Board of Directors

1
Board of Directors

• Saturday
• February 11, 2006

2
CHAIR WELCOME
3
ACADEMY UPDATELt Gen John F. Regni, 73
Superintendent
4
CHAIR REMARKS
5
REVIEW OF MINUTES November 12, 2005
February 2, 2006 (Teleconference)
6
PRESIDENTS REPORT
7
Presidents Report

• CASE Awards
• Trends
• Action item updates

8
Council for Advancement and Support of Education
(CASE)

• CASE Awards the Association of Graduates
• Grand Gold
• Excellence in Photography/News/Editorial or
  Feature Photography To Hanoi and Back
• Gold
• Excellence in Advertising/Radio Commercial
  National Treasure
• Excellence in Advertising/Radio Commercial The
  Long Blue Line
• Silver
• Excellence in Advertising/Television Commercial
  Air Force Academy Just the Beginning
• Bronze
• Excellence in Multimedia/Website or Special
  Section Web Guy Notes
• Excellence in Advertising/ Television Commercial
  Just the Beginning
• Sweepstakes Runner-Up
• For Excellence in Educational Advancement/2nd
  Best Communications Department in the VI District
  (3000-5000 students)
• 21 CASE Awards won in Communications from
  2001-2005

9
990 Ending Net Assets
10
990 Revenue and Expense
11
Action Items

• ARC Email Addresses
• Register of Graduates
• Letters to Dick Schlosberg and Harry Pearce
• Communications Plan
• 2006 Graduate Leadership Conference

12
2006 Graduate Leadership Conference23-25 July
2006
13
Admin

• Conference Fee
• 50.00 (25.00 Classes 2001-2006)
• Lodging
• Rampart Lodge - Standard rooms plus DV Suites
• Local hotels rooms blocked through date TBD
• Transportation
• Off base and travel to/from Doolittle/Supts
  House POV
• Daily conference functions Academy bus

14
Schedule of Events (tentative)

• Sunday 23 July 2006
• Arrival and registration
• Monday 24 July 2006
• AM - Continental breakfast, Doolittle Hall
• AM - Welcome and Administrative Remarks
• AM - USAFA Senior Leaders
• Supt Update and Panel Discussions
• Lunch, Doolittle hall
• PM Cadet Panels plus choices
• Airmanship Programs
• Character Development Programs
• Global Engagement
• Evening Reception at the Supts House

15
Schedule of Events (tentative)

• Tuesday 25 July 2006
• AM Light Breakfast, Doolittle Hall
• AM Jacks Valley
• BCT Cadet Commander Welcome
• Obstacle Course, Assault Course, Leadership
  Reaction Course
• Lunch with basics
• PM Town Meeting, Doolittle Hall
• AOG update (questions and issues for discussion
  will be solicited pre-conference)
• Q A
• PM - Conclusion

16
Invitee Proposal

• Invite signed by Supt and AOG President/CEO prior
  to AOG-wide email invite
• Last year's participants
• General officers, class officers, alumni chapter
  officers, past AOG board members, graduate
  members of foundations, former wing commanders,
  Rhodes Scholars, Jabara winners, inputs (5-10)
  from class presidents/scribes, patron SS grads
  and above.
• Recommendations from AOG Board of Directors and
  USAFA
• Email invite to all AOG email database
• 200 max/on-line registration/class quotas

17
COMMITTEE REPORTS
18
Campaign Steering UpdateFebruary 11, 2006
19
Outline

• Progress through 12/31/05
• Highlights Trends Milestones
• Impact of Gifts
• 3rd and 4th Quarter Projections

20
Progress through 12/31/05
21
Progress through 12/31/05
22
Progress through 12/31/05
23
Highlights Trends Milestones

• 25.83 million in campaign
• 6.83 million in 2005/06 equal to entire 2004/05
  FY
• 11,879 donors 45,593 gifts
• 27 donors giving 100,000 or more
• 72 donors giving 25,000 or more
• 112 donors giving 10,000 or more (69 of all
  contributions)

24
Highlights Trends Milestones- contd -

• Received 4 gifts of 1 million during quarter
  (5 previously)
• Secured first-ever charitable remainder trust
  (revocable)
• Class Giving
• 03 743,000
• 04 849,000
• 05 1,006,000
• 06 1,310,000 (6 months)
• Annual Fund down year-to-date
• 2005 raised 10.3 million (350 increase in 4
  years)

25
Impact of Gifts

• Memorial Pavilion
• Warrior Remembrance Fund
• Learning Centered Environment
• Much, Much More

