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Title News - January/ February, 2004

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January/ February, 2004 - Volume 83 Number 1

2003-2004 ALTA® Financial Report

Once again, ALTA® has had a very successful year. In 2003, ALTA® accomplished many goals in the areas of Government Affairs, Education, Membership, and Public Relations, all the while increasing revenues and maintaining expenses within budgeted limits. A brief synopsis of our financial picture for 2003 and a look at the approved 2004 budget follows.

Year In Review

The 2003 operating budget anticipated that ALTA® would need to draw $247,000 out of reserves in order to meet planned obligations. However, at the time of this writing, ALTA® anticipated ending 2003 with a Net Operating Income of approximately $710,000. It should be noted, however, that approximately $610,000 of the net income is directly related to the ongoing Public Relations Campaign and is earmarked for 2004 Public Relations expenses. The remaining $100,000 of additional net income is a result of increased membership, above average advertising and sponsorship revenue, and a very successful Tech Forum and Annual Convention.

Riding the wave of a very healthy housing market and a tightening insurance market, ALTA® has experienced strong membership growth in 2003. That growth has resulted in a dues revenue increase of more than 12% over last year. Also experiencing positive influences from the housing market and the overall improving economy were ALTA®'s Advertising and Sponsorship programs. Advertising revenue had experienced diminishing returns over the last few years, but 2003 brought the return of vendors looking to promote their organizations through advertisements on ALTA®'s Web site and in Title News magazine. Additionally, through the use of new and inventive sponsorship programs, ALTA®'s Meetings Department was able to provide increased sponsorship opportunities to members and vendors alike. The result was a significant increase in sponsorship revenue over 2002. ALTA® also had an extremely successful Tech Forum and Annual Convention in 2003. Combined revenue from the two meetings was more than $860,000 with the net income expected to top $130,000.

With relatively few exceptions, expenses for 2003 have been in line with budgeted estimates and are expected to end the year within 2% of projections. The association's Reserve Asset fund also faired better in 2003 as the stock market began to reverse its losing trend. The fund's assets at the end of the third quarter were approximately $3,784,000, compared to $3,391,000 at the end of the third quarter 2002.

Management's continued focus on reducing costs and using technology to improve productivity has proved effective in leading ALTA® toward a financially sound and minimally profitable organization in 2003. The final financial hurdle for 2003 will actually take place in January of 2004, when ALTA®'s financial records will be audited by the accounting firm of Johnson Lambert & Company (JL&Co). JL&Co. has audited ALTA® for the last two years and has special expertise in the area of non-profit auditing.

A Look Ahead

ALTA®'s financial outlook continues to be positive as we move into 2004. The approved 2004 budget anticipates revenues exceeding expenses, resulting in a net operating income of $112,751. Exhibit 1 is the approved 2004 Income and Expense Budget. Exhibit 2 represents the percentage of revenue and expense sources as they relate to the overall 2004 budget.

In addition to its normal operations in government affairs, education, product services, and meetings in 2004, ALTA® will increase its efforts to promote the title industry through the ongoing Public Relations Campaign. While some exciting marketing products were developed in 2003, the next phase of the PR Campaign will bring about an even greater financial commitment. Campaign advertisements in National Mortgage News, REALTOR®, Mortgage Banking, and Origination News magazines, and planned banner advertisements on will cost ALTA® in excess of $600,000 in 2004. As the campaign develops significant additional costs are anticipated. Your continued contributions to the campaign will ensure adequate funds are available to keep the campaign moving.

Members can rest assured that their commitment to ALTA® will continue to provide the funding necessary to conduct outstanding educational programming, provide quality products and services, and retain the leadership necessary to promote the industry and its interests in 2004 and beyond.

If you have any questions or would like additional information about ALTA®'s financial operations, please feel free to contact me at the contact information below.

Mark E. Hernick is ALTA®'s director of finance and administration. He can be reached at 1-800-787-2582 or

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American Land Title Association
1800 M Street, NW, Suite 300S
Washington, D.C. 20036-5828
P. 202.296.3671 F. 202.223.5843
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