience outside the United States preferred."
When questioned regarding this
clause, Shaughnessy replied:
The USCF
represents itself internationally. We are about to go to the FIDE meeting at
the Olympiad and try to get other countries to vote for our motion. An
understanding of other countries helps get them on our side. That understanding
comes from personal experience in other countries. I would hope the USCF would
become a leader of a large and effective minority in FIDE in the short run and
perhaps a leader of the majority in the long run.
Perhaps
true to some extent, but do we want our Executive Director to attend FIDE
meetings? I don't, and would rather that he or she minimize ceremonial
long distance travel within the United States as well. Running the office
plus seeking sponsorship already makes a difficult enough job; leave FIDE to our
Delegate, Zonal President, and other international specialists.
The Board wisely did not accept
Shaughnessy's phrase as part of its ED job description.
USCF Relocation
USCF has moved its headquarters and
most of its employees to Crossville, Tennessee. The main advantage of this move
is that the cost of living in Crossville is about 20% lower than our old
location in New Windsor, New York. Crossville also has a very active chess
community, especially in the area of scholastic chess. I believe that the
Federation will operate successfully out of its Crossville office. However, the
way that relocation was handled is a legitimate campaign issue, especially when
incumbents are seeking re-election.
Missed Opportunities?
The 2003-4 Executive Board was in
such a rush to outsource B & E sales that they almost accepted bids that were
greatly inferior to what ultimately proved available.
Likewise, the 2004-5 Board visited
one location, the local government and chess leaders did a great job of hosting
the Board meeting, and the Board quickly decided to eliminate all other bidders.
Outsourcing and relocation were two
issues of monumental importance to the Federation. Just as vendors were willing
to offer large sums of money for USCF’s book and equipment sales rights, cities
and towns were prepared to make substantial offers in order to obtain the
prestige of being home to a national organization. There are unlikely to be
future issues of comparable income significance to the Federation, other than
the renewal of the outsourcing contract.
Let’s look at the events behind the
relocation to Crossville.
Relocation: The 2002-3 and 2003-4 Boards
The 2002-3 Board had considered
relocation. Crossville offered three acres of land free, and after an earlier
vote to move to Palm Beach Gardens, the Board changed its mind and approved
Crossville’s bid.
A majority of the 2003-4 Board, though, was
opposed to
Crossville because of its distance from major cities. In March 2004, the Board passed a
motion calling for a reopening of the bidding for relocation. This motion called
for a “Relocation Committee to evaluate a move” to be appointed, and said that
“Bidding instructions for sites interested in housing the USCF offices are to be
made available by April 15 in a special delegate mailing and also will be posted
on www.uschess.org and other websites and newsgroups. All bidders must have
their bids finalized by July 1. The relocation committee will present their
recommendations for ratification at the August USCF Delegates meeting.”
The Board then appointed the
Relocation Committee: chair Beatriz Marinello, members Tim Hanke, Mike Carr,
Ilya Gurevich, and Dave Knudson. The President/Chair said that
the Board would support the Committee’s relocation choice and indicated that
this would take the heat off the Board politically. Also, the plan was for
the Committee to visit bidders at its own expense.
However, the Committee took no action
to produce bidding instructions, and the July 1 deadline was not announced to
potential bidders. Eventually, the President/Chair decided to announce a Sept 1 deadline,
too late for the committee to present recommendations for ratification by the
Delegates. No new Board vote was taken, so the July 1 deadline and committee
report to the Delegates were technically still required. The Relocation
Committee did begin discussions of a general nature.
Crossville Responds
The Crossville people were
understandably shocked when they heard that bidding was reopened, saying that
the Board should have discussed the Federation’s change of mind with them before
calling for new bids. They suggested that the Board, or at least the President
and ED, come to Crossville to explain their reasons. Beatriz agreed to the
latter, and I was about to reserve my plane flight for a meeting to be held July
10-11 in Crossville when she said that she had changed her mind, that there was
no chance that USCF would relocate to Crossville and that by going there we
would only encourage false hopes.
A few weeks later, USCF received a
letter from the Crossville city attorney, threatening legal action if the
Federation did not move to Crossville. Our attorney told us that we were under
no obligation to move, and could be held liable only for whatever expenses
Crossville had incurred in reliance of the past Board’s vote to move there,
which he didn’t feel would be very much.
At the annual meetings in Florida in
August, Harry Sabine represented Crossville and had discussions with the Board.
A new idea was suddenly advanced at a Board meeting, that USCF split its office
and move the membership, ratings and accounting departments to Crossville and
the Executive Director, Chess Life, and scholastic departments to a large city,
perhaps Miami. Sabine was asked whether Crossville would accept this and said he
wasn’t sure. The Board agreed to meet in Crossville in September.
The Relocation Bids
On August 30, only two days before
the bidding deadline, four new members were added to the Relocation Committee at
the suggestion of the President/Chair: Steve Shutt, Leroy Dubeck, Stan Booz, and
Jon Haskel. This expanded that committee from five members to nine.