26
3rd and 4th Quarter Projections

• March 31, 2006 25 - 27 Million
• June 30, 2006 28.5 Million
• Roll-out of Campaign
• Increased Volunteer Involvement
• Increased Planned Giving
• Memorial Pavilion Wreath Laying

27
Campaign Steering Objectives
?y 12/1/05

• Provide leadership to development program
• Continued progress on Building Leaders of
  Character for the Nation campaign
• Continue to build a culture of philanthropy at
  the Air Force Academy
• Increase overall cash flow to AOG

28
Memorial Pavilion/Columbarium/Directory Building
February 2006
Wayne Bees Kellenbence Director, Alumni
Programs and Special Projects
29
Project Timeline
30
Project Timeline (Construction)
Key Event Start Scheduled Completion Actual
Completion 65 Design Completed
09/30/05 09/30/05
09/30/05 Construction Documents Finalized (90)
11/03/05 02/02/06
01/05/06 Permitting and review by AOG/AFA
01/03/06 02/06/06
02/07/06 Final
Comments into Drawings
02/02/06 03/22/06
On Track Final Estimate and Bidding
02/21/06 03/20/06 GMP
Value Engineering (if reqd)
03/21/06 04/03/06
Finalize Contract w/AOG
01/30/06 04/03/06 On
Track Subcontracts Award
04/04/06 04/18/06 Submittals
Shop Drawings 04/17/06
06/26/06 Material
Fabrications 11/14/05
11/18/05 11/18/05
04/27/06 09/25/06
Groundbreaking 05/12/06
05/12/06 Project Closeouts
04/04/07
05/31/07 Commissioning
04/04/07 04/24/07 Punch Lists
04/11/07
04/24/07 Final Acceptance
04/24/07 04/24/07 Transfer of
Property 05/11/07
05/31/07 Dedication
05/28/07 05/28/07
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Project Timeline (AOG/USAFA)
Key Event Start Scheduled Completion Actual
Completion Validate/Update DD 1391
10/03/05 11/14/05
11/02/05 Prepare Gift Offer
11/15/05
11/21/05 11/18/05 SHPO
Coordination 11/01/05
11/21/05 01/09/06 Documentation
for Air Staff 11/22/05
12/14/05 01/19/06
Air Staff Gift Acceptance
12/15/05 03/14/06
On Track! Congressional Notification
03/15/06 03/28/06 Right of
Entry Prep/Received
03/29/06 05/10/06
32
Finance Investment UpdateFebruary 11, 2006
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SUMMARY

• First Quarter Financial Results
• Investment Income
• Contributions
• Uncollectible debt
• Investment Portfolio
• Performance
• Asset Allocation change
• Accounting System Update

34
Six Months Ended December 31, 2005 Plan vs.
Actual(accrual basis)
35
Income Good News

• Investments produced a total return of 2.8 or
  415,000 in the 2nd quarter 206,000 above budget
  (7.4, or 1,080,000, 663,000 above budget YTD).
  Total return was .9 better than the weighted
  benchmark and nearly all sectors performed better
  than their respective benchmarks.
• Fundraising is 1.8 million ahead of Plan for the
  quarter (2.2 million YTD). The fourth quarter
  included three major restricted gifts totaling
  3.5 million. While the budget for the full year
  anticipated that the cultivation efforts underway
  since the Campaign began would produce strong
  contributions, the results for the December
  quarter are well beyond our initial expectations.
• Dues income is ahead of Plan by 10,000 for the
  quarter (84,000 YTD). This is due to
  conservative budgeting of the contribution from
  life memberships
• Other income is 52,000 ahead of Plan for the
  quarter (106,000 YTD.) Merchandise sales were
  strong in December, contributing 23,000 more
  than planned and fees associated with higher than
  planned participation in alumni events
  contributed 33,000 more than planned. In
  addition, advertising revenue was 16,000 higher
  than Plan because the Plan did not provide for a
  printed register.

36
Expenses More Good News

• Membership expenses are above Plan because of
  unplanned levels of participation at events, most
  notable the tailgate at the Air Force/Navy game
  that was sponsored by the AOG. Much of the
  additional expense was offset by higher revenue
  (in the Other Revenue Category )
• USAFA support below Plan by 192,000. This is a
  timing difference. As of 31 January, 2006, we
  had paid an additional 50,000 to the Academy,
  and we had made gift offers of 230,000 that have
  not yet been accepted.
• Both Management and General and Fundraising
  expenses continue to be below Plan. This is a
  carryover of the staff related savings from the
  first quarter. In the first week of January, we
  hired 4 new staff members, and we are currently
  in the process of closing the hiring process for
  two other vacant positions.
• Uncollectible Debt is the only bad news. We
  added 212,000 for uncollectible debt. Two
  significant factors were at play here. The
  budget was overly optimistic, and we had higher
  than anticipated losses in the Annual Fund,
  though they are lower than the prior year.

