Call to Order: President John M. Hotchner called the annual general meeting of the American Philatelic Society to order in Ballroom H of the Santa Clara, California Convention Center on Saturday, August 29, 1998 at 9:00 a.m.

President Hotchner introduced the Board members, the Committee Chairmen who were present, the Trustees of the American Philatelic Research Library, and the Past Presidents of the Society.

President Hotchner introduced Executive Director Robert Lamb who, in turn, introduced the staff from State College.

President Hotchner introduced STAMPSHOW 98 Chairman Stephen Schumann, who introduced the local committee who were present.

President Hotchner and Executive Director Lamb recognized those members who had been celebrating twenty-five continuous years' membership with the American Philatelic Society.

President's Report: The American Philatelic Society's Board of Directors met for eleven and a half hours here this week. The Board received a report and accepted a series of recommendations regarding the Society's presence on and use of the Internet. It makes a wide range of recommendations for ways to promote membership communication, fund raising, member services, new memberships, and more. Next we need to prioritize and cost out these recommendations, and Hotchner appointed a committee composed of Janet Klug (Chairman), John Hotchner, Bob Lamb, and Frank Sente to do that before the next Board meeting in Orlando. Hotchner thanked Past President Randy Neil and his committee for the work done to advance this issue.

The Board received a report from the Space Requirements Committee chaired by Bill Bauer. Bud Hennig and Hotchner formed this committee to determine what space is needed for the Library, whether we needed additional administrative space in State College, whether we should consider moving to a more central location in the United States, and if there was a way we could utilize today's or future technology to reduce the need for space in the library and/ or increase services to the membership.

The Committee concluded there is an immediate need for both library and administrative space. For those of you who have been to State College that was not a hard conclusion to reach. It also concluded the cost of moving away from State College would be far greater than the benefits. It concluded that while the Library is already using technology there are additional things that can be done and there are additional areas that can be looked into. Those imperatives will be addressed by the Trustees.

The Board of Directors considered the fundamental question of whether we should stay in State College. If we don't stay there we shouldn't expand there. Looking at all the equities, we concluded we must stay in State College. We would lose two thirds of our staff including most of our directors if we would move. We can't afford to do that.

On the question of how to acquire needed space, the Board has directed that Bob Lamb arrange for professional assistance to convert plans for an additional area of space from concept to specifics based on the Bauer committee assessment for space requirements for the next 25 years. Lamb will also look into zoning, legal and associated matters and researching the practicalities and economics of building more than we need at this point with the idea that we would rent out space until it is actually needed by the Society in the future. We are aiming at not having to come back to the membership every ten years asking for funding for more space.

In the meantime, Hotchner will put together a committee asking for recommendations on how we can fund the different alternatives. At Orlando we will try to make sense of all this and make conclusions on how to do this in a responsible manner.

Hotchner thanked Bill Bauer for taking over the Space Requirements Committee on very short notice after the death of John Foxworth who was heading that committee.

The Board received a report from an ad hoc committee to try to bring the American First Day Cover Society's annual show AMERICOVER under the World Series of Philately system with consequent benefits to both the APS and the AFDCS. This was originally Ken Lawrence's idea and he chaired the committee. The committee and AFDCS has produced a draft agreement much of which has been written after extended discussion between officers of both societies. The draft has been referred to the Committee on the Accreditation of National Exhibitions and Judges with instruction to report back at the Orlando show.

The Board authorized our Show Director Ken Martin to complete arrangements for our August 2001 convention to be held in Atlantic City, New Jersey.

We asked Bill Welch and Bob Lamb to look into the economics of expanding The American Philatelist by a 16 page signature and to review our advertising charges and the policies guiding the percentage of advertising in The American Philatelist.

The Board continued discussion of bylaws proposals passed by the previous Board but not yet put to a vote by the membership. Those of you who read Linn's will know all about this from Les Winick's column. The current Board supports the concept of term limits and decided it would put three changes to the membership as written. We will also recommend possible alternatives. In one case we have decided to accept as written a bylaws change that has to do with shortening the election process. In another case we are offering members the opportunity to vote for no change as an alternative. That has to do with the prior Board's recommendation that we remove Committee Chairmanship as a basis for running for President. In the third case, the area of term limits, the current Board wants to offer an alternative to what the prior Board recommended. All of this will be offered and explained with next year's election ballot.

