This past fiscal year has seen every possible effort exerted to place the Brotherhood in the forefront of rail labor negotiations. At the same time every effort was made to contain the costs surrounding negotiations, the skill and initiative used in the recent round of negotiations was ground breaking and never before included the ability of so many Grand Lodge and system division/federation officers in the execution of negotiations, Presidential Emergency Board and infinite court battles. As I predicted over the past two years, this round of negotiations would cost the Brotherhood in excess of $1 million dollars. As you will see in this Report, this prediction has come to fruition, and proof that you can only get what you pay for. This is reflected by the resounding results of the ratification, a satisfaction not experienced since the 70's as echoed by those who became so very involved.

All spending in excess of the income in each case as required by the By-Laws was placed before the Grand Lodge Executive Board. While permission was granted for these expenditures, it was done so only after long and arduous discussions, which reflected that the decision for such expenditures were only done in the interest and for the betterment of the Brotherhood’s membership.

The Officers, Appointees and employes have continued to seek out and execute cost cutting initiatives; however, as the years have progressed, the last large cost cutting initiatives have been executed, but still each day efforts are made to change the daily operation and reduce costs.

In accordance with Article VI, Section 8, of the Grand Lodge Constitution and By-Laws, I take pride in submitting the following Report reflecting the financial condition of the Brotherhood of Maintenance of Way Employes and the successes we have had while maintaining a sound fiscal condition over this year April 1, 1996 through March 31, 1997.

The total income for the fiscal year under review, April 1, 1996 through March 31, 1997, was $11,692,841.15, a decrease of $963,526.47, or 7.61 percent from the previous fiscal year April 1, 1995 to March 31, 1996. The combined income from dues and initiation fees decreased $89,272.20 or .96 percent from the preceding fiscal year. Income from investments decreased $810,918.56 or 28.68 percent.

The net expenses for the fiscal year under review, April 1, 1996 through March 31, 1997, were $13,069,220.02, for an operating deficit of $1,376,378.87. The net expenses for the previous fiscal year from April 1, 1995 through March 31, 1996, were $11,980,897.69, resulting in an operating excess of $675,469.93. Expense over income increased by $2,051,848.80, for the period covered by this Report compared to the previous fiscal year.

In this my second term, I have and will continue to meet the fiduciary responsibilities for which I have been elected and am dedicated to preserving the Brotherhood’s sound financial position. With the continued assistance of President Fleming, the Grand Lodge Officers, staff and employes, the system division/federations, subordinate lodges and membership support, we will strive to maintain the Brotherhood’s position as a leader among rail labor.

In conclusion, I wish to express my sincere appreciation to President M. A. Fleming for his continued assistance and guidance, to the Grand Lodge Officers, staff and employes in the President’s Department for their cooperation and dedication.

I also would like to express a special appreciation to the entire staff and employes of the Secretary-Treasurer’s Department. Equally as well, I wish to thank all the system federation and division officers and subordinate lodge officers, who have maintained a devoted commitment to serving our members when time is of the essence, when funds fail to meet the needs of a progressive union and work is never ending.

Independent Auditor’s Report

In our opinion, the financial statements shown below presents fairly, in all material respects, the financial position of the Brotherhood of Maintenance of Way Employes as of March 31, 1997 and 1996 and the results of its operations for the years then ended in conformity with generally accepted accounting principles.

Landgren & Company, P.C.

Costs Associated With Strike Activities

The following is a report of payments made from the Strike Fund Trust for the period April 1, 1996 through March 31, 1997. A total of $42,936.74 was paid from the Trust.

Strike benefit payments, investment management fees and bank service charges were the only payments made from the Strike Fund Trust. At the close of the fiscal year March 31, 1997, there was a balance of $15,855,591.89 in the Strike Fund.

Payments to members due to the Brotherhood's enjoined strike against Norfolk Southern Railroad totaled $1,638.00.

Payments to members honoring the Shop Craft strike at Waycross, Georgia totaled $432.00.

Investment management fees and bank service charges totaled $40,866.74.