Problem Solving Process

Problem Statement: Determine the best way for managing the windfall that has come to our Cemetery Association.

Facts:

The Association received a bequest of sufficient scope to require a decision on how the monies should be best managed in the long term.

The association is currently being managed by a President, Sextant, and two co treasurers. Three of these are in their mid sixties. The youngest member is not interested in being left alone, in the long term, to manage the association as it is presently configured.

While the Association is currently capable of managing its short term operations, a long term, more simplified fiscal vehicle will be needed in the future to simplify the management process .

Our enterprise is guided by the principle of first insuring the maintenance needs of the Cemetery Association, and second by a sense that monies in excess should be used to support the needs of the community.

The decision on which type of vehicle to adopt is a serious choice that merits the undertaking of a formal decision making process. The current board should show for the record that we considered, a broad of possibilities and did not enter into this decision without careful thought and deliberation.



Assumptions:

The present board will not face unexpected attrition in the time period required to implement the chosen vehicle.

There will not be an economic disaster of sufficient scope to collapse the government and economy.

The adopted vehicle will be able to operate with a minimal staff in a worst case scenario.

Courses of Action:

1. Keep present system in place.

2. Adopt a Foundation Model

3. Adopt an Investment Firm Model

4. Manage funds in house by buying conservative financial instruments.

Advantages and Disadvantages

Keep the Present System. Under the present system we have a 501c3 which makes us a non profit . This was set up with the realization that the old system, adequate for managing a net worth of under 20K was not going to suffice for an enterprise worth many times that amount. It seemed self evident at the time that this was the way to proceed, however, with this accomplished there were restrictions imposed on the disbursement of funds. The disadvantages were that this did not provide a long term solution to the attrition dilemma and did not allow for excess funds to be used for community actions.

Adopt a Foundation Model. In this choice we would dissolve our current 501c3 and turn over management of our resources to a Community Foundation. They would invest the assets and in return provide a legal binding contract to subsidize the Association on an annual basis for maintenance. An association member would serve on the board and influence policy on the expenditure of Foundation revenues.

Manage Funds In House: In this scheme the Cemetery Association would invest in conservative financial instruments such as CDs, Bonds and S&P 500 Companies and maintain a revenue generating portfolio which would be used for both cemetery maintenance and in the support of the community.