Another change has been offered by Gordon Morison's Life Membership Committee which has been looking at the need to be certain that our life membership fee structure adequately supports the long term burden of life memberships on Society's finances and that it is fair to the membership. The result is that we will put before the membership bylaws changes that will allow us to change the current $440 fee to a sliding scale based on age and to reduce the charge to the upper age bracket. If this passes it will become effective in the year 2000, so those who benefit from the $440 will have plenty of time to sign up before the fee changes.

The Board approved the applications of the Tanna Tuva Collectors Society, the German Colonies Collectors Group, and the Fakes and Forgeries Study Group to become affiliate members of the APS.

The Board approved a $3.8 million budget for 1999 that shows a projected surplus of $8,000.

The 1998 budget at this time shows a projected surplus of about $30,000. We have at this time no projected dues increase now or in the future. Hotchner particularly complemented Bob Lamb and the staff because it is their careful financial management of our resources that is responsible for our success.

The Board considered a recommendation from staff that would provide a financial guarantee against loss on our APEX expertizing certificates when they certify genuineness. Several potential problems were discussed and the matter was referred back to staff with our approval in concept for further developmental work.

The Board considered a draft agreement with Washington 2006 that has been hammered out between our Board of Vice Presidents and the leadership of Washington 2006. That was passed with a few modifications to ensure that any problems, especially financial problems, can be identified and dealt with before they become fatal.

On another initiative considered by the Board, the staff has developed the outline and some of the details of a new APS youth program, tentatively titled the APS All Star Stamp Clubs. It's aimed at supporting existing stamp clubs for elementary and middle school children and encouraging formation of new stamp clubs. It is expected that the APS will set up a help desk for club faculty advisers, provide them with a quarterly newsletter, and set up a three-tier testing and recognition system with appropriate certificates for the kids. In this way we believe we can supplement what the Postal Service is doing, help these clubs be a positive experience in the hobby for youth, and give youth the sense of accomplishment that will make them stay with the hobby or want to return to it once they have gotten beyond their student years. The Board did vote to establish the APS All Star Stamp Clubs and staff will be working to accomplish that. Hotchner will be asking the membership for donations.

The Board pursued the concept of putting the American Philatelist on carefully selected newsstands. There are a great many potential problems to overcome with this idea which was presented by our Secretary Janet Klug. The Board believes there is a nugget of a good idea and we want to follow it up.

Another of our new Board members, Lloyd de Vries, suggested that we stagger the election of officers to assure that we don't have a completely new and inexperienced Board installed in the future. After discussion which included wrestling with the idea of yearly elections, we decided the problems outweigh the potential benefits.

Ann Triggle, another of our new Board members, proposed an idea that the Board of Directors accepted to modify the bylaws to broaden ways in which a Board of Vice Presidents slate may be constituted. As you may know, the three members of the Board of Vice Presidents must now live within 250 miles of each other. The change would permit the three members to live beyond that range if they agree in written form to meet in person every eight weeks at no cost to the Society. This will be proposed to the membership among next years bylaws changes.

Finally, the Board in Executive Session selected the winner of the Ernie Kehr Future of Philately Award and the latest inductees in the Hall of Fame. The honorees will be announced at an appropriate time later. Also the Board dealt with two appeals from actions by the Board of Vice Presidents, confirming one fully and slightly modifying penalties assessed in the second case.

On Wednesday, August 26 the Board spent two hours talking about developing a Strategic Plan which Hotchner has written about in his President's Column. This is being spearheaded by Steve Luster. We have reviewed its present status, agreed on next steps and will be asking for input from the staff at State College. At Orlando we expect to spend one full day going over the plan, brainstorming, and discussing how we will fund the ideas, etc. It is an ambitious undertaking.

