I propose a vote for $150 per month for MRO over the next six months.
What’s an MRO and what can you make with it?
MRO is an acronym for Maintenance, Pepair, and Operations. Kind of like a greatly expanded “office expense” category for a lot more than just an office.
Why do we need it?
We have been buying things like furnace filters, paper towels, markers and pencils and other things out of the wandens budget. That doesn’t sound like it would reach $150/mo but furnace fiIters alone are about $10 each and we have 2 furnaces with 2 filters each and we are now replacing them every two weeks. Plus lots of small stuff that just adds up.
I have forecast the MRO part of the warden budget to be about $150/mo, which is more than half of the $250/mo warden budget. Leaving very little for the actual purpose of the warden budget. The warden budget has also been pretty hammered. Currently the warden budget has been used up through mid-march and I know of expenses that will soon use it up through about the end of April. Even though we are just over a month into this year. The problem has been aggravated because we have a spate of tool failures. Plus now that Hive operations are ramping up, we are seeing more needs.
If you have questions, reply to this email, contact me on Slack or talk to me in person when I am in the Hive.
I greatly support this plan. As someone that spent time on the inside of a lot of this for a while, we absolutely need a standing operating budget. In the end, this won’t change the amount of money that gets spent. The big thing that will happen is make the expenses much more transparent and easier to track since they won’t shoehorned into the warden budget.
So… as much as I support this in concept, I felt obligated to take a peak over at finance.hive13.org
We just recently moved and activity is low. I’d feel MUCH more comfortable with an increase in discretionary spending if more than one month out of the last 5 showed us being net positive.
We have not yet proven we can survive at our minimum expenses after the move. We need to re-learn to pinch pennies, NOT increase our budgets right now.
I hate to say it, as I have a number of purchases for the hive in the last month that I’d like to be reimbursed for, but I vote no on this. At least till we show we can at least skate by without burning reserves, or we can start growing membership again.
Kevin I understand that fear, because it is completely valid and justified. but the counterpoints I have are,
Are things like Air Filters, Cleaning Supplies, and Sanitizer things we will avoid purchasing?
Are the only reoccurring monthly expenses rent and insurance?
One of the (many) things I struggled with was that we never really had a good grasp of what we were spending money on. without that it become difficult to make reasonable projections or effectively vote of the bigger ticket items when they come up. Maybe the work that has been done getting things into QuickBooks with address that, but it is too soon to see that. At this point adding a second line items seems like it would help to better track these things, and ensure that we have less random members sitting on expenses that get lost in the reimbursement tracking ether. That was all part of the reason I had pushed for setting us up with dash.io for the hive controlled prepaid cards, which never got enough support.
We only seem to have 2 methods of addressing that currently. Either have a vote for every expenditure, or shoehorn everything through the wardens. Maybe another solution would be to change the “warden budget” into the “operating budget” and increase it to absorb the currently-not-warden expenses. Overall the current model doesn’t really work, and knowing exactly where expenses are is the most critical in times like these.
Also, Just because the budget is there, that doesn’t mean it has to be spent. It is only earmarked for a purpose and planned for, if at the end of the month we have more than expected it is a happy surprise. Currently it feels like we keep having to ask why do we have less money than we thought we should have again this month?
The warden budget has historically been used for this type of consumable. We have branched out recently to also using it for minor improvements to areas, which is why the budget is getting eaten up. The hive has survived periods in the past where we essentially said “ok, no more votes, and no more spending till we recover a bit” and supplies and improvements during those times were made by the contributions of willing and able members.
I think now needs to be one of those times. My vote will become a yes in this in the future, AFTER we are able to go 3 to 6 months where we are at least averaging cash-neutral, but right now we are not there, we are bleeding money.
The move is, for all general purposes, done. The budget is used up, we still have people working on making things nicer, but at this point that needs to be treated no differently that improvements at the old hive were. It should either be driven and financed by willing members, or put up for a vote for a budget for a specific improvement.
