national elevator industry, inc. · 4/7/2009 · national elevator industry, inc. 1677 county...

National Elevator Industry, Inc. 1677 County Route 64 • P.O. Box 838 • Salem, New York 12865-0838 • 518.854.3100 Fax: 518-854-3257 WWW.NEII.ORG • E-Mail: [email protected]

MINUTES s

NEII BOARD OF DIRECTORS SIMSBURY 1820 HOUSE

SIMSBURY, CONNECTICUT APRIL 7, 2009

1. Call to Order. The President, Randy Wilcox, called the meeting to order at 9:30 am. 2. Roll Call.

Directors Company Michael Corbo Mitsubishi Elevator

John Karnash * Schindler Elevator Corp. Barry Pletch ThyssenKrupp Elevator Corp. Vance Tang KONE Inc. Randy Wilcox Otis Elevator Company Keiji “Kenny” Yamashiro Fujitec America Inc.

Others Present Company Doug Babcock (part time) Draka Elevator Products, Inc Brian D. Black Code and Safety Consultant to NEII Cayce Blanchard (part time) Mitsubishi Elevator Louis DeLoreto (part time) Otis Elevator Co. Robert Feldman ThyssenKrupp Elevator Corp. Timothy Grace (part time) Schindler Elevator Corp. Andy Juhasz KONE Inc. Mike Klehr (part time) Minnesota Elevator Inc. Rick Lowenberg (part time) Minnesota Elevator Inc. Dennis Mayer Otis Elevator Company Robert Merlo (part time) GS Elevator Inc. Stephen Patton, Treasurer Otis Elevator Company Kurt Stepaniak KONE Inc.

Minutes – NEII Board of Directors April 7, 2009 Page 2 of 6

* John Karnash was empowered with a proxy to act on behalf of Jakob Zueger (Attachment #1). 3. Adoption of Agenda. The Board approved the agenda published on the NEII web site. 4. Approval of Minutes February 17, 2009 Meeting.

THE FOLLOWING RESOLUTION WAS MADE SECONDED AND APPROVED To dispense with the reading of the February 17, 2009 meeting minutes and that they be approved.

5. Election of NEII Officers. Dennis Mayer, Chair of Nominating Committee (Dennis Mayer, John Karnash and Kurt Stepaniak) reported for the Nominating Committee.

THE FOLLOWING RESOLUTION WAS MADE SECONDED AND APPROVED To elect the following slate of officers to serve until the next Full Regular Members Annual meeting:

President Randy Wilcox Vice President Vance Tang Treasurer Stephen Patton Secretary Edward A. Donoghue

6. Welcome.

a. President. Randy Wilcox welcomed the member to NEII 75th Anniversary meeting. He advised that he would be requesting the formation of a NEII Ad-Hoc Long Range Strategic Planning Committee under new business.

b. Managing Director. Edward A. Donoghue welcomed the members and

reviewed the objectives for the meeting. He also reviewed the history of NEII and gave an overview of the databases and resources available to employees of NEII member companies in the member area of the NEII website.

7. Presentations.

a. NEII Communications Committee. Ms. Cayce Blanchard gave an oral report for the NEII Communications Committee and responded to questions. See Attachment #2 to view Ms. Blanchard’s PowerPoint presentation.


b. NEII Trust Committee. Timothy Grace gave an oral report for the NEII Trust Committee and responded to questions. See Attachment #3 to view Mr. Grace’s PowerPoint presentation.

c. NEII Safety Committee. Louis DeLoreto gave an oral report for the NEII Safety Committee and responded to questions. See Attachment #4 to view Mr. DeLoreto’s PowerPoint presentation.

d. NEII Government Affairs Committee. John Karnash gave an oral report for the NEII Government Affairs Committee and responded to questions. See Attachment #5 to view Mr. Karnash’s PowerPoint presentation.

e. NEII Central Code Committee. Andy Juhasz gave an oral report for the NEII Central Code Committee and responded to questions. See Attachment #6 to view Mr. Juhasz’s PowerPoint presentation.

f. PBC Project. John Karnash and Andy Juhasz gave an oral report on the NEII PBC Project and responded to questions. See Attachment #7 to view Mr. Karnash’s and Mr. Juhasz’s PowerPoint presentation.

g. NEII Code and Safety Consultant. Brian D. Black, NEII Code and Safety Consultant gave an oral report and responded to questions. See Attachment #8 to view Mr. Black’s PowerPoint presentation.

h. Elevator Escalator Safety Foundation. Robert Merlo, Vice Chair of EESF gave an oral report for the EESF and responded to questions. See Attachment #9 to view Mr. Merlo’s PowerPoint presentation.

EXECUTIVE SESSION

8. Reports. a. President. Randy Wilcox reported he had no issues beyond those on the agenda

and the issue he raised in item 6a. b. Treasurer. Steven Patton presented the 2008 independent auditors report by

Loftus Ross, LLP (Attachment #10) and his January through February 2009 budget report (Attachment #11) and responded to questions.

THE FOLLOWING RESOLUTION WAS MADE SECONDED AND APPROVED To accept the written reports (Attachments #11) of the Treasurer Steven Patton and 2008 independent auditors report (Attachment #10) by Loftus Ross, LLP.


c. Administrator. Edward A. Donoghue reported on the status of the NAEC CodeFinder agreement.

d. NEII Code and Safety Consultant. Brian D. Black, NEII Code and Safety Consultant presented his written report (Attachment #12) and responded to questions. See also Attachment #8.

THE FOLLOWING RESOLUTION WAS MADE SECONDED AND APPROVED To accept the NEII Code and Safety Consultant written report (Attachment #12) and oral report of Mr. Brian Black.

e. Central Code Committee. Andy Juhasz gave an oral report for the NEII Central Code Committee and responded to questions. See Attachments #6 and #7.

THE FOLLOWING RESOLUTION WAS MADE SECONDED AND APPROVED To accept the NEII Central Code Committee oral report of Mr. Andrew Juhasz.

f. Government Affairs Committee. John Karnash gave an oral report for the NEII Government Affairs Committee and responded to questions. Mr. Karnash also reported that the Committee is following up with Stateside Associates on opportunities the industry may have in tapping into federal stimulus funds. See Attachments # 5 and #7.

THE FOLLOWING RESOLUTION WAS MADE SECONDED AND APPROVED To accept the NEII Government Affairs Committee oral report of Mr. John Karnash. g. NEII Ad-Hoc Crocs Steering Committee. Dennis Mayer gave an oral report for the NEII Ad-Hoc Crocs Steering Committee and responded to questions. Mr. Mayer also reviewed the Media Analysis of Crocs-Related Escalator Issue (Attachment #13) that was prepared by Gibbs and Soell. Gibbs and Soell will be updating the media analysis on a quarterly basis. He also reviewed the draft NEII Ad-Hoc Crocs Steering Committee Objectives (Attachment #14) and requested the Board approve same.

THE FOLLOWING RESOLUTION WAS MADE SECONDED AND APPROVED To accept the NEII Ad-Hoc Crocs Steering Committee oral report of Mr. Dennis Mayer and approve the NEII Ad-Hoc Crocs Steering Committee Objectives in Attachment #14.

9. Old Business.

a. Web/Teleconference NEII Committee Meeting. Brian Black, Louis Bialy and John Karnash had no report.


10. New Business. a. 2009 EESF Contribution.

THE FOLLOWING RESOLUTION WAS MADE SECONDED AND APPROVED To pay half the 2009 EESF contribution of $30.000.00 in April with the remainder to be paid in October.

b. Strategic Planning Ad-Hoc Committee. Randy Wilcox recommended an Ad-

Hoc Committee be established to prepare a long range strategic plan for NEII.

THE FOLLOWING RESOLUTION WAS MADE SECONDED AND APPROVED To establish a NEII Strategic Planning Ad-Hoc Committee to look at all aspects and activities of NEII and appoint Louis Bialy, Chair NEII Central Code Committee; John Karnash, Chair NEII Government Affairs Committee; Dennis Mayer, Chair NEII Legal Advisory Group; Brian Black, NEII Code and Safety Consultant and Edward A. Donoghue, NEII Administrator members.

11. Committee Appointments. Otis Elevator Company requested Betsy Ceriello be appointed to the NEII Government Affairs Committee (Attachment #15).

THE FOLLOWING RESOLUTION WAS MADE SECONDED AND APPROVED To appoint Betsy Ceriello a member of the NEII Government Affairs Committee.

12. Membership. Edward A. Donoghue reported that the following companies have failed to pay their 2009 dues:

• B & G Elevator Inc. – Associate Regular Member. • GS Elevator Industries Inc. – Associate Regular Member.

THE FOLLOWING RESOLUTION WAS MADE SECONDED AND APPROVED To terminate B & G Elevator Inc. and GS Elevator Industries Inc. membership for failure to pay their 2009 dues if not paid by May 15, 2009 in accordance with Article II, Sec 10 of the NEII Bylaws.

13. Meeting Schedule.

June 16, 2009 1:00 PM EDT Teleconference Meeting.

September 23, 2009 United in Orlando. Gaylord Palms, Orlando, Florida


NAEC Rate $186.00 Single/Double Telephone: 407.586.2491 Addition information including hotel reservations http://www.unitedconvention.com/hotels.html

December 7, 2009 1:00 PM EST Teleconference Meeting.

