October 21, 1984

Executive Committee of the American Institute of Physics

Minutes of Meeting

1. Convene – Roll Call
The meeting was called to order at 12:45 p.m. by Chairman Ramsey.

Members Present
Norman F. Ramsey, Chairman of AIP
Robert T. Beyer
Roderick M. Grant
William W. Havens, Jr.
H. William Koch, Director
David Lazarus
Theodore E. Madey
Robert R. Shannon
Jack M. Wilson
Ann E. Wright

AIP Staff
Gerald F. Gilbert, Treasurer
Robert H. Marks, Associate Director for Publishing
Lewis Slack, Associate Director for Educational Programs
Bernard Dolowich, Controller
Lawrence T. Merrill, Assistant to the Director
Nathalie A. Davis, Assistant to the Secretary
Paul A. Parisi, Assistant to the Associate Director for Publishing

For clarity in presentation with reference to the printed agenda, events recorded here are not necessarily in the same chronological order in which they occurred.

2. Report of the Secretary
Grant reported that the minutes of the 6-8 September meeting were not yet ready for distribution.

3. Recommendation of Committee on Finances Regarding Investment of Funds
Gilbert reported on the 20 October meeting of this committee. The investment objectives and program of the Institute were reviewed. Their recommendations are taken up individually below.

The following motion was made by Madey, seconded by Havens, and unanimously CARRIED.

MOVED that an additional $300,000 be invested with Drexel Burnham Lambert, bringing AIP's total investment with them to $1,000,000.

Gilbert said that the committee has been closely following developments in the area of no-load mutual funds. They recommend that $600,000 of the amount previously authorized for this purpose be invested in three aggressive growth, no-load mutual funds.

The committee requests flexibility to switch investments within each group of funds as the market dictates. Gilbert would do the switching by telephone after consultation with Weaver and Sears.

The following motion was made by Havens, seconded by Wilson, and unanimously CARRIED.

MOVED that $200,000 be invested with the Fidelity Fund Group, in its Fidelity Magellen Fund, with authorization for telephone switching to and from the Fidelity Cash Reserves Fund.

The following motion was made by Wilson, seconded by Madey, and unanimously CARRIED.

MOVED that $200,000 be invested with the T. Rowe Price Fund, in its New Era Fund, with authorization for telephone switching to and from the T. Rowe Price Prime Reserve Fund.

The following motion was made by Wilson, seconded by Madey, and unanimously CARRIED.

MOVED that $200,000 be invested with the Stein Roe & Farnum Fund Group, in its Stein Roe Capital Opportunities Fund, with authorization for telephone switching to and from the Stein Roe Cash Reserves Fund.

The Institute's long term investments now consist of $2 million with Avatar, $1 million with First Manhattan Co., and $1 million with Drexel Burnham Lambert, and $600,000 in aggressive mutual funds, when the above recommendations are implemented. The remaining $2,300,000 available for long term investment is to remain in the AIP cash management account.

The committee will meet to conduct its first annual review in January 1985. They will receive reports from the current investment manager, and will have proposals from three prospective investment managers. They will request Executive Committee approval to dismiss an investment manager if they think it advisable. This will be done by telephone ballot at the appropriate time.

4. Report on Advisory Committee Meetings Held since September Executive Committee Meeting

In answer to Wright's, question, Gilbert said that the final adjustments, which will be quite small, will show in the following year's statements.

1. Audit Committee
   Gilbert noted Attachment A, the· report of the Audit Committee, submitted by Barschall. He called attention to Recommendation 4 of that report, which recommends that fourth quarter variances be estimated, and the Institute's books closed on that basis in order to expedite the audit. The Audit Committee has been concerned about the lateness of the audit, but heretofore the auditors were unable to begin until these variances were completed. The auditors, Touche Ross & Co., are in agreement with this proposal.

2. Committee on Public Information and Education
   The committee encouraged the staff to move ahead on the proposal to complete and distribute posters to high school teachers.

   They also reviewed "Physics News in 19_" They thought the focus should remain on producing a publication of use to science writers, but the present wider distribution through PT should be continued.

3. Committee on Physics Today
   This committee thought the present ratio of text to advertising (about 50/50) was satisfactory. They passed a resolution commending the staff for the increased reporting of education topics. They were enthusiastic about "Physics News in 19_" being incorporated in the January 1984 issue of PT and encouraged continuation of this means of distribution.

   1. Transmittal Letters to Members of Congress
      Slack said the PT Advisory Committee had discussed the practice of sending PT to Congress.

