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> USCF Executive Board Meeting, Sunday 5/22
>
> Here is my report on the second open session of the Executive Board
> Meeting, held 5/22 in Minneapolis from 3-5 PM.
>
> The meeting opened with Marinello, Schultz, Bauer and Shaughnessy in
> attendance. Steve Shutt arrived a few minutes later and Tim Hanke
> joined by telephone a little after that. Once again, there were a lot
> of numbers tossed around and, while I tried to copy them all down, I
> may have made errors.
>
> AWARDS
>
> Winners of the various awards to be handed out at the U.S. Open were
> announced. The usual suspects.
>
> SCHOLASTIC COUNCIL
>
> The results of an election for three open seats on the Council were
> announced. Two of the top three finishers are also candidates for the
> Executive Board; if either is elected he will be replaced on the
> Council by the next highest finisher. The top five:
> 1. Robert Tanner
> 2. Mike Nietman
> 3. Steve Shutt
> 4. Mikhail Korenman
> 5. John Haskell
>
> ANNOUNCEMENT
>
> Beatriz Marinello announced that her stint as office COO will end on
> May 31, 2005.
>
> CONTRACTS MOTION
>
> A subsitute motion for the one considered yesterday was read by Randy
> Bauer. For contracts of over $10,000 written approval of the USCF
> President must be obtained. Contracts of $30,000 or more will require
> approval of the full Executive Board. This policy will be published

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> every issue of Chess Life and on the USCF web site.
> PASSED 3-0-1, with Shutt and Hanke absent and Marinello abstaining.
>
> U.S. OPEN
>
> The workshop schedule for the U.S. Open was approved. There were only
> copies of this for the EB, so I don't know what was in it.
>
> CROSSVILLE BUILDING
>
> Elizabeth Shaughnessy reported. All of the architect's and engineer's
> drawings are done. Shaughnessy explained how some people got the

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> impression that a non-bidding contractor would be used, who is an
> associate of the architect. It is a normal pre-bid procedure
> to take the drawings to a single contractor, who will NOT be bidding

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> the job, for a preliminary cost estimate. Adjustments can then be

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> to the design if needed. Then the job is opened for 3-4 bids.
>
> The pre-bid estimate was quite high, for an unexpected reason. The
> building itself was not too costly but the plans for the surrounding
> land turned out to be expensive because of solid rock discovered only

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> few inches down, making digging difficult. Changes were made to the
> plans to reduce cost in this area. Planned parking spaces were cut

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> 33 to 24 and a few other steps were taken. This resulted in a savings
> of about $89,000 off the preliminary estimate.
>
> The final pre-bid estimate after the changes is $561,000. Shaughnessy
> reported that for a projest of this size, it is usual to allow for an
> overage of 5%. Bids will now be solicited from 3-4 Tennessee
> contractors. Ground breaking will be in August 2005 with the building
> expected to be complete in March or April of 2006.
>
> Steve Shutt proposed an EB motion, naming Elizabeth Shaughnessy the
> official EB liaison to the architect, with full authority to move the
> project forward.
> This PASSED 5-0-1, Shaughnessy abstaining.
>
> BANK LOANS
>
> Beatriz Marinello met with four Tennessee banks, resulting in written
> loan proposals from two of them. There were no copies of these
> documents for spectators, so what follows is based only on my notes,
> which may contain errors both of fact and of understanding.
>
> One bank offered a loan for the full cost of construction, the other
> set a cap of $500,000. The interest rate for either would be 5 or

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> I'm not sure which. As for a permanent loan or mortgage, both banks
> were offering a fixed rate of 7.25% for 15 years. They also offered
> some adjustable rate options, such as 3 years at 5.875% or 6%. There
> was also an offer of 5 years at 6.25%.
>
> One of the spectators was Joel Channing, who has extensive experience
> with loan arrangements of this type. He was asked to look at the
> documents and had some questions, such as whether there are any
> pre-payment penalties. It was agreed by the EB that Channing and

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> Bauer will call the banks together to clear up the uncertainties.
>
> BUDGET
>
> Some new facts emerged about this preliminary budget, which is due to
> be finalized by June 21st. As currently designed, the budget has a
> surplus of $630,000, not including any B+E revenue, which is being
> taken off budget. This was so astonishing that I raised my hand and
> asked if I had understood correctly. I had.
>
> Other items of interest:
>
> 1. The architect's fee will be $40,000.
> 2. The Publications Dept. will remain in New Windsor until the new
> building is ready. Estimated cost of that move is $10,000 but may be
> less, as the USCF has earned a free moving load from the company

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> handled the previous moving activity.
> 3. The renegotiation with Hanon Russell is continuing. No other

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> are available for public release.
>
> Eric Schiller then addressed the EB. He stated that he represented a
> number of authors, including all of those handled by Cardoza
> Publishing, plus John Watson, Danny Kopec, Arnold Denker, Raymond

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> etc. They jointly charge that Hanon Russell has excluded their books
> and other products from his inventory, for purely political reasons.

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> stated that attempts to contact Russell directly about this had been
> ignored. Schiller requested free advertising in Chess Life to help

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> up for lost sales. He threatened to organize a boycott of USCF sales

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> national tournaments if he didn't get satisfaction.
>
> The EB had questions, such as:
>
> 1. What if Russell states that it isn't politics, the books just

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> meet his standards as potential good sellers? Schiller replied that

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> can provide royalty records proving that the books in question are

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> sellers. Elizabeth Shaughnessy noted that she could confirm that
> Russell had not replied to a direct inquiry from Schiller.
>
> 2. Is there anything the EB can really do? Does it have the right to
> force inventory on Russell? Elizabeth Shaughnessy read aloud the
> applicable section of the agreement with Chess Cafe. I couldn't get

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> all down but it was something like this: "Chess Cafe shall accept
> input from USCF ... to provide satisfaction to USCF members." Exactly
> just what this means is not clear. Joel Channing suggested that USCF
> could use the renegotiation with Russell as leverage to get

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> on this issue but Beatriz Marinello was reluctant to take such an
> approach.
>
> The EB agreed to investigate and appointed Steve Shutt to handle it.
> Eric Schiller will submit a brief. No promises were made about Chess
> Life ads.
>
> That was the last item of substance. The EB adjourned shortly before

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> PM.
>
> One more time, I remind you that this is not an official report and
> thus may contain errors, both of fact and of interpretation.
>
> -- Hal Terrie