You Solve It -- A likely Bankruptcy Scenario

[David CO]

On 8/27/2020 at 6:16 PM, Cburkhardt said:

 Let's have some fun with this to lighten our spirits and understand that there will be a future for Scouting after the bankruptcy and COVID have run their courses.  

Are you starting to regret your suggestion that we have some fun with this?

Edited August 29, 2020 by David CO
typo

[David CO]

(continued)

The conservative scout division comes out with a new uniform neckerchief.  The loose ends of the new neckers reach all the way down to the beltline, somewhat reminiscent of Donald Trump's unusually lengthy neck ties.  The liberal scout division totally abandons the neckerchief (after BLM decries them as a racist homage to lynching).  

The neckerchief becomes the symbolic focal point of the on-going battle between the conservative and liberal divisions of BSA.  Eventually, the term "necker" comes to be used as a pejorative against all conservatives, with strong connotations of racism.

Edited August 29, 2020 by David CO

[InquisitiveScouter]

Those who want to separate Scouting from the BSA migrate to a grass-roots, no-professionals-needed program.  They use the original BP materials,

http://www.thedump.scoutscan.com/yarns00-28.pdf

and leverage modern information-based tools to wiki their knowledge together on how to run a successful program.  They run locally autonomous Scouting programs out of their churches, schools, and civic organizations, which provide them spaces to meet. They camp at local, county, state, national parks and do outdoors activities accordingly. They use commercial off-the-shelf (and cheaper) clothing for "uniforms".  They use the Congressional Award for Youth as their replacement for Eagle Scout.

https://www.congressionalaward.org/

None of the other accouterments.

Aren't the Scout Promise and the Scout Law enough?

 

[ParkMan]

5 hours ago, Cburkhardt said:

A national liquidation might result in 50-60 surviving large councils of focused functionality continuing forward, with a small licensing organization becoming the new “national”.  Essentially, Scouting would have BSA councils in metropolitan areas (often operating a camp) and a limited number of small councils would exist outside those areas because of unique circumstances.  Most small councils would no longer be capable of owning a camp and very few would conduct summer camp due to insurance reasons.  The surviving councils would continue to serve their geographies, and the unserved areas outside those geographies would allow units there to license directly with the “new” BSA.  There would be vast portions of the US outside the metropolitan areas without volunteer or professional Scouters above the unit level.  A number of local and unaffiliated clubs continue to engage in local camping activities and include only adults and youth who ascribe to the social, religious or other philosophical views of those clubs.

 

I would assume that if the new organization of large councils could control the licensing, they could in essence all become mega councils.  I would gather that during liquidation all current council agreements become void and the existing councils would in turn have no ability to license program materials from the new BSA until new agreements are made.

Hypothetically, say that my council survived but did not join in with the 45 others and did not obtain licensing rights.  We then effectively become a regional camping club for kids with no relationship to the new national.  Could I as an individual simply then start a new council in that geography and purchase the licensing rights?  Or more likely, doesn't the large council that licenses from the new national simply then contact every district and ask them to become part of that council?  District volunteers and units have no particular reason that they couldn't simply jump ship and help reorganize in that territory for the new council.

Would this not effectively trigger a mass council re-organization?  It would be messy for a few months, but I sense that the big councils would quickly redraw the map so that they are not fighting with each other for territory.

So in your case, doesn't Big City council simply take over all the other territories?

Edited August 29, 2020 by ParkMan
clarified a thought

[Cburkhardt]

Parkman:  Great points, all.

My second potential outcome was designed to show how a new BSA organization could fairly easily emerge even if there was a national liquidation (which I don’t predict will occur).  The dynamic is that the resource-abundant geographies will be able to move forward.  The surviving entities that would lead the movement in those areas would be the ones that have the best financial, property management and volunteer leadership resources.  Smaller councils will only survive if they have some unique attribute that allows them to continue.  The best will pal in with the larger councils.  The remaining geographies will either offer Scouting on a unit basis through a licensing arrangement with one of the continuing councils or directly with he “new” national.  
 