14. Adjournment. The meeting adjourned at 2:15 PM. Respectfully submitted

Edward A. Donoghue, CPCA Secretary Attachments: 1. Proxy for Jakob Zueger 2. NEII Communications Committee Presentation 3. NEII Trust Committee Presentation 4. NEII Safety Committee Presentation 5. NEII Government Affairs Committee Presentation 6. NEII Central Code Committee Presentation 7. NEII PBC Project Presentation 8. NEII Code & Safety Consultant Presentation 9. Elevator Escalator Safety Foundation Presentation 10. Loftus Ross, LLP Audit Report 11. Treasurers Report 12. NEII Code & Safety Consultant Report 13. Gibbs and Soell Report on Crocs Related Issue 14. NEII Crocs Ad-Hoc Task Group Objectives 15. Appointment to NEII Government Affairs Committee h:\wpdocs\neii board of directors\2009\04-07 minutes.docx

http://www.unitedconvention.com/hotels.html�

ATTACHMENT # 1 Page 1 of 1

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NEII Communications Committee Update

Spring Board MeetingApril 2009

Cayce Blanchard, Mitsubishi Electric and Electronics USA, Committee Chair

Year-end review…

• Proactive Media Relations– Press releases

• Global Technical Barrier Free T d A t (N t Y t

08 Year-End Recap

Trade Announcement (Not Yet Issued)

– All releases posted for media and member reference on the public area of www.neii.org.

• On-line press room maintained

• Reactive Media Relations– Media requests and

statements

08 Year-End Recap

• Elevator safety information• Codes information• Crocs-related media inquiries

– Trade magazines– National/regional newspapers

– Media monitoring for elevator industry news


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08 Year-End Recap

• Issues Management– Crocs

• Established Ad-Hoc Steering C itt t it dCommittee to monitor and manage issue

– Created quarterly news and issue monitoring reports

– Offered strategic counsel– Developed stand-by media

statements and Q&A documents for industry response

• NEII Web site Enhancements– Refreshed content

Increased visibility

08 Year-End Recap

– Increased visibility of safety messages

– Created prominent link to EESF

08 Year-End Recap• Performance-Based Code, ASME A17.7/CSA

B44.7: Educational Webinar– Presented by Lou Bialy and Ed Donoghue– Interactive presentation offered to local AHJ p

representatives around the country– Co-sponsored with NAECA International – More than 80 attendants from over 20 states and

Canadian provinces – Resulting Q&A incorporated into the FAQ section of

PBC’s Web site, http://www.pbc-elevators.com

• Member e-Newsletter: NEII NOW– 3 issues per year

• Spring, Summer and Fall/Winter

Content strengthened through

08 Year-End Recap

– Content strengthened through increased member editorial contributions and committee reports

– Broader audience reached when member companies republished articles

– Reprints of newsletter articles used in industry trade publications


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08 Year-End Recap

• Strategic Planning Initiatives– 2009 public relations plan– Annual committee meeting and periodic

planning conference callsplanning conference calls– Monthly activity and budget status reports– Ongoing strategic counsel

A Look Ahead…2009 Communications Plan

09 Communications Objectives• Position NEII as an

authority on building transportation industry issues and strengthenissues and strengthen the association’s influence in the areas of codes and safety

09 Communications Objectives (cont.)

• Promote the adoption of the Performance-Based Safety Code for Elevators and Escalators, ASME A17.7/CSA B44.7 (PBC) A i t i ti i i di i• Assist association in managing media issues that may be harmful to the industry and members’ reputation

• Proactively monitor Crocs shoe issue and assist the association in maintaining a “ready-response”


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09 Communications Strategies• Serve as a resource

for communicating industry information to the media and public

• Use target trade and consumer media, the NEII Web site and the PBC Web site as conduits to reach NEII’s specified audiences

09 Communications Strategies (cont.)• Work closely with NEII Gov. Affairs, Central

Codes Committees and Stateside Associates to develop strategies and tactics that encourage the adoption of the PBC.p– Partner with Stateside Associates to develop effective

communication tools and content that present a call to action to the local AHJs

• Augment/improve existing communication tools to continue to add value to current NEII members and generate interest with new members.

Target Audiences• NEII Members (Full, Associate and

Trust) • Industry associations

– NAESA International, NAVTP, NAEC, NEIEP tNEIEP, etc.

• Industry Influencers– Building owners, managers, operators – Maintenance contractors and

inspecting authorities– Legislators, regulators and consultants– Local AHJs

• Media (trade, national and regional print/broadcast)

09 Communications Tactics• Draft Press Releases

– NEII’s 75th Anniversary– PBC Webinar– Jurisdictions’ adoption of Performance Based Codep

• Draft and place byline/feature articles in trade media

• Publish NEII NOW e-Newsletter– 3 issues: Spring, Summer and Fall/Winter


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09 Communications Tactics (cont.)• Lead Industry Webinars:

PBC – May 19th: NEII member

companies and lobbyistsP t i b NEII• Promote via members, NEII Now e-newsletter and members area of NEII Web site

– October 13th: Industry influencers and trade media

• Promote via trade press release and NEII and PBC Web sites

– Interactive Q&A– Measurement reports

gauging effectiveness

09 Communications Tactics (cont.)

• Offer Issue Counsel and Management– Monitor key issues affecting the industry and its

members, and provide ongoing counsel to C i ti C itt d L l Ad i GCommunication Committee and Legal Advisory Group

– Crocs Ad-Hoc Task Group• Quarterly media/news analysis• Creation and distribution of media statements• Ongoing strategic counsel

09 Communications Tactics (cont.)

• Maintain and manage 2009 strategic communications/public relations plan

• Develop 2010 public relations plan• Develop 2010 public relations plan• Host annual committee meeting and direct

periodic planning conference calls• Manage monthly activity and budget status

reports• Deliver ongoing strategic counsel

Questions?Thank you!y


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Trust Committee

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2008 ANNUAL REPORT TO THE

NEII MEMBERSHIP

NEII Trust CommitteePurpose:

The Trust Committee shall be solely

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The Trust Committee shall be solely responsible for the administering the rights and obligations of NEII with regard to the Trusts.

Membership:

• Shall consist of not less than three (3) and not more than five (5) members

• Any NEII trust member whose reported hours for all IUEC member employees equals or exceeds 10% of

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IUEC member employees equals or exceeds 10% of the total reported hours worked for all members shall be entitled to Trust Committee membership

• Only officers or employees of NEII trust members may serve on the committee

• No NEII trust member will be entitled to have more than one Trust Committee member

NEII Trust Committee

Trust Committee Members• Timothy P. Grace Schindler Elevator Corp. – Chair

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y p• Charles D. Moore KONE Inc. - Member• Greg Garger Otis Elevator Corp. - Member• Bruce Brenizer Mitsubishi Elevator – Member• Patrick Heaney Thyssen Krupp Elevator - Member


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NEII Trust Committee

NEII Trusts• National Elevator Industry Educational Program (NEIEP)

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National Elevator Industry Educational Program (NEIEP)• Elevator Constructors Annuity and 401(k) Retirement Plan• Pension Plan• Health Benefit Plan

Trust MembersTrustees

Annuity & 401K Christian Grenier, Otis - Chair Kevin Stringer - IUEC - Co-ChairE. James Walker, Jr., DRM Ernest Brown - IUECJoseph Zaffuto, KONE Mike Langer - IUECNicole Onder - Schindler Charlie Val - IUEC

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Pension E. James Walker, Jr., DRM Kevin Stringer - IUECJeffrey Adler - Otis Larry McGann - IUECJoseph Zaffuto, KONE Joseph Rapine - IUECNicole Onder, Schindler Edward Christensen - IUEC

Health Plan E. James Walker, Jr., DRM Kevin Stringer - IUECDavid Powilatis - Otis Allen Spears - IUECJoseph Zaffuto, KONE Donald Mitchell - IUECMichael Shields, Schindler Patrick McGarvey - IUECMichael Shields, Schindler James Biagini - IUEC - Chair

NEIEP Christian Grenier - Otis Bill Johnston - IUECJohn Jaster, KONE Mike Avery, IUECJohn Faure, Mitsubishi Thaddeus Tomei, IUEC

NEII Trust CommitteeSummary of Trust Committee Activity• Meet quarterly via tele-conference

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• Trustees are invited to participate

• Have utilized meetings to gain status updates from trustees, appoint trustees, to discuss matters relating to the trusts and to make decisions relating to the trusts that previously were made by the Board of Directors

Summary of the TrustsNational Elevator Industry Educational Program

(NEIEP)• Contributions

Current contributions @ $.55 per hourC t t ib ti ill i t d th h lif f CBA

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Current contribution will remain steady through life of CBA.