37
Investment Rate of Return
38
Investment Portfolio Fund Changes

• In January we added 1.7 million to the
  Investment Portfolio, generally from cash
  contributions in received in December.
• In January, we shifted 2.9 million from the
  Vanguard Bond Fund to PIMCO Total Return
  Institutional Shares.
• The Finance and Investment Committee approved a
  reduction of the Bond allocation to 10 (from
  21) and increase the Hedge Fund allocation to
  31.

39
Investments Asset Allocation(Proposed Change)
40
Accounting System Review

• USNA Visit Financial Edge Demonstration
• Preliminary Phone discussion with Blackbaud
• Blackbaud scheduled to visit on February 16th to
  provide a tailored demonstration
• Expect price quote in the next two weeks for
  software, training, and installation support
• Currently evaluating hardware needs and costs

41
Audit
42
APPOINTMENT OF CHAIR

• Board Chair recommended Mike Christy
• Approved by Board, email vote 6 Feb 06

43
Independent Auditors Report

• Audit completed by BiggsKofford
• on 29 September 2005
• Unqualified report
• IRS Form 990 completed and filed
• Management Letter w/recommendation

44
Graduate Dependent Scholarship
45
2006 GDS Committee Members

• Vic Andrews 66
• Scott Dennis 79
• Lisa Mazur 85
• Don Williams 83

46
Graduate Dependent ScholarshipAs of February 11,
2006

• Objectives
• Award merit-based scholarships to member
  graduates children for college
• Identify and orient new committee members
• Action Plans
• Solicit and identify volunteers (1 board member,
  3 non-board members)
• Orient committee members with objectives,
  process, etc.
• Evaluate and make selections for May announcement
• Results Expected and Measurements
• Quantitative assessments to select at least 10
  students for award
• Schedule
• Jan 06 Confirm committee member composition
• Feb 06 Provide greater detail on assessment
  criteria and process
• Mar-Apr 06 Make assessments of students
  application packages
• May 06 Finalize scholarship selections and
  announce winners
• Jun-Sep 06 Staff makes formal presentations,
  publishes in Checkpoints
• Budget Requirements
• 10k for scholarships plus photocopy and FedEx
  costs

47
Governance
48
Strategic Planning CommitteeFebruary 11, 2006
49
BRC Vision

• BRC Mission

Strategic Plan 2002-2008 Goals
Strategic Communications Plan
STRATEGIC GOALS

• Organization
• Staff
• Committees

50
-DRAFT-STRATEGIC PLANNING GOAL2006-2011

• Successfully complete capital campaign to support
  the Academy by year
• Grow to number of members by 2011
• Promote interest among graduates in the Academy,
  its mission and its heritage
• Provide programs and services to support graduate
  members
• Maintain a strong, enduring, cooperative
  relationship with the Academy

51
COMMITTEES

• PERMANENT STANDING
• Governance
• Alumni Relations
• Humanitarian Fund
• Graduate Dependent Scholarship
• Distinguished Graduate
• Heritage Tradition

• STATUTORY
• Audit
• Financial
• Nominating

AD HOC Compensation Campaign Steering Strategic
Planning
52
COMMITTEES

• PERMANENT
• STANDING
• Governance
• Alumni Relations
• Humanitarian Fund
• Graduate Dependent Scholarship
• Distinguished Graduate
• Heritage Tradition

• STATUTORY
• Audit
• Financial
• Nominating

AD HOC Compensation Campaign Steering Strategic
Planning
53
Alumni Relations
54
AOG Survey

• Objective To Survey the AOG community to
  understand what our membership values, what they
  dont value, and what they would value
• Action Plans Ready to sign contract and execute
• Results Expected and Measurements Survey
  Results will provide priorities/strategy vectors
  for AOG
• Schedule
• Budget Requirements Well within Budget
  allocation

55
Transition to Electronic Register

• Objective to provide an electronic register
  that is more capable than current paper and
  supports strategic requirement for robust
  e-community
• Action Plan Transition work in progress
  technically, end state unclear. No implementation
  plan yet (politically)
• Results/Measurements Need definition of End
  State
• Schedule Transition after CY06, but need to
  understand survey results/electronic end state as
  well
• Budget G for CY06, TBD for beyond.

