December 15, 2012
Members of the Blue Skies Aviation Association stand before two of the club’s three aircraft at Solberg Airport (N51) in Readington, NJ. (L to R) Frank DeLuca, Bill Sundburg, Tom Halvorson, Ray Limedola, and Jeff Lavine. Photo credit: Steve Schapiro
Each month we will spotlight one flying club, providing basic information about how the club is organized and how it operates, in an effort to share some of the secrets of its success. Or first club is the Blues Skies Aviation Association based at Solberg Airport (N51) in Readington, New Jersey. The club was founded in 1957 and currently operates three aircraft and has 44 active members. Here is our Q&A with Club President Jeff Lavine:
Blues Skies Aviation Association
Solberg Airport (N51), Readington, NJ
1998 C-172 Skyhawk ($115/hr) 1978 PA-28-181 Archer ($115/hr) 1978 C-182RG Skylane ($150/hr) Rates are tach hours, wet. All three aircraft are owned by the club and have Garmin GNS-430W with autopilot.
$3,500 total - $750 initiation fee covering manuals, keys, etc. $2,750 bond returned when the member leaves the club.
$70 per month
44 active (Cap of 50); There are also 24 inactive members who don’t pay monthly dues but haven’t requested a refund of their bond.
What’s your attitude towards financial controls? Blue Sky Aviation Association has a long history and could have dissolved around 20 years ago if a member had not taken control of the finances and turned the club around. Since then we have very rigid financial controls in place to keep us solvent. The financial aspect is what has kept us going all these years. The monthly dues covers fixed expenses and that is inviolate. If membership decreases to a point where we can't, dues are raised. If the costs increase, dues are raised.
How do you think about safety and maintenance? The club absolutely stresses safety before all else. When we do 50-hour oil changes, we actually conduct 50-hour inspections although there is no legal requirement to do this. Our maintenance costs are high because we don't let anything, major or minor, remain unfixed. Of course, some cosmetic things are done when convenient. We have been on Solberg-Hunterdon Airport (N51) for many years and have a superb relationship with the FBO/Owners. We have the best tie down spots and when we need maintenance we get it ASAP.
Tell us about your membership structure? Our membership remains fairly constant with a continuing recruitment effort. We can usually balance the attrition with new members. All of our members are at least private pilots and we have several flight instructors and one ATP who flies for United. We conduct monthly membership meetings, including cookouts in the summer, and we have an annual dinner, usually with a guest speaker. We have a six-month probationary period, which protects both the club and the new member. We have only had to reject a member once in my memory.
How about training? We allow advanced training, but do not allow primary training. This works to our benefit for several reasons. We are not in conflict with the FBO (in our case also the airport owner) for primary students, it keeps our insurance rates lower, and it is less wear on the aircraft. The FBO's instructors are authorized to instruct our members in our aircraft, so they derive revenue from us.
Give us some insight into your operational procedures. The rates we charge for the aircraft are tach time, wet. Members can have three active reservations at one time. We work on an honor system in regards to dates; biennial, medical, and an insurance required annual review. If the dates are not in ScheduleMaster or have expired, the member cannot reserve an aircraft. The Board reviews the credentials annually to ensure accuracy. We permit members to go inactive if they need to. We retain the bond, but they no longer pay dues and cannot reserve/fly club aircraft. When the issue that forced them to go inactive passes, they can resume active membership. You can go to our website, www.blueskyaa.com, Our operating instructions and bylaws are posted on the site.
How do you manage long-term maintenance costs? The hourly rate for the aircraft includes, fuel, maintenance, and engine reserves, with a tiny bit of overage for unplanned expenses. We calculate the maintenance portion based on the prior year's cost for that aircraft. Sometimes we win, sometimes we lose, but we are usually very close. The engine reserve portion of the hourly rate is accounted for separately for each aircraft. Unless there is an extraordinary need to swap out an engine prior to TBO, we are usually right on the money for replacing that engine with a remanufactured engine at TBO.
What are your thoughts about insurance? We did consider reducing our coverage in order to save money. But we decided against it – after an incident the members won’t remember that you saved them all that money. They will remember you didn’t insure the airplane adequately.
How do you deal with aircraft upgrades? When we want to upgrade avionics, or otherwise upgrade our equipment, we have several choices. We can use any discretionary funds, ask members for voluntary supplemental bonds, or borrow money from members or a lending institution. We NEVER assess our members for upgrades, engine replacements, etc.
The final association Blue Skies emphasized was their relationship with its insurance agency. “When the need information, they don’t want information because they want to be difficult to deal with. They need information because the agency wants to go to different underwriters and see if they can get you the best rate,” Jeff said. Basically, the more information you can provide that’s germane to what they are doing, the better they can act as your agent. “If you withhold information or if you treat it lightly, you’re making their job more difficult and they’re going to have to go with whatever they can get, which might not be the most advantageous arrangement for you,” he said.
One key to proper insurance is making sure the club has adequate coverage to replace an aircraft with a like one. Jeff was considering reducing hull coverage until Bill reminded him, “The members won’t be very forgiving. They won’re remember that you saved them all that money. They will remember you didn’t insure the airplane adequately.”
Can you explain your organizational structure, and how it works? We are an exempt corporation with a five-member board of trustees: President, Vice-President/Safety Officer, Treasurer (the real brains on the Board!), Secretary/Recruitment Officer, and Maintenance Officer. We meet monthly, and more often if the need arises. While we try to respond to member input, issues and concerns, the club is not a democracy. The board always acts on the best interest of the club, even if a few members may object. For example, we had a prop strike incident, and the member probably didn't realize it had happened, or wouldn't admit it. Some members wanted a full investigation, wanted that member charged for the full insurance deductible, etc. The board determined that we could not positively identify which member had been flying the aircraft when it happened and elected to just pay the deductible, replace the prop, and educate the members on proper taxiing procedures.
Any final thoughts on how your club has lasted for 50 years? It comes down to a few things: Good aircraft, well maintained with up-to-date avionics; Attractive aircraft rates; A very tight, well-managed financial system; A management team that is not swayed by the desire of the moment, and always focuses on the financial viability of the club and fairness to members.
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