• Present Value (as of 12/31/08) $52,000,408.48

• Enrollment 7,843 in 2008/2009 school year

– 6,851 Apprentices enrolled in NEIEP classroom program– 2,795 Mechanics and Apprentices enrolled in NEIEP computer based education

courses.– 834 of which enrolled in a computer based course for credit in year 1, 2, 3 or 4– Balance enrolled for elective continuing education


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Summary of the TrustsNational Elevator Industry Educational

Program (NEIEP)• Development Projects

Testing for Hydraulic Elevators course

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Testing for Hydraulic Elevators course Computer based Testing for Hydraulic Elevators Re-write of Year 3 curriculum Reformat of all four years of instructor support material (DVD

based) Update NEIEP program catalog Development of a prototype escalator lab Building expansion project nearing completion Reformat of the Mechanic exam Development of joint Apprenticeship Committee training course

Summary of the TrustsNational Elevator Industry Educational Program

(NEIEP)

• Website Enhancement NEIEP has developed a student mechanic exam history report.

C ti d d l t d i i f ti i d ti

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Continued development and revisions of continuing education courses: Creation of CBT version of Testing of Hydraulic Elevators

NEIEP has been approved to provide continuing education in: Washington, Indiana, Florida, Georgia, Oregon, Illinois,

Massachusetts, Vermont and Maine Currently working on additional continuing education for licensing

offerings to meet state licensing requirements of eight hours continuing education. The following will have two or more courses with the end goal of having a library of courses available to all nine approved states: Washington, Indiana, Florida and Illinois

Implemented a dynamic report for Joint Apprenticeship Committees to use to track progress of students enrolled in online courses.

Summary of the TrustsNEI Pension and Health Plans

Pension Plan

• Industry Hours 50.23 million 2008 48 78 million 2007

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48.78 million 2007 46.99 million 2006

• Market Value $3.63 billion 12/31/08 $4.55 billion 6/30/08 $4.85 billion 12/31/07 $4.81 billion 6/30/07 $4.25 billion 6/30/06


Pension Plan (continued)

• Investment Performance Annual return for ’08 @ -24.81%, worse than index 1.82% Annual return for ’07 @ 8 65% beat index by 1 62%

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Annual return for 07 @ 8.65%, beat index by 1.62% Annual rate for ’06 @ 8.7%, 1.02% worse than index Annual return for ’05 @ 5.81%, .68% worse than index Annual return for ’04 @ 10.62%, beat index by 0.55 %(26th percentile)

Rate of PolicyPeriod Return (Ann) Index (Ann) Difference (+/-)

1 Year -24.81% -22.99% -1.82%3 Years - 2.72% - 2.45% -0.27%5 Years 1.53% 1.33% -0.20%10 Years 3.24% 2.02% -1.22%


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• Actuarial Valuation Actuarial reports as of July 1, 2008 expected to be released in April 2009.

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Preliminaries indicate no unfunded vested benefits for withdrawal liability purposes.

Funding period dropped to 5.5 years from 7.7, and Funded Percentage decreased to 94.8% from 95.2%

In September 2008 the Plan was was neither critical or endangered status under the Pension Protection Act of 2006.

Due to decline in the financial markets since July 1, 2008, it is probably that the Plan will be in endangered status as of July 1, 2009.

It is likely that the Plan will have an unfunded vested benefits for withdrawal liability purposes.



• Arbitration The Arbitrator issued a ruling on the Ineligible Participants arbitration brought by the

Trustees in 2006. The ruling is subject to a favorable determination by the IRS on a Private Letter Ruling request.

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Private Letter Ruling request.

• IRS Filing The Trustees approved a filing in the IRS Voluntary Correction Program (VCP) related to

benefits owed to separated participants who did not begin receiving pension benefit until after age 65. The Plan’s fiduciary liability insurance will pay the VDP fee.

• Proposed Trust Amendment The Employer Trustees have presented an amendment to the Declaration of Trust at the

last four Trustees meetings that would change the voting procedures so that the Employer Trustee’s vote would be recorded as a unified vote. The Union Trustees have not supported the proposed change.


Health Benefit Plan

• Market Value $487 million 2008 $486 million 2007

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$486 million 2007 $383 million 2006 $283 million 2005 $221 million 2004

Financial Overview

• Plan reserves expected to increase to $705 million by end of 2011, per The Segal Co.• Current continuation value of the Fund is 13.5 months increasing to 15 months by 2011.• 2008 unaudited financial statements show that contributions exceeded benefits and

administrative expenses by $80M, but the Plan experienced a decrease in assets available for benefits of $7M due to investment losses totaling $87M.

• Lotsoff Capital Management will be replaced. RogersCasey recommended Aberdeen Asset Management.

Investments

• Plan rankings and rates of return against their balance funds as of December 31 2008:

Summary of the TrustsHealth Plan (continued)

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31, 2008:Rate of Policy

Period Return (Ann) Index (Ann) Difference (+/-)1 Year -15.74% -9.73% -6.01%3 Years - 1.19% 1.09% -2.28%5 Years 0.98% 2.37% -1.39%10 Years 2.78% 3.89% -1.11%


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Arbitration

• The Arbitrator issued a ruling on the Ineligible Participants arbitration brought by the Trustees in 2006. The ruling is subject to a favorable determination by the IRS on a Private Lettering Ruling request.

Summary of the TrustsHealth Plan (continued)

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Proposed Plan Amendment

• Employer Trustees have presented an amendment to the Declaration of Trust at the last for Trustees meetings that would change the voting procedures so that the Employer Trustees’ vote would be recorded as a unified vote. The Union Trustees have not supported the proposed change.

Summary of the TrustsElevator Constructors Annuity and 401(k) Retirement Plan

401(k)

• Market Value $185.5 million 2008 $224.6 million August 2008

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$211.3 million 2007 $170.3 million 2006 $132.6 million 2005 $102.8 million 2004

• Trustees’ Meeting Schedule In early 2008 the Trustees voted to reduce the number of Annuity/401k Trustees’

Meetings to two per year, vs. quarterly. Given recent market volatility and concerns expressed by RogersCasey that six month intervals are too long to ensure proper and timely rebalancing activities, the Trustees agreed to resume meeting quarterly, at least until the market climate stabilizes.

Summary of the TrustsElevator Constructors Annuity and 401(k) Retirement Plan

401(k)

• Proposed Trust Amendment In May 2008, the Employer Trustees presented an amendment to the

Declaration of Trust that would change the voting procedures so Employer

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g g p p yTrustees’ votes would be recorded as a unified vote. The Union Trustees opposed the proposed change and the vote was deadlocked.

• Professional Services Engagements. Trustees unanimously approved the continuation of the current professional

service providers for 2009.

• 2009 Chair & Co-Chair Elected Christian Grenier (Management Trustee – Otis) was elected Chairman.

Kevin Stringer (Union Trustee) was elected Co-Chair.

Summary of TrustsElevator Constructors Annuity and 401(k) Retirement Plan

The Annuity

• Market Value $243.4 million 2008

$251 9 illi A t 2008

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$251.9 million August 2008 $203.5 million 2007 $136.0 million 2006 $85.2 million 2005 $45.9 million 2004

• Mass Mutual confirmed the Annuity / 401k had no exposure to Bernard Madoff’s Ponzi scheme.


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NEII SAFETY COMMITTEE

UPDATEUPDATE

Lou DeLoreto, OTIS Elevator

April 07, 2009

• Membership

• Mission / Policy / Objectives

• Standard Agenda

Topics

Sta da d ge da

• Emerging / Current Issues

Chair:

Lou DeLoreto OTIS Elevator

Members:Tim Daly NEIEPJohn Faure Mitsubishi Electric & Electronics USA

Committee Members

John Faure Mitsubishi Electric & Electronics USALJ Fleetwood Fujitec America Inc Ricia S. Hendrick Elevator World IncDavid Kobasic Thyssenkrupp Elevator CorporationRobert G. Merlo NAECNathaniel Miller KONE Inc.Frederick J. Wilt Schindler Elevator Corporation

Mission

To analyze safety issues within the elevator industry, to developresources and guidance to promote an accident free environment for field employees and to assist employers to comply with government safety standards and regulations.

Objective

To develop guidance documents for NEII members and the elevator industry that address compliance, accident prevention and loss mitigation. The goal is to encourage safe work practices and injury prevention in the industry.


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Recent Activity• OSHA Violations• Serious / Fatal Incidents

Field Safety Handbook Revisions

Standard Agenda**

yNEIEP ActivitiesOSHA Emerging / Ongoing IssuesProjectsPosition Paper ReviewBest Practices

**Last meeting held Feb 18-19 2009

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80

51

70

44

73

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InspectionsViolations February 2009 Committee discussion

• Continuous industry enforcement • Informal talks about OSHA emphasis• Importance of an industry approach• Decisions could be precedent setting

Occupational Safety & Health Administration (OSHA)

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1121

2004 2005 2006 2007 2008 2009

Data taken from OSHA.gov and reflects FED OSHA cases only

• Decisions could be precedent setting• Sections of Handbook in question

Recent OSHA informal ConferenceXYZ Elevator Company

Industry HandbookContinuous improvement opportunities identified as a result of OSHA and injury reviews

Industry related- Escalator Safety- Fall Protection for deep elevator pits- Overhead Protection in construction

OSHANew Appendix for Elevator Specific Procedures

- Car Top Access / Egress- Pit Access / Egress- Electrical Lock Out Tag Out- Mechanical Stored Energy- Confined Space Work permits- Hot Work Permits

Will be Updated to reflect most current handbook changes

- Policy & Procedures- Video/pictures

Good opportunity re assess risk

New Hire EHS Training DVD

Good opportunity re assess risk

Committee partnering with elevator world as subject matter experts

Can be used by entire industry

3Q Completion


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Thank you

Questions ?