56
Electronic Communications

• Two Near Term Objectives
• Ensure comprehensive capability to support
  electronic register
• Action Plan Supportable technically but need to
  know end state
• Results/Measures No definition of end state
• Schedule Supportable Technically but need to
  know end state
• Budget Requirements No extra budget identified
  due to technical necessity at this time

57
Electronic Communications

• Provide quality e-community to enable AOG
  strategic objectives
• Action Plan Requires definition of end state
  per strategy requirements, survey, etc.
• Results/Measurements TBD
• Schedule on track to implement flexible website
  capability
• Budget TBD based on end state, survey, etc.

58
Life Membership at Graduation

• Objective
• Maximize grad membership and participation
• Continue/Increase Parent Revenue Stream
• Class of 10
• Application mailed to appointees (USNA model)
• No In-processing solicitation
• Long Term
• Clearly define LMAG objectives
• Evaluate Class of 10 response (cadets and
  parents)
• Adjust offering for Class of 11 and beyond
• Investigate family/parent plans to increase
  revenue and cadet support

59
Strategic Vision for Alumni Relations
60
Vision/Mission Statement Components

• To provide strategic direction for enabling
  capabilities that enhance a robust graduate
  e-community
• To develop a culture of giving back to USAFA
  and the graduate community at large
• To provide strategic direction for enabling
  outreach for support of both USAFA and the AOG

61
STAKEHOLDERS

• Academy graduates
• USAFA
• AOG Directors and Staff
• Air Force

62
Strategic Objectives and Measures

• To provide a robust community for
  sustained/event-driven alumni support
• Percentage of registered members
• Prompt/response percentage
• Customer service response rate/speed
• Market share of budget for alumni relations vs.
  other events
• To leverage the community for the purposes of
  revenue generation
• Revenue generation dollars vs. source of
  solicitation
• To provide opportunities to garner support of the
  USAFA and AOG vision
• Number of committed volunteers per outreach
  opportunity

63
Draft Strategy for Alumni Relations Committee

• Sustained Alumni Support
• Two-way communication
• Snail mail
• Electron communication/e-mail
• Web page
• Push timely fresh info
• News
• Board business
• Cadet culture
• Web chat/board
• Polls (non-official)/solicit for feedback
• Membership business
• Access/privacy
• Virtual capabilities vs. snail mail

64
Draft Strategy for Alumni Relations Committee
contd

• Membership benefits
• Register
• Active duty specific needs
• Members vs. non-members
• Academy access
• Life membership program
• Networking infrastructure (virtual)
• Headhunting opportunities
• AF career support/mentoring
• National organization structure
• Chapters
• Class structure

65
Draft Strategy for Alumni Relations Committee
contd

• Event driven alumni support
• Reunions
• Multiple classes vs. resources
• GLC/Class Senate
• Election/Governance
• Communication methods

66
Draft Strategy for Alumni Relations Committee
contd

• Revenue generation
• Sabre Society
• Campaign
• Merchandise
• Dues/recruiting
• Parents (to recruit and be recruited)
• Cadets
• Message

67
Draft Strategy for Alumni Relations Committee
contd

• Support for the AOG and/or USAFA (other than
  fundraising)
• Outreach opportunities (face to face)
• Distinguished alumni
• AOG Board/staff
• USAFA leadership
• Parents
• Volunteerism
• Character development center/honor reps

68
Nominating CommitteeReport
February 11, 2006
69
Nominating Committee

• Al Rogers 64 Director, Chair
• Gil Mook 67 Director
• John Moore 78 Director
• Vacant Director
• Dave MacGhee 70 Non-Director
• Vic Thuotte 73 Non-Director
• Rob Mishev 99 Non Director

2
70
Overview

• Open session
• Proposed change for Requirements for Directors
• Policies Procedures and Recruiting updates
• 2006/7 Nomination Planning Schedule
• Strategic Planning Summary
• Nominate a candidate for AOG Board Director
• Executive Session (closed for discussion)
• Discuss Nominating Committee Vacancy
• Board Transition Planning
• Summary

3
71
Recommend Change to Requirements of AOG
Directors on AOG Website

• Para 3 (today)
• Financially support the AOG and the Academy
  consistent with his or her ability through
  individual and/or class gifts, and be willing to
  assist in donor cultivation and solicitation
• Para 3 (Proposed)
• Financially support the AOG and the Academy
  consistent with his or her ability through
  individual and/or class gifts, and be willing, as
  appropriate, to assist in donor cultivation and
  solicitation.