At the deadline, bids were received
from Campbell Hall (NY), Ellenville (NY), Grapevine (TX), Lindsborg (KS),
Louisville (KY), and Rochester (NY). Crossville submitted nothing new but asked
that its 2003 bid again be considered. The location USCF had voted to move to in
January 2003, Palm Beach Gardens (FL), asked for more time to submit a proposal
that would offer the Federation potentially very valuable land. This was granted,
and later clarified with the announcement of a new bidding deadline of October
10. The sale of USCF’s New Windsor building was finalized later in September,
and the Federation had been operating out of its leased space next door since
July. That lease was to expire May 31, 2005, so a relocation decision by the end
of 2004 seemed desirable.
The Relocation Committee began
discussing the bids. Campbell Hall, Grapevine, and Rochester failed to offer a
low cost purchase option so were not seriously considered. Ellenville required
extensive renovation and a New York State grant to cover this was essential;
lacking assurance of grant approval this bid was also dismissed.
The Louisville Bid
Louisville submitted an interesting
bid, offering free downtown office space if USCF placed numerous tournaments at
the Galt House Hotel and obtained sufficient room nights. That hotel, which we
have used in the past for National Scholastics, also offered a very reasonable
rate and we could have added $10 or so to that rate and received it back as a
commission. The package seemed to me to be worth further study and perhaps
negotiation, even though it was sufficiently complex so I was not certain if it
was a good bid or not.
I was surprised by the vehemence of
the Board’s opposition to Louisville. Several Board members were quick to rule
the bid out because allegedly in order to meet our room nights quota, we would
have to place most National Scholastics in Louisville. I pointed out that
presently we hold National Scholastics in Nashville every two years, and that
this places a larger percentage of our scholastic room night business in
Nashville than would be needed to obtain free office space in Louisville, but
the Board ignored this argument, although Randy Bauer supported giving
Louisville further consideration.
Tim Hanke derided the entire concept of free
space in return for room nights, and referred to the Galt House as “an old hotel
that is ready for the wrecker’s ball.” The Galt House was recently renovated and
the area near it upgraded; it is Kentucky's most prominent convention hotel.
The Lindsborg Bid
A strong bid was received from
Lindsborg, Kansas, which under the leadership of Mikhail Korenman has hosted
numerous successful international chess tournaments and festivals as well as
USCF national tournaments. The Lindsborg bid was similar to that of Crossville
in that the locals are enthusiastic but the location is far from major cities.
However, the Lindsborg offer had a major advantage over Crossville. While
Crossville offered free land on which USCF will constuct a 5000 square foot
building at a likely cost of at least $500,000 and maybe much more, Lindsborg
offered free land AND a free 8900 square foot building! Some renovation of the
building would be desirable, but probably not more than $100,000 worth.
Lindsborg also offered a $72,000 grant to help cover relocation costs.
Overall, I believe that the Lindsborg
bid was financially more advantageous for USCF than Crossville by over $400,000.
Randy Bauer visited Lindsborg shortly
before the relocation vote, and told the Board that financially, that bid was
"far superior to Crossville" and might improve still further.
Mikhail Korenman was upset that the Lindsborg bid was rejected, saying that he
was extremely disappointed not in the result, but on how the decision was made.
He asked why the Board reopened the bidding only to follow with the “circus” of
shutting the new bidders out and returning to the same location, and complained
that it was unfair to other bidders for the Board to visit (and meet in) only
Crossville. Mikhail was especially interested in hearing how the Crossville
offer could possibly be superior to that of Lindsborg, a question the Board did
not attempt to answer.
In Beatriz’ reply to Mikhail, she
surprisingly admitted that politics was part of the Board’s decision, saying,
“After assessing the situation financially as well as politically I decided to
support making the decision on Sunday and in favor of Crossville.” She
continued, “Moving the USCF Headquarters to Crossville is a sound and solid
decision,” but failed to even try to explain how this sound and solid decision
was as sound or solid as Lindsborg.
Tim Hanke attempted to explain the
Board’s reasoning. Following is his email to Korenman, with my current comments
(all caps) intermixed.
Subj: RE: Lindsborg
Date: 10/18/2004 11:06:15 AM Eastern Daylight Time
From: timothyhanke@comcast.net
To: korenman@bethanylb.edu
CC: randybauer2300@yahoo.com, bradyf@stjohns.edu, chessoffice@aol.com, beatchess@aol.com,
chessdon@aol.com, elizabethshaughnessy@hotmail.com, stephenshutt@yahoo.com
Sent from the Internet
Mikhail,
To be honest, I agree with many of your comments. At USCF, we have an
unfortunate habit of changing our minds.
In the case of the USCF relocation decision, here is what I think happened.
1. After a confused bidding process, the Board voted in 2003 to move to
Crossville.
2. During 2003-2004, the USCF went through many changes. Not only did we change
our operations, but five of seven Board members were replaced.
3. With most of the Board new, it was necessary for the Board to re-educate
itself about the relocation options. That is why the bidding process was
re-opened.
THE BIDDING PROCESS WAS REOPENED IN MARCH 2004 WHEN THERE WERE FIVE BOARD
MEMBERS. THE OTHER TWO WHO TOOK OFFICE AUGUST 2004 WERE NOT THERE YET. THE
PROCESS WAS REOPENED NOT FOR RE-EDUCATION, BUT BECAUSE THE BOARD WAS DEAD SET
AGAINST MOVING TO CROSSVILLE.
