The purpose of this letter is to inform our members about some questions which have been raised recently relating to our structure and operating procedures. We will address those questions below, but more importantly, we would also like to share with you our view for the future.
When the USASF was founded in 2004 the All Star community was much different than it is today. There were no rules, no safety guidelines and no competition standards. There was also no true recognized national championship. If we had had a crystal ball at that time and had been able to see how All Star would develop in the following 10 years, there is no question many things would have been set up differently. However, since we did not have the luxury of what is now hindsight, it is important to understand the history of the organization in order to better appreciate why USASF made some of the decisions that are now being questioned.
We accept some of the questions that have been raised as a legitimate attempt to strengthen the organization, and we welcome that dialogue. Like all organizations, ours is not perfect, but we remain committed to doing what is right for the athletes, coaches and organizations that make up All Star Cheer and Dance.
History of USASF
USASF was founded in 2004 by Varsity and CHEERSPORT. At that time, both companies believed that there needed to be an organization that could bring stability to the sport and serve the athletes and coaches by standardizing rules, promoting safety and providing sanctioning standards.
In evaluating how to legally establish this new organization, Varsity and CHEERSPORT determined that a non-profit entity was the preferred structure. Therefore, USASF was chartered as a non-profit corporation in Tennessee as this was viewed to be a cost effective ($100 fee) and a quick and efficient way to start the organization. There was never any serious discussion about setting it up as a 501c corporation because this would have added unnecessary complexity and delay. A 501c status is used primarily for organizations that receive charitable donations, which the USASF does not. The corporate charter for USASF is posted on our website. To be clear, USASF is a separate legal entity from, files taxes independently of, and is not a corporation owned by Varsity. The corporate structure is controlled by the USASF Board of Directors and could be changed if the board decided it was in the best interest of the members.
As the USASF was being formed, it wrote its bylaws and appointed its first Board of Directors. Viewed today, it is obvious those bylaws could be improved upon. But remember, when written there was no reason for a formal set of complete statutes. The bylaws made all of the original board seats permanent in order to assure the organization stayed true to its mission. They also required a unanimous vote to change the bylaws. This stipulation is probably not ideal today, but frankly it was originally proposed by CHEERSPORT as protection to insure that it could not be voted out at some point in the future. JAMfest was also granted a permanent seat when they joined based on similar concerns. The bylaws have been amended several times over the years to broaden membership and representation to include coaches, gym owners and other event producers. The bylaws and amendments can be seen on our website.
After USASF was formed, Varsity provided an interest free line of credit to the USASF. At its peak, the loan balance was $1.8M. As of December 31, 2012, the balance on the loan was $565K.Varsity has allowed the USASF to have complete flexibility with our repayment schedule. The loan has been completely interest free to the USASF. This has been an incredible benefit to our organization and members, and it would have been impossible for the USASF to survive without it. Varsity has also continued to guarantee a substantial “rainy day” fund to insure USASF could withstand any type of unforeseen natural or financial disaster such as having to cancel Worlds one year. There has been no “co-mingling of funds” or any other impropriety. Just as any lending institution would do, Varsity secures the loan by retaining certain rights to the USASF trademark and intellectual property.
As previously stated, the USASF and its board recognize that change is needed within the organization. The board met via conference call on Wednesday, April 3, 2013 and agreed to initiate a process to systematically manage this change. We want to move promptly but do not want to make the mistake, which has occurred in the past, of making significant changes without taking the time to solicit input from all members and stakeholders.
The issues we have identified to address are as follows:
- Board Make Up: This will include, but will not be limited to, structure of the board, balance of representation and accountability within the USASF.
- Bylaw Revisions: Revise the bylaws to accurately reflect the current environment and govern USASF properly.
- Worlds: A comprehensive analysis of everything relating to Worlds including the pros and cons of utilizing Walt Disney World as a venue.
- Location of USASF Office.
As this process unfolds, there may be other areas we examine based on feedback from our membership. We will utilize our existing committees, the NACCC and our USASF Regional Meetings to insure our entire membership is heard and considered as we address these issues.
One area the board felt needed to be improved now was that of financial reporting. Though we have nothing to hide, we believe a more detailed financial report would eliminate some of the inaccurate statements from our critics. As always, an independent certified public accounting firm will review the books and records. In addition, moving forward into 2013, a report by that public accounting firm will be included in a calendar year annual report that will be provided to our members and available to the public. This new annual report will also address a general update of the status of the USASF, as well as its future plans. In about three weeks we will post the 2012 financial report for the USASF on the website, along with more detailed information than has been presented in the past.
The board also agreed to move forward aggressively on several programs that we feel are critical to serving our athletes and coaches. We will consider and investigate options for an enhanced athlete membership program with an outstanding and affordable individual insurance option component and provide information in the upcoming weeks. Our professional membership program will also be improved, including reviewing the option for background checks for everyone working with our athletes. Also, we have already asked Les Stella to develop a more dynamic and comprehensive FAQ section on our website to provide a better way to field and answer the most common questions. These are types of initiatives that only USASF is in a position to accomplish and we are committed to getting them done expeditiously.
In closing, we would like to thank all of the hundreds, if not thousands of people who have volunteered their time and efforts to create and build the USASF. The organization would not have accomplished what we have without their dedication to make our sport better. We look forward to working with our entire community to insure we continue to build an even stronger and more effective USASF.
USASF Board of Directors
Mike Burgess, Vice President
Jim Chadwick, President
Tara Patton Harris
Happy Hooper, Secretary/Treasurer
Read the GrowCheer.org response to USASF’s open letter here.