      Koch noted Attachment B, which contained: a) an exchange of telemail memos between Lazarus and Koch concerning the transmittal letter, signed by Koch, which accompanied the September PT sent to Congress and which called attention to the article in that issue describing the SURA controversy; b) copies of his transmittal letters for the July, August, and September issues; c) a copy of the article about SURA in the 17August 1984 issue of Science; d) a copy of the article about SURA in the September 1984 issue of PT.

      Koch then distributed his 15 October 1984 letter to Hereford regarding this matter, in which he stated that his transmittal letter had been taken out of context. He said that the PT Advisory Committee felt it essential that PT continue to cover controversial issues, that the transmittal letters should be continued, but that care should be exercised in wording. He reviewed the recent discussions on this, and felt that it was important to take these letters in context. Hereford's letter was the first one he had ever received questioning his letters of transmittal.

      Lazarus reported that someone had come to him questioning Koch's letter of transmittal. He thought the tone of the letter unwise, as it deals with a delicate subject. He thought that the letter from Koch, though only a letter of transmittal, could be interpreted as a criticism of the accelerator, and thus could be used as ammunition by people who want to stop the project. Letters on AIP stationery could be interpreted as speaking for the physics community. His feeling is that PT should cover controversial issues, but care should be exercised to avoid any implications of community concurrence with one side or another of an issue.

      Ramsey thought that PT should cover this kind of subject, and felt that the idea of a covering letter is good. However, certain things in the article and in the letter were unfortunate. He thought Koch's letter to Hereford could have been a little more apologetic and noted that letters are frequently taken out of context. Koch said that the PT article is more accurate than the article on the subject in Science. He asked if there was any objection to the practice of sending transmittal letters; there was none. He agreed to send a follow-up letter to Hereford.

   2. Buyers' Guide and Physics in 19--
      Marks said that the Buyers' Guide was more successful than anticipated. It brought in $160,000 worth of extra advertising and had a higher than usual content of ads ($80,000) for the issue. These covered all start-up costs and programming. The net loss for this first Buyers' Guide was $40,000. A side benefit has been increased ads in succeeding issues. Suggestions have been received, and plans are being made, to improve both the editorial and business content in next year's issue. They plan to do a reader survey, part of which will be designed to allow readers to indicate whether they want the guide as a separate issue or not.

      Marks said that members of both advisory committees report that they largely ignore the Science buyers' issue; however, when presented as a regular issue of PT (with editorial material) they go through it, and they thought it would be a mistake to do a 13th issue that no one looks at.

4. Committee on Educational Policy
   Slack said that this committee met in late September. They discussed ideas for the Gemant award. Six proposals have been received, with some similarities among the six, and with promising ideas. They will meet again in February and hope to have a proposal ready for the March Governing Board meeting.

   They discussed the poster idea for high schools and recommended that four posters be produced and that funding to get them into high schools be sought.

   1. Appointment of Subcommittees

      The committee discussed the relationship of the policy committee with its advisory (sub) committees. Bauman (Chairman) recommended a nominating committee consisting of Bauman, Ramsey, and Koch to make recommendations and appointments for these subcommittees.

   2. Decision on Two Appointments in Educational Programs Branch
      The committee approved the two new positions which had been budgeted for 1984. The new per on in the Manpower Division has already been hired. The new person in the History Center will probably start next year.

   3. Cooperation with Other Disciplines on Pre-College Science Education

      This was not discussed.

5. Review of Action Items and Principal Discussion Items On Governing Board Agenda
Koch made introductory comments regarding the Governing Board meeting. There will be three workshops during the Monday morning session. He has a memo regarding distribution of the Governing Board into three groups. Members may switch groups if they desire.

Item 90 - Report on Gemant Award
This was discussed under Agenda Item 4.D.

Item 9D - Prospects for One Common Data Base
This was not discussed.

1. Item 7D - Acceptance of Report of Task Force on AIP-Society Relations and Assignments to Board Policy and Advisory Committees

   Koch said that he planned to distribute to the workshop on the Constitution two tables Gilbert had prepared which show in percentages the volume of business done for the Member Societies. One table includes AIP in the volume; the other table is exclusive of the volume which AIP does for itself.

   He noted that the majority of control on the Board is not determined by either of these elements. In the long run problems could emerge in a case where a Member Society has almost no business with AIP, yet is able to set AIP policies.

   Wilson and Shannon felt that this analysis was not fair. Wilson thought the figures were misleading and not adequately documented or explained and that dues collection is an enormous amount but is quite different from publishing a journal. Ramsey noted that dues collection is only a turnaround of funds.