4
72
Nomination Policies and Procedures on AOG
Website

• Updated Key Data for 2007 cycle
• Nomination packages must be received by 1 Aug 06
• Nomination petitions must be received by 1 Aug 06
• Additional Admin clarifications

5
73
Recruiting Resources

• Class Senate (if BRC amended Bylaws are approved)
• Class officers
• Chapter Presidents
• AOG Board Directors
• AOG Committee Chairs
• AOG Web Site
• Checkpoints
• Nominating Committee

6
74
Planning Schedule CY2006
As of 2/11/06
Calendar Year 2006 Nominating Committee Timeline
7
75
Planning Schedule CY2007
As of 2/11/06
Calendar Year 2007 Nominating Committee Timeline
8
76
Objectives
AOG Strategic Plan Nominating Committee

• Identify individuals qualified to become AOG
  Board Directors consistent with the Bylaws and
  Board Guidance provided by the Chair
• Recommend to the Board Director candidates for
  election and/or appointment in accordance with
  the election schedule and for unplanned openings
• Insure the Nominating Committee supports the AOG
  Bylaws, governance model, and Board Chair guidance

9
77
Action Plan Nominating Administration
10
78
Action Plan Information Management
11
79
Action Plan Recruiting Candidate Support
12
80
Action Plan Election Administration
13
81
Results Expected Measurements
14
82
Schedule
15
83
Budget Requirements
16
84
Nomination of a New Director

• Bill Maywhort has submitted his resignation as a
  Director
• Chair requested Nominating Committee to explore
  combined 3rd Co Chair Campaign Steering Committee
  and AOG Board Director
• Nominating Committee worked in consultation with
  Dick Schlosberg and Harry Pearce current
  Co-Chairs of Campaign Steering Committee

17
85
EXECUTIVE SESSION
18
86

• Director vacancy on Nominating Committee due to
  Bill Maywhorts departure
• Recommend waiting until results of BRC Amended By
  laws vote and then proceed with filling IAW
  selected Bylaws

21
87
AOG Board Approved Transition Approach
If BRC Amended Bylaws are approved

• Within 45 days of the certification of the
  election results by the AOG Secretary, the Board
  shall approve and publish a transition plan
• Estimate by approximately 25 June 2006
• Within 90 days after the certification of the
  election results by the AOG Secretary or 1 July
  2006, whichever is later, the Board shall consist
  of not more than 17 elected or appointed
  Directors
• Estimate 1 July 2007
• Full implementation of the Board size and
  composition, consistent with the Bylaws, will be
  complete not later than 1 July 2007
• Board size may be 13 or 15, yet to be determined

22
88
AOG Board Guidance Feb 2005

• Nominating Committee Al Rogers 64, Committee
  Chair, reported that five board members are up
  for reappointment  Bill Boisture 67, Charles
  Garcia 83, Ted Legasey 67, Gil Mook 67   and
  Amber OGrady 96.   The five members were
  excused and the Board unanimously approved their
  reappointment in accordance with the plan for an
  orderly transition to the new governance model. 
  Three of the reappointed members must resign in
  2007 to allow for election of three additional
  at-large members.   General Yates will be leaving
  the board this summer and the committee
  recommends General Ed Eberhart 68 for
  appointment.  The board unanimously approved the
  recommendation.  

23
89
AOG Board Transition Planning
24
90
Transition Planning

• Guiding Principles
• Bylaws compliance
• AOG best interest
• Experience
• Diversity
• Commitment
• Personal considerations

• BOARD

• COMMITTEES

• Nominating Committee
• Elected Director-Chair
• Director
• 5 Non-Directors

25
91
Summary(If BRC Amended Bylaws Pass)

• May 2006 Board Meeting
• Election results
• Transition plan update NC (5 to 2 appointed
  terms committee transition)
• Nominating Committee new composition initiate
  NC
• Board guidance to NC for 2007 election chair
• June 2006
• Advertise/Interview candidates for non-director
  NC-NC
• Approve transition plan on or before
  approximately 25 June
• July 2006
• Board at 17 on July 1, 2006
• Present 2 non-directors candidates for board
  approval - NC

26
92
Summary contd (If BRC Amended Bylaws Pass)

• August 2006
• 1 August deadline for 2007 nomination packages
  and petition candidates
• August October 2006
• Interview candidates for 2007 slate
• November 2006 Board Meeting
• Present slate for Board approval

27
93
NEW BUSINESS
94
USNA Governance Model
95
Board Operating Procedures
96
Board Meeting Schedule

• May 12-13, 2006
• August 11-12, 2006
• November TBD, 2006
• February 9-10, 2007
• May 11-12, 2007
• August 10-11, 2007
• November TBD, 2007
• February 8-9, 2008

97
Adjournment
98
EXECUTIVE SESSION