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GAC: REPORT/UPDATENEII Board MeetingNEII Board Meeting

Presentation To:NEII Board of DirectorsApril 7, 2009

Presented By:John S. M. KarnashChairman, GAC

I. Model Elevator Law (MEL) – EIWPF (Fund)

A. Annual Meeting to be Scheduled for 3rd Q, 2009:• Overview of MEL Progress and Key Issues

• MEL Rev. 4 – Platforms / Stairway / Residential

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• Target States for 2009 – 2010

• Review of Fund’s Financial Statements

• Review of Fund’s Programs and Organizations

– Fund Presentation and Review in 2nd Q, 2009

• Performance Based Code (PBC) Support

B. MEL (or MEL-like) statutes have been passed in 16 states to date. Recurring issues:

• “Supervision” of Helpers / Apprentices

• Emergency and Temporary Licensing

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• Emergency and Temporary Licensing

• Establishment of Elevator Boards

• Locals’ Mischief

• Non-Union Company Opposition

C. States Identified for 2008 - 2009:

New Ongoing

Kansas Iowa* Ohio*Kentucky* Maine* Pennsylvania*

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North Dakota New Jersey Virginia*South Dakota New York Washington, DC*Utah* Nebraska* West Virginia*

North Carolina*

* = Lobbyist Retained By Fund


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II. Key States – Update and 2010

A. Ongoing States

FL

• “Direct supervision” of apprentices issue… resolved by

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maintaining status quo.

• S.B.1332 amendment introduced… raised concerns on licensing, supervision, inspection of residentials, time to comply with code violations, A17.3, etc.

• Advised by Lobbyist on 4/2/09 that S.B.1332 (and H.B.1165) will not pass this session.

IL

• S.B.1722 Amendment to Elevator Safety Act… condominium owners seek postponement of bill’s elevator upgrade requirements until 2013.

• 3/19/09 letter from GAC to sponsor of bill… opposed removing this equipment from Safety Act.

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• Issues have become more numerous and complex, e.g.licenses, local AHJ authority, etc.

• Lobbyist retained by GAC, working with Fund’s Lobbyist.

NJ

• Fund will introduce bill to blend MEL Rev. 3 with existing statute. Latest draft received 4/3/09… under review.

NC

• Secretary of Labor, who opposed licensing, was reelected… MEL bill dead.

• S.B.114 introduced in 2/09 exempting places of worship from installation and maintenance requirements.

• GAC will send letter opposing bill and urging LULA

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GAC will send letter opposing bill and urging LULA requirements be met.

OH

• MEL Rev. 3 key provisions in both House and Senate bills.

• Awaiting latest draft for review / comment.

PA

• Introduced MEL Rev. 3… languishing.

VA• Amending legislation was introduced to address deficiencies/

omissions in existing legislation.• Passed in 2/09 and awaiting signature by the Governor:

– Supervision– Certification of residential mechanics

T h i

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– Temporary mechanics– Industry representation on Board

WVA• Enabling legislation passed in 1st Quarter of 2008 (effective

2010) differs from MEL Rev. 3., e.g. DS language, term of license.

• GAC and Fund participating in rulemaking process.• DS definition now tracks the CBA.


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B. New InitiativesKS• Fund did not pursue. Fund advises it will not be targeted in

2009-2010.KY• Bill was submitted too late by Fund. Will be resubmitted in

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next session.NY• Withdrew last year based on Lobbyist’s advice. Remain in

discussions, no legislation introduced.ND & SD• Absence of elevator regulation… few conveyances, minimal

effort.• Fund will not pursue. Possibly targeted in 2009-2010.

UT

• GAC provided comments to draft legislation (e.g., “immediate” supervision)… to be incorporated by bill drafter.

• Once received, GAC will review revised proposal.

D.C.

B d 8/8/08 l tt f DCRA 1993 l ti ll

10

• Based on 8/8/08 letter from DCRA… 1993 law essentially would require mechanics to have 8,000 hours as an electrician’s apprentice to obtain license!

• Fund / IUEC uninformed until GAC advises… now fully engaged with GAC / industry reps.

• Meetings held 3/30 and 3/31 with DC Council Members… strong support, bill being drafted to address licensing and Board issues.

NV

• GAC submitted “comments” to Nevada OSHA proposals circulated in 2/09. Nevada OSHA dismissed all but a minor one.

• Lobbyist has been identified and is being retained.

11

III. Destination-Oriented Elevators – San Francisco Matter

• Lobbyist / lawyer was retained to assist NEII in addressing matter with responsible agencies and stakeholders.

• GAC and CCC submitted industry comments to CCB and GVK l

12

GVK proposals.• Latest draft Administrative Bulletin (AB) being prepared,

voice intelligibility (VI) standard likely to be imposed.• GAC seeks authorization from Board to retain an expert to

(1) challenge city’s VI expert and standard, and (2) assist NEII in developing appropriate standard.

• The state of California is now involved, likely to adopt San Francisco’s AB.


4

IV. Budget – 2009-2010

• Legislative and regulatory activity continues to increase + PBC campaign.

• Continue to utilize Fund’s lobbyists / influencers where

13

• Continue to utilize Fund s lobbyists / influencers where possible on MEL matters.

• Continue active participation of GAC members in process… “proactive” approach.


1

Central Code CommitteeCentral Code CommitteeReportReportReportReport

Presentation to:NEII Board of DirectorsFarmington, CTApril 7, 2009

Prepared by:Lou BialyPresented by:Andy JuhaszCentral Code Committee

Introduction• Adoption of PBC is covered separately as a CCC/GAC

report. Other aspects of PBC are covered in this report• The status of CodeFinder and other Code issues is

Confidential 2

The status of CodeFinder and other Code issues is briefly discussed.

• The status of Platform Rescue Systems (Outside Emergency Elevators) is discussed

• The status of action with other Elevator Associations in the interest of Global Technical Barrier Free Trade is discussed

Establishment of AECOs

• As of March 12, 2009 three organizations have been accredited by ANSI as AECOs!

Confidential 3

have been accredited by ANSI as AECOs!– TUV America (Sud Deuchland)

– UL

– Lift Instituut (Netherlands)

Establishment of AECOs

• This is a significant historical event and fulfils a major milestone towards innovation

Confidential 4

fulfils a major milestone towards innovation with safety– Will encourage adoption of A17.7/B44.7 PBC

by AHJs

– This could not have occurred without strong NEII commitment and effort


2

Standard for Suspension Means

• Revision of A17.6 Draft Standard for Suspension Means is continuing

Confidential 5

Suspension Means is continuing. Revision addresses all issues identified in the Hazard Assessment with all suspension means (SWRs, AFRs, CSBs)– Several Letter Ballots have been issued. The

process towards consensus is continuing

CodeFinder Data Base

• A licensing agreement was executed with NAEC for use of CodeFinder by their

Confidential 6

NAEC for use of CodeFinder by their members

• An orientation session was held for NAEC members at their annual meeting

• Initial response of NAEC members was positive

CodeFinder Data Base

• A further training/feedback session was held with editors of CodeFinder

Confidential 7

held with editors of CodeFinder

• Feedback was generally positive

• Issues identified during the session were noted and are to be addressed

• The BOD will continue be updated

Platform Rescue Systems (PRS)/Outside Emergency

Elevators (OEE)

Confidential 8

• At a previous board meeting the concern relating to PRS/OEE was discussed

• ASTM Standard has been written at urging of manufactures of PRS/OEE devices


3

PRS/OEE

• Action under ASMEAd Hoc Committee was formed to develop

Confidential 9

– Ad Hoc Committee was formed to develop requirements for PRS/OEE. Committee commenced prescriptive requirements

– A presentation was made to ad hoc committee showing the benefits of PBC approach

– The ad hoc committee is now moving towards referencing A17.7/B44.7 Performance Based Code rather than developing prescriptive requirements

Intercontinental Liaison on Global Technical Barrier Free Trade

(GTBFT)

• Aim is to establish a worldwide set of standards

Confidential 10

Aim is to establish a worldwide set of standards that will reduce technical barriers to trade and improve safety– Global Performance Based Standards per ISO 22559– Global ISO/CEN Prescriptive Standard based on EN 81– Global Conformity Assessment Bodies (GCABs) – Global recognition of certifications

Intercontinental Liaison on Global Technical Barrier Free Trade

• Liaisons have been set up by CEN to take into account international views on a globally relevant EN 81 Code This is in line with GTBFT

Confidential 11

EN 81 Code. This is in line with GTBFT. • The first meeting took place October 2008

– US, Japan, China, Korea were represented– Constructive input was given and acknowledged– Next meeting: April 2009

Liaison Meetings with Japan Elevator Association

• The second meeting between the JEA and NEII was held in Kyoto, Japan November 12-13,2008

Confidential 12

y , p ,• Brian Black’s presence was very helpful and

signified commitment of NEII • The meeting was very constructive and many

issues relating to Codes and safety were discussed.