4. The Board felt a special obligation to visit Crossville, because we had
already made an organizational commitment to move there. That is why we held our
fall 2004 Board meeting in Crossville.
THE BOARD FELT NO SUCH OBLIGATION IN MARCH WHEN IT REOPENED THE BIDDING, NOR DID
IT FEEL THAT WAY IN JULY WHEN THE PRESIDENT DECLINED TO VISIT CROSSVILLE. WHY
THINGS CHANGED SO DRASTICALLY IN AUGUST, I’M NOT SURE.
5. During the visit to Crossville, the Board was pleasantly surprised at how
attractive the area was, and how enthusiastic the town was about having USCF
move there.
COMPARED TO WHAT? THEY DIDN’T VISIT OTHER BIDDERS.
Meanwhile, the Crossville bank continued to offer us a no-money-down
construction loan, which several of us felt was a very important consideration.
IS HE SERIOUS? HE WOULD RATHER BORROW $500,000 OR MORE TO CONSTRUCT A BUILDING
BECAUSE NO MONEY DOWN IS REQUIRED THAN OBTAIN A FREE, LARGER BUILDING?
There were other positive financial factors, such as a strong local economy,
affordable home prices, and no state income tax (except on unearned income).
DID THE BOARD BOTHER TO COMPARE THE SAME FACTORS FOR LINDSBORG AND OTHER
BIDDERS? LINDSBORG ALSO HAS A VERY LOW COST OF LIVING.
6. Randy Bauer visited Lindsborg very late in the process. In retrospect,
perhaps it was a mistake on our part, not to pay more attention to your bid
earlier.
7. During our Board conference call yesterday, one of the Board members made a
very persuasive argument about why we should finally make up our minds to move
to Crossville. He said, essentially, "Crossville has played by the rules, we
already voted to move there, we don't see another offer that looks superior,
FREE LAND PLUS FREE LARGE BUILDING DOESN’T LOOK SUPERIOR TO FREE LAND AND WE PAY
AT LEAST $500,000 FOR A SMALLER BUILDING!?
and it is unfair to Crossville, at this late date, to keep them dangling while
we search around for another deal that may be slightly better.
WE ALREADY “SEARCHED AROUND” BY INVITING BIDS, THEN WE OWED IT TO THE BIDDERS
AND THE USCF MEMBERS TO SELECT THE BEST BID, NOT IN EFFECT SAY “WHOOPS, WE’RE
SORRY WE REOPENED THE BIDDING.”
It is Crossville's bid to lose, and they haven't done anything to lose it."
This is how I see the process. Yes, it was not perfect, far from it. We are all
human and we make mistakes and argue with each other and sometimes change our
minds. But I think our final result was a fair one. Or at least, as fair as it
could be, at this point in time. I only regret we could not have done something
good for Lindsborg, becase it seems you have a truly remarkable chess community.
Tim Hanke
USCF Vice President of Finance
The Liberty Bid
When the call for bids was posted at
uschess.org, it specifically mentioned that USCF was not committed to moving out
of the Hudson Valley area of New York, and that bids from this area would be
considered and would have the advantage of not requiring major employee
turnover. The New Windsor area is rather expensive, so I made some calls
elsewhere in the Hudson Valley where the cost of living is lower. One of these
calls put me in touch with the Sullivan County Partnership for Economic
Development and the Gerry Foundation, set up by multibillionaire Alan Gerry, the
founder of Cablevision. Alan Gerry’s hometown is Liberty, NY, he is interested
in bringing a national organization there, and his foundation is building a $40
million cultural center about ten miles away.
The Gerry Foundation owns the former
Loomis Hospital, a 21,000 foot three story building on about 15 wooded acres.
The area around the building consists of about five beautifully landscaped
acres, quite a contrast to the property USCF was given in Crossville, which is
undeveloped farmland. The ground floor of this building alone would be more than
sufficient to house the USCF, so two other floors would have been available for
lease to others or for holding chess tournaments, lectures, camps, etc. An the
cost of living in Liberty is very low, only about 2% more than that of
Crossville.
The Gerry Foundation offered to sell
the building to USCF for $250,000. I obtained a realtor’s report that estimated
its value as clearly over $500,000. The realtor also estimated the likely rental
income we would earn by renting out some of our excess space as $63,000 per
year. Granted that this is uncertain and the actual income could have been much
different, I still considered the potential for rental income to be an asset, as
was surprised when Crossville supporters said that USCF lacks the expertise to
“be in the landlord business.” My reply to this was that for 5% to 10% of income
we could hire a property manager. The Board ignored this possibility and
continued to repeat that we shouldn’t be in the property management business.
The former hospital building is about
105 years old, but appears in good shape. To be conservative I estimated
spending several hundred thousand for renovation, but it was far from clear this
would be needed. The Crossville supporters, without giving details and without
having seen the property, claimed that a million dollars in renovation would be
necessary!
Tim Hanke, who did not visit the
building, called it a “white elephant” and “money pit” that “needs to be gutted”
and suggested that the owner wanted to give it away to avoid tax liability
(false, the Gerry Foundation was exempt from paying taxes on it).
Beatriz Marinello referred to Liberty
as a “depressed area,” which was true a few years ago about a different part of
town but certainly not correct about Alan Gerry’s neighborhood (he lives a few
blocks from the hospital building).
