NASBP Meetings and Events Have Made this Fall Productive and Lively!
Where has 2016 gone? Before we know it, this year will be history; and, hopefully, in another 25 years the current president will identify a golden nugget of importance that stands out to her as worthy of mentioning when examining the Association’s past accomplishments. As we continue our walk through our first 75 years of NASBP, the decade of the 1960s was characterized by growth. For the first time, NASBP had a home of its own located in New York City and a dedicated employee to run the organization, Bruce Wallace, who served as President of NASBP from 1951-1953. NASBP and the National Association of Casualty and Surety Agents (NACSA) entered into an agreement to share offices and staff, which lasted for 29 years.
In 1963, we moved to Washington, DC. The two major challenges to the industry at the time were the development of wrap-ups and owner-controlled surety programs. Revenue for the Association topped out at $54,165 with 253 members. Member involvement continued to grow and leadership embarked on the first long-range plan for NASBP. This resulted in a number of important actions that propelled us into the true professional association we are today. Here are a few that stand out to me:
1. Wrote and accepted a professional code of conduct
2. Created the Executive Committee
3. Hired auditors and improved the internal accounting system
4. Created two regions
5. Moved to Washington, DC
These certainly were good years for the business. The largest bond written was $60 million for the tunnel across the lower Chesapeake Bay in VA. Annual meetings during the 1960s were held in Boca Raton, Hawaii, Canada and Puerto Rico.
The 1970s firmly defined NASBP’s mission. We stepped into the legislative arena, enhanced industry outreach efforts, and developed our educational offerings. Our membership and staff were quite busy accomplishing a number of “firsts”:
- Advocacy efforts began with a federal court of Louisiana where the matter of directed suretyship on public works was being decided. NASBP was involved and contributed $1000 at the time to fight the issue.
- During this decade NASBP liaised with numerous industry groups, including AGC, AIA, SAA, and TRIP. The first State of the Industry Interviews were held, and the report was given at the 1976 Annual Meeting.
- Vince Como chaired the Committee, with agents and company people participating; that developed the first schools. In 1973, Aetna hosted the inaugural class in Hartford, CT; next we went to the Fireman Fund’s office in San Francisco; and then in 1977 the first advanced school was offered.
The 1970s resulted in a difficult business environment compared to the 1950s and the 1960s as industry loss ratios climbed. Travelers wrote $49 million in premiums with a 57% loss ratio, and the loss ratio for Small Business Administration guaranteed contracts escalated to 150%. A couple of other notable statistics from that period include the first increase in the Miller Act threshold from $2,500 up to $25,000 and a $3.4 billion joint venture project was securitized with an irrevocable letter of credit, and NASBP membership grew to 386 agencies.
Fast forward to September and October 2016, as NASBP ambitiously executes its operational plan while maneuvering the daily issues that often become urgent matters. It has been a busy few months for both NASBP and me. In addition to three of the four regional meetings that NASBP hosts, on September 29 the NASBP Small and Emerging Contractor Committee, in conjunction with the U.S. SBA, held the pilot program titled, “Your Path to Surety Bonds,” for interested small business owners. In addition, the NASBP Professional Development Committee delivered the Sales Workshop, the NASBP Finance Committee developed the budget for next year, and NASBP staff prepared for the 2016 Mid-Year Board Meeting while making preparations for a number of 2017 special events.
Attending three NASBP Regional Meetings initially seemed daunting, and I’m pleased to say that the experience was amazing and my fears were for naught. Other than me being physically ill while in Texas, my husband, Doug, and I truly enjoyed meeting new people and hearing about what is on the minds of the NASBP membership. While each Regional Meeting has a distinct personality, the common issues of concern are subcontractor default insurance (SDI), the economy, claim management, and owners’ (both public and private) actions that are changing contractors’ liability, which trickles down to the sureties.
Our travel included Austin, Nashville, and Napa, so no complaints here. Doug expressed his appreciation numerous times because he would not have had the opportunity to experience these places or the people without NASBP. In September, I was privileged to experience a portion of the NASBP Sales Workshop. Our own NASBP members Larry McMahon of Alliant Services and Don Appleby of Holmes Murphy, coordinating with facilitator Jonathan Dick, shared many of their hard-learned lessons and sales models with the 38 attendees. The level of energy and enthusiasm from instructors and students alike was so impressive that I’m hoping to be in a position to attend the entire workshop the next time it is offered.
The NASBP Regions 4, 5, 6 & 7 Meeting followed the Sales Workshop and began the next day at the same location in Austin, TX. One of my pet peeves is when people complain about things that are outside of their control, so I promise not to mention how hot and humid Texas can be in September, how my hair curled after stepping outdoors within five minutes, or that I did not dress appropriately (oh, right, I CAN control that one). Thank you Regional Directors, Jill Tucker, Brian Deimerly, Jenni Waggoner, and Greg Morin, for accepting the responsibility of programming and hosting this event. I’d like to share with you one takeaway from each meeting that resonated with me.
The Austin Regional Meeting headlined a session about SDI that featured J. Brad Robinson of LendLease, and Mike Pipkin of Weinstein Radcliff Pipkin LLP. The first slide had two words on it, “Uber and Airbnb.” Our speaker compared the effect of SDI on the surety industry to these two companies’ impact on each of their respective markets. This impacted me personally because we had just inked the contract with Chip Conley, Head of Global Hospitality & Strategy at Airbnb, as our keynote speaker for next year’s Annual Meeting in Boca Raton. As Brad closed the session with Q&A, he was asked this question: What if a subcontractor tells you it will post a bond as security in lieu of being put into the SDI program? Brad said, and I’m paraphrasing his response, that it is better to have the contractor it wants doing the job and providing a bond as security than to use the second choice contractor even if that contractor is enrolled in their SDI program.
Next was the Regions 8, 9, 10 & 11 Meeting in Nashville. This is my agency’s regional meeting, so we were busier with dinners and meetings but that did not stop us from enjoying the sessions, old friends, and some of the sites in Nashville. A hearty thank you goes out to the Regional Directors of these Regions, Chad Martin, Josh Etemadi, Mark Kerin, and Novica Prekpala, for developing a fabulous program. A special note of gratitude to David Campbell, President of Lexon Surety Group, and his team for hosting a first-class cocktail party for all of the meeting attendees, which was held inside the Country and Western Hall of Fame. They also had a very cool poster commemorating the Regional Meeting designed and printed on site by the historic letterpress shop, Hatch Prints; and then they gave one to every attendee.
The one takeaway I’d like to share from this meeting came from the presentation by S. Scott MacDonald, PhD. about the economy. I was an econ major in college, so I always appreciate the “assumptions” that economists craft to support a particular theory. In this case, Scott did not even throw me a bone. He approached our future economy by explaining what makes it work and identified three important statistics that represent the average replacement levels required for the economy to stay even. These three are (1) a 2.5% GDP, (2) 1 million new housing starts, and (3) 250,000 new jobs. So watch the reports, and if the statistics surpass these numbers, the economy will grow.
We then hopped on a plane with Bethany, arriving in San Francisco to attend the NASBP Regions 1, 2 & 3 Meeting just in time for rush hour—shall we say rush hours. It took us about 3.5 hours to drive to Napa, but again, since I can’t control the traffic, I won’t complain. Instead I’ll mention the diverse scenery we encountered during the 70 mile drive, each site more incredible than the last. As we left the airport, the San Francisco Bay glistened in the sunlight and Waze took us on a scenic and enchanting tour of downtown San Francisco. Finally upon reaching the Bay Bridge, I came to the conclusion that it is one amazing construction project; and as we followed the road north we saw grape trees galore, some already harvested and others lush with fruit. Last but not least, we must have passed 20 wineries, each one grander than the last.
So you are thinking my takeaway is how much we enjoyed being in a different part of the country but it isn’t. It was the keynote speaker, Lamar Engel, who was a colorful individual who learned his trade from working for the Oscar-winning director, producer and screenwriter, Francis Ford Coppola. Engel is a renowned sommelier and environmentalist who presented the history of Napa and the development of its wine business. Listen up, here’s the point; Lamar told us that, as part of the growth of the industry, in 1979 the Wine Spectator started the practice of rating wines. Do you think that was well-received? Of course not; initially, the industry rebelled because nobody liked being rated, and now the industry loves the rating system because it sells wines!
Thank you Regional Directors, Mike Specht, Guy Armfield, and Chris Downey, for hosting this informative program for a very engaged group of attendees. I also want to thank all of the presenters and sponsors, without whom these events could not take place. I’m interested in your takeaways, so do not hesitate to email me at firstname.lastname@example.org.
Lynne W. Cook is Senior Vice President at Early, Cassidy & Schilling, Inc. in Rockville, MD. She can be reached at email@example.com.