4

Liaison Meetings with Japan Elevator Association

• The JEA are supportive of global performance b d t d d ll ISO/CEN b d

Confidential 13

based standards as well as an ISO/CEN based prescriptive Code. They are working towards increased harmonization with EN 81

• The next meeting, originally proposed for October 2009 in the US will probably be delayed to 2010 due to budget concerns

Future Meetings of NEII Committees

• In view of heavy travel costs and poor i diti th CCC ill l t

Confidential 14

economic conditions the CCC will evaluate means to reduce travel to meetings for all committees and sub committees– Teleconferencing will be considered where

practical


1

Performance Based Code Project Performance Based Code Project CCC/GAC ReportCCC/GAC ReportCCC/GAC ReportCCC/GAC Report

Presentation to:NEII Board of DirectorsFarmington, CTApril 7, 2009

Presented by:Andy JuhaszJohn Karnash

Introduction• Adoption of A17.7 / B44.7 PBC is crucial for

the successful introduction of innovative technology and is the remaining major step

Confidential 2

technology and is the remaining major step in the NEII plan for PBC

• Stateside Associates is our lobbying organization to encourage adoption on jurisdiction by jurisdiction basis

Progress• Regular discussions continue to be held with

Stateside Associates to review progress and assist in meeting objectives

Confidential 3

assist in meeting objectives

• Overall approach focuses direct lobbying of key jurisdictions by lobbyists and the creation of a supportive atmosphere for adoption of the A17.7 / B44.7 PBC

Target Jurisdictions

• Initial target jurisdictions:

CA GA IL MA IA ID SC CT Chicago

Confidential 4

– CA, GA, IL, MA, IA, ID, SC, CT, Chicago

– CA and MA are particularly difficult due to tradition of independent action, but are key examples for the others


2

Creation of Supportive Atmosphere

• Stateside PBC website is active and providing information and answering questions about the PBC

Confidential 5

PBC– Website address: http://www.pbc-elevator.com

Creation of Supportive Atmosphere• Webinar was held to inform the regulators.

– NEII Communications Committee worked with Stateside to accomplish this

Confidential 6

– Webinar took place November 18, 2008– Lou Bialy and Ed Donoghue provided

instruction at webinar– Webinar was very successful many good

questions– Excellent feedback from attendees

Creation of Supportive Atmosphere• Further Webinars have been Scheduled.

– May 19, 2009 – Webinar for employees of NEII Member Companies and Stateside Associates

Confidential 7

pLobbyists

– Oct 13, 2009 – Webinar for all interested parties.

– Lou Bialy and Ed Donoghue will be the instructors at the webinars

Action by CCC / GAC

• The CCC / GAC is monitoring progress as Stateside proceeds with execution of the plan

Confidential 8

• Presentations in MA and CA

• Leveraging of recent AECO accreditation in approaching AHJs

• Discussions with ASME to solicit their support


3

PBC – 2009 Budget / Benchmarks

• Budget included four (4) critical areas:

1 P j t M t

Confidential 9

1. Project Management

2. Lobbyists / Attorneys

3. Webinar

4. Printing, Travel, Miscellaneous

• Project Management - $144,000

• Lobbyists/Attorneys - $212,250

Confidential 10

• Travel & Miscellaneous - $9,290

• 2009 Budget proposal for PBC project was $370,000

– Board authorized $400,000

• 2009 Expenditures (3/30/09):

– Total Project (Contract) - $144,000.00

Total Project (Non Contract) $ 168 14

Confidential 11

– Total Project (Non-Contract) - $ 168.14

– Total Paid - $ 48,168.14


1

Code and Safety Consultant’s Code and Safety Consultant’s ReportReportReportReport

Presentation to:NEII Board of DirectorsSimsbury, CTApril 7, 2009

Presented by:Brian BlackCode and Safety Consultant

Committee Representation

• A17 Standards• A17 Code Coordination (Chairman)( )• A17 Emergency Operations• A17 Hoistway• A17 International Standards• QEI• etc.

Accessibility

• ADA• ABA

US Department of DefenseAdopted ABA Accessibility Guidelines

December 2008


2

US Department of JusticeWithdrew proposal to adopt ADA Accessibility Guidelines in January 2009

(change of administration)

Accessibility

• ICC/ANSI A117.1-2009– Clean up of Destination-oriented elevators

• CSA B44, Appendix E

Local Elevator Codes

• PBC in North Carolina, Iowa, New Hampshire, Ontario & Newfoundland

• Ohio• California• Illinois• An A17.1 A17.7 Paradox

Electrical Codes

• 2008 National Electrical Code® (2011)

• 2009 Canadian Electrical Code


3

Inspection and Testsnow in ASME A17.1a-2008/CSA B44a-08

ki ll t t i t f ti t• making all tests a maintenance function, not an inspection function;

• basing inspection frequencies on a risk analysis;• permitting equipment monitoring in lieu of on-site

inspections for monitored equipment.

Seismic Activities• NEII Seismic Task Force• Rewrite of Section 8.4 to harmonize ASME

A17.1/CSA B44 with IBC and ASCE 7

Use of Elevators in Fires

• ASME A17 Task Groups

The Snickers Conundrum

2009 International Building CodeSection 3008 – Occupant Evacuation Elevators


4

1009 International Building Code other requirements

Car si es to accommodate a stretcher• Car sizes to accommodate a stretcher• Robust Fire Service Elevators

NFPA 101/5000

• ASTM E 06-77 Platform Rescue Systems• ASME A17.1/CSA B44

Performance Based Safety Code

• ASME A17.7/CSA B44.7 report by Central Code/Government Affairs Committees

Architectural Standards Committee

• Revisions to NEII-1ASME A17 7/CSA B44 7 b i i d• ASME A17.7/CSA B44.7 being reviewed for inclusion

• Car sizes for ambulance stretchers


5

Performance Standards Committee

• NEII Power Supply Data Form• How to Prepare Elevators for an p

Emergency• Maintenance Control Programs• ASME A17.1a-2008/CSA B44a-08 • ASME A17.7-2007/CSA B44.7-07

Safety Committee• Current Position Papers

– Asbestos Safety;A Fl h H d d El t i l S f W k– Arc-Flash Hazards and Electrical Safe Work Practices;

– OSHA Confined Space Regulations as They Pertain to Elevator Pits;

– OSHA Power Industrial Truck Operator Regulations;

– Guidelines for Emergency Preparedness Plan.

Safety Committee• New video program on employee safety• Elevator Industry Field Employees’ Safety y p y y

Handbook• NFPA 70E and Personal Protective

Equipment• OSHA Training Matrices

Safety Code for Elevators and Escalators: ASME A17.1

ASME A17 1a 2008/CSA B44a 08 on• ASME A17.1a-2008/CSA B44a-08 on December 5, 2008


6

Wind Turbine Lifts Guide for the Inspection of Elevators, Escalators and

Moving Walks: ASME A17.2g

• Published October 2007

Safety Code for Existing Elevators and Escalators:

ASME A17 3ASME A17.3• Publish Spring 2009

Standard for Elevator and Escalator Electrical

Equipment: ASME A17.5

• December 2004 current edition


7

ASME A18 Platform Lifts and Stairway Chairlifts

• Proposal to delete requirement for constant pressure switches

ASME A17 CODE COORDINATION COMMITTEE

• Workshop on the Use of Elevators in Fires and Other Emergencies – March 2010

ASME QEI-1-2007

• Issued February 2008• Committee considering “Second-Tier” g

qualification for ASME A18.1 equipment• “QEI Services, Inc.”

Th k YThank You

Questions?


1

Elevator Escalator Safety Foundation

Update report to the National Elevator Industry, Inc.

March 15, 2009

NEII’s Donations

00 $25,00

0

$25,00

0

$25,00

0

$25,00

0

$30,00

0

$30,00

0

$30,00

0

$30,000

$35,000

TOTAL: $302,500

$0 $0

$10,00

0

$5,000

$5,000

$10,00

0

$20,00

0

$20,00

0

$20,00

0 $22,50

0 $2 $2 $2 $2

$0

$5,000

$10,000

$15,000

$20,000

$25,000

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

EESF 2009 Officers

Michael J. Ryan, ChairmanRobert Merlo, Vice ChairmanRobert Kazar, TreasurerRicia Hendrick, Secretary

NEII Representative on EESF BoardJosé Manuel Upegui, KONE

Programs

Safe-T Rider

A Safe RideA Safe Ride

National Elevator Escalator safety Awareness Week

Interactive program: www.safetrider.org

Interactive program: www.asaferide.org

Elevator U


2

Program Update

SAFE-T RIDER 2007-08 FINAL REPORT

Goal: To reach 500,000 students,

RESULTS:

456,804 children in the US and

46,233 in Canada

503,037

Program Update

SAFE-T RIDER 2008-09 to date

Goal: To reach 600 000 students Goal: To reach 600,000 students

(100,000 increase from previous year)

RESULTS TO DATE (3/12/09):

294,606 children in the US and

27,370 in Canada

321,976

Program Update

SAFE-T RIDER Growth Chart

58 02 31

14 74 21 01 503,

037

600,000

692 10

,460

99,0

73 128,

782

177,

835

303,

161

340,

994

446,

75

400,

452

454,

8

403,

933

456,

1

451,

11

450,

07

450,

02

451,

20 5

321,

270

0

100,000

200,000

300,000

400,000

500,000

1991

1992

1993

1994

1995

1996

1,997

1998

/99

1999

/00

2000

/01

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/2007

2007

/08

2008

/09

Program Update

A SAFE RIDE

Now available exclusively online

$2,000 budgeted to purchase 5,000 Workbooks


3

Program Update

NATIONAL ELEVATOR ESCALATOR SAFETY AWARENESS WEEK

Eight companies/organizations celebrated in eight g p g gareas this past November

18 States signed proclamations– 8 new states

31 Cities signed proclamations– 24 were new

23 Canadian proclamations were receivedNext year’s Date: November 8 – 14, 2009

Program Update

1200

www.SafeTRider.org

0200400600800

10001200

User Sessions

July Aug Sept Oct Nov Dec

2008 2007

Program Update

800

www.ASafeRide.org

0

100

200

300

400

500

600

700

User Sessions

Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec

2008 2007

Program Update

8,000

www.EESF.org

0

2,000

4,000

6,000

Sept Oct Nov Dec

User Sessions

2008 2007


4

Program Update

Elevator U ProjectOBJECTIVE: To develop a safety program aimed at college aged adults to educate them on the safe and proper use of elevators, escalators and moving walks.