Lamb and Hotchner had breakfast with Dickey Rustin and Rick Arvonio, senior managers from the U.S. Postal Service Stamps Development Department. They were also invited to lunch with the entire Board which turned into a free-wheeling discussion on a great many issues. I want to report to you that we don't see eye to eye on every issue. Those were aired so we make certain we understand each other. We do have similar goals in many respects, and those we will pursue vigorously: things like promotion of the hobby, encouragement of youth, improving the tone of our partnership stamp shows. The Postal Service is a major contributor of financial support, but more than that, a lot of effort and a lot of ideas to these ends and in other areas such as our Youth Essay Contest and our next Winter Show Americas 99 in Orlando. We are not bound by that. We continue to tell them where we feel they are helping neither themselves nor the collecting community and they expect no less. They aren't shy about telling us where we are off the mark. The important thing is that we can do great things together, but not if we dictate to them or cut off communication as some have suggested. That might feel good momentarily but would do long term harm to our interests and those of the hobby.

Board of Vice Presidents Report
Dr. Peter McCann: Vice Presidents, of which there are three, are actual members of the Board of Directors of the APS but we also serve as a mini Board within the Board. We act as the judicial arm within the APS. All the tawdry things that happen in terms of relations between stamp collectors and dealers come to us for review. Helen Bruno at APS Headquarters handles most of the complaints but the remainder, about 10%, come to the Board of Vice Presidents. We meet every two months and we spend two to three hours going through the cases and making judicial decisions about what should happen to the people who bring these cases to us. It is one of the many services the APS offers its members and hopefully most members won't ever have to take advantage of it.

Secretary's Report
Janet Klug: Klug has attested to and signed all the official documents of the American Philatelic Society and taken minutes at the Board meetings and General Meetings according to the bylaws.

Executive Director's Report
Bob Lamb: This is the third consecutive year of membership growth. Ther numbers are small but positive. In the hobby today that is an encouraging sign. We work hard at this. We have a couple of campaigns going on now. It is our sincere hope we can say the same thing next year, but it is not something we can take for granted.

The Board passed the highest budget in the Society's history which reflects the level of services members enjoy. We have a budget of $3.8 million and are showing a projected surplus for next year.

We have a wonderful, extremely generous membership in the APS. At the Tiffany Dinner the previous evening we accept a check for $100,000 from the estate of Leo August for the promotion of the hobby. We have a member who has given us a life insurance policy for $130,000. We hope it is a long time before we can collect on it but we are grateful to him for it. We had a very special contribution last year. Janet Klug and the Tonga & Tin Can Mail Study Circle donated an original tin can from the mail service. Visitors to the APS wants to see the tin can mail container.

Last year the Board voted to change insurance plans. We have been very pleased with the support of the membership on this. Five thousand members so far have signed on to the new plan. The projected income to the Society from the new plan is about $75,000. It is one of the reasons why President Hotchner can say we have no planned dues increases. The insurance is continuing to grow. Last month it grew at about the rate of ten new subscribers per day. We hope that pace will continue.

The Summer Seminar had the largest attendance ever since the inception of the program. Everyone had a lot of fun and Lamb invited members to attend the next Summer Seminar. It's a great vacation and you learn a lot about stamps.

Book publishing has resumed. We have made our costs on Spurious Stamps, a book we released last year. The few remaining copies we sell will be all profit for us. We will not reprint it. We have a new pamphlet on sale on Earliest Known Usages on U.S. stamps for roughly the first 600 U.S. stamps. It is available to members for $4.

Expertizing certificates are down this year, but it will still be the second best year in the service's history. We find that 20% of the 6,000 stamps we see each year are either faked or altered. If you have any questions about any of your stamps, Lamb urged members to submit them to be expertized.

Hotchner mentioned guaranteeing certificates. There are problems that need to be worked out, but we have felt that we have more responsibility to our members if we say a stamp is genuine. If it later turns out to not be genuine and a member suffers a loss we believe that member should be reimbursed for any loss. We believe we should stand behind our opinions.

Sales Division has reached record highs this year. We exceeded $13 million in inventory. Stamps are getting bigger and they don't fit into our sales books. We are now looking at a feasible way to produce larger sales books.