Stan Booz posted on the newsgroup
that the Liberty building had been “vacant for decades.” I pointed out that it
had been occupied as the Holy Rood Seminary until 2000, and Stan of course did
not reply.
It was clear to me that the Board
majority was dead set against anything but Crossville, but the Liberty building
did involve some risk. While those Board members were going all out to be
negative, there could indeed be unexpected expense that would cancel out or even
exceed the rental income.
Erik Anderson’s Offer
I mentioned the Liberty offer to Erik
Anderson, President of USCF's most valuable sponsor ever, America’s Foundation For Chess.
Erik and his associates are acquainted with Alan Gerry, and apparently hope to
obtain sponsorship from his Foundation. Erik was interested in helping USCF move
into the Liberty site under risk free conditions. Given two weeks, he said he
would contact Gerry and try to set up an ownership team for the building (AF4C
and/or Gerry) that would offer USCF a minimum of five years of free rent.
See Anderson's offer here.
While this was not a firm offer and
those two weeks might have produced nothing, here was USCF’s best sponsor ever
proposing to talk to a billionaire anxious to bring a national organization to
his town. A tremendous upside, and virtually no downside to waiting the two
weeks. Surely, the Board would want to know the outcome of this discussion?
I underestimated the determination of
the pro-Crossville group; they didn’t even want to talk to Erik. Apparently,
they feared an attractive proposal from Anderson/Gerry and felt they had to rush
through approval of Crossville before it was clear there was something better.
Beatriz said in the conference call
that approved Crossville, “Why move into somebody’s house or somebody’s facility
when we can afford to buy our own place?” After seven straight losing years, we
finally had one that was profitable, and here is our President suggesting that
we give our money away because we are able to, rather than consider the possibility
of five or more years of free rent!
She went on to refer to AF4C as a
group “that wants to dictate where we’re supposed to be moving” and continued,
“If the American Foundation For Chess and Erik Anderson want to help the USCF we
should welcome their help, and it should be unconditional...”
Unconditional sponsorship! Give us
your money, and don’t ask for anything in return. Wouldn’t that be nice, but in
the real world, sponsors expect to get something back. Here was a possible
win-win situation: USCF gets five or more years of free rent, AF4C finds a
promising new sponsor, and Alan Gerry brings a national organization to his home
town. And how does our President react to this possibility? By saying basically,
“Give us money and don’t tell us how to use it.” Sorry, we won’t get much
sponsorship this way, you have to give something to get something. USCF had
something to give, the prestige of having a national organization. Now we have
given that asset to Crossville in return for some land. We could have done
better with Lindsborg, and possibly still better with Liberty.
Steve Shutt’s comment on Anderson’s
offer during that call was as follows: “I’m not sure that I would want to see
his involvement in buying a building, though. I see so many more valuable
contributions that he could make in terms of supporting scholastic chess...”
This is the VICE PRESIDENT OF THE USCF saying in effect “we’re not interested in
five years of free rent, use your money for scholastic chess instead.”
Incredible!
Also during that conference call,
Elizabeth Shaughnessy said that it would be “dreadful to get bogged down in the
business of being a landlord.” This was an argument the pro-Crossville group was
making when the proposal was that USCF buy the building, and a weak one as
we could hire a property manager. This argument was completely out of place when
discussing the Anderson proposal, which would have made USCF a tenant with free
rent, not a landlord.
Meeting in Crossville
The Board met in
Crossville in late September, granting that bidder an opportunity offered to no
others. The local leaders of chess and government did a great job of
hosting the meeting, apparently causing some Board members previously opposed to
Crossville to decide that there was no need to seriously consider other bids.
These Board members, in my view, failed in their duty to carefully examine
USCF's best options. It was wrong for them to have opposed Crossville to
begin with without being there, but equally wrong to have visited only one
bidding site and then ended the search without comparison or negotiation.
Lindsborg, at least, had a much better bid than Crossville on paper and it is
outrageous that the Board didn't visit.
At the Crossville meeting, the Board
decided to eliminate Lindsborg (!), said the contenders were Crossville,
Palm Beach Gardens and Liberty, set Oct 10 as the final bid deadline, and
declared that its final selection would be made by November 1. Palm Beach
Gardens then said they could not meet the Oct 10 deadline and withdrew.
The Final Decision
The Board met by
conference call on Oct 17, with a majority determined to approve Crossville as
quickly as possible. A motion to delay the decision for two
weeks to allow Liberty and Lindsborg to improve their bids was
defeated 4-3 with Schultz, Brady and Bauer in favor, even though at the Crossville meeting the Board had stated there
would be a decision by Nov 1, and two weeks from Oct 17 was Oct 31.
The rejection of the proposed two
week delay had to be one of the dumbest business decisions in USCF history.
Even Randy Bauer, now a "slate" candidate, said, "I hate the idea that we're
leaving money on the table. I do not believe in my heart of hearts that
we've gotten the best possible deal." Of course, Bauer was exactly correct (why
he later decided to join a slate with those who rushed to judgment and left
USCF's money on the table is beyond me).
Click here to listen
to an audiotape of the Board's Oct 17 conference call.