• Michigan State University has submitted print materials and a public service announcement

• Purdue University’s senior level Public Relations course is forming groups to develop a program prototype to submit to EESF.

• Programs will be revealed at the Elevator U Conference in June 2009.

FINANCES

2008 Audit Income $536,689

Expense $478,418

Increase/decrease in unrestricted net assets: $58,271

Expense Breakdown:

Programs: $338,667 (71%)

Administration: 102,495 (21%)

Fundraising: 37,256 (8%)

Fundraising Efforts

2008 FINAL CAMPAIGN RESULTS

$317 186 in donations from 258 members$317,186 in donations from 258 members

105.72% of $300,000 goal

Renewing Members = 204 (81%)

New Members = 37

Returning Members = 17 (have not donated since 2007 or longer)

Fundraising Efforts

2009 CAMPAIGN RESULTS TO-DATE

Donations & Pledges12 MAR 09 12 MAR 08$135 780 $ 89 925$135,780 $ 89,925

Number of Contributors to date:12 MAR 09 12 MAR 08

136 143

2009 Campaign ChairmanRobert “Bobby D” DeFrancesco, Benfield Electric

2009 Regional Campaign Chairmen:John Compton, Draka Richard Gregory, Vertex Corporation


5

Fundraising Efforts

2008 FUNDRAISERS (14% of Budget)

Chicago Cruise ($17,127)g ($ , )

NAEC Recognition Reception ($22,379)

NAESAI Silent Auction (Canadian $3,128)

NAVTP Silent Auction ($2,682)

Other Special Events – Raffles ($631)

Pop Joe Memorial Golf Outing ($32,545)

Total = $75,942

Fundraising Efforts

2009 PLANNED FUNDRAISERS- details available at www.eesf.org/events

Pop Frohlinger/Joe Marchese Golf Outing June 11 2009Pop Frohlinger/Joe Marchese Golf Outing - June 11, 2009

Elevator U Silent Auction – June 16, 2009

EIGSC Annual Golf Outing - June 19, 2009

EESF Chicago Cruise – July 1, 2009

CEA Golf Outing - August 7, 2009

NAVTP New York Region Dinner Cruise - August 20, 2009

UNITED (NAEC, NAESAI, CECA, NAVTP)- September 20, 2009

CANADA

Toronto Harbour Cruise – June 4, 2009

Annual Meeting

Held March 3, 2009 in Atlanta, GA

Tentatively scheduled for March 2 2010 Hilton Atlanta Airport Tentatively scheduled for March 2, 2010 – Hilton Atlanta Airport

Strategic Plan developed

All members of EESF are encouraged to attend

Strategic Plan

Increase fundraising• Increase Payroll Deduction• Solicit Manufacturers for support• Create IUEC Fundraisers• Explore New fundraising opportunities

Increase Industry Awareness of EESFIncrease Industry Awareness of EESF • Prospect for new members at non-participating events• Use active EESF members• Distribute Safe-T Rider Illustration Video NationwideIncrease involvement of Non-Participating Industry Groups• Target key non-involved industry groups, MESA, NCEIG, ECNY, BOMA, etc. • Pursue West Coast board members• Develop and deliver marketing communications requesting involvement • Update regions with EESF/EESFC information Increase Company Volunteerism• Advertise in education industry publications and at workshops • Advertise in company intra-nets• Managers programExpand Program Scope• Advertise in education industry publications & at workshops• New MarketsDelivery Verification• Encourage Teacher self reporting


6

Elevator Escalator Safety Foundation

Update report to the National Elevator Industry, Inc.

March 15, 2009


LOFTUS ROSS LLP

CERTIFIED PUBLIC ACCOUNTANTS

THOMAS J. ROSS, CPA, C1P

MEGAN M. ALEXANDER, CPA SCOTT R. HARTUNG, CPA HEATHER D. PATTEN, CPA LEO A. RIGBY, CPA, CISA MARY A. SCELLEN, EA GERALD J. LOFTUS, CPA (RETffiED)

Board of Directors National Elevator Industry, Inc. 1677 County Route 64 P.O. Box 838 Salem, NY 12865-0838

PO BOX 4750, 111 EVERTS A VENUE QUEENSBURY, NY 12804 PH: (518) 792-6595 FAX: (518) 792-6635 EMAIL: [email protected]

February 27, 2009

MAR , '] LUu~l

In conjunction with our engagement to audit the financial statements of National Elevator Industry, Inc. as of and for the year ended December 31,2008, we came across the following matter which we would like to bring to your attention.

CASH DISBURSEMENTS

While testing cash disbursements we noted one instance where a check (#1948, payable to Stateside Associates, in the amount of $32,551.58) had only one signature. Since it is the policy of National Elevator Industry, Inc. to have two signatures on all checks, we recommend that management ensures that this policy is followed when all checks are signed.

At this time we would like to thank Edward Donoghue for the courtesies extended to us during our engagement.

We would be pleased to meet with you at your earliest convenience to review any questions you may have concerning this letter.

Sincerely,

Loftus Ross LLP

f:kath.w iJ p~ Heather D. Patten, CPA Principal

HDP:mma

G IWP85731 NATL ELEVATOR\MGMT LTR DOC


http:32,551.58http:32,551.58mailto:[email protected]:[email protected]

LOFTUS ROSS LLP


THOMAS J. ROSS, CPA, C1P

PO BOX 4750, 111 EVERTS AVENUEMEGAN M. ALEXANDER, CPA QUEENSBURY, NY 12804SCOTT R. HARTUNG, CPA PH: (518) 792-6595HEATHER D. PATTEN, CPA FAX: (518) 792-6635LEO A. RIGBY, CPA, ClSA EMAIL: [email protected] A. SCELLEN, EA

GERALD J. LOFTUS, CPA (RETfRED) February 27,2009

Board of Directors National Elevator Industry. Inc.

We have audited the financial statements of National Elevator Industry, Inc. for the year ended December 31,2008 and have issued our report thereon dated February 27,2009 Professional standards require that we provide you with the following information related to our audit.

Our Responsibility under U.S Generally Accepted Auditing Standards

As stated in our engagement letter dated August 26,2008, our responsibility, as described by professional standards. is to express an opinion about whether the financial statements prepared by management with your oversight are fairly presented, in all material respects, in conformity with U.S. generally accepted accounting principles. Our audit of the financial statements does not relieve you or management of your responsibilities.

Planned Scope and Timing of the Audit

We periormed the audit according to the planned scope and timing previously communicated to you in our meetings about planning matters.

Significant Audit Findings

Qualitative Aspects of Accounting Practices

Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by National Elevator Industry, Inc. are described in Note A to the financial statements. No new accounting policies were adopted and the application of existing policies was not changed during 2008. We noted no transactions entered into by the Organization during the year for which there is a lack of authoritative guidance or consensus. There are no significant transactions that have been recognized in the financial statements in a different period than when the transaction occurred.

Accounting estimates are an integral part of the financial statements prepared by management and are based on management's knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because


mailto:[email protected]:[email protected]

Board of Directors February 27. 2009 National Elevator Industry, Inc. Page 2

of the possibility that future events affecting them may differ significantly from those expected.

Difficulties Encountered in Performing the Audit

We encountered no significant difficulties in dealing with management in performing and completing our audit.

Corrected and Uncorrected Misstatements

Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are trivial. and communicate them to the appropriate level of management. Management has corrected all slJch misstatements. In addition, none of the misstatements detected as a result of audit procedures and corrected by management were material, either individually or in the aggregate, to the financial statements taken as a whole.

Disagreements with Management

For purposes of this letter, professional standards define a disagreement with management as a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or auditor's report. We are pleased to report that no such disagreements arose during the course of our audit.

Management Representations

We have requested certain representations from management that are included in the management representation letter dated February 27, 2009.

Management Consultations with Other Independent Accountants

In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a "second opinion" on certain situations. If a consultation involves application of an accounting principle to the Organization's financial statements or a determination of the type of auditors' opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants.

