sample numbers

Sat Apr 11 17:15:55 EDT 2009

#6 only works if someone is willing to step forward to personally guarantee
the loan with the bank. Tim is unable.

If somebody was willing to step up.this would solve all the problems. We
could buy whatever we wanted.

Bob

From: eefc-core-bounces at workingcode.com
[mailto:eefc-core-bounces at workingcode.com] On Behalf Of Mike Lysik
Sent: Saturday, April 11, 2009 5:12 PM
To: Eagle East Flying Club Core Team
Subject: Re: sample numbers

Bob

Can you ask Tim if he would go for item-6 on Todd's list below?  Example:
If we go with 976 for $18k, + $10k for 430W(installed) + some $ for
xponder(does this come with the 430W?) + some money for whatever general
upgrades the cockpit and panel need(do the VOR's work? one may be broken) +
$20k for engine + anything else = total cost of plane to be financed by our
group, guranteed by Eagle East.

Mike

----- Original Message ----- 

From: Todd Brooks <mailto:toddmbs at yahoo.com>  

To: Eagle <mailto:eefc-core at workingcode.com>  East Flying Club Core Team 

Sent: Saturday, April 11, 2009 4:19 PM

Subject: RE: sample numbers

Nice work guys.  I need to wake earlier I guess!

After reading the slew of emails, I have a few thoughts:

1. The survey let me complete it without answering it and then I couldn't go
back.

2. If we finance a plane for 10 years it actually comes out to very little $
per member with regards to the plane itself.  It's the other fixed costs
that really add up. 

3. I think the number of members will only slightly affect the monthly dues.
Here is why I say this: if we only have 10 members the likelihood of us
buying another plane is slim; so we will only have to cover our costs to a
minimum and contribute to the savings account with a reasonable amount.
However if we have 20 members then we will want to buy another plane and if
the dues are the same then that extra money will go into the savings for
another plane.  Does that make sense?

4. I say finance as much as possible.  

5. The initial down-payment could be structured to where a member gets
vested after so much of a time period.  This will first lock in a member so
they don't just leave after a month and we're stuck with less cash.  It also
gives some of our money back after we're up and flying.  For example (making
up numbers here): if we take $1000 upfront per member, half of that can be
returned in 6 months if they leave and 3/4 can returned in 12 months if they
leave.  Then after a year we can take a vote and decide what we do with the
down-payment; return some of it, all of it or use it towards another plane
for example.  (Just a thought)

6. Going back to 976, I'm missing a gap somewhere in this financing scheme.
Why would we have to pony up $18,000?  That would leave only a $25,000
(roughly) loan.  Why can't we refinance the whole thing at $40k-ish and give
Tim is money. Then we only have to come up with $4,000 ($267 / 15 member).
And can't we finance it after the plane gets outfitted with new avs? Hence,
finance the Garmin.

7. I like the spreadsheet.  The totals in green appear to be bare minimum
cost for 12 members.  Assuming that, we will have to round these numbers up
to whatever reasonable amount can include a slush fund/saving account.

Todd

--- On Sat, 4/11/09, Steve Gordon <steve at media-phile.com> wrote:

From: Steve Gordon <steve at media-phile.com>
Subject: RE: sample numbers
To: "Eagle East Flying Club Core Team" <eefc-core at workingcode.com>
Date: Saturday, April 11, 2009, 1:49 PM

I see your point.  If we can roll in these seemingly up front costs into the
loan it might be more fair to all members regardless of when they join or
leave, and it's less of a burden to the founding members.  This is assuming
the bank would allow us to finance things such as an initial overhaul fund.

I intentionally left the cost of a GPS NAV/COM out of the base costs to keep
the options simple. I asked a followup question in the survey asking if
members would be willing to spend approx $500 - $1,000 towards that
equipment.  However, if that cost is rolled into the loan, we would need to
communicate a monthly dues increase.  I can change the wording of the
folowup question to reflect what the monthly increase would be.

Sent from Windows Mobile Smartphone.

-----Original Message-----
From: James Carlson <carlsonj at workingcode.com
<http://us.mc1113.mail.yahoo.com/mc/compose?to=carlsonj@workingcode.com> >
Sent: Saturday, April 11, 2009 1:25 PM
To: eefc-core at workingcode.com
<http://us.mc1113.mail.yahoo.com/mc/compose?to=eefc-core@workingcode.com> 
Subject: RE: sample numbers

Steve Gordon writes:
> The one-time cost is a hard number to nail down because it depends very
much
> on the particular aircraft we choose.  It just happens that given the
> particular aircraft chosen as samples, the 172 has a higher one-time cost
> than the Cardinal.  Since these are not necessarily the actual aircraft we
> will pursue, I thought we should give a range as we will not know the
actual
> cost until we settle on something. 

Yep; the new spreadsheet does look pretty good.  The SMOH handling was
confusing at first until I figured out that you were recapturing the
lost asset value from the members so that we'd have an adequate
initial fund for repair later.

These numbers don't seem to include the avionics we've been talking
about, or at least it's unclear to me if they do (and they're just
rolled into the overall purchase).  The extra $10K up front for a 430W
would need to go in somewhere, and it needn't necessarily go in the
one-time cost.  It could be financed.  (I think we're probably better
off keeping as many things out of the one-time cost as we can, and
borrowing more instead.  The monthly cost doesn't get returned to
those who leave the club, but at least part of the one-time cost might
need to be.)

If someone is in the club for (say) a year, I think it's completely
fair that he pays his share for the financed fixed costs paid during
that year, but it's probably not fair to charge him for the whole cost
of the extras -- amount down, SMOH, or 430W.  He didn't use those
things up.

Consider: suppose we just put the entire plane into the one-time cost.
Those leaving would logically get their portion of the plane back;
we'd buy up their share.  Now suppose we finance everything.  Those
leaving would get nothing back, because they paid as they went.  This
argues to me that it's in the club's interest (and also fair) to make
sure as much goes to the monthly dues as we can.

In any event, none of the numbers are outrageous, so it feels like
we're in the right area.

-- 
James Carlson         42.703N 71.076W         <carlsonj at workingcode.com
<http://us.mc1113.mail.yahoo.com/mc/compose?to=carlsonj@workingcode.com> >
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