ED attacked for seeking relocation bids!?
Even though our call for bids on our website had specified that a
Hudson Valley location might be acceptable and would have the advantage of
retaining many employees, I was attacked for suggesting a two week delay to
allow an Anderson/Gerry proposal to be considered. Here is an exchange I had
with Beatriz Marinello on the newsgroup:
The effect of moving into a building purchased by AF4C for five years, with a
written agreement promising free rent and renovation of the building by its
owner, would have been a financial windfall for USCF. Crossville is
providing a year of free rent in a temporary building, and you referred to this
offer as being worth $70,000 for USCF. If that is the case, the Anderson offer
should be worth at least $350,000. Is USCF so wealthy that it can afford to
throw away the chance to save $350,000? Please note also that Erik's email
did not limit his offer to five years of free rent, he said AT LEAST five years.
The offer could have been still better. I can't believe that you wanted to
reject it without finding out.
What was the downside of waiting two weeks? The worst thing that could have
happened was that the Anderson-Gerry talks were unproductive, the Board would
vote for Crossville two weeks later, and we would have avoided insulting the
best sponsor in USCF history. Not such a bad outcome.
>Erik Anderson is a very respectful and successful business person. The USCF
>should be always grateful to him for his contributions to chess. But the
>USCF deserves to have it own building and control over the operations.
With a lease providing free rent, USCF would have had sufficient control.
Exactly what are you suggesting might have happened? A few month ago you favored
a split move partially into the Excalibur building in Miami, where we would have
paid rent, and you seemed unconcerned that this would give Excalibur too much
"control." Is moving into someone else's building OK if you pay rent but
undesirable if the rent is free?
>This is nothing personal, but you are going to far to secure a position of
>control within the USCF.
Beatriz, the issue here is which relocation possibility is best for USCF. To
attempt to switch the discussion to accusing me of trying to take control of
USCF is not only outrageous, but also reflects the fact that you are unable to
make a reasonable argument for why it was better to slap Erik Anderson in the
face than to wait two weeks.
My year as volunteer ED ends Dec 31 (long before the move) and if the Board
wishes they can fire me at any time, so please don't pretend this is about where
I want USCF to be while I am ED. Rather, it is about why the Board would support
paying over $500,000 for a building and not waiting two weeks to see if we are
offered free rent at a much nicer site for at least five years.
Bill Goichberg
And Tim Hanke sent many emails which
claimed that my interest in Liberty was motivated by my desire to be ED there,
such as the following:
>>It is crystal-clear that you are only interested in sites near where you live.
>>Intelligent people can draw their conclusions from this fact.
>>I, on the other hand, support a site (Tennessee) that would be much less
convenient
>>for me than your site (Hudson Valley). This is because I want the
best choice for
>>USCF, not for myself. Unlike the case with you, my personal
preferences have
>>nothing to do with my decision-making process.
Hanke’s claims are outrageous. When I
was speaking favorably about Lindsborg and Louisville, of course he didn’t say I
was “only interested in sites near where you live.” Board members should stick
to facts and not speculate, with no proof, about the motives of others.
Relocation Committee, Revisited
Remember the Relocation Committee? It
was selected in March, instructed to report its recommendation to the Delegates
Meeting in August, and President/Chair Beatriz Marinello had stated that the
Board would support the Committee’s selection and that the Committee would visit
bidders at its own expense. As the July 1 bid deadline was
never announced and Marinello changed it to September 1, the report to the
Delegates was impossible, but what location did the Committee ultimately
recommend?
Strangely enough, the answer is that
the President/Chair never polled her committee for a recommendation, so none was
made! This may have had something to do with the fact that several committee
members sent emails endorsing the idea of giving Erik Anderson the two weeks he
requested to negotiate with Alan Gerry.
The Committee was also sent to visit
no bidders, despite its members' offer to do so at no expense to USCF.
Playing Politics with the US Open
Before 1993, USCF invited bidding on
all national tournaments and the Board awarded these events. This process proved
very political, and in 1993 it was changed so the office makes the awards. This
has generally worked better and caused less controversy. In 2001 another change
was made for the National Scholastics and the US Open only- USCF runs the
tournament and places it where the office feels is best, taking into
consideration profitability, geographic rotation, and any sites that may be
suggested by affiliates.
In the spring of 2004, I discussed contracts with the Board. We agreed that
contracts involving over $10,000 would require Board approval and those over
$5,000 Presidential approval, but tournament contracts were specifically
exempted; the ED could continue to sign these on his own.
When I became Executive Director, the
next US Open to be placed was 2006. The long established tradition is that
geographic rotation is especially important for this event; not since the 1940s
has one area had two US Opens during a five year period. Considering both this
factor and likely profitability, I decided that the Chicago area was the perfect
location. The US Open has not been in this area since 1994, and it has been in
the Midwest only once since then (St. Paul 2000). Both Chicago and the Midwest
are overdue, and Chicago also has a history of large turnouts.
In the spring of 2004, I contacted
the Hyatt Regency Oak Brook, where I hold tournaments, and asked about USCF
holding the 2006 US Open. They were interested, and after some discussion I
received an excellent proposal: $89 room rate, 10% commission to USCF on rooms,
and no meeting room rent if we get 1040 room nights, a fairly easy target. There
were some minor problems with the contract, but I held the space tentatively
pending working these out.