Other Audit Findings or Issues

We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the Organization's auditors. However, these discussions occurred in the normal course of our professional

£OFIUSROSSILP· CERTIFIED PUBLIC ACCOUNTANTS


Board of Directors February 27,2009 National Elevator Industry Inc. Page 3

relationship and our responses were not a condition to our retention.

This information is intended solely for the use of the Board of Directors and management of National Elevator Industry, Inc. and is not intended to be and should not be used by anyone other than these specified parties.

Very truly yours.

~R~Ll.P Loftus Ross LLP

LOFTUSROSSLLP . CERTIFIED PUBUCAcaJUNTANTS


NATIONAL ELEVATOR INDUSTRY, INC.

FINANCIAL STATEMENTS AND

OTHER FINANCIAL INFORMATION

Year Ended December 31, 2008


TABLE OF CONTENTS

Independent Auditors' Report

Page

1

Financial Statements

Statement of Financial Position 2

Statement of Activities 3

Statement of Functional Expenses 4

Statement of Cash Flows 5

Notes to Financial Statements 6-7


LOFTUS ROSS LLP


TlfOl'fAS]. ROSS, CPA, CTP

MEGAN /'.1. ALEXANDER, CPA SCO'lT R. IlARTUNG, CPA PO BOX 4750, 111 EVERTS AVENUE

QUEENSBURY, NY 12804HEA THER D. PA TTEN, CPA PH: (518) 792-6595LEO A. RICBi', CPA, CiSA

MARY A. SCELLf.1V, £4 FAX: (518) 792-663S EMAIL-LROSS({iJl.OFTUSROSS.COMCER.4LD J. I.orrus, CPA (RETffiELJ)

INDEPENDENT AUDITORS' REPORT

Board of Directors National Elevator Industry, Inc,

We have audited the accompanying Statement of Financial Position of National Elevator Industry, Inc. (a not-for-profit organization), as of December 31, 2008 and the related Statements of Activities, Functional Expenses, and Cash Flows for the year then ended. These financial statements are the responsibility of the Organization's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America, Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements, An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation, We believe that our audit provides a reasonable basis for our opinion,

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of National Elevator Industry, Inc., as of December 31, 2008 and the changes in its net assets and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America,

February 27, 2009

LlYkh~~ )Jf'fo~ssLLP


http:EMAIL-LROSS({iJl.OFTUSROSS.COMhttp:EMAIL-LROSS({iJl.OFTUSROSS.COMhttp:SCELLf.1Vhttp:SCELLf.1V


STATEMENT OF FINANCIAL POSITION

December 31, 2008

ASSETS

CURRENT ASSETS: Cash and Cash Equivalents

Unrestricted

Prepaid Insurance

$763,138

2.777

TOTAL CURRENT ASSETS $765,915

FIXED ASSETS: Equipment Accumulated Depreciation

TOTAL FIXED ASSETS

$313,471 (139.934 )

$173,537

OTHER ASSETS: Annuity Net of Amortization

TOTAL OTHER ASSETS

$11,023

$11,023

TOTAL ASSETS $950,475

LIABILITIES AND NET ASSETS

CURRENT LIABILITIES: Accounts Payable

TOTAL CURRENT LIABILITIES

$80.056

$80,056

NET ASSETS: Unrestricted

TOTAL NET ASSETS

$870.419

$870,4 19

TOTAL LIABILITIES AND NET ASSETS $950,475

See Notes to Financial Statements

Page 2



STATEMENT OF ACTIVITIES

For the Year Ended December 31, 2008

REVENUE: Assessments - Regular Membership

Assessments - Trust Membership

Annuity Income

Interest Income

Code Finder Income

TOTAL REVENUE

FUNCTIONAL EXPENSES: Program Services

Management and General

TOTAL FUNCTIONAL EXPENSES

DECREASE IN UNRESTRICTED NET ASSETS

NET ASSETS:

Beginning of Year

End of Year

$1,370,500 12,000 4,252

15,342 27,500

$1,429,594

$849,960 85,235

$935,195

$494,399

376,020

$870,4 19


Page 3



STATEMENT OF FUNCTIONAL EXPENSES

For the Year Ended December 31, 2008

FUNCTIONAL EXPENSES: Code Consultant Code Expenses Elevator/Escalator Safety Foundation Administrative Services Administrative Expenses Insurance Amortization Depreciation Advertising & Public Relations Telephone Stationery, Printing & Supplies Legal Fees & Professional Fees Dues & Subscriptions Supplemental Pension Meeting Expense Postage & Delivery Trust Consultant Travel Office Expense Trust Administration Lobbying Services

TOTAL FUNCTIONAL EXPENSES

Total

$106,915 43,014 30,000 36,000

943 7,135

484 66,557

110,643 7,844

16,508 3,750 1,500 4,267 1,815 1,591 4,800

628 3,015 1,570

486,216

$935,195

Program

Services

$106.915 43,014 30,000

0 0 0 0

66,557 110.643

0 0 0 0 0

1,815 0

4,800 0 0 0

486,216

$849,960

Management and

General

$0 0 0

36,000 943

7.135 484

0 0

7,844 16.508 3.750 1.500 4,267

0 1,591

0 628

3,015 1,570

0

$85,235


Page 4



STATEMENT OF CASH FLOWS

For the Year Ended December 31,2008

CASH PROVIDED (USED) BY:

OPERATING ACTIVITIES: Change in Net Assets $494.399 Items not Affecting Cash

Amortization 484 Depreciation 66.557

Prepaid Expenses 470 Accounts Payable 25.731

NET OPERATING ACTIVITIES $587.641

FINANCING ACTIVITIES: Purchase of Equipment

NET FINANCING ACTIVITIES $(71,810

INCREASE IN CASH AND CASH EQUIVALENTS $515.831

CASH AND CASH EQUIVALENTS: Beginning of Year 247,307

End of Year $763,138

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the year for:

Interest Taxes

$0 o

DISCLOSURE OF ACCOUNTING POLICY:

For purposes of the Statement of Cash Flows. the Organization considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivaients, including restricted cash.


Page 5



NOTES TO FINANCIAL STATEMENTS

December 31,2008

(A) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This summary of significant accounting policies of National Elevator Industry. Inc (NEil) is presented to assist in understanding the Organization's financial statements. The financial statements and notes are representations of the Organization's management, which is responsible for its integrity and objectivity. These accounting policies conform to generally accepted accounting principles and have been consistently applied in the preparation of the financial statements.

BUSINESS ACTIVITY NEil, a national trade association headquartered in Salem, NY, is a not-for-profit Corporation organized to foster and promote the interests of its members in the area of short range transportation systems.

PROPERTY AND EQUIPMENT Property and equipment are carried at cost. Depreciation of property and equipment is computed using straight-line or accelerated methods at rates based on the estimated useful lives.

Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred.

REVENUE Revenue is reported on the accrual basis and consists primarily of membership assessments.

RESTRICTIONS ON NET ASSETS The Organization reports gifts of cash and other assets as restricted support if they are received with donor stipulations that lim it the use of the donated assets. When a donor restriction expires, that is. when a stipulated time restriction ends or purpose restriction is accomplished, temporarily restricted net assets are reclassified to unrestricted net assets and reported in the statement of activities as net assets released from restrictions.

The Organization reports gifts of land, buildings, and equipment as unrestricted support unless explicit donor stipulations specify how the donated assets must be used. Gifts of long-lived assets with explicit restrictions that specify how the assets are to be used and gifts of cash or other assets that must be used to acquire longlived assets are reported as restricted support. Absent explicit donor stipulations about how long those long-lived assets must be maintained, the Organization reports expirations of donor restrictions when the donated or acquired long-lived assets are placed in service.

Page 6



NOTES

(A) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

ORGANIZATION

NEil is an organization exempt from income tax under Section 501 (c) (6) of the Internal Revenue Code.

ADVERTISING Advertising costs are expensed as incurred. Advertising expense for the year ended December 31,2008 was $110,643.

USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

(8) INVESTMENT IN ANNUITIES/SUPPLEMENTAL PENSION The Organization has purchased single premium annuity contracts on the lives of two of its former employees. The cash flows generated from one of these investments is used to provide a post retirement payment to a former employee in consideration for past services. The amount earned from the annuity and the corresponding expense has been recorded on the Statements of Activities and Functional Expenses. The other annuity agreement calls for payments to be made directly to the former employee by the insurance company. The annuities, which have been recorded at cost, are being amortized over the expected remaining lives of the annuitants.

(C) RELATED PARTY TRANSACTIONS The Organization conducts business with Edward A. Donoghue Associates, Inc., whose President is the Secretary of NEIl. The total amount expensed by NEil for services in 2008 is $67,532. This has been allocated to various expense accounts, including, but not limited to, Code Consultant, Code Expenses and Administrative Services.

(D) CONCENTRATION OF CREDIT RISK The Company occasionally maintains deposits in excess of federally insured limits. Statement of Financial Accounting Standards No.1 05 identifies these items as a concentration of credit risk requiring disclosure, regardless of degree of risk. The risk is managed by maintaining all deposits in high quality financial institutions and IJsing repurchase agreements.