   Wilson made the following motion, which FAILED for lack of a second.

   MOVED that these tables not be distributed until they are documented and explained.

   Havens said he saw the other side. Several Member Societies do not support AIP, which necessitates a heavier commitment on the part of the other Societies. He thinks this is to the detriment of the physics community. He said that these are documented figures, as they are taken from the audit report.

   Gilbert said these figures are presented on the basis of volume of business handled (operations), as defined in the Constitution, and are based on the total number of memberships. There are two factors: income and expense. Dues are not a large item in the income category. The bulk of items in income are in publishing. Expense is primarily publishing expenses. It does not include the member assessment charge. It does include service charges applicable to Societies. It includes exhibits and job orders. He said all figures on this chart are documented in the statement of account. The reason for including AIP in these figures is that AIP has publishing expenses, and the bulk of the money is in publishing. When figuring volume of business, this is taken into account by the IRS, and the Societies also ask about this.

   Koch pointed out that the issue is how to develop sound criteria regarding prospective member societies.

   Wright said we need to get to the heart of the matter when considering criteria for admitting new member societies. The question is whether Member Society status would remain tied to the total number of physicists in the society or would be determined by some other criteria, such as services required.

   Madey said it is important to examine the nature 0f the services AIP provides and that Lehrfeld commented in this regard that AIP should not extend purely administrative services to non-member societies. This could affect our 50l(c)(3) status.

   Shannon said the point is whether representation should be proportional to involvement or to membership. If these numbers are used, the question speaks to only one aspect.

   Koch said these figures would not have to be used for the workshop and that the discussion could center on other issues. Lazarus thought it legitimate to raise these questions in the Executive Committee, but it could be difficult in the Governing Board. Madey said he saw no harm in distributing these figures, with the proper explanation. Havens said he was bothered that one of the recent issue of PT list the MRS in the
   Member Society meeting lists and that certain schedules are being planned around the MRS. It seems that affiliated societies are having as much effect as ember Societies on certain things.

   Marks said that as an affiliated society, the MRS can ask for services, for which they pay a 15% overhead charge. The October issue is on materials, a timely subject that benefits the entire physics community. AIP did the same thing for AVS and AAPM when they were affiliated societies.

2. Item 8 - Establishment of Ad Hoc Committee on New Building and Space Requirements
   Koch read the list of proposed members for this committee: Havens as Chairman, Beyer, Madey, Pake, and Wilson.

3. Item 9B - Possible AIP Involvement in Co-sponsored Journals
   This was not discussed.

4. Item 9C1 - Financial Statements for 6 Months Ended 30 June 1984
   Gilbert reviewed the figures, which will be distributed and reviewed at the Governing Board meeting. We have $11.5 million in the cash management plan. Of this, $8.3 million consists of deferred subscription income (under liabilities). $2.4 million is uninvested monies at the disposal of the Investment Committee. The value of plant, property, and equipment totals $7.2 million. Long term investments in the operating fund, under professional investment, come to $1.6 million. Total assets are close to $24 million. Total liabilities are about $13 million, the largest of which is deferred subscription income and the long term debt, largely in the Woodbury facility mortgage.

   We are on target with revenue in publishing operations. The budget for 1984 provided for investment income of $425,000. This figure was compiled in early 1983, and several factors have changed this: double digit interest rates were not anticipated, investment income available for long term was not all withdrawn for investment with managers as expected, and the capital expenditure budget was not spent as fast as expected. As of 30 June, AIP had realized $523,000 in net investment income, and he now expects the total for 1984 to be $1 million. Expenses are all proportionate to the budget. The 1984 projected net income was $1.5 million; as a result of the increase in the investment income, he conservatively expects it to be $2 million.

   Madey asked about the New York City real estate tax refund. Gilbert said there had been a discussion of which journals are to be supplied free, per the agreement with the city. It has presumably been resolved, and the refund should be received soon.

5. Item 9C2 - Acceptance of 1983 Audit; Appointment of Auditors for 1984
   See Item 4. A.

6. Item 9C3 - Progress with New Computer System

   Dolowich said that great strides had been made since February. AZTECH will take up file maintenance, the critical path of the project, in the coming week. This work will take three weeks. When this procedure is finished, we will have a good idea of when the entire project will be completed. He reviewed the payment schedule, as revised in April and in September. Through 30 September just under $700,000 has been paid out on this project. $8,000 is authorized for October, so the total to date is $708,000. From 1 October to 31 December, a $15,000 payment is due for the detail design.