Neither I nor the hotel addressed the
remaining issues as quickly as we should have, but in May I spoke to the
President of the Illinois Chess Association, asking whether ICA would approve of
USCF holding the 2006 US Open in the Chicago area. In June at an ICA meeting,
this idea was unanimously approved.
About that time, Events Manager Diane
Reese told me that hotels in Louisville and Kansas City were interested in the
2006 US Open. Chicago is likely to be a much bigger draw, so I told her to
forget those hotels, that I was planning to go with Hyatt Regency Oak Brook.
By September I was almost ready to
sign the contract, but some of the meeting rooms were still listed incorrectly.
About then, Joan DuBois at the office received a call from Leroy Dubeck, who
said that the New Jersey State Chess Federation was going to submit a bid for
the 2006 US Open. Joan asked me what to tell Leroy, and I said to tell him the
tournament will be in the Chicago area.
A few weeks went by, and I received a
call from Beatriz Marinello, who asked me if I was aware that the NJSCF was
bidding for the 2006 US Open. I said that I was aware of Dubeck’s call, but we
had told him it was going to be in the Chicago area. Beatriz asked me to call
Steve Doyle regarding their bid, and said that I shouldn’t sign a hotel contract
for the event without Board approval. I felt the latter instruction was improper
but said OK.
I called Doyle and told him that
Cherry Hill just had the US Open in 2002, and 2006 would be too soon. Also,
since 1994 the northeast had three US Opens, the midwest only one. And finally,
that Chicago would probably outdraw Cherry Hill and I had a great hotel contract
to boot. Doyle seemed to understand, but suggested I write to NJSCF President
Joe Ippolito. I did so, explaining why I thought the Chicago area was the right
choice.
I heard nothing for awhile, but Stan
Booz made a post speculating that if the US Open went to Oak Brook, the hotel
might personally credit me for the business produced- in other words, the usual
suggestion, without evidence, of corruption. I feared that the Board might
disallow Oak Brook so when Bill Brock, expected to be the next ICA President,
inquired about the 2006 US Open, I told him that I was almost ready to sign for
Oak Brook, but we should look for another site as the Board had surprisingly
become involved and I couldn’t predict what would happen. Bill called a number
of hotels and found another good possibility, the Sheraton.
On Nov. 8, I received a final
contract from Hyatt Regency Oak Brook, all corrected and ready for signing.
However, I didn’t forward it to the Board, because the list of meeting rooms was
not in electronic form. I asked the hotel to send me an email with the list of
rooms so I could forward it to the Board.
This list did not arrive quickly, and
on Nov. 18, I received the contract from the Sheraton, with a $95 room rate- not
much worse than $89, but there was no commission for USCF. The location was
closer to a train station but that commission was probably a $10,000 or more
plus for the Hyatt, so I much preferred the Hyatt bid.
On Nov. 18, I also received an email
from Bill Brock supporting the two bids on behalf of ICA and saying that the
return of the US Open to the Chicago area was overdue.
On Nov. 20, I was shocked to receive
the following email (shown along with my reply to it) from Events Manager Diane
Reese, who was supposed to be working under me:
Subj: Re: US Chess Federation3
Date: 11/20/2004
To:
res1yb6k@verizon.net, lwdubeck@aol.com
CC: beatchess@aol.com, timothyhanke@comcast.net, stephenshutt@yahoo.com, bradyfm@msn.com,
chessdon, Randy.Bauer@iowa.gov, elizabethshaughnessy@hotmail.com, Chessoffice
In a message dated 11/20/2004 5:47:35 PM Eastern Standard Time, res1yb6k@verizon.net
writes:
Subj: US Chess Federation3
Date: 11/20/2004 5:47:35 PM Eastern Standard Time
From: res1yb6k@verizon.net
To: lwdubeck@aol.com
CC: Chessoffice@aol.com, beatchess@aol.com
File: USChessFederation31.doc (697856 bytes) DL Time (31200 bps): <6 minutes
Sent from the Internet
Hello Leroy,
I have attached the contract for the Cherry Hill Hilton for the 2006 US Open.
>>I can't imagine why, as you know that I have been working on a Chicago
>>area bid
which is far better for USCF. It is also much too soon to think
>>about repeating
Cherry Hill which had the Open in 2002. And the Midwest
>>has had only one US Open
since 1994.
I feel this is a good contract, with appropriate space and considerations.
>>A $115 room rate is a good contract!? You must be kidding. The US Open
>>has never
had a three digit hotel rate, and having to pay so much for an event
>>of many
nights will hurt attendance.
I have also copied Bill for his signature, and Beatriz.
Please note the hotel is holding the space until Nov 30.
>>I will forward bids from two Chicago area hotels to the Board on Monday,
>>along
with my intended choice. In addition to satisfying our long established
>>principle of US Open geographic rotation, both bids offer lower room rates
>>than
Cherry Hill, as well as requiring fewer room nights to avoid rent. Of
>>course, the Board can always overrule me, but in the absence of a Board vote
>>to do this, I will not sign this Cherry Hill contract.
>>Bill
Thank you, diane
Please let me know if you have any questions.....