Under President Hotchner's leadership we have been encouraged to look for ways to provide more services to collectors. One of the areas we have looked at is philatelic products. There are philatelic products that are not satisfactory. One of those is a watermark fluid. We went to a chemical company in Pittsburgh and asked them if they could produce a watermark fluid that was not unhealthy to our members and was not unfriendly to our environment. The fluids available now either destroy the ozone layer or potentially cause cancer. That's not good enough. We have found something we think will be better. It is being tested now before we endorse it. We also worked with a company that produces preservation sprays for the Library of Congress to protect their valuable manuscripts and documents. We are trying to produce something that will keep stamps and covers from deteriorating because of the acid in the paper.

One of the last remaining things PACIFIC 97 needed to do to clean up its affairs was to sell some remaining frames. As it turned out, our decorator lost 200 of our frames so we were able to buy some of the leftover frames. They are down to just a handful of frames. A number of our shows around the country are talking to them.

The American Philatelic Research Library is celebrating its thirtieth birthday on October 10. The APRL is having a birthday party in State College on that date and we are inviting all 56,000 members to attend. All we ask is that you tell us you are coming and that you bring a present for the library, whether it be a book, a philatelic artifact, or a monetary donation. There will be seminars, events, and tours.

Questions
Earl Lowenstein: The Junior Philatelists of America are concerned about stamps the USPS is issuing that are limited to a particular state or location so that availability is difficult. (Lowenstein mentioned the recent Wisconsin and Klondike stamps.)

Hotchner: We discussed this with the USPS. The USPS is expanding the number of stamps it issues. These will be available at philatelic boutiques. As a business decision, the amount of money that it costs the USPS to produce the number of stamps needed for full national distribution is more than they can justify on their bottom line. Hotchner did not agree with it but that is USPS' stance. Even when they do make stamps available nationally, the USPS can't impose them. In many cases availability has to do with whether the local postmaster orders them The APS has no additional influence, but we can keep pressing the issue.

Ken Webber: Asked when the APS would get an 800 toll free number.

Hotchner: This is an economic issue. It has been looked at several times and we believe the cost would outweigh the benefits.

Lamb: We looked into it and the estimated cost was $20,000. It was deemed too expensive.

Hotchner: The great majority of APS members can well afford the cost of a three minute phone call to APS headquarters if they need to contact us, and the services you get when you do that offset the modest expense for the call. Many of our services can be accessed at no cost through the Internet at our website.

Elliot Landau: The high counters dealers are forced into using by the USPS here at STAMPSHOW are not friendly to children, they are difficult for older dealers, and they impossible for people with disabilities and come in wheel chairs. Indeed, we have been threatened with litigation on two occasions under the Americans with Disabilities Act.

Hotchner: We have been talking with the USPS, but they want what they want. They want to improve the look and tone of our shows, and they want STAMPSHOW to look like a professional convention.

(Comment from audience): Is this the American Philatelic Society's show or the USPS show? We should determine what sort of counters we want. The membership should decide.

Hotchner: The membership would have some divided opinion. In a Society with 56,000 people there is not going to be a unified opinion.

Alan Warren: After the APS has solved the watermark fluid problem, can it find a quality peelable hinge?

Hotchner: We are working on this. We are not ready to talk specifics at this time. We realize there is a need.

George Cosentini: A heartfelt thank you to the APRL for the fine level of service they have given.

Ernest Bergman: Was fed up with semi-postal stamp the USPS released. He was disgusted with the poor design. It will not sell. It needs to be a pleasurable design to get people to support the cause.

Hotchner: The USPS is interested in having the stamps both used and saved. For purposes of use the design is important. Not everybody is going to like every design.

Jackie Alton: World Columbian Stamp Expo gave $2000 to the APS for the expertizing service.

Hotchner: Yes, we also totaled up that World Columbian has given over $30,000 to the APS and the APRL in the last several years. We are grateful.

Adjournment
The two members with the lowest membership numbers were asked to adjourn the meeting. Both Bud Sellers and Bud Hennig simultaneously moved the meeting be adjourned. Seconded. Passed unanimously.

Attest:Respectfully submitted:

John M. Hotchner, President
Janet Klug, Secretary