The warden budget includes our operational costs, we should NOT increase it till we show we can operate cash-neutral in the new space. We just need to break the habit we have developed of being so free with the warden budget. previously, it was managed by having wardens submit requests, and at the end of the month we decided what items needed to be bough that month, and what could wait. let’s get back to that instead of just saying yes to everything we think of buying on the warden budget.
So we need to figure how to do this general operation funding thing if we don’t do this. Perhaps reducing the warden budget by some amount and having a new operating budget to maintain the same net cash flow.
Air filters should not be part of the warden budget. I didn’t mind the old system where the wardens would submit things and the COO would purchase or punt. The warden could say “this is critical” or something like that if they felt it shouldn’t be punted.
I like separating the operational stuff from warden area stuff.
I see warden stuff for things like solder, sanding belts, and minor improvements. One could argue that is operational stuff also.
Running a business is complicated.
We should not be buying stuff and then expecting reimbursement later without some check. That is an invitation for a big mess.
I could vote yes on that - separating the warden budget and “operational budget”, but doing it by splitting the warden budget instead of just creating another additional budget. That said, isn’t this just over-complicating things and reducing the flexibility of the budget?
As the Hive’s Treasurer, I will also use this opportunity to assert to membership that the Hive’s Hive’s financial status remains comfortably favorable in our new 2701SG home. The Hive can afford this limited and necessary budget increase in “fixed” expenses as submitted for membership vote.
To add to the latest posts and Kevin’s stated concerns, 2020 was indeed a significant financial year for Hive13. We started (in January) at 2929SG bursting at-the-seams with sufficient reserves to consider making a change. In February, the 2701SG opportunity presented itself and a member vote committed an initial $15k to the move. In March we voted to increase our 2701SG footprint from 7k sqft tp 11.5k sqft. Despite the COVID pandemic we began to make the move during the summer months. In July voted to commit an additional $10k to the move budget. By the end of the year had fully-expended the $25k move commitment and settling into the ‘new normal’. The impact of expending these reserves has clouded/masked the limited monthly view presented in finance.hive13.org. At this point, the 2020 year-end results are in and the picture is a bit clearer. Despite the many COVID pandemic challenges, membership has held steady and slightly improved. It is significant that over a dozen members stepped up their support to the Cornerstone Level. As the move dust continues to settle, we are seeing our monthly income has increased somewhat. Our monthly expenses have also increased, but by a bit more. It is good news that we are still comfortably cash-positive in the new 2701SG location. It is just not (yet) as much cash-positive as it was at the old 2929SG location. This all is FANTASTIC NEWS and is a credit to all who have contributed to make 2020 be the success that it was, despite the challenges. Hive13 is poised for an even brighter future.
The challenge does remain how we will decide to budget our available monthly net-positive discretionary allotment going forward. There are many competing goals to consider; from rebuilding our reserves to expending more for further 2701SG improvements. As always, with our fixed expenses covered, every new member’s contribution goes straight into increasing the monthly net-positive discretionary allotment going forward, so growth will help provide additional opportunities.
Kevin (+), I realize you (and the general membership) are likely not (yet) party to the year-end numbers posed in the leadership SLACK channel. Perhaps Kayla (as Secretary) will share this with you personally if that would sway your decision. I am also available if you or anyone else wishes to contact me directly. There is to be a review and discussion of the numbers at the next board meeting to then roll out to other inquiring minds in membership. The board meeting is open and all are welcome to participate.
It was not my intent to further hijack this VOTE thread to further fork into the minutia of these details at this time. I plan to make a separate post of the formal financial status after the next board meeting review to facilitate the budget discussion.
I vote YES.
I’m also working on some further analysis of things that may shed more light on the warden/MRO budget situation.
Stay tuned. But if what I suspect is true, the $150 MRO number may not be the increase that it looks like.