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President's Message: Dues Talk

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NEVADA LAWYER
EDITORIAL BOARD Patricia D. Cafferata, Chair scott McKenna Michael t. saunders, Chair-elect Gregory R. shannon Richard D. Williamson, Vice Chair stephen F. smith Mark a. Hinueber, immediate Past Chair Beau sterling erin Barnett Kristen e. simmons Hon. Robert J. Johnston scott G. Wasserman Lisa Wong Lackland John Zimmerman BOARD OF GOVERNORS President: Frank Flaherty, Carson City President Elect: alan Lefebvre, Las Vegas Vice President: elana Graham Immediate Past President: Constance akridge, Las Vegas Paola armeni, Las Vegas elizabeth Brickfield, Las Vegas Laurence Digesti, Reno eric Dobberstein, Las Vegas Vernon (Gene) Leverty, Reno Paul Matteoni, Reno ann Morgan, Reno Richard Pocker, Las Vegas Bryan scott, Las Vegas Richard scotti, Las Vegas Mason simons, elko Hon. David Wall (Ret.), Las Vegas ex-Officio interim Dean nancy Rapoport, UnLV Boyd school of Law Richard trachok, Chair Board of Bar examiners
Message from the President
Frank Flaherty, Esq., state Bar of nevada President
DUes taLK
“I will not make any broad promises to you on behalf of the board, beyond stating that we do not anticipate a dues increase within the next few years and that the board and staff will continue to work diligently to control costs and to be smart with your dues dollars.”
October always seems to be a good time to talk about money. At the last meeting of the Board of Governors (BOG), we spent some time discussing your licensing fees, typically referred to as “dues.” I am happy to report that the State Bar of Nevada is in good shape, fiscally and otherwise. Thus, the conversation was not about raising dues; rather, the discussion was about whether or not the BOG should recommend to the Nevada Supreme Court that your dues be decreased. This is a logical point for a recap of recent “dues history.” In 2006, bar dues were increased to $450 for active attorneys and $125 for inactive attorneys. For newer admittees – admitted less than five years – dues were increased to $250. Prior to 2006, bar dues had been at $350 since 1997. Prior to 1997, the dues were $250. At the time of the 2006 increase, the BOG promised the membership that dues would not be increased again for five years. Internally, at the bar, we refer to this as the “five-year dues cycle.” The board anticipated excess revenues generated in the early years of the dues cycle would primarily be set aside in the “designated dues fund” and spent in later years, when the bar’s expenses were projected to exceed revenue. The 2006 dues increase was necessary to cover increased expenses for our then-growing bar, which had seen membership increase from 5,756 in 1998 to 8,511 in 2006. As of 2012, it now has 10,264 members – a 78 percent increase since 1998. By comparison, total bar staff has increased by roughly 45 percent since 1998, and now has 45 full-time employees. There were additional reasons for increasing dues in 2006: to provide additional funding for the Clients’ Security Fund; to supplement the bar’s feebased “core functions,” namely admissions and continuing legal education; and to support pro bono by funding the Access to Justice Commission, whose director is one of the bar’s full-time employees. Also in 2006, the board anticipated the need for a new headquarters in southern Nevada and, thus, part of the increased dues revenue was committed to a “building fund” for the purchase of larger headquarters. 2010 was the last year of the five-year dues cycle, when the board expected to draw down the last of the designated dues fund to cover increased expenses. However, I am happy to further report the bar has ended the year with net revenue in every year of the dues cycle and beyond. We finished the
STATE BAR STAFF Executive Director: Kimberly K. Farmer Bar Counsel: David a. Clark Director of Finance & Information Systems: Marc Mersol Director of Admissions: Laura Meyers Gould Program Director: Lisa McGrane Asst. Director of CLE: stephanie Hirsch NEVADA LAWYER STAFF Publications Manager: Jennifer smith (jennifers@nvbar.org) Nevada Lawyer Coordinator: Melinda Catren (melindac@nvbar.org) Publications Specialist: Christina alberts (christinaa@nvbar.org) GRAPHIC DESIGN Georgina Corbalan
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Nevada Lawyer
October 2012
