Dues Hike: Where Did the Money Go?

March 16, 2006: It has been nearly four years since a special IBT Convention was held to raise dues from two hours pay to 2.5 hours pay. In that time, an additional $525 million has been raised as a result of the dues hike. Members are asking, where did that money go? Here we present some factual answers, based on financial reports obtained from the union, including the 2005 General Secretary Treasurer report.

Who got most of the dues hike? The dues hike generates about $140 million extra each year. Because a large bite of it goes to the International Union, the dues income of the IBT almost doubled as a result of the increase—from about $80 million to $140 million per year.

Hoffa says he solved the union’s finances. Has he? Actually, the members solved it by paying an extra $60 million per year in dues to the International in the dues hike. Since July 2002, an extra $225 million has flowed into the International treasury. Hoffa’s own dues would be $302 per month if he paid 2.5 times his hourly rate. But he pays $63 per month, so it hard to see how he solved the union’s finances.

How much of my dues goes to the strike fund? 3.3 percent of your dues goes to the strike fund, so about 97 percent goes elsewhere. How did we get that 3.3 percent ? The IBT Constitution specifies that 22 percent of your dues goes to the International, and 15 percent of that (15 percent of 22 percent is 3.3 percent ) goes to the strike fund. For example, if your dues are $50 per month, then $1.65 of your dues goes to the strike fund.

Doesn’t the rest of the dues hike go into organizing?2.2 percent of your dues goes to the International’s organizing program. (That’s 10 percent of the 22 percent). That’s about $14 million per year. $15.9 million was spent in 2005. Most International unions are putting much more into organizing. On $50 dues, that’s $1.10 to organizing.

If the International Union almost doubled its income from our dues, and just these modest amounts go to organizing and the strike fund, where does the rest go? That’s a good question. A good bit goes to pay 148 multiple salaries to officials, almost all of them very large donors to Hoffa’s campaign. Over $8 million went to “communications” last year, most of it PR for Hoffa. Some went to meetings at resorts. An unknown amount went to make oil portraits of Hoffa and Keegel. While only $1.2 million went to help corporate campaigns against employers, $28.6 million went to administration in 2005.

Hoffa says the “government” costs a lot. How much? The Independent Review Board (IRB) cost $2.9 million in 2005, one of the smaller items in the IBT budget, and less than half of one percent of a Teamster dues dollar.

How much does the “Family Plan,” the lucrative pension plan that covers top officials, cost? $9.9 million in 2005, almost as much as the International’s organizing budget.

Who determines these financial priorities? The IBT Convention in June can set some guidelines and should. The International officers elected this fall will largely determine where the International spends money in the future. Will it be organizing and building Teamster power, or more salaries for friends and comforts for officials?

If you have questions on Teamster finances, contact TDU for answers or documentation fo your own research. Your Teamster dues dollar is a great investment; get involved to make it work effectively to build our union.

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