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Chapters may sell self-generated lists or labels of their own chapter members, but may not store or reproduce member names and addresses from other chapters. Chapters may not sell labels or lists obtained directly from the Headquarters.
It is the chapters' responsibility to update their own lists each month when they receive changes from the Headquarters, to ensure all lists are accurate.
When chapters sell self-generated lists or labels, they must agree to refrain from restraint of trade or anti-trust practices as described in The Sherman Act, The Clayton Act, and The Federal Trade Commission Act. Income received from selling lists is unrelated business income, subject to tax. There is no principal-agent relationship between the chapter and national association; the chapter sells its lists or labels without national approval or knowledge. Compliance with all laws and regulations is the responsibility of the chapter.
In November 1983, staff members from Chapter Services, Education, Membership, and Leadership areas discussed the concerns raised by two of the chapters to be able to sell lists of their members' names and addresses as a source of non-dues revenue. They developed the policy and the following analysis.
A chapter is perfectly within its rights in refusing to provide its membership list to competitors of the chapter. However, if the chapter makes the list available to its members, it probably must also make it available to nonmembers who compete with its members. Likewise, if the list is made available to suppliers of goods or services to members, it should be made available on the same basis to all suppliers and not just selected ones. Chapters selling self-generated lists should be incorporated to protect individual members from liability; however, incorporation and liability insurances do not protect chapter leaders from anti-trust violation penalties - liability insurances specifically exclude coverage for these cases, and criminal penalties may be imposed on individuals if a chapter were convicted of anti-trust charges.
There is a possibility of the national association (and therefore all other chapters) being included in anti-trust or restraint of trade actions. The College follows strict procedures in releasing the membership list to outside agencies. Chapters should establish similar procedures.
The proposed policy whereby chapters may sell only self-generated lists is recommended to protect the majority of chapters. The chapter-generated list may decrease the potential of the College (and therefore all other chapters) being drawn into an anti-trust action. The sale of lists maintained by the College may be perceived as a chapter acting on behalf of the College when in fact the College has no mechanism of knowing to whom the list is sold or not sold. The proposed policy helps minimize the liability of ACEP and other chapters for inappropriate chapter actions.
It is important to note that tax laws consider revenue from the sale of lists to be "unrelated business income," and taxable. Chapters selling lists should see a tax advisor to determine how much tax needs to be paid on sales and how to file the appropriate tax return.
Currently, chapters are charged only for the cost of the paper on which the labels or lists are printed ($12.80 per thousand for membership labels and rosters). A chapter with 1,000 members pays $12.80 for a set of adhesive membership labels. Chapters are not charged for staff time to process the order, records maintenance charges, and costs incurred in developing and distributing monthly membership address changes and updates to each chapter. An estimate of these costs would add $35 to the costs of each label order, plus $110 per chapter per year for the membership and address update chapters receive each month.
Chapters also do not pay any portion of the computer expense for maintaining the records, which is $.21 per record per month, because the College would incur this expense whether or not chapters exist.
The proposed policy does not call for charging these costs to chapters. The College absorbs most of the chapter label expense in order to encourage frequent communication between a chapter and its members. It is not prudent, however, for the College to continue to sell labels to chapters below cost and have the chapters sell those same labels at a profit. Since the issue was raised by only a few chapters, it would not be fair to charge an additional $35 per order to cover costs, basically penalizing most chapters that use the labels only for chapter mailings: newsletters, meeting promotions, special notices. Because the national association wishes to encourage communication with chapter members, the decision has been made not to charge the full cost of labels to chapters and to allow chapters to sell only their self-generated lists in accordance with the policy.
Educational and commercial firms pay a higher price than chapters for membership labels ($30-$75 per thousand, plus postage). This revenue helps defray chapter label costs, helps minimize dues increases and helps defer some of the cost of collecting chapter dues. Staff members do not believe chapter sales will affect College sales; firms purchasing lists normally wish to promote a program or service regionally rather than in just one state.
It is important to a few chapters to be able to sell lists of their members, and the policy allows them to do so. To sell their own lists, chapters must produce their own lists. They may have a computer to store and reproduce lists or labels of their chapter members, and are required to maintain current, up-to-date lists. The Headquarters will continue to send monthly address changes and membership updates to chapters, and chapters are responsible for making these changes to their own lists. In no instance can chapters sell lists produced by the Headquarters, nor may they store and reproduce lists of members from other chapters.
Before determining whether to maintain, reproduce, and sell chapter lists, chapters should consider the revenue expected and the procedures and liabilities.
