Dear AHA Member,
Our Association has confronted several issues head on lately with the promise of providing an Association that is more responsive to you, our members. In this message, I want to review for you the results of our Board of Directors meeting in August, which included an updating of our Business Deployment Plan (BDP), discussion on proposed changes with our Sweepstakes Program, and a presentation about our AHA Information Technology system. I also want to tell you about our upcoming Sport Horse Nationals, our first-ever Trail Ride, our 2005 Convention, and several outreach efforts.


Our August meeting of the Board saw a report from various chairs about the progress of the BDP. To refresh your thinking, the BDP is the "blueprint" we are using to build our Association, or "house," to your specifications. Outside the board meeting room we positioned a large BDP chart, complete with deadlines and symbols that indicated whether or not the particular plan is on target. With few exceptions, we are moving forward with the BDP, and for the first time in our history, we have actual measurements that you, our stakeholders, can follow. Please check on our AHA website, ArabianHorses.org to monitor the progress of the various committees working in our four cornerstone areas: Breed Growth, Organizational/Efficiency, Financial Stability and Communications. This is a new process for us, and it represents change, but change is what I promised you. We are now more visibly accountable to you, which should give you a renewed sense of ownership in your organization.



The financial report given to the Board indicated "promising results." Our net operating income for the first quarter was just over $45,000. This time last year, we had a loss of $249,000 in the same time period. Revenues at the operating income level were $309,000 higher than first quarter last year with several areas making up the increase: Registry Services were up due to the amnesty program; magazine revenues are up; Sweepstakes and Futurity revenues are up, primarily due to interest income; Partner Marketing is up in sponsorships; membership revenue is up, despite a slight dip in numbers; awards revenue is up due to a price increase while expenses were down in this area. Net income from services and programs was $178,000. It was also pointed out that we are "trimmer and leaner" in staff, with a savings in salaries and benefits of $78,000 for the first quarter. Employees are down to 62, compared to 69 a year ago. For the first time ever, prior to the meeting, Directors were sent a cover letter from AHA Controller Jon Barnickel, telling them what areas had changed in numbers, why they had changed, why certain areas were up and why others were down. This cover summary letter proved valuable to both the Executive Committee and to the Board, and enabled all of us to zero in on areas of importance and grasp more quickly the reasons for financial fluctuations. Jon, together with our Treasurer Frank Galovic, is making great strides in reporting to us the financial situation of our organization in a more understandable, businesslike manner.



Prior to my election as President I promised we would research the Sweepstakes program and change it. I am keeping that promise to you. I believe that a new, revamped Sweepstakes program is the key to moving our breed and Association forward, restoring confidence in the program and the Association, and bringing new breeders on board and getting back the great many we have lost. We are an Association that must be responsive to all of our breeders and exhibitors, not just those who target the national and regional levels of showing. There have been a lot of opinions, questions and discussions by various people. Some of these may or may not be accurate. Whenever you question what the facts are, and/or what I have said, I encourage you to read what I have publicly documented on the AHA website or refer to the e-mail I sent to you.



The Sweepstakes issue is a controversial one and I want to let you know the facts as well as my opinion. Contrary to what some people have been told or have believed in the past, the Sweepstakes Trustees are the AHA Board of Directors. The Trustees do have final authority over the Sweepstakes program. The Sweepstakes program should have been changed prior to this; the facts of the matter are the fund is in jeopardy if nothing is done. I explained to the Board that I believe we must stay focused on the target, as we do not have much time. We only have one bullet left and it is vital we hit the bull's-eye. My concern is that if we miss the mark, we have lost a chance at re-energizing our Arabian breed. Another fact is the Sweepstakes Commission has worked hard, and I have been very supportive of the Commission. They were told no more band-aid approaches; it needs surgery. The Commission came back with a proposal that the Trustees felt had portions with a lot of merit but there were portions that the Trustees felt would not stimulate breedings, transfers or encourage participation in the Sweepstakes program. By Board motion, the Sweepstakes Commission has been directed to present an outline of their recommended changes to the Board by September 8, with a final draft to be presented to the Board by October 7.



Some may think this has become an all-important issue to me. To that, I plead guilty and I will tell you why. I have watched the dwindling numbers over the years, watched the downward spiral and continually challenged AHA leadership to stop the decline. Did you know that in 1994 we had 7,452 breeders; in 1999, we had 5,969 breeders of purebred Arabians, compared to 3,241 breeders in 2004. What a significant decline; it has to tell us a very basic message: we are failing to provide a program which offers incentives for people to breed.

