After merger talks fail, national club pulls plug on financial support
The AACA Museum was conceived under the direct supervision of the Antique Automobile Club of America’s Board of Directors. Now, the club will completely cease its support for the museum in Hershey, Pa., that shares its name.
“The Antique Automobile Club of America (AACA) has always valued our partnership with the museum that bears our name,” stated a letter mailed in early December 2016 to club members by the AACA National Board of Directors. “We are, however, writing to inform you that, after much deliberation, we have made the difficult but responsible decision in the best interest of our members to discontinue our relationship and financial support with the AACA Museum.”
The decision to cease financial and other forms of support comes after failed merger negotiations between the club and the museum.
“They (the AACA Museum Board of Directors) have decided that they don’t want to be legally attached to [the AACA club] in any way,” said Tom Cox, current AACA vice-president and incoming club president. “Our board is charged with the legal duty of looking out for that which our membership owns, and our membership does not own any of that museum.”
Hank Hallowell, president of the AACA Museum board, said the merger talks have been going on for 2-1/2 years.
“During that time, we have made a series of proposals to the club,” Hallowell said. “We had one letter of intent signed by both parties. That was about one year ago. Well, the club felt that they could not do it. That is how it fizzled out. It was good with us, not good with them.”
Cox said, “The club’s legal counsel advised that the proposal would have disenfranchised members’ voting rights. Consequently, we could not move forward.”
The original letter of intent provided for the construction of a wing on the rear of the present museum that would contain the AACA Library and Research Center and the club offices as well as new gallery space for the museum. The library and club offices are currently housed in a building in Hershey that dates to the early 1900s.
When the club withdrew from the signed letter of intent, Hallowell said the final proposal that the AACA Museum offered to the AACA during the 2016 Hershey meet week included a three-acre parcel of land worth in excess of $1 million at no charge.
“We thought that was a good proposal,” Hallowell said. “The idea was to put everything on the same campus. The [original] letter of intent had a wing going off the back (of the museum) for the library and offices. Our thought [in the final offer] was a campus setting with the library and club headquarters on the property.
“We had it appraised worth in excess of $1 million, but that was the last proposal that was rejected.”
“…In their proposal, they wanted us to split the funds raised from the capital campaign [for the new AACA Library and national headquarters] with them,” Cox said, “and we need to probably raise somewhere in the neighborhood of several million to build an adequate library facility… So, if we are going to raise $4 million and we have to give them more than half of it, we are double paying for the land. And, on top of it, our membership still has no legal attachment to the museum that advertises itself as the Antique Automobile Club of America Museum.”
Steve Moskowitz, executive director of the AACA, said he hoped the plan to merge the AACA with the AACA Museum would have in some ways paralleled the 2006 merger between the club and the AACA Library, which were originally separate entities. Cox added that the merger between the club and the library has been successful, which is partially why a new library is necessary.
“The merger gave economy of operation, better access, better clarity, a whole host of things, and it was good for the long-term expansion of the library,” Cox said. “The library has done extremely well since the merger. We now have three master degree librarians and lots of collections coming in.
“We want it to be a world-class facility and right now, we are almost at capacity and if we’re going to be the steward we want to be and if we want to be the resource to the automotive community we want it to be, we need to expand it.”.
Like the AACA Museum, the AACA Library was the brainchild of the AACA board of directors, according to Cox. And like the library, the museum was made a separate 501(c)3 entity to not only encourage tax-deductible donations, but also to protect the club, which is now a 501(c)3 itself, in case the museum could not support itself.
“The museum was created by the AACA board of directors as a 501(c)3 because there was concern it needed tax-deductible charitable status,” Cox said, “and there were board members that weren’t sure how successful the museum would be. Museums can be a financial drain, and by making it separate, that should there be budgetary shortfalls that could not be foreseen, it would not negatively affect the club.”
Hallowell said that the idea to eventually merge the club and the museum was not the original plan for the two sides, and such planning began only a few years ago. Bill Smith concurred that the original plan was to keep the club and museum separate.
“That was my intent, and I have been there since the first day,” said Smith, who was AACA executive director and also a former AACA president when the idea for the museum was formalized in 1993. Smith retired from the club as executive director when the museum opened in 2003. Currently, he is an AACA life member and a member of the AACA Museum board of directors.
Cox disagrees, noting that the AACA Museum’s Board of Directors approached the AACA about eight years ago to discuss strategic planning and an eventual merger in a joint board meeting at the museum. However, the idea did not advance until several years later.
“About 2-1/2 years ago, another group of museum board members had inquired about a merger,” Cox said. “We just had one of the founding board members present with two other museum board members at our board meeting where he stated that the intention was that it would always be there, together…and he’s one of the original museum board members.”
Hallowell said the AACA currently funds about $80,000, or 5 percent, of the museum’s $1.5 million operating budget. Cox said additional types of giving have made the AACA’s total amount of annual financial support for the AACA Museum an even more substantial figure. Cox said the 5 percent or $80,000 figure given by the museum does not include other AACA member and club donations.
“The amount of overall annual support from AACA and its members is considerably higher than that amount,” Cox said. “Since [the AACA Museum’s] inception, the AACA — through dues sharing — has gifted over $1 million to the museum. That is in addition to all of the millions of dollars that have been given to the museum by individual members and also AACA regions and chapters. They also received donations of vehicles from our members and estate gifts from AACA members who have passed on.”
Jeff Bliemeister, who served as curator of the museum until five years ago and recently returned as executive director, said the museum will begin to look at ways of making up the national club’s annual contribution to the museum. He added that, as part of the partnership between the club and the museum, AACA members were granted free admission to the museum, and that will continue. In fact, he said museum visitors will see few — if any — signs that the club has withdrawn its support.
“In terms of name changes, mission statement, we don’t have any plans to change that,” Bliemeister said.
However, since there will be no legal ties between the AACA Museum and the club, the AACA Board of Directors has “regrettably and unanimously” withdrawn all support for the museum.
“We have no protection, from our perspective, and we must look out for the investment of our members,” Cox said. “That museum could do whatever it wanted. We don’t know that they are going to change their mission statement and what their strategic outlook is for the future. It might be different that what ours is now. In good faith, we want to make sure if our club and members are donating, that the museum continues to do what it was original intended to do when the AACA Board of Directors founded it.”
Hallowell said he hopes the relationship between the club and the museum will remain the same, even without the funding from the club.
“We would like the status quo. To us, the only issue is their decision to end their funding,” he said.
“While we are understandably disappointed in the outcome, AACA founded the museum, and we wish them well,” said Cox. “Meanwhile, we will continue doing what is necessary to keep AACA the worldwide resource it has become, and in so doing, make sure our services and Library and Research Center are not only second to none, but also accessible the world over by member and non-member alike.”