Page 16 - MFM August 2017
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The Business of the Fraternity  Part 2

                                      Bruce Lahti, Grand Treasurer

     In my previous article, I discussed how Grand Lodge  events and Lodge maintenance projects.  This will
    and the Montana Masonic Foundation are set up and  give you an idea of the funds you will need to expend
    how they operate.  In this article, I’d like to discuss  in the upcoming year.
    some best practices for a Masonic Lodge.
                                                        Then you need to figure out how you will pay for
     It may be easy to believe that since your Lodge is a  those expenses.  Primary, of course, is Lodge dues.
    small organization that taking care of Lodge finances  If  your  Lodge  participates  in  the  Pre-Paid  Life
    is a simple task.  However, done right, it may be a  Membership fund, you should estimate receipts from
    little more complex than you may believe.          that.  Please bear in mind that interest earnings from
                                                       that fund continue to dwindle in today’s low-interest
     First, it’s important to note that the Lodge officers  market.  You would then add in earnings from any
    are  fiduciaries  and  have  a  fiduciary  duty  to  the  other Lodge investments.  If expenses exceed these
    members.   A  short  definition  of  a  fiduciary  is: An  amounts you will need to do one of two things- spend
    individual  in  whom  another  has  placed  the  utmost  less or raise funds.
    trust and confidence to manage and protect property
    or money. It is a relationship wherein one person has  If  the  Lodge  has  a  large  investment  fund,  the
    an obligation to act for another’s benefit.  When you  temptation may be there to utilize a portion of the
    think about taking care of Lodge assets, you are taking  principal funds from that source.  My recommendation
    care of assets that don’t belong to any individual, but  is to avoid that temptation.  Utilizing the principal of
    rather the members of the Lodge; the past, present,  investment assets is a death spiral.  Each time you
    and future.  Therefore being responsible for the assets  invade  principal,  future  earnings  erode.   As  future
    of the Lodge is not something to be taken lightly.  earnings  go  down,  there  is  a  temptation  to  further
                                                       invade the principal.
     In  the  most  simple  terms,  Lodge  officers  should
    strive  to  leave  the  Lodge  in  as  financially  sound  Another issue that faces many Lodges today is an
    a  position  as  when  they  assumed  office,  if  not  outdated  building.    Generally,  the  older  buildings
    better.  I recognize that this can be a daunting task  need  constant  repair.    In  addition,  there  are  often
    in  some  Lodges  that  are  suffering  for  members  or  issues with buildings that require a substantial outlay
    participation.  There are some tools that can assist  such as roofs, boilers/HVAC, plumbing or flooring.
    officers with this responsibility.                 It  is  important  to  recognize  that  these  issues  will
                                                       occur and budget a “sinking fund” allowance to take
     An  effective  tool  to  maintain  fiscal  responsibility  care of these potential issues.  To do that, the Lodge
    is  a  budget.    I’ve  learned  that  many  Lodges  don’t  with its own building should include an amount in
    bother with a budget as they assume their finances  its annual budget that it will set aside from current
    are  so  meager  that  budgeting  is  a  waste  of  time.   earnings to create and increase a repair fund.  This
    However,  a  budget  gives  you  a  roadmap  on  how  is the same for Lodges that participate in a building
    to preserve assets, take the Lodge from one year to  corporation  with  other  Masonic  entities.    If  that
    the next and is an opportunity for upcoming Lodge  building corporation is not charging enough rent to
    officers to learn the finances of the Lodge.  Even the  establish  a  building  repair  fund,  it  will  still  come
    simplest budget can assist officers in understanding  back  to  the  Lodge  when  one  of  those  catastrophic
    the lodge’s financial needs.  I’ve long believed that  events occurs.
    if you don’t know where you’re going, it matters not
    which road you take.  Failure to adopt a budget can  Another  issue  often  overlooked  by  Lodges  is
    leave a Lodge floundering throughout the year.     insurance.    Grand  Lodge  carries  limited  liability
                                                       insurance  on  Lodge  activities,  but  it  is  up  to  the
     You should start with what you know are existing  Lodges to actually insure their property for damage
    expenses that need to be met.  After that, determine  and  carry  liability  insurance  on  the  premises.    In
    an  expense  budget  for  any  programs  you  wish  to  order  for  Grand  Lodge  insurance  to  cover  any
    accomplish.  This could include community charitable  liability  from  an  injury  occurring  to  a  member  or
    efforts, Bikes for Books, required observances, social  guest  on  the  property,  the  insurance  requires  that
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