Document gb22zpga54m4aXqyQLQ0DeNBL

FUICTI"1:; i'ATE'.'.IALS STA-IDf.i1D.S Ii.lSTITUTJ:, IJC., E-210 I'-..OUTE t!4, PA?)~.i.:US, ::.J. 07652 !1IJUTES OF 7liE A:.UUAL :.JEZT!i.TG of the FRICTIOn ; :ATE:RIALS ST&:~ARDS Ii.iSTITUTE, IHC. Pt:!d.'lesday and Thursday, June 13 and 14, 1979 at Ocean ~eef Club, Key Lar~o. Florida i.:W.ffiErul PRESlliiT REPRESEHTATIVES Abex Corporation Bendix Corporation Brassbestos lianufacturing Corp. Carlisle Corporation General i:Iotors. Corporation Lear-Siegl~r Inc. Juturn Corporation P.T. Brake Lining Company H.K. -Porter Company Raybestos-!.!anhattan Inc. Reddat-ray ::Ianufacturing Co. Thiokol Chemical Corporation s.:~. ~Tellman Corporation ~llieeling )rake Block R. L. Cutler F. E. ~-Iessier u. Simon R. Perritt (Proxy from E. Zacharias) R. J. Kick D. J. Oe;ilvie J. H. Greenen Stuart Comins t-1. n. Sleeth R. R. !1oalli J. H. Uoore J. P. Gallagher G. A. Carrigan L. Bureess PROXY AVAILABLE Scan-Pac i1fg., Inc. H. A. Scandrett (Proxy to E. W. Drislane) OTHERS ?RESEi1T Abex Corporation R. E. ~lelson (6/13) Bendix Corporation ~eavy Vehicle Systems Group R. E. Elliott Delco-tloraine Division R. E. Kettering i'Tuturn Corporation J. L. lfellatf a.~. Porter Company R. !!. Hartman Raybestos...i~anhattan, Inc. D. E. Cunningham T.t. J. B.ussell Redd.:n1ay !!anufacturing Company F. H. Barton J. E. Clegg S.K. t1ellman Corporation TJheeling Brake Block R. Kaminski c. Hilson rr. Burgess Robert P. Gorman, Esquire G. Stratton J. z. Jackson Distinguished Guest J. L. HcGovem, Jr. Federation of European l1anufacturers of Friction Haterials (FEHFH) R. Join Friction ;laterials Standards Institute ::::. U. Drislane Ur. !.!easier, President, called this meeting to order at 1: 45 P.M. FMSI 02143 J._!,.L...., -2- Junt! 13 .:, 14' 19 79 : :Ii7UTES :)f JU:.It:: 28-29, 1n8 ::zETii.~G The minut~s of the meetinf, ~eld June 28-29, 1978 had been distributed. ~io corrt:!ctions uere suggested. Upon motion duly made, St:!conded and unanimously passed, it was; P~SOLVED: That the minutes of the June 28-29, 1978 'ieetin3 be accepted as urittt:!n. PRESIDEliT 1S BEPORT Ur. Uessier, President, reported on actitivities for the 1978-79 fiscal year. Ile commented on publication of the 11Friction l!aterials Hork Practices Guide," the History of the Institute that was prepared immediately after the June 1978 !leeting, and publication of the "1979 Brake Block Identification Catalog., t!r. Eessier also noted the grantinG of trademark regiStrations to FUS and FHSI and resolution of a question concerning the Consumer Product Safety Commission jurisdiction on which a question was raised at the June 1978 Ueeting. It H88 noted that the National Hisbway Traffic Safety Administration has responsibility for automotive friction materials regulations and these are not under the jurisdiction of the Consumer Product Safety Commission. Hr. Hessier also addressed questions that would be raised at the meeting concerning an "Asbestos Health Hazards Compensation Act" and recent contacts by the Institute ~1ith the Toxic Substances Control Office of the Environmental Protection Agency. He thanked those who had contributed of their time in furthering the intt~rests of the Institute and the industry. Upon motion duly made, seconded and unanimously passed, it was; F~SOLVED: To accept the President's Report as written. BEPORl' 01~ BOARD OF DIRECTORS ACTIVITIES This report covers activities of the Board of Directors since the Annual llembership l!eeting in June 1978. It 788 reported at the June 19, 1978 session of thtt ~tembership Meeting that the Board of Directors had elected the following Officers for 1978-79 terms: Hr. Francia E. rtessier, President; l1r. Ronald R. Uoalli, Vice-President; Hr. Uilllam F. Messier, Treasurer; ~Ir. Edt1ard ~1. Drislane, Secretary. At the Board of Directors Ueeting it was voted to retain Gorman and Cole as Legal Counsel for th~ 1978-79 year. The Board of Directors voted to accept the expens~ budget of $91,250 for the 1978-79 fiscal year. The Board of Directors voted to retain the prior year's fee formula