The Financial Health of Our Organizations: NCBTMB

Note: For the past few years I have done a series of reports on the financial status of the non-profit organizations that represent the massage therapy profession. I obtain this information from Guidestar, a financial information clearinghouse for non-profits. The organizations can provide their Form 990 (Return of Organization Exempt from Income Tax) to Guidestar, and if they don’t, the IRS does it for them. I will state for the record that I am not an accountant or a financial analyst; I just report what I see (and maybe offer a few opinions). I usually get asked the question every year why I am not reporting on ABMP. Associated Bodywork & Massage Professionals is a privately-owned for-profit company, and they are not obligated to release their financial information. Non-profits are on a different filing schedule than the rest of us, and there is variance amongst them in when their fiscal year ends. The deadline for filing is the 15th day of the fifth month after the end of their fiscal year. An organization can also request and receive up to two 90-day extensions, and due to the number who haven’t filed yet for 2011, it appears that some of them have done that.

The National Certification Board for Therapeutic Massage & Bodywork has filed their 2011 Form 990 in a timely manner so I’m going to start with them this year. I’ll be following that up with my report on the Federation of State Massage Therapy Boards. The financial status of these two organizations are intertwined for one reason: since it’s introduction in 2008, the MBLEx has taken a substantial market share of the entry-level exam market away from the NCBTMB. For many years, the NCBTMB exams were enjoying a monopoly, except for the few states that require their own exam.

In 2008, the first year that the MBLEx was available, the NCBTMB’s revenue from exams was in excess of $6 million. By 2011, that had dropped to $3,380,813. Instead of a monopoly, they had a 47% share of the market. I confess that I was expecting it to be even less, since the Federation has relentlessly encouraged their member states to use the MBLEx exclusively. I think the fact that the NCBTMB has retained as much as they have is proof that plan has not yet come to fruition. The income at the NCBTMB from people recertifying dropped by a little over $5k, and sales of their exam guide were down about $17k. Sales of their mailing list also took about a $20k hit this year.

They are showing a total revenue of $5,357,738 for 2011. From 2010 to 2011, the NCBTMB’s total revenue went down to the tune of $443,312. That’s not exactly a shocking figure in this time of recent recession.

The 2011 return, due to the timing of the NCB’s fiscal year, reports the salary of former CEO Paul Lindamood; although the filing was signed by his replacement Mike Williams. Lindamood’s compensation and benefits amounted to over $257,000. No word on what Mike Williams is doing the job for. Non-profits have to report the breakdown of compensation of officers, directors, trustees, key employees, highest compensated employees, and independent contractors. All together, the NCBTMB paid out over $1.7 million in compensation during 2011. Their other major expense is over $1.3 million in exam administration fees.

The bottom line is what tells the tale for most businesses–for profit or not–and their net revenue after expenses for 2011 is $227,326 which is down over $240,000 from 2010.When you consider that during Paul Lindamood’s reign at the helm, the organization went from being almost $270,000 in the hole in 2009 to having a net income of over $469,000 in 2010, it looks like it’s time to either slash expenses, the way he did, or generate more money.

That’s exactly what the NCBTMB hopes will happen in the coming year(s) on both fronts. They are rolling out the new rules for national certification, as well as the new rules for continuing ed providers, and doing away with organizational approval. The requirement that each individual be approved as a provider in their own right should generate some additional funds. The new rules for becoming nationally certified, in my humble opinion, is initially going to cause a further decrease for them. Since the new rules are jacking up the education requirement from 500 hours to 750, and requiring 250 hours of work experience, that will automatically disqualify people who might have otherwise taken the exam for entry-level licensing. The NESL is still an option in some states, but with the entry-level exam revenue steadily declining for the past four years, and the MBLEx becoming more firmly entrenched with the member states as time goes on, I’d be surprised if they don’t continue to lose ground in that market.

Their expenses could go back down. The application and recertification processes are online, and that’s going to knock a few staff members out of a job. They spent about $40k more in 2011 attending conventions than in 2010. I feel that they should be present at all major massage meetings, so I don’t begrudge that money…conventions are never held at Motel 6 so unless I’m an invited speaker, I feel that one in my own pocketbook. Legal expenses also increased by about $13k this year, but lobbying decreased by almost that same amount. It does cost money to go in and challenge a state that is considering dropping your exam–or appealing to one that has already dropped it to reinstate it.

On a positive note, total assets increased by about $70k, while total liabilities decreased by about $142,000.

All in all, it wasn’t the best year they’ve ever had–and it wasn’t the worst, either. The NCBTMB has had some administrations in years gone by that seemed hellbent on bankrupting the organization. I feel pretty safe in saying that isn’t the case here; they have some dedicated staff and board members that are determined to make it work, and we’ll just have to wait and see what happens. In the meantime, their new website is very snappy. You can check it out and all the new changes they are implementing at www.ncbtmb.org

6 thoughts on “The Financial Health of Our Organizations: NCBTMB

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