International Etchells Class Association of Australia Inc
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Dear Association Member,

Update 4.
Further information relating to Special General Meeting 7 December 2019



Need for Sail Royalty Income

One of the proposed rule changes put forth for discussion and consideration is the adoption of a sail royalty on all new Etchells sails. Some background information on the current finances of the International Etchells Class Association (IECA) as well as a discussion of the needs and uses may be helpful in consideration of this proposal.

History

The sources of income to the International Etchells Class are Membership Dues and New Boat Fees. Expenses include Class management, Measurement Expenses, Website, World Championship Expenses and World Sailing Fees. Over the past twelve years the average annual income has been $61,132 with average annual expenses of $63,694. Over this period the Class has been running a slight operating loss on average of $2,561 per year. Over this timeframe the cash position of the Class has dropped from approximately $88k to an estimated $65k at the end of 2019.

Summary: Over the last dozen years the trend in our cash reserves is down and our average annual net income is negative.

Need

A healthy and successful Class requires investment be made in to the Class itself. The IECA has had no excess funds for investment back in to the Class for over a decade.

Sources

Sail royalties provide income which benefits the Class administration and all the Etchells owners and participants. The system works well in other longstanding large worldwide fleets such as the J24, J70 and Star class. A US$50 royalty would be applied to all new Etchells sails. Between North and Doyle Sails the number of Etchells sails sold this year is estimated to be 550-700. This example would generate US$27.5K-$35.0K in income for use by the Class.

Uses

Royalty revenues will provide a dedicated pool of funds for strategic investment in to the Class. This revenue stream could be used for current initiatives such as:

  • Training and support to bolster class measurers worldwide
  • Communication initiatives (quarterly or semi-annual newsletters, social media development, etc) to help promote the class and serve our members, etc.
  • Class rules/document review
  • Support National and regional initiatives with emphasis on promoting fleet, Corinthian and youth team growth/development, examples:
    • coaching or clinics at certain events
    • funding youth teams to campaign in the host countries at each worlds and lead up regattas to be competitive

Note this list is not in any way exhaustive and will expand as ideas are generated and priorities take hold. The point is that the Class needs to generate a source of income to fund initiatives such as these which further the interests and health of our worldwide Class.

If over time we have sufficient resources to fund these and future initiatives and have excess we could look at lowering the current system of membership fees.

Implementation

Initially a proven and effective method is proposed which incorporates the following:

  • A US$50 royalty to be placed on every new Etchells sail
  • A unique sequential IECA sail royalty tag/patch must be permanently affixed to every new sail near the tack for mainsails and jibs and in the head for spinnakers.
  • Sailmakers to buy these sail royalty tags/patches from the IECA Office at a price approved by the IGC from time to time for each sail. Initially US$50 per sail.
  • Sailmakers to attach royalty tags/patches to every new sail that leaves their lofts.
  • It is not an Etchells sail unless the sail royalty appears thereon.
  • Royalty tags shall not be transferred from one sail to another.

The IGC would determine on an annual basis how the royalty income would be utilized based on an annual review of suggested initiatives and agreed to Class priorities.

Summary

It is imperative for the long term viability and success of the International Etchells Class that we make investments in strategic initiatives such as the ones listed above. Sail royalties are a proven and successful technique used in other large, longstanding fleets. Those who are actively sailing and buying new sails are the ones who will be funding the royalty income to the benefit of all Etchells owners, associates and participants.

"The royalty tags are a win win for the class administration and all the Etchells owners. The system works very well in J24, J70 and Star class. I don’t see any downside to this at any level from beer can fleet to active campaigners". -- Jud Smith, Doyle One Design

Jim Cunningham
IECA Chairman



Dear members of the Etchells Class,

There have been messages released by the IECA over recent days explaining the rationale behind the proposed changes to the Sail Acquisition rules and also why Royalty Fees are required for our class and the plans for what the revenue will be put towards.

In this message I would like to address plans for the implementation of the Sail Royalty system.

Several of the one-design classes that have similar systems have been canvassed, as have the sailmakers that service those classes. Their advice and suggestions have been given due thought and adapted to what we think will work best in the Etchells Class.

Hopefully the points below will provide some clarity.

Amount of Royalty:

  • Shall be US$50.00 per Royalty tag.
  • This amount frozen until Jan 1st 2023, after which time the Royalty fee may be reviewed.

How sails are tagged:

  • Every Etchells sail manufactured and/or supplied after the change-over date shall be affixed with tamper-proof cloth Royalty tags prior to leaving the sail loft. These tags shall be affixed via adhesive and stitching. Royalty tags will be printed with a serial number.
  • Royalty tags shall also be signed by the sail-maker with a permanent marker. The signature to extend beyond the tag and onto the sail itself

Certification:

  • By affixing and signing the tag and sail, the Sailmaker certifies that the class sail-royalty fee has been paid for that sail AND that the sail has been measured and is in complete compliance to Etchells class rules

Logistics:

  • Sailmakers order the Royalty tags directly from the International Etchells Class Association (IECA).
  • The IECA will keep a log of serial numbers. Sailmakers will report back to the IECA, detailing the sail type, dispatch date and customer relating to serial numbers.

Implementation:

  • If the vote to implement the proposed Sail Royalty scheme were passed, the change-over date of the new rules will be the later of the following dates:
    • 30 days after the rule-change is ratified by World Sailing or
    • the 30th June 2019
  • After this time, all sails declared for use at IECA sanctioned events shall be either:
    • Sails manufactured and/or supplied prior to the change-over date: stamped and signed with a measurer’s signature, as per the existing rules. The date noted within the stamp shall pre-date the change-over date. These sails are effectively “grand-fathered” and exempt from tagging.
    • Sails manufactured and/or supplied after the change-over date: shall be affixed with the Royalty tag.
  • Event Registration procedure:
    • Sail declaration forms will be filled out detailing sail type, sailmaker and royalty tag number.
    • In the case of sails pre-dating the change-over date, the date on the measurement stamp shall be noted.

Regards,
Andrew Palfrey
International Etchells Class Governor



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