Where the Money Goes

Chief Operating Officer and CFO Lorraine Petrakis joins host Amara Obiledu to open the books on NANA's own finances — the $14.2 million operating budget, the reserve policy she runs with the Treasurer, and why the annual Summit has to be read as its own profit-and-loss line, not folded into the general budget.

• Lorraine Petrakis — Chief Operating Officer and CFO, NANA. Joined in 2019 from a museum consortium; owns the budget, the reserve policy with the Treasurer, and the Summit P&L.

• 00:00 Intro

• 01:15 The $14.2 million budget, top line

• 07:00 Where dues revenue actually goes

• 13:20 The reserve policy, and why it exists

• 19:40 Reading the Summit as its own P&L

• 25:30 What a member should ask before challenging a dues increase

• 30:10 Lorraine's museum-consortium background

Host: Lorraine, you're the person who has to answer for every dollar in this building. Let's start with the top line. $14.2 million operating budget this fiscal year, and our fiscal year runs July through June.

Lorraine Petrakis: That's right. Roughly two-thirds of that is personnel, which is normal for an organization like ours — we're a services business, and the service is people. The rest splits across the research program, member communications, the advocacy team's operations, and event production, which is a bigger line than people expect because the Summit alone runs well into seven figures.

Host: Where does the revenue side come from?

Lorraine Petrakis: Dues are the base, but they're not the majority. Individual membership is $195 and Organization membership is $1,450, and between the two of those we cover a meaningful share of the budget, but not all of it. Summit registration, sponsorships, and course fees make up most of the rest. If dues were our only revenue line, we'd either need to raise them well past what members would tolerate, or we'd need to shrink the staff, and neither of those is a trade I want to make.

Host: Let's talk about the reserve policy. What is it, and why does the board care so much about it?

Lorraine Petrakis: I run it jointly with the Treasurer, currently Haruko Tanaka. The policy sets a floor — we hold a minimum number of months of operating expenses in reserve, so that if Summit registration comes in soft one year, or a sponsor pulls out late, we're not making emergency staffing decisions in the same quarter. It's boring by design. The whole point of a reserve policy is that nobody should ever be talking about it in a crisis, because the crisis is exactly what it exists to absorb quietly.

Host: Has it ever actually been drawn down?

Lorraine Petrakis: Modestly, in ordinary years where a program ran a planned deficit — a new course line in its first year, for instance, before enrollment caught up to cost. That's a normal use of reserve. What we watch for is any year where the draw is unplanned, because that's the signal that something in the budget assumption was wrong, not that the reserve is doing its job.

Host: You mentioned the Summit needs to be read as its own P&L. Walk me through why.

Lorraine Petrakis: Because it's the single largest thing we produce, and if you blend its costs and revenue into the general operating budget, you lose the ability to tell whether the Summit itself is healthy. Hotel room blocks, catering minimums, AV production, staff travel — those costs move independently of the rest of the organization's spending. Registration revenue, sponsorship revenue, and the group discount Rosalind's team offers at 15% off for five or more attendees from one organization — those move independently too. I want a Summit P&L that stands alone, so if it's ever under strain, we see it immediately rather than three quarters later buried in a consolidated number.

Host: Is the Summit profitable on its own?

Lorraine Petrakis: It needs to be, and it generally is, though the margin isn't wide. Attendance has grown every year — 1,050 people at this year's Summit — and growth in attendance helps the P&L because a lot of the cost structure is fixed regardless of whether we host 900 people or 1,100. But growth also means renegotiating room blocks and catering minimums every year, which is its own kind of work.

Host: If a member organization pushes back on a dues increase, what should they actually ask us for?

Lorraine Petrakis: Ask what specifically the increase is funding. A board that raises dues without being able to answer that question is setting itself up for a harder renewal conversation the following year. I'd rather a member challenge us on that and get a real answer than accept an increase quietly and lose trust in the number later. Our dues, for what it's worth, haven't moved since 2023, and if that changes I'd expect the board to be specific about why.

Host: You came from a museum consortium before this. How does that experience carry over to running finance for an association of associations?

Lorraine Petrakis: More directly than you'd think. A museum consortium is also managing a mix of dues-paying members with wildly different budget sizes, a signature annual event, and a reserve that has to survive a bad year for any one member without the whole consortium feeling it. The scale here is larger and the sector is different, but the underlying finance problem — build a budget that doesn't depend on every single revenue line performing exactly as forecast — is the same problem I was solving before I got here.

Host: Last question. What's the finance conversation you wish more member boards were having with their own executive directors?

Lorraine Petrakis: Reserve policy, honestly, more than dues. Almost every association I talk to has strong opinions about what dues should be, and far fewer have a written reserve policy with an actual floor in it. If you only remember one thing from this episode, it should be that — write the floor down, and don't let a good year talk you into spending past it.

Host: Before you go, I want to ask about something you touched on earlier. You said personnel is roughly two-thirds of the budget. Is that typical for a sector association, or does it run higher here?

Lorraine Petrakis: It's typical, and honestly it should be higher rather than lower for an organization like ours, because we don't manufacture anything or hold inventory. What we sell is expertise and access — research staff, policy staff, event staff, member-facing staff. When people ask why an association's overhead ratio looks different from a retailer's, that's the answer. Labor is the product.

Host: Does that make the annual budget conversation with the board harder, since so much of it is fixed cost tied to people?

Lorraine Petrakis: It makes it more honest, which isn't the same as harder. A retailer's board can debate discretionary spending on inventory or marketing. Ours has to debate staffing levels directly, which is a more uncomfortable conversation but a clearer one. I'd rather the board see the real trade-off — one more researcher versus one more course offering — than have it obscured inside a vague line item.

Host: Walk me through how a course fee, or a sponsorship dollar, moves through the budget differently from a dues dollar.

Lorraine Petrakis: Dues are unrestricted — they fund whatever the board has approved for the year. A course fee is tied directly to the cost of running that course, instructor time, the learning platform, so it's closer to break-even by design; we're not trying to profit heavily off education, we're trying to cover its cost and make it accessible. Sponsorship dollars are the most flexible of the three, but they're also the least predictable year over year, so I budget them conservatively and treat anything above plan as upside rather than baseline.

Host: Last question, and it's about you rather than the number. What's the finance mistake you see most often from a first-time executive director?

Lorraine Petrakis: Building next year's budget off this year's actuals without asking whether this year had something unusual in it — a one-time gift, an unusually cheap venue, a sponsor who won't renew. I did that myself early in my career at the museum consortium, and it took one bad year to teach me to always ask what's baked into last year's number before I copy it forward.

Host: Lorraine, thank you for opening the books.

Lorraine Petrakis: Happy to. Come back and audit me again next year.