   AZTECH' s original estimate of the programming cost was $36, 000 (nine to1 ten months). AIP estimates that this will take 30-man months. AIP staff had always thought the AZTECR time estimate was much too low. They could ask for as much as $90,000 in this area.

   Dolowich estimates that costs for testing may be $17,000; out-of-scope programming: $20,000; conversion costs; $8,000; backup, and restart: $10,000. This would come to an approximate additional total of $160,000, bringing the projected total estimate to $868,000, for the entire new system.

   Managem1ent requests authorization of an additional $200,000 to insure the completion of the AZTECH project. Marks said that this is an outside figure, based on stage by stage projections. It is rounded up to allow for additional contingencies. Dolowich will try to bring it in under this amount.

   Dolowich emphasized that AZTECH does not know our budget and he continually tells them that costs are a grave concern.

   Lazarus and Wright asked how much of the $200,000 was out-of-scope and how much was underestimate. Dolowich said it would be difficult to estimate separately the out-of-scope projects; the RFP was not written in enough detail that one could isolate these things.

   Wright said that it sounds as if we have way overshot the original estimate, with considerable out-of-scope items, but we are getting much more than was in the original contract.

   Shannon thought that this overrun was not unreasonable or uncommon and that these procedural delays are not surprising. The greatest concern should be to get a system that will work. The Governing Board needs to know that the project is being well managed and what steps are being taken to keep it within the additional limit.

   The following motion was made by Havens, seconded by Shannon, and CARRIED, with one abstention.

   MOVED that the Executive Committee recommend to the Governing Board that authorization be given for an additional $200,000 for completion of the subscription fulfillment system, if needed.

7. Item 9C4 - Report on Fund Raising
   This was not discussed.

8. Item 9C6 - Authorization of Sale of Meggers' Coin and Stamp Collection
   This was not discussed.

9. Item 9D - Nominating Committee for Subcommittees of Committee on Educational Policy
   This was discussed under Agenda Item 4.D.

10. Item llA - Briefings for Chief Elected Officers
    This was not discussed.

6. Additional Discussion Items

1. AIP Involvement in APS Electronic News Service "What's New"
   Koch reviewed the background for this undertaking. The original experiment is scheduled to end after December. Goodwin of PT writes a portion of this material, and is doing it entirely while Park is in China. If APS decides to charge for the service after December, we may want to negotiate a price with them. Havens said that the major cost is the preparation of the column. The transmission costs are negligible. Their current appropriation is $20,000. If APS decided to make it a commercial arrangement, the projected subscription price would be about $50.00 per year, based on 1,000 subscribers. He doesn't know if it is a useful service or if people would subscribe; the present free usage is only about 700. It will be discussed at the APS Council meeting next week.

2. AIP Versions of FIZ and Tomash Agreements
   Harks said that the proposed agreement had been sent to FIZ. Rittberger and Donth will be in New York next month and he hopes that the contract will be signed then.

   An agreement in principle baa be n reached with Tomash. Marks is working on a budget for next year, and thinks it will go smoothly.

3. AIP Involvement in Use of The Support Center
   Koch said that AIP management has been looking for management courses. Boyce had discovered The Support Center which offers management workshop courses for nonprofit organizations and thought they were useful. The Nonprofit Management Institute that conducts the courses gets support from industry, and the fees are very reasonable. Management plans to try them as an experiment.

4. Change in AIP's Legal Counse1
   Koch said that AIP management has been disappointed in its house legal counsel, a firm used since the 1930’s. Koch and Gilbert think we need to, interview and consider a new firm. They plan to interview firms both in New York and in Washington.

5. Status of Membership Application of AGU
   Koch said that the AIP officers had recently visited with Spilhaus, the Executive Director of the AGU. AGU has 15-16,000 members, including a number of physicists. If they joined now, they could not contract their subscription fulfillment or publishing with us for a few years, although they are interested in publishing, but they would contract for historical services and other things. They have expressed interest in getting involved with AIP in electronic publishing. We have not done any services for them as an affiliated society.

   Marks said that they now do their publishing with William Byrd Press, which is an expensive firm. The AGU page charges are $140.00 per page and are mandatory.

6. APS and AIP Investments in Physical Review Abstracts and General Physics Advance Abstracts
   Marks distributed a sample issue of the projected GPAA, dated 25 October 1984. This product is an example of cooperation with several Member Societies, especially APS. There has been good response to the APS promotion. Havens added that about 70% of the requests received by APS are for both PR Abstracts and GPAA.

   Marks said AIP staff is working with OSA to get their abstracts. Shannon said this is a question of economics. The tapes have to be converted to be compatible.

