July ends in rare AMO budget deficit

July 2021 ended in a rare operating budget deficit for AMO members.

This shortfall was linked directly to a drop in AMO membership dues and initiation fee receipts - our principal sources of operating revenue - which declined by $37,000 and $14,000, respectively.

The balance due from yearlong lagging initiation fees was $2.7 million.

Legal expenses linked directly to the long-awaited end of internal impeachment proceedings and to persistent issues generated by American Steamship Co., a Great Lakes employer of AMO engineers and mates, were also principal factors.

Travel expenses tied to contract negotiations at AMO headquarters and in Washington and to recruiting at the U.S. Merchant Marine Academy in Kings Point, New York, and at the six state-operated maritime academies, contributed to the one-month deficit as well.

In sum, operating expenses totaled $999,306 in July, while the deficit totaled $130,966 - the worst monthly results since 2014. Deficits began declining in May 2015, with only a few months closing short since then.

Bob Rice, the new AMO Secretary-Treasurer since August 1, is developing ways to encourage timely payment of dues by all deep-sea, Great Lakes and inland waters AMO members and applicants for membership uniformly, identifying and correcting procedural flaws left unchecked for nearly seven years.

AMO Director of Business Administration Thom Heaton noted a 2021 year-to-date operating budget surplus of $503,000 and is projecting a year-end surplus of between $300,000 and $400,000.

Cash reserve and investment account balances totaled $15,950,170 as of July 31 - "a continuing record for AMO," Heaton said. These accounts were not tapped to meet payroll or routine expenses such as utility bills - a practice that ended January 1, 2015.

AMO is in its seventh consecutive year without a membership dues increase or an increase in the initiation fee, including the January 2015 rollback of a dues increase set in the fourth quarter of 2014. AMO membership dues and initiation fees remain the lowest among the three U.S. merchant marine officers' unions.