for the 19 78-79 year. During the year, the Board of Directors took several actions by mail ballot. In addition, they reviewed and made recommendations on other items of concern to the Institt,~te. They asked the Asbestos Study COtll!littee to. review the proposed "Friction Haterials Uork Practices Guide" and make reco~ndations to the Doard of Directors. Acting on recommendations by tht~ Asbestos Study Committee, the Board voted to proceed with publication of the ::Friction Uaterials Work Practices Guide." The Directors reviewed FMSl 02144 ~IIi.1UTES OF Tl:B Aili.;UAL ~~El:::TVG -3- June 13 & 14, 1979 a report on the FI:1SI Qualified Enployt.:!e Pension Plan. Tht.:!y revietY"ed the delinquent receivable frot'!l the Hayes-Albion Corporation and recommended pursuit of collection tlithout use of a collection agency or legal firm. They asked Counsel to reviet7 the Consumer Product Safety Act to see if asbestos-containing brake linines uere a consumer product under definition of the act. Acting on recommendations of the Asbestos Study Committee and Legal Counsel, they decided that representation tolould not be made to the Consumer Product Safety Commission as regards recall procedures for brake linings. The Board of Directors voted to accept the name changes of tt70 Regional Nembers. One ~1as Francisco Stedile, S. A. of Brazil to Fras-Le, S.A. The other was ~usco de Colombia to Colfriccion, S.A. The Directors concurred on investment of Institute funds in u.s. Treasury obligations and they voted to transfer funds from a savin~s account to the Hhitehall l!oney Harket Fund. The Directors concurred in extending an invitation to Hr. J. L. ilcGovern to address the Friction Materials Standards Institute at the June 1979 i'.1eeting. The Directors reviewed procedures as regards granting others permission to use the Institute copyrights and trademarks. The Directors voted to accept the application of the Guardian Corporation of Brighton, I1assachusetts to serve as an Active Hember of the Institute. At the Board Heeting held on June 12, 1979 reports by Officers and Committee Chairmen rere read and resolutions uere passed accepting the reports. There were t:Tr~o recent applications for membership t7hich had been considered by the Hembership Committee by mail ballot immediately prior to the meeting. One was an application for Regional J!embership from Canadian Distex Corporation of Canada and the other an application for Licensee Uembership from Lima International Parts of Lima, Ohio. Both of these applications had been recommended for acceptance by the Hembership Committee and were also recommended for acceptance by the Board of Directors at that meeting. Upon recommendation of the Delegate from Auto Friction Corporation, the Board voted to transfer membership of Auto Friction Corporation to P.T. Brake Lining Company, Inc. Th~ Directors vott.:!d to pursue ~ collection throug~ Legal Counsel of tht.:! $850 rect.:!ivablt.:! fron Hayt.:!s-Albion 8orporntion, This Hayes-~lbion receivable is fran their failure to pay the last half of its annual fee in the year it resigned its membership. In the fee formula area, the Directors indicated that Friction Materials Corporation of Israel (doing business as Interfriction) is participating in the brake linin& category as well as in the clutch facing category. The Directors stated that participation in a category, for Regional 11ember fee formula purposes. is accomplished if the Regional l-iember offers to sell a product using the ~!SI copyriehts or trademarks. They directed that Legal Counsel tighten up the description to indicate participation uhere a Regional Uember is offering that product for sale. The Directors voted for a new fee schedule which approximates a 10% increase over the l978-79 schedule. The sChedule is as follows: Activel1embers: $1,050 Basic Fee plus $700 per category Regional Hembers with Active Member rights: same fee as Active llembers Regional Hember Regular: $1,450 Regional ~lember Association: $2, 400 Licensee: $550 fN\S\ 02'\45 ilii:lUTES OF THE