7. Status of Building Facilities: Moves, Expansions
   Marks noted that the Executive Committee had autho1rized management in September to rent additional space at 216 East 45th Street. 12,000 square feet will be available in this building in early 1985. Management is negotiating on this, to satisfy current New York needs.

   Space on the lower level at Woodbury is being converted now for office use. This will utilize all the available space there, and should take care of publishing needs for the next five years.

8. Update on 1984 Capital Expenditures Budget
   Gilbert distributed a handout and reviewed the current figures on the capital expenditures budget (attached herewith). Most items are now complete and under budget.

7. Other Business

1. Confirmation of Approval for Renovation of Headquarters Building
   Marks asked for confirmation of the telephone approval which was requested the previous week.

   Beyer made the following motion, which Wright seconded, and which was unanimously CARRIED.

   MOVED that the expenditure of up to $85,000 for renovation of the AIP headquarters building be approved, in confirmation of the telephone approval.

   Grant said he had not been informed of this telephone request for approval. In addition, he had not been informed of two other telephone ballots taken in the last five months. Although he is not a voting member of the Executive Committee, as Secretary and a member of the Committee, he must be informed of such matters. Koch agreed; he said these instances were an oversight. Grant would be kept fully informed in the future.

2. Ad Rates for Physics Today
   Marks noted that there have been many improvements in PT, including more articles and wider distribution. Our advertisers are getting a bargain. He requested authorization to raise the rate for a one-time black and white ad from $2,200 to $2,500 effective as of February 1985. Prices for color and for ad frequency would have appropriate adjustments. This is the start of a program to increase ad rates, which will help PT to break even. Wright asked if increased rates would take away some ads. Marks said he was confident we could sell this. Our ad rates are on the low side.

   Shannon said he would vote against this proposal, since he had received no written supporting material. Gilbert distributed Greeley's memo, dated 18 October, to Shannon for his information on the adjusted rates.

   The following motion was made by Wright, seconded by Havens, and CARRIED, with one abstention.

   MOVED that ad rates for Physics Today be increased, effective February 1985, with a one-time full-page black and white ad to be $2,500, with appropriate adjustments for color and ad frequency. The base rate for the Buyer's Guide issue would be $3,000 with similar adjustments.

3. New Corporate Associates
   Merrill presented two new applications for Corporate Associate membership: The first was Xerox (Palo Alto), which applied for a $500 rate, requesting several journals. The second was Kentech Corporation, a new firm which does physic -related work, also applying for the $500 rate.

   It was pointed out that the Xerox application was from a branch of the company, which as a whole is already a Corporate Associate. Concern was expressed that the $500 rate level indicated far fewer physicists at that branch than were known to be employed there. The following motion was made by Havens, seconded by Wilson, and then TABLED after discussion.

   MOVED that Xerox (Palo Alto) and Kentech Corporation be accepted as new Corporate Associate members, each at the $500 rate.

   Wright suggested amending the motion to specify that the membership fee for Xerox be changed to correspond with the number of physicists on the staff. This suggestion was not formally acted upon.

   Lazarus then made the following motion, which Beyer seconded and which was unanimously CARRIED.

   MOVED that the motion to accept the two new Corporate Associate members be TABLED.

   The following related motion was made by Wright, seconded by Madey, and then WITHDRAWN following discussion. The Advisory Committee will be meeting during the Corporate Associates meeting. With these considerations, Grant suggested that the motion was not needed.

   MOVED that this matter be referred to the Advisory Committee on Corporate Associates and that future applications be checked for the number of physicists on the staff.

   Merrill explained the rate structure for the Corporate Associate program. Dues have not been raised since 1968. One change was made a few years ago, eliminating the complimentary journals, and specifying that journals be paid for at the member rate. Some companies take a large number of journals, some only a few.

   A quick calculation done by Executive Committee members showed that the dues collected in many cases were less than the benefits given through reduced journal subscription rates. This reverses the concept that the Corporate Associates are supporting the activities of the Institute.

   Merrill further explained that when firms apply for membership, they select their category on the basis of the number of physicists. The Xerox application is from a librarian, which may explain the low estimate.

   Following general protests over the low level of the dues, Ramsey suggested that the whole dues structure should be reviewed, while noting the support of the Corporate Associates in the Corporate Associates meeting and in other activities of the Institute.

8. Executive Session
The staff was excused for the executive session at 4:10 p.m. This is reported in the official minutes only.

9. Adjournment
The meeting was adjourned at 5:00 p.m.