* * * * * * * * * * * * * *

Page 7


NATIONAL ELEVATOR INDUSTRY, INC.YTD February 2008

2009 YTD Plan Plan Jan Feb Mar Q1 Q2 Q3 Q4 Actual Variance

Ordinary Income3010 · Members Dues 556,500 556,000 - - - - 0 0 556,000 (500) 3020 · Other Income 4,250 - - - - - 0 0 0 (4,250) 3030 · Code Finder - - - - - 0 0 0 - Total Income 560,750 556,000 - - - - 0 0 556,000 (4,750)

Expense1000 · Administrative1010 · Administrative Services 36,000 - 3,000 - - 0 0 3,000 33,000 1020 · Accounting/Auditing 4,000 - - - 0 0 0 4,000 1030 · Insurance 9,000 - - - 0 0 0 9,000 1040 · Professional Fees 50,000 1,065 2,405 - - 0 0 3,470 46,530 1050 · Office Expense 1,000 - 324 - - 0 0 324 676 1110 · Supplemental Pension 4,267 356 356 - - 0 0 711 3,556 1120 · Postage & Delivery 2,200 - 142 - - 0 0 142 2,058 1130 · Telephone 7,000 77 764 - - 0 0 842 6,158 1140 · Stationery, Printing & Supplies 7,000 - 263 - - 0 0 263 6,737 1150 · Depreciation & Amortization - - - - - 0 0 0 - 1170 · Bank Charges 3,000 - - - - 0 0 0 3,000 1180 - Misc. Administrative Expenses - - 38 - - 0 0 38 (38) 1190 · Contingency 50,000 - - - - 0 0 0 50,000 Total 1000 · Administrative 173,467 1,498 7,292 - - - 0 0 8,790 164,677

2000 · Operating2010 · Advertising & Public Relations 91,000 - - - - 0 0 0 91,000 2020 · Code 47,500 - 4,964 - - 0 0 4,964 42,536 Total 2030 · Committee 138,500 - 4,964 - - - - - 4,964 133,536

2040 · Consultant - Codes 106,000 - 11,502 - - 0 0 11,502 94,498 2050 · Dues & Subscriptions 3,500 - - - - 0 0 0 3,500 2060 · EESF 30,000 - - - 0 0 0 30,000 2070 · Legal 25,000 - - - 0 0 0 25,000 2080 · GAC Services 600,000 51,750 12,152 - - 0 0 63,902 536,098 2090 · Meetings 8,500 - - - 0 0 0 8,500 2100 · Travel 3,000 - - 0 0 0 3,000 Total 2000 · Operating 914,500 51,750 28,618 - - - 0 0 80,368 834,132

Total Expense 1,087,967 53,248 35,910 - - - 0 0 89,157 998,810

Net Ordinary Income (527,217) 502,752 (35,910) - - 0 0 466,843 994,060

Other Income/(Expense)3025 · Labor Document Database - - 3040 · Interest Income 10,000 124 153 - - 0 0 277 (9,723) 3050 · Annuity Income 4,260 - - - 0 0 0 (4,260) Net Other Income/(Expense) 14,260 124 153 - - - 0 0 277 (13,983)

Net Income (512,957) 502,876 (35,756) - - - 0 0 467,120 980,077

Trust Committee3015 · Trust Members Dues 12,000 12,000 - - - - 0 0 12,000 - 2045 · Consultant - Trust 2,000 - 400 - - 0 0 400 1,600 1015 · Trust Administration 3,500 - 93 - - 0 0 93 3,407 Trust Net Income 6,500 12,000 (493) - - - 0 0 11,507 5,007


National Elevator Industry, Inc. CODE & SAFETY OFFICE 47 Leicester Street • Perry, New York 14530 • Office: 585.302.0813 Fax: 585.302.0841

WWW.NEII.ORG • E-Mail: [email protected]

NEII ASSOCIATION HEADQUARTERS

1677 County Route 64 • P.O. Box 838 • Salem, New York 12865-0838 • 518.854.3100 Fax: 518-854-3257

BOARD OF DIRECTORS MEETING April 7, 2009

Code and Safety Consultant’s Report

1. Central Code Committee

1.1 NEII Representation on Codes and Standards Committees NEII continues to participate in the codes and standards committees of ASME, ICC, NFPA and other code development bodies, with Brian Black serving on the majority of these as NEII’s Code and Safety Consultant.

1.2 Accessibility Except for the US Department of Defense, the status of the US government accessibility requirements in effect remain virtually unchanged since the last NEII Board of Directors’ meeting in September 2008:

Agency Applicable Regulations Facilities Subject to the Americans with Disabilities Act (ADA)

Department of Transportation 2004 ADA Accessibility Guidelines Department of Justice 1991 ADA Accessibility Guidelines (effective November

2006) Facilities Subject to the Fair Housing Act (FHA)

Department of Housing and Urban Development 1991 Fair Housing Accessibility Guidelines Facilities Subject to the Architectural Barriers Act (ABA) – federally funded projects

General Services Administration 2004 ABA Accessibility Guidelines (effective May 2006, February 2007 for leased facilities)

US Postal Service 2004 ABA Accessibility Guidelines (effective October 2005)

Department of Defense 2004 ABA Accessibility Guidelines (effective December 2008)

Department of Housing and Urban Development 1984 Uniform Federal Accessibility Standards

The Department of Justice ADA regulations apply to most private and public sector construction in the US. On January 22, 2009, the Department withdrew its Notice of Proposed Rulemaking (NPRM) to update its regulations to reference the 2004 ADA Accessibility Guidelines. Withdrawing proposed regulations is pro forma for Executive departments and agencies when there is a change of administration, and it is unclear 1) whether any changes will be made, and 2) when a NPRM will be issued.


NEII Code and Safety Consultant’s Report April 7, 2009 Page 2

The update of the ICC/ANSI A117.1-2003 standard is almost complete, and a publication date of 2009 is expected for the new edition. No significant changes affecting elevators have been approved as NEII was able to convince the committee to reject a number of unfavorable proposals. We serve on the Editorial Committee and are hoping to add clarifying text and figures to the standard, particularly for destination-dispatch elevators. The CSA B44 Committee is continuing its review of the Appendix E accessibility requirements to harmonize with ICC/ANSI A117.1-2003. Last, NEII has been extensively involved in deliberations in San Francisco that would significantly augment the accessibility requirements for destination dispatch elevator systems. Working with both our Area Code Committee members and a lobbyist from Greenberg Traurig, we have attempted to hold the line on these deliberations to keep the requirements similar to the national provisions found in ICC/ANSI A117.1-2003. Results have been mixed, and the city has indicated that it intends to publish its “improved” requirements later this year. Concurrently, the California State Architect’s Office has announced its intent to establish a task force to study accessibility enhancements for destination systems on a state level.

1.3 Local Elevator Codes North Carolina, Iowa, New Hampshire, Ontario, and Newfoundland have adopted the ASME A17.7-2007/CSA B44.7-07 Performance Based Safety Code. Ohio has indicated its intent to do so in the near future. California has adopted the ICC International Building Code and ASME A17.1-2004, although it has retained its old Title 24 accessibility requirements for elevators (see item 1.2 for a discussion of destination dispatch developments). Illinois has adopted ASME A17.1-2004 with the ASME A17.1a-2005 and ASME A17.1s-2005 supplements, and Chicago is in the process of adopting ASME A17.1-2007. NEII and Stateside Associates have been meeting with officials in Chicago to discuss a direct adoption of ASME A17.7-2007. An emerging concern involves jurisdictions that have adopted ASME A17.1-2007/CSA B44-07 without amendments but do not acknowledge the resulting adoption of ASME A17.7-2007/CSA B44.7-07 by reference. The committee is discussing meeting with these jurisdictions to encourage recognition of the Performance Based Code. 1.4 Electrical Codes The 2008 edition of the National Electrical Code® is published and available. A summary of changes in the 2008 edition has been posted on the NEII website in the members’ area. NEII will be submitting two proposed code changes for the 2011 edition. The current Canadian Electrical Code is the 2006 edition. A new edition will be available shortly with only changes to the numbering system, while there is a plan to incorporate the NEC® changes in the 2009 Canadian Electrical Code. A summary of the code’s elevator requirements will be published on the NEII website.

1.5 Code Requirements for Inspection and Tests The ASME A17 Standards Committee approved a proposal containing alternatives to current inspection and testing practices, procedures and frequencies which included:


NEII Code and Safety Consultant’s Report April 7, 2009 Page 3

• making all tests a maintenance function, not an inspection function; • basing inspection frequencies on a risk analysis; • permitting equipment monitoring in lieu of on-site inspections for monitored equipment.

The changes are in the first Addenda to ASME A17.1-2007/CSA B44-07, issued December 5, 2008. 1.6 Seismic Activities The NEII Seismic Task Force continues to analyze the seismic requirements of ASME A17.1/CSA B44 and the ICC International Building Code with the goal of harmonizing the seismic requirements. The latter references ASCE 7 Minimum Design Loads for Buildings and Other Structures. A current TN that would rewrite all of Section 8.4 of the code to realize this harmonization is currently under consideration.

1.7 NEII Area Code Committees At its January 2009 meeting, the committee members discussed ways to make the Area Code Committees more effective. This will remain an agenda item for future meetings. The Area Code Committee rosters are available in the members’ area on the NEII web site. Members’ can be identified and contac

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