Ai.Ti.iUAL MEETING -4- June 13 & 14, 1979 Upon revie1dng the report of the Public Relations Committee, it T-ras recommended that the Institut;e offer the "Friction Hnterinls \-Jork Practices Guide" to APRA, ASIA AND CFS for their distribution. After review of the Data Book and Technical R~port, the Directors referred a question as regards listing of metallic lininc releases to the Data Book & Technical Committee. In the asbestos area, the ~irectors discussed EPA's proposed Voluntary Action Program for friction materials. They reviewed the letter that was received from Johns-1-lanville suggesting Institute cooperation ~dth the Office of Toxic Substances Control. They also discussed the Illinois Insitute of Technology (IIT) Research Institute report which alleged that a major source of asbestos exposure in the environment comes from exposures in brake repair shops. They also reviewed a legislative draft for an "Asbestos Health Hazards Compensation Act." After considerable discussion the Board directed that the Asbestos Study Committee develop plans for an Institute response to the Board concerning both EPA's Voluntary Action Program and the legislative draft on the Compensation Act. As regards the Institute Development Committee, the Board of Directors considered expansion of the Institute to accomodate manufacturers who did not manufacture friction materials. It was decided not to expand the Institute to include manufacturers such as Aimco as Active Hembers. As regards the annual meeting, the Board of Directors decided not to extend invitations to wives to attend the next meeting and selected the Homestead in Hot Springs, Virginia as the site for the June 1980 Meeting. There were discussions concerning enforcement of the Institute's copyrights and trademarks and it was sugzested that the Institute again extend an invitation to Virginia Friction Products to join the Institute as an Active llember. The Board reviewed a report by the Secretary concerning changes in insurance and information on an :'Errors and Omissions" policy. An application had been filed for an "Errors and Omissions" policy but no action ~o1ill be taken until the coverage and the rates have been ascertained. The Directors reviewed a letter from Legal Counsel concerning Officer and Director exposure and directed that Counsel draw up a plan for indemnification of Officers and Board Uembers for tort liability to third persons. The Board was advised that the trust agreement for Hiss Duschek' s pension had not been prepared prior to the Board Heeting. Counsel advised that he had draft copies of this trust agreement ~71th him. However, these ~~ould have to be revised as the Board voted to increase the pension payments to !Iiss. Duschek fr0111 $6,000 a year to $6,600 a year. The Board reviewed a report by the Secretary on his attendance at the Federation of European Hanufacturers of Friction Materials (FEMFM) meetiti.~ in England in Uay this year. The foregoing is a report on activities of the Board of Directors since the June 19 78 Ueetings. Upon motion duly made, seconded and unanimously passed, it lo7as; RESOLVED: To accept the Secretary's report on activities of the Board of Directors for the 1978-79 fiscal year. FMSI 02146 l:I~IUTES OF T!-~:S ~JJ:'1UP..L :JEETIUG -5- June 13 & 14, 1J79 TREASUP.ER' S IUPORT Hr. H. F. U~ssier is Treasur~r of th~ Institute. Hr. Messier indicated that because of other commit~nts at B~ndix he would be unable to attend the 1979 Annual Heeting and ask~d that the S~cretary read his report. The Secretary read the Treasurer's report. In summary, the report noted that the Institute projected about $2,000 excess of income over expenses for the 1978-79 fiscal year. Th~ report included a conventional balance sheet and an income and expense statement, along with an analysis of variances from budget. The report concluded that the Institute had a healthy financial position. Upon motion duly made, seconded and unanimously passed, it v1as; RESOLVED: To accept the Treasurer's Report as written. BRAKE PERFORI1Al.'ICE