I would like to share my opinion and analogies. My first analogy is this: Why do you think casinos are so successful? If all of you that receive this e-mail had a quarter, all of you could put it into a slot machine and pull the handle; sure you may not win but the facts of the matter are everyone has an equal chance to participate. Now let me give you another scenario: all of you give me a quarter, but only a small portion can play, if you can not play how many more quarters will you give? I think this describes the decline in participation of the Sweepstakes program. I would like to see every Sweepstakes horse have a chance to win, not just at the nationals or regionals. Please do not misunderstand me; I believe we should continue to award our very best athletes in the Arabian industry at our regional and national shows with added money. We have to concentrate on the target, one that is going to encourage you to breed, register and help you market your horse. We all breed for National Champions but the facts of the matter are very few are born. However, there are a lot of nice horses born that will not win the nationals or regionals that are Sweepstakes horses. What value does Sweepstakes add to a horse that will not compete at nationals or regionals. Only 7.8 percent of horses shown at our shows exhibit at the nationals. What are we doing for those who do not show at this level? I believe if every Sweepstakes horse is eligible to win money at every level and the stallion owner and the mare owner receive a return on their investment, people will participate in the program.



I believe we should pay out by the point system. Points are cash. If you show your Sweepstakes horse and earn points, at the end of the year AHA will send you a check. This system does several things: It encourages the sale of Sweepstakes horses, encourages the breeding of Sweepstakes horses, and encourages participation at the local show level where we as an industry need the most help. Plus an added benefit to the mare and stallion owner is that they will receive a portion of all point money that is earned for the rest of the life of the horse. Who wins? We all win….breeders, exhibitors, our breed and the Association will be winners! The details of this program are the responsibility of the Sweepstakes Commission. I do believe that in 2006 there will be a revolutionary program that encourages participation by every breeder.



One concern I hear voiced when I travel to various events is "why do new computers cost so much money?" Remember last Summer, we heard a report from an independent consultant that our Information Technology system needed improvements to the tune of $700,000. At the August meeting, IT Director Bob Huff told the Executive Committee and Directors that it will take between $2 million to $3 million to bring our system up to today's level of sophistication. The figures were based on bids we received. Bob told the Board that we have to redevelop a new database and redesign all systems. It is not merely about new hardware; the problem goes beyond that. We've merged two associations, each with IT systems that were less than perfect and not very compatible, and we are trying to get by with using bailing wire to hold them together. Bob emphasized to the Board that this is an issue we are going to have to deal with sooner or later. I realize the need is there, and I believe the Board does also. It is imperative we consider return on investment and what we can afford to do and not do. The Executive Committee and the Board did not commit to an annual expenditure for IT. They did approve spending $175,000 this year, which we do have in our budget and which will go toward development of the new system architecture and the development of the new membership program, the Arabian Community Shows and web registration. The Board has requested that a comprehensive set of funding options be developed for discussions at the November 2005 Board meeting.



As most of you are aware, there has been considerable national media attention focused on FEMA Director Michael Brown, who was formerly our Judges & Stewards Commissioner. In many instances, the references to Mr. Brown and his association with AHA have been less than accurate. We had many media inquires also. This week, our Association issued a news release to the media, clarifying his employment with us and what his title and job responsibilities were while employed with us. You can find that news release on our website under news releases. If any of you are contacted by the media concerning Mr. Brown, please refer them to Barbara Burck or to me.



I realize that at times, I get more detailed than many of you might want as I share with you how our organization is changing and improving. This is your organization, and I feel you have a need and a right to know. Indeed, we do have some bright spots coming up and I am pleased to report them to you.

First off, I am looking forward to traveling to Lexington, Virginia in September for our third annual Sport Horse Nationals. This will be my first visit, and I am really excited about going to the original site of the Sport Horse Nationals. It is interesting to note that we have 550 horses entered, which is 100 more than budgeted and anticipated. This year for the first time, we have Sport Horse Driving classes. To give you an idea of how welcome this is, note that we have 22 entered for one class, and 18 for another. This is great and speaks well for the need our Association has seen and responded to. We need to give ourselves a pat on the back as well as those who support and exhibit at the Sport Horse Nationals. New this year is the "Celebration of Arabian Sport Horse," a full day on Saturday focusing on education and entertainment.