As for the areas that might not initially be in a council geography, I think a licensing agreement could probably be arranged fairly easily.  The cost would be minimal compared to current fees because the “non-council” troops would obtain their insurance elsewhere.  The mega councils will be very picky about what geographies they include in the council, because they will not want to incorporate vast tracts of unsupervised YPT risk in the council insurance pools.  The bankruptcy will have made the BSA the most abuse-secure youth program anywhere, because post-Bankruptcy YPT incidents on the part of any youth serving organization will spell the end of those organizations.

Someone on this site probably knows the history of how Scouting first spread across the country.  I seem to recall reading that groups of individuals could petition the BSA to organize a territory if they met certain standards.  Seems to me that the formally-unserved territories could organize where there is sufficient support.

[Cburkhardt]

How would ownership of properties be handled?  Under any of these potential outcomes, it would seem wise to separate ownership and management of properties from the councils in order to protect the assets from future suits.  Under the hypothetical, I might suggest that a separate property organization be formed to own Big City Scout Reservation and the training center.  Between the investment bankers from the former Rich Folks council and the members of the former council camping committees of predecessor councils, there would be plenty of talent to get that done.  It would be best to establish the new corporation and make the property transfers as soon as the bankruptcy is over.  A benefit is that the new entity could probably do a better job of figuring out how to generate some Private sector cash income for off-season property use.

[Cburkhardt]

How would the national liquidation potential outcome affect rural units in small towns?

The unit leaders and youth participants probably would not feel much difference, except their registration fees would plummet.  They would have on-line access to all program materials and the licensor would sell recognition items directly to them.  These items would also cost less, as the licensor would only seek to break-even on its program research and development efforts.  There would be no volunteer or professional structure above the unit level in these geographies.  The chartered organization concept would not function outside of council territories, because the BSA would not supervise or service these units in any traditional way.  Liability insurance would be arranged locally — probably through the church or other organization where the unit is allowed to meet.

These units could attend summer camp at any council property with excess capacity to serve them.  They would need to pay an insurance surcharge in order to cover the week of summer camp.  Some units would choose to run their own week of camp nearby.

[ParkMan]

47 minutes ago, Cburkhardt said:

How would ownership of properties be handled?  Under any of these potential outcomes, it would seem wise to separate ownership and management of properties from the councils in order to protect the assets from future suits.  Under the hypothetical, I might suggest that a separate property organization be formed to own Big City Scout Reservation and the training center.  Between the investment bankers from the former Rich Folks council and the members of the former council camping committees of predecessor councils, there would be plenty of talent to get that done.  It would be best to establish the new corporation and make the property transfers as soon as the bankruptcy is over.  A benefit is that the new entity could probably do a better job of figuring out how to generate some Private sector cash income for off-season property use.

Interesting that you posted about that. I was thinking about the same after my prior post and the right structure for longer term ownership of camping resources.  Legally separate "Friends Of" organizations might make a lot of sense here.
 

19 minutes ago, Cburkhardt said:

How would the national liquidation potential outcome affect rural units in small towns?

The unit leaders and youth participants probably would not feel much difference, except their registration fees would plummet.  They would have on-line access to all program materials and the licensor would sell recognition items directly to them.  These items would also cost less, as the licensor would only seek to break-even on its program research and development efforts.  There would be no volunteer or professional structure above the unit level in these geographies.  The chartered organization concept would not function outside of council territories, because the BSA would not supervise or service these units in any traditional way.  Liability insurance would be arranged locally — probably through the church or other organization where the unit is allowed to meet.

These units could attend summer camp at any council property with excess capacity to serve them.  They would need to pay an insurance surcharge in order to cover the week of summer camp.  Some units would choose to run their own week of camp nearby.

One of the differences I see here is that initially there will be a much smaller professional structure at the national level.

I wonder if we will see the same at the local level.  If we start removing fundraising and membership drives, the district executives role becomes smaller.  I wonder if we'll see a very small number of professionals per council going forward and a greater reliance on infrastructure.

