Prepared by Angela Cain, CEO & William Fulton, CFO

There are four primary reasons a dues increase is needed:  Increase in cost of doing business  Increase in member benefits and services  Decrease in dues revenue  Decrease in non-dues revenue

Since 2002 the purchasing power of the dues we collect has declined by 20.4%, yet programs for members have grown considerably.

According to Consumer Price Index/Purchase Power calculations*, annual state association dues that were set at $125 in 2002 have the same purchase power as $ in Source: *The cost in a particular year of a bundle of goods and services purchased by a typical consumer compared to the cost of that bundle of goods and services in a base period.

How Much Things Cost *National statistics available for 2008, not 2009

In the past 8 years, MAR has undertaken several new initiatives that impact how the association serves its members. These include a continuing series of printed and electronic publications, webinars, websites, standard forms and contract software, and improved member outreach and advocacy efforts devoted to improving members’ knowledge, skills, and business practices.

We are delivering great value for each dues dollar. Since the last dues increase, we have increased member programming by more than 50% while reducing staff size almost 36% and reducing operating expense by 4.5 %.

We are actually spending LESS than we did 8 years ago and giving our members MORE. In 2009, members get MORE for dues dollars than ever before…

Member Benefits

Did you know…  MAR dues = $125/member  MAR benefits & services*= $200.74/member *excluding Mississippi REALTOR® Institute

MAR Membership: Cost of Dues vs. Cost of Services -$ $75.74 Dues Payment Added Value

Past, Present & Future

Operating Income/Expense History

Then and Now

Income History

In the past, non-dues revenues, primarily from our real estate school, have made it possible to forego a dues increase. However, we simply can't, in the future, expect to raise sufficient non-dues revenue to fund the level of member benefits and services you’ve come to expect from this great association.

And we can’t solve our budget shortfalls forever by dipping into reserves.

Reserves History MAR used reserve funds for operations and capital expenditures Funds added to reserves ($90,000.00) 1999($120,000.00) 2000($200,000.00) 2001($150,000.00) 2003($67,000.00) Total withdrawals($627,000.00) 2004$115, $183, $175, $125, Total funds deposited$598, An association of this size and scope should have a minimum of 6 months of operating reserves ($715,000.00). Reserves fund balance as of 4/17/2009 was $659,

What is MAR doing to cut expenses?

Expense cuts made over past 4 years  Staff members decreased from 14 in 2002 to 9 in 2009  Recently laid off 10-year employee of association  No staff raises for 2009  Renegotiated multiple vendor contracts  Designated MAR building a smoke-free property and saved $2,000/year in employee health insurance  Changed paper weight/printing/marketing approaches and saved $41,500 annually  Changed member outreach strategy; utilizing more webinars/technology-based outreach – saved $6,000 annually  Reduced staff and leadership travel expenses – saved $3,000

What are other states doing?

What about other small states? State Membership in 2008 Projected membership in 2009 Actual Membership in 2009Dues Amounts 2010 Membership Projections % of Revenue from Dues Last Dues Increase Membership Size Maine9% decrease $ NA90%No4130 Rhode Island* 10% decrease 15% decrease $ % decrease 35%No4040 New Hampshire 8.5% decrease 5% decrease 9.8% decrease $ % decrease 70% Montana**Flat10% decrease 11% decrease $ % decrease 90% New Mexico9% decrease 8% decrease 17% decrease $ % decrease 85% Mississippi2% decrease 12% decrease 11% decrease $ % decrease 55% *Shares 50% of expenses with Statewide MLS, this keeps dues lower. 65% of revenue from continuing education (24 hours required every 2 years) **Annual 3% cost of living dues increase each year

Why increase dues now when our members are already struggling?

Now, more than ever, our members need help. And MAR should remain a viable resource in the challenging months and years to come.

Our financial challenges are long-term. To dismantle our reserves and/or cut back on key programs, benefits, and services now would be a shortsighted and short-term solution.

2010 Budget Projections  9% decrease in membership (budgeted 12% decrease in 2009)  7% decrease in education revenue  15% decrease in other revenue (advertising, sponsorships, exhibits, etc.)  5% decrease in expenses

Dues History  Previous State Association Dues Increase 1998: $60 to $85 – 41.7% increase  Last state Association Dues Increase 2002: $85 to $125 – 47.1% increase

Proposed 2010 dues increase scenarios:  Long-term solution: $3/month or $36/annual increase = 28.8% increase  Medium-term solution: $2.50/month or $30/annual increase = 24% increase  Short-term solution: $2.08/month or $25/annual increase = 20% increase

2010 Dues Increase Scenarios

“Living in the past has one thing in its favor – it’s cheaper.”

“The bitterness of poor quality lingers long after the sweetness of a cheap price is forgotten.”

“In any moment of decision, the best thing you can do is the right thing. The next best thing is the wrong thing and the worst thing you can do is nothing.”

A $3 a month investment in your state association is a $3 a month investment in your future business success. Vote YES.