I had the opportunity to adjudicate at the Youth Nationals this Summer. What a great time our youth had! It was a unique experience for me to see the energy, vitality, and competency that our youth displayed. Standing in center ring made me realize that I was viewing exhibitors who will be the foundation of our breed for years to come. We have to strive to improve our Association and breed if we are to keep them involved. This show brought back memories of my children that competed at Youth Nationals; my daughters are now 22, 24 and 28 years old. Experiencing this show, made me realize even more the importance of what we are all about.

I must admit that I never thought that I would have the opportunity to meet the Prime Minister of Canada, but I did during the Canadian Nationals. It was a great honor to meet and spend some time with Prime Minister Paul Martin, the Minister of Finance and the Minister of Agriculture. Obviously security was very tight, however, there was an opportunity to watch some of the show, tour part of the facility and a have one-on-one conversation with the Prime Minister and his wife. I feel it is important for AHA to have recognition around the world if we are to be the leading horse association. I also met with the facility directors and city officials to solidify our working relationships as well as to discuss some exciting new multi-million dollar improvements to the facility that will be a direct benefit to AHA. The Canadian National, with its friendly atmosphere coupled with the professional leadership of the Canadian Nationals Show Commission, was a bright spot for me. I thank all of those who extended their friendship to me. I really appreciated being there!

Just as I thought I would never meet the Canadian Prime Minister, I never thought I would be going on an AHA 1st Annual "fun" trail ride in Nebraska. This ride, which is sold out, is a first. In my travels this Summer, I have encountered folks who tell me they are going on the ride, and how excited they are about going. I will let you know of my experiences this Fall. We plan to do more of these in the future.

The Arabian Horse Association is going to be visible this Fall. Through our Marketing/Development and Promotion initiatives our breed and Association will have increased visibility this Fall. We will have a booth presence and Arabian breed demo at the newest Equine Affaire being held September 16, 17 and 18 in Louisville, Kentucky. It is anticipated that 75,000 people will go through the event, offering us plenty of opportunities to present our Association and breed. Following this event in Louisville, the national convention for the Future Farmers of America holds their annual convention. Last year, 54,000 youth descended upon the Exposition Center with colleges, universities, and various breeds vying for their interests. We will have a booth at the three-day event. In both events, we are partnering with Region 14. Kudos goes to the Kentucky Arabian Horse Association which is offering a $2,000 scholarship to youth at the FFA Convention.

Our Annual Convention is coming up in November. From early reports on the number of resolutions coming forth, it appears that we will have 25 or fewer resolutions to consider. Remember, this year's Convention will be shortened by a day, so timing is going to be an important issue. Note, that at 6 p.m. on Wednesday, November 16th we will have an open session for resolution proponents and opponents to discuss the resolutions.

An important part of my role as President is to maintain relationships with the various groups we interact with. I am pleased to be invited again to a meeting of the Purebred Arabian Trust that will be held in San Diego. I attended their meetings in Florida and Atlanta earlier this year and was welcomed and warmly received by members of the Trust. I look forward to attending their Fall meeting. I also attended the "Think Tank" in Arizona graciously hosted by Bazy Tankersly. These meetings provide me the opportunity to interact with various groups and members who are leaders in our Arabian community. I appreciate the opportunity for such interactions.



We have some weighty issues on our plate right now and are confronting some major changes within our organization. In order to improve our Information Technology, we have to improve our financial situation, which is always a challenge. In order to stimulate breed growth and the marketability of our horses, we have to improve our Sweepstakes program. I sense that there is a growing team spirit and realization that we have to pull together in order to change the direction of our breed and organization. It is difficult making adjustments and forging new paths; however, with your support we can do it! Our BDP is working as efficiently as it was designed to do. We are making progress. When we gather in Ft. Worth for our Annual Convention, I am sure we can take pride in looking back at what we have accomplished this year. Let's stay the course. I am looking forward to seeing all of those attending Convention. I continue to have an open door policy so feel free to contact me to address any concerns or issues you might have. If I cannot answer your question, I will either get the answer or forward it to someone who can answer it. I may not respond immediately because I do get a tremendous amount of e-mail and I am out of town frequently. Also, keep in mind there is the chance I never received it. Communication is vital and it is my top priority to keep you informed.

In closing I would like to send my thoughts and prayers to those affected by the devastating hurricane. I know there are efforts to help the many horses and horse owners who have been tragically affected. I am sure any help you can offer will be greatly appreciated. We must open our hearts and homes to those in need. Relief information sites can be found on the AHA web site.


Thank you and God Bless!