 

 

[Cburkhardt]

National Staff Reductions.  Great questions.  Under both possible outcomes I posted, the national staff reductions are near-total.  If there were a liquidation, “national” could essentially be a program research, development, supply and licensing service unit owned and operated by the larger go-forward councils.  That might mean 15-20 program development staffers and a similar amount of supply division staff (most of that would be contracted out).  Under those outcomes there is no national field staff.  The mega councils are on their own to do as they please and for practical reasons don’t report to anyone.  
 

I posted these two outcomes to show that even under liquidation, the BSA can very much continue as a healthy, meaningful organization in firm control of our future.  I will soon post a non-liquidation outcome that I think is more likely to occur.

[walk in the woods]

11 hours ago, Cburkhardt said:

How would ownership of properties be handled?  Under any of these potential outcomes, it would seem wise to separate ownership and management of properties from the councils in order to protect the assets from future suits.  Under the hypothetical, I might suggest that a separate property organization be formed to own Big City Scout Reservation and the training center.  Between the investment bankers from the former Rich Folks council and the members of the former council camping committees of predecessor councils, there would be plenty of talent to get that done.  It would be best to establish the new corporation and make the property transfers as soon as the bankruptcy is over.  A benefit is that the new entity could probably do a better job of figuring out how to generate some Private sector cash income for off-season property use.

This would be interesting in that a separate management company would have no incentive to service only Scouts BSA units during the summer.  Nor would there be an incentive to focus on Merit Badge work.  They wouldn't be bound by BSA camp standards or the G2SS.  They might cater to Scouts BSA units for a year or two but that wouldn't last long.

[Cburkhardt]

Good point WIW.  The councils would have to transfer properties with extensive trust conditions to prioritize Scouting uses.  I think of the summer camp programs as being operated by council camping program committees and the land/facility management companies as focused on maintenance and off-season uses to build maintenance-specific endowments.  Council executive boards don’t typically have the bandwidth to focus on generating revenues that way.  One result is maintenance backlog.  Another is allowing the camps to become financial burdens when they could generate revenues.

[Cburkhardt]

The Continuing exposure of the properties to lawsuits is a huge issue as well.  Bankruptcy will force us to close and sell some properties.    Local councils will do their best to keep our best properties.  After the bankruptcy is over the tort lawyers are not going to lose interest in BSA assets.  Post-bankruptcy suits will continue.  Every time someone has a complaint against the Bsa for just about anything, a suit will be filed in an attempt to liquidate our remaining assets.  Smart councils will not wait for those suits to be filed, because it will be too late at that point.

[DuctTape]

Moving forward post bankruptcy I can envision all remaining camps being moved into "corporations" , separate from councils legally and functionally. 

[RememberSchiff]

20 minutes ago, DuctTape said:

Moving forward post bankruptcy I can envision all remaining camps being moved into "corporations" , separate from councils legally and functionally. 

Our "council" camp is in fact not owned by council, just managed. A wise decision done years ago not because of lawsuits but for fear council would sell it.  I expect our camp will become a totally separate business. Now whether the camp will run summer camp itself or contract with a scout council is a good question.  I suspect the former.

Edited August 30, 2020 by RememberSchiff

[David CO]

(continued)

Big City Council sells its camp to the Big City River Band of the Miami Tribe.  It gains federal recognition as a Indian reservation.  This gives it significant liability protection from bottom-feeding lawyers.  It not only survives, it doubles in size after buying the neighboring boy scout camp, the Gerard Bored Scout Reservation, named after the most boring president the country ever had, at trait that continued for decades at his namesake scout facility, which totally focused on advancement and merit badges.

The new Indian Reservation/Scout Reservation restores all of the outrageously exciting and politically incorrect activities that BSA had outlawed years earlier.  Mothers weep at the very thought of sending their precious little boys there.  The boys badger their fathers into letting them go. 

The camp successfully fights off every new lawsuit claiming sovereign immunity.   A few boys do get hurt, and some parents do complain about their sons coming home from camp with full-body sun tans, but the camp is wildly successful.  Most boys feel that it is a small price to pay for having such a great, exciting, and authentic scouting experience.

Edited August 30, 2020 by David CO