Board of Directors Approved Minutes: February 17 & 18, 2010

Approved Minutes

Present: Carol D. Goodheart, EdD; James H. Bray, PhD; Melba J. T. Vasquez, PhD; Barry S. Anton, PhD; Paul L. Craig, PhD; Norman B. Anderson, PhD; Rosie Phillips Bingham, PhD; Jean A. Carter, PhD; Rachel N. Casas, BA; Armand R. Cerbone, PhD; Suzanne Bennett Johnson, PhD; PhD; Nadine J. Kaslow, PhD, and Jennifer F. Kelly, PhD

Absent: None.

I. Minutes of Meeting

A.(1) The Board voted to approve the minutes of the December 4-6, 2009, Board of Directors Meeting.

II. Elections, Awards, Membership and Human Resources

No items.

III. Ethics

A.(2) The Board voted to recommend that the Council of Representatives approve the following amendments to the Ethical Principles of Psychologists and Code of Conduct (2002):

From the Introduction and Applicability section:

If psychologists' ethical responsibilities conflict with law, regulations, or other governing legal authority, psychologists make known their commitment to this Ethics Code and take steps to resolve the conflict in a responsible manner[. If the conflict is unresolvable via such means, psychologists may adhere to the requirements of the law, regulations, or other governing authority] in keeping with basic principles of human rights.

From Ethical Standard 1.02:

1.02 Conflicts Between Ethics and Law, Regulations, or Other Governing Legal Authority

If psychologists' ethical responsibilities conflict with law, regulations, or other governing legal authority, psychologists clarify the nature of the conflict, make known their commitment to the Ethics Code and take reasonable steps to resolve the conflict consistent with the General Principles and Ethical Standards of the Ethics Code. [If the conflict is unresolvable via such means, psychologists may adhere to the requirements of the law, regulations, or other governing legal authority.] Under no circumstances may this standard be used to justify or defend violating human rights.

From Ethical Standard 1.03:

1.03 Conflicts Between Ethics and Organizational Demands

If the demands of an organization with which psychologists are affiliated or for whom they are working are in conflict with this Ethics Code, psychologists clarify the nature of the conflict, make known their commitment to the Ethics Code, and [to the extent feasible, resolve the conflict in a way that permits adherence to the Ethics Code.] take reasonable steps to resolve the conflict consistent with the General Principles and Ethical Standards of the Ethics Code. Under no circumstances may this standard be used to justify or defend violating human rights.

IV. Board of Directors

A.(3) Dr. Anderson provided the Board with an update on the Interim Diversity Implementation Plan. The Board voted to support Dr. Anderson's plan of appointing a staff Diversity Plan Implementation Group comprised of the Executive Directors or their representatives from all the major units in APA central office, chaired by the Deputy CEO, to address implementation of the recommendations in the Interim Diversity Implementation Plan.

B.(4) The Board discussed the item "Procedural Safeguards to Ensure Scientific Integrity of APA" and voted to establish a group comprised of representatives of the Board of Educational Affairs (BEA), the Board of Scientific Affairs, the Board for the Advancement of Psychology in the Public Interest, the Board of Professional Affairs, the Policy and Planning Board and the Committee on Legal Issues, to be chaired by Dr. Bingham, to develop procedural safeguards to ensure scientific review of APA resolutions, reports, policies and related activities.

V. Divisions and State and Provincial Associations

No items.

VI. Organization of the APA

No items.

VII. Publications and Communications

No items.

VIII. Convention Affairs

No items.

IX. Educational Affairs

A.(8) The Board received an update on the BEA Task Force on Translating Psychological Science into Classroom Practice.

X. Professional Affairs

No items.

XI. Scientific Affairs

No items.

XII. Public Interest

A.(5) The Board voted to recommend that the Council of Representatives receive the report of the 2009 Presidential Task Force on Psychology's Contribution to End Homelessness.

XIII. Ethnic Minority Affairs

No items.

XIV. International Affairs

No items.

XV. Central Office

No Items.

XVI. Financial Affairs

A.(6) The Board voted to recommend that Council approves the following Net Asset Allocation Plan including the 2010-2012 Financial Forecast:

1. The goal for attainment of net assets as stated in Association Rule 210-3 is reaffirmed; namely, that the Association strives to maintain net assets equal to at least one year's operating budget.

2. Consistent with accounting practices, conventional wisdom and comparable financial data from other organizations, the Association should not consider any portion of theoretical building equity toward attainment of the net assets goal mentioned in item 1 above.

3. Currently, rather than specifically set aside funds outside the normal budget process for development of programs deemed to be of high priority to the membership, the Association enthusiastically supports consideration of proposals (in the form of a business plan) for new revenue generating ideas. [Such proposals for new revenue generating ideas should be thoroughly detailed including all direct costs, indirect costs, and staff costs. Such proposals reviewed by the FC, the Board and approved by the COR, will be funded out of ongoing revenues or out of the Association's net assets, as necessary, assuming that full consideration is also given to the impact of such funding on progress towards the Association's net assets goal mentioned in item 1 above.]

4. Each year, based on actual results and an analysis of our net assets, future financial forecasts and the net asset allocation plan will be adjusted accordingly.

5. Once the net assets goals are attained, any number of future actions can be taken including the long-term stabilization of dues; the long-term availability of funds for the development of programs deemed to be of high priority to the membership; further apportionment of building and investment proceeds toward operational expenses, etc.

6. The specific financial forecast for 2010 — 2012 is as follows:

a) Strive to attain a net asset goal equal to at least one year's operating budget consistent with Association Rule 210-3;

b) Include $3.5M net cash flow from building operations in the operating budget as a regular source of revenue (consistent with Council's action of February 2008);

c) Restrict capital expenditures to no more than $10M over the forecast period;

d) Continue to reinvest net realized gains/losses from our long-term portfolio activity;

e) Rather than reinvesting all interest/dividends from our long-term portfolio activity, the forecast assumes that long-term interest/dividends be transferred to supplement operations during the entire forecast period 2010- 2012;

f) Treat Federal income tax expenses as non-operating activity;

g) Treat all real estate cash flow in excess of $3.5M annually from building operations as an increase to net assets (increase to investment and/or debt extinguishment) after the operating line of credit has been paid off;

h) Continue to pay down the long-term debt; no sale of our real estate is anticipated during this forecast period;

i) To present annual budgets that are consistent with Association Rule 210-2.1 that call for a surplus of between 1% and 2% of budgeted revenues (after consideration of the cash flow from buildings) in order to provide a basis for orderly expansion of operations and services in successive years and to provide a margin of safety against contingencies.

The Board also supported the recommendation to have the Audit Subcommittee and Finance Committee consider alternative approaches for doing the financial forecast.

B.(7) The Board voted to recommends that Council approve the revised Long-Term Investment Policy.