Please note the one change I made at the last minute to the contract is the
addition of the word "office"in part of the Crystal Room (same location as last
time)
Diane J. Reese
National Event Director
Even with a normal US Open room rate,
Cherry Hill would have been unacceptable based on geographic rotation, but
$115!? I had no idea the Cherry Hill hotel was that expensive. No US Open has
ever had a rate in three digits; $115 would be a dramatic surge upwards, quite
costly to the players for a lengthy event. Also, Cherry Hill offered no
commission to USCF, room tax in Cherry Hill was almost double that of Oak Brook,
and more room nights were required (1215 vs. 1040) to avoid meeting room rent.
I was determined not to sign the Cherry Hill contract unless ordered to do so by
the Board, and though Beatriz could usually get four votes out of them for
anything, I wondered if they would pass something so clearly against the
interests of USCF and its members. But Beatriz and the campaign manager for her
“slate,” Leroy Dubeck, started making arguments to attempt to win Board
approval.
Dubeck pointed out that the $115 rate was lower than the $129 rate at the
Supernationals in Nashville. True, I responded, but the kids only stay a few
nights, they often stay 3-4 in a room, and there are no inexpensive hotels with
the facilities for an event that size. Click here
for other Dubeck arguments.
Then Beatriz joined in with an even
sillier argument:
"I have not seeing a bid from Chicago,
although I am familiar with the hotel in which Bill Goichberg is proposing to
host this tournament. Years ago, Al Losoff organized a K-12 in this location, I
remember the two of us tossing around different ideas for solving the problem
with space. I completely agree that the space is not appropriate for this event
which includes our annual convention."
To which I replied:
"Yes, it must have been quite a
problem for that 1200 player event. However, the US Open does not draw anywhere
near that number of players, nor does it have as many spectators (parents and
coaches)."
Finally, when I forwarded the email
from Bill Brock and Beatriz realized that the ICA strongly supported having the
event in the Chicago area, Beatriz gave in, saying USCF “should not be in
between two state associations” and allowing me to make the decision.
There was one final blast from the
“slate,” however. Here is an email from Elizabeth Shaughnessy, shown along with
my response.
Subj: Re: 2006 U.S. Open
Date: 11/22/2004
To:
elizabethshaughnessy@hotmail.com, Beatchess@aol.com, timothyhanke@comcast.net,
stephenshutt@yahoo.com, bradyfm@msn.com, Chessdon@aol.com, Randy.Bauer@iowa.gov
In a message dated 11/22/2004 6:42:45 PM Eastern Standard Time,
elizabethshaughnessy@hotmail.com writes:
Subj: Re: 2006 U.S. Open
Date: 11/22/2004 6:42:45 PM Eastern Standard Time
From: elizabethshaughnessy@hotmail.com
To: Beatchess@aol.com, Chessoffice@aol.com, timothyhanke@comcast.net,
stephenshutt@yahoo.com, bradyfm@msn.com, Chessdon@aol.com, Randy.Bauer@iowa.gov
Sent from the Internet
Dear board,
We are all busy. I hate to be testy, but I really have heard enough about
the bids for the 2006 US Open.
There are two things I hope for in the future:
1. The President and the CEO work together in harmony for the good of the
organization.
2. That we never again have to deal with the "just another two weeks"
syndrome. We have a bid from New Jersey. We do not have a bid from Chicago.
>> Elizabeth, it might be better not to jump to conclusions when you don't
>> have
the facts.
>> The bid from the Hyatt Oak Brook arrived in the office Nov. 8. The bid from
>>the Sheraton Arlington Heights arrived Nov. 18. The bid from Cherry Hill
>>arrived Nov. 20.
>>Why did I not forward the Oak Brook bid to the Board? Because part of it was
>>a letter and not an email, so I asked them to put it all in email form so it
would
>>be easier to forward. The Sheraton bid was quite recent and I just haven't
found
>>time to do much with the bids lately, other than conducting a
debate with Leroy
>>Dubeck that should not have been necessary.
Oh, but it is coming and what's more I have lobbied the Illinous Chess
Association President to lobby the USCF board even though there is as yet no
bid.
>> The suggestion that I had to lobby anyone in Illinois is outrageous. Everyone
I
>> have spoken to in ICA is very enthusiastic about having the US Open in
Chicago
>>and this idea was unanimously approved at an ICA meeting in June, as I
have
>>stated (but you apparently choose to ignore).
>> Note that the email from Bill Brock was written two days before I received
the
>>very surprising Cherry Hill contract.
Reminds me of Crossville v wherever. Let's hire a ED in January who
does not play politics to get his/her way.
>> Who is playing politics?
>> The ED has awarded national tournaments for about ten years.
>> The Board discussed contracts this spring and told the ED that no Board
>>approval was needed for tournament award contracts.
>> The ED properly worked on this one for eight months, coordinating with the
ICA.
>> Suddenly, the Events Manager who is supposed to be under the ED, and who
>>knows the ED has put a lot of effort into a Chicago US Open, draws up a New
>>Jersey contract with a much higher hotel rate, more room nights required to
avoid
>>rent, and in an unprecedented fashion, in the same city that had
the tournament four
>>years before the date in question. This is done with no
discussion with or notice to
>>the ED. When the ED complains, the Events manager
says she was led to believe
>>Cherry Hill had Board approval.
>>The ED says, wait a minute, I've been working on Chicago for a long time and
we
>>have two very good possibilities, both better than Cherry Hill. Then a
Board
>>member who has yet to see these bids says the ED is playing politics!?
>>There may be some politics being played here, but as you will see when you
receive
>>details of the bids, it's not Chicago which needs any political
activity to appear to be
>>the correct choice.
>>Bill
Elizabeth
Click here for more emails relating to the placement of the 2006 US Open.
Nothing further (like an apology) from Elizabeth after the above.
Stan Booz, Again
In Dec 2004, Stan Booz, co-chair of
the Finance Committee, posted his latest round of attacks on Erik Anderson,
President of America's Foundation For Chess, which saves USCF $100,000 per year
by running the US Championship. Booz accused Anderson of having his wife
on the AF4C payroll. Even if true, so what, if she does her job? But
the truth is, Michelle Anderson of AF4C is not related to Erik Anderson.
Booz also called Anderson "just
another trough feeder," language common on the chess newsgroup and indicating
someone who is active in USCF affairs solely to make money at USCF's expense.
 |
"Parrthenon" <parrthe...@cs.com> wrote in message
news:20041206124250.00289.00001444@mb-m17.news.cs.com...
> As usual, though, Mr. Bauer is harping on the armpit
defense. He refuses
> to
> address the real issues (my two red flags). Nor does he
condemn Stan
> Booz's
> defamation of Erik Anderson, a multimillionaire who raised a
record
> $255,000
> for the recent U.S. Championship in San Diego.
How did I defame him? By stating the facts? The thing speaks for
itself. He
is just
another trough feeder.
|
In December and January, Booz also
implied that Ken Thomas and I are "crooks," charged that a provision in USCF's
building sale that our lawyers approved of was "a fraudulent financial
transaction" (see post), and falsely posted that
an Executive Board candidate's wife cheated a department store out of $4000.
See also
Booz exchange with Susan Polgar, above.
It's incredible that this Board majority has such low ethical standards that
they allow this sort of person to continue to represent USCF as co-chair of an
important committee!
Reckless Public Attacks OK, says Board Majority
At a Jan 23, 2005 Board conference
call, Don Schultz made the long overdue motion to remove Stan Booz from the
Finance Committee. Here is what happened, according to the Executive Board
Newsletter:
EB 05-32 (Schultz): Move to
remove Stan Booz as a member of the Finance Committee.
No Vote Taken
Amend EB 05-32 Randy Bauer
introduced an amendment to change it to read remove: "as a member of the Finance
Committee" and replace it by "Co-chair of the Finance Committee."
EB 05-32 (Schultz):
Move to remove Stan Booz as Co-chair of the Finance Committee Failed 5-2
In Favor: Schultz and Bauer; Opposed Marinello, Shutt, Hanke, Brady and
Shaughnessy.
Tim Hanke then made the following
substitute motion for EB 05-32.
EB 05-33 (Hanke): The
EB will send a letter to Stan Booz asking him to cease and desist from personal
attacks on the Internet.
Passed 3-1-3 In Favor: Bauer,
Brady and Schultz; Opposed: Shaughnessy; Abstaining: Marinello, Shutt and Hanke.
After further discussion, Randy
Bauer introduced the following motion:
EB 05-34 (Bauer):
Move to reconsider EB 05-33. Passed 5-2 In Favor: Marinello, Shutt,
Hanke, Bauer and Shaughnessy; Opposed: Brady and Schultz.
The motion to reconsider EB 05-33
passed and after discussion EB 05-33 was again voted upon.
EB 05-33 (Hanke):
Reconsidered: The EB will send a letter to Stan Booz asking him to cease and
desist from personal attacks on the Internet. Failed 3-3-1 In Favor:
Schultz, Brady and Bauer; Opposed: Marinello, Hanke and Shaughnessy;
Abstaining: Shutt.
Beatriz Marinello said she changed
her vote and voted against the motion because it was specifically aimed at an
individual and not consistent with other instances of abuse on the Internet
where the Board failed to act.
EB 05-35 (Shutt): The
Executive Board condemns the personal attacks over the Internet against
Executive Board members, committee members, and staff.
Passed 5-1-1 In Favor:
Marinello, Shutt, Schultz, Shaughnessy and Bauer; Opposed: Brady; Abstained:
Hanke.
Frank Brady said he voted against
the motion because it was not specific enough and he felt specific condemnation
of Stan Booz was called for.
What do we learn from the above
circus? Apparently:
Bauer thinks that a person who makes
irresponsible and vulgar public attacks and posts false information is fit to
serve on the Finance Committee, but not to be a Chair.
Marinello, Shutt, Hanke and
Shaughnessy see no problem with such a person being a Chair of the Finance
Committee.
Bauer supports sending a letter to
this person asking him to cease his attacks, while Marinello, Hanke and
Shaughnessy oppose even this mild step, and Shutt has no opinion.
Marinello opposes sending a letter
asking that such inappropriate behavior stop, because the Board has not done
this to others who have abused the internet. She totally misses the point
that unlike these other posters, Booz is a Board appointee who represents USCF!
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