Bar Association board approves FY25 reforecast using reserves for office downsizing and entity regulation work

The Bar Association board voted unanimously to approve an updated fiscal year 2025 reforecast budget after a presentation from Director Tiffany Lynch.

The reforecast moves previously budgeted work from fiscal 2024 into fiscal 2025 and reassigns designated reserves to cover costs tied to an office downsizing project and an entity regulation pilot, Director Tiffany Lynch said.

Lynch said the reforecast covers three of the association’s four funds — the general fund, the CLE fund and the client protection fund — and that the combined revenue projection across those three funds is about $25,000 lower than previously estimated. "The reforecast allocation for revenue is about $25,000 less in total across all three funds," Lynch said. She told the board the majority of the increased expenses — roughly $259,000 — are indirect costs tied to the downsizing and to completed capital and scanning work, and that overall the association anticipates an increased use of reserves of about $284,000.

Among the specific changes Lynch described: an approximately $154,000 increase in projected general fund revenue that largely reflects year-to-date receipts; a roughly $180,000 reduction in CLE revenue tied to the timing of product sales and seminar registrations; a one-time $60,000 rent-related increase assessed because a new lease included the leasehold excise tax in the rent rate; and about $40,000 added to the regulatory reform cost center for consulting and outreach tied to the entity regulation pilot. "We were assessed the leasehold excise tax for 2024 and 2025," Lynch said, calling the rent-related increase a one-time addition.

Lynch also explained indirect expense changes related to depreciation for leasehold improvements, costs for record storage and a scanning project (including temporary staffing), and additional IT consulting and software licensing. She said the client protection fund had no revenue changes and only a minor increase in indirect expenses, reducing an originally projected net income by about $1,900.

A board member asked whether a reforecast required formal approval because it is principally arithmetic. "According to Director Lynch, yes," the chair responded, and the board proceeded to a roll-call vote. The motion to approve was moved and seconded (movers not specified in the record) and carried unanimously. The board directed staff to include the approved reforecast as part of the May financial statements.

Details reported by Lynch show the general fund’s reforecasted use of reserves is about $1.5 million (an increase of $67,000 from the original budget), though use of unrestricted reserves is reduced by $92,000 because designated reserves are being applied to specific projects. The CLE fund’s reforecasted result is a loss or use of reserves of approximately $119,000; Lynch noted the CLE fund had an ending balance of about $1.3 million from the prior fiscal year to support that use.

No statutes, ordinances or external legal authorities were cited during the discussion. The board did not amend the reforecast during the meeting; the vote approved the package as presented.

The association’s next step, per staff, is to publish the approved reforecast with the May financial statements and to continue implementing the downsizing and the entity regulation pilot under the budgeted allocations.