year with net revenue in 2011, and we are projected to finish this year with net revenue as well. Thus, to date, the board has not had to draw from the designated dues fund, which explains why our discussion in August was about a potential “reduction” in dues. After considering the issue carefully, the board decided not to recommend a dues reduction to the court. At this time, membership dues account for roughly 52 percent of state bar’s total revenue. The board reviewed a five-year projection based on admission trends. Admissions, which have generally trended upward, are expected to level off in 2015, to approximately 270 new admittees per year. Then, in 2016, our membership revenue will take another hit when 135 of you turn 70 and achieve dues-exempt status. No hard feelings; happy birthday. Thus, the net increase in membership dues dollars is projected to be only $27,450 per year by 2016. By comparison the net increase in membership dues from 2010 to 2011 was $86,739. The board was also informed by what I refer to as “The Alaska Experience.” In 2008 Alaska Bar Association (AKBA) dues were $550. The AKBA board decided to lower dues for a few years to reduce the “surplus” or “unappropriated capital” held by the bar. Accordingly, AKBA dues were lowered to $410 in 2008, and set to increase to $460 in 2009 and to $500 in 2010. However, when the time to look at dues for 2011 came around, AKBA was forced to increase dues beyond $500, beyond the $550 at which the AKBA started this exercise, all the way to $620! So what happened? Unfortunately for AKBA: “the best laid plans of mice and men….” You know the rest. As it turned out, in 2011 there were “budget stressors” and insufficient “unappropriated capital,” and AKBA had to cut expenses and increase dues to $620. But that bar’s tale of woe does not end there. In 2012, the unexpected struck – the state of Alaska declined to renew AKBA’s lease for its headquarters – and AKBA dues were increased to $660. It is reported that if AKBA dues had been left undisturbed in 2008, AKBA members would most likely be paying $550 today, and perhaps for several more years going forward. In the end, the BOG concluded that any potential temporary benefit you would receive from a reduction in dues was outweighed by the risk of the unexpected. And of course, there is the expected as well. The bar has been actively pursuing a larger facility for its southern Nevada headquarters and an additional part of the surplus in the dues designated fund has already been allocated to that purpose. Also, I am happy to say that, because of the surplus in the dues designated fund, the board may be in a position, if it so chooses, to purchase and build out that new facility with only modest financing, or perhaps none at all. This is my eighth year on the Board of Governors, and I can tell you that your board is vigilant when it comes to your dues dollars. I can also tell you that your entire bar staff, led by Executive Director Kim Farmer and Finance Director Marc Mersol, has worked diligently to reduce costs by examining alternatives and rethinking fundamental assumptions. In closing, taking a lesson from The Alaska Experience, I will not make any broad promises to you on behalf of the board, beyond stating that we do not anticipate a dues increase within the next few years and that the board and staff will continue to work diligently to control costs and to be smart with your dues dollars.
A Note From the Issue Editor
BY JuDGE ROBERT JOHNSTON
The weather isn’t the only thing changing in Nevada right now. Our state is saying goodbye to familiar faces on the federal bench and welcoming new ones. What better time to bring our members an issue that looks at both the history and the future of our federal courts? In this issue, you will meet two of our newest U.S. District Court Judges: Miranda Du and Gloria Navarro, who both bring their unique perspectives (as, in the first case, an immigrant and, in the second, a first-generation American), along with their intelligence and experience to their roles. Our readers will also find some sage advice from veterans of the bench; all three of Nevada’s Ninth Circuit judges share their tips to practitioners appearing in appellate court in an article by Paul Georgeson. Prof. Tuan Samahon’s article examines the “blue slip tradition” and whether or not the weight of that tradition is stripping power from the president when it comes to judicial appointments. In another article that illustrates change in Nevada’s courts, Margaret Foley takes a look at the increasing dependence the District of Nevada has on its senior judges. Finally, in this issue’s back story, Richard Pocker examines the important role of lawyer representatives in the District of Nevada. How is your CLE status for the year? If you don’t have all of those credits just yet, we have some good news. This issue contains an expanded list of the state bar’s CLE offerings for the rest of 2012. JUDGE ROBERT J. JOHNSTON has served as a U.S. Magistrate Judge since 1987, scheduled to retire in Dec. 2012. In 2010 he was reappointed to the Ninth Circuit Conference Executive Committee having previously served from 1996 to 1999, participating in organizing three circuit conferences. Additionally, he served on the Ninth Circuit Magistrate Judge Executive Board from 2003-06. Johnston served as a member of the Court Administration and Case Management Committee of the Judicial Conference of the United States Courts from 2004-2010. He is also a board member of the Nevada Judicial Historical Society and the Ninth Judicial Circuit Historical Society.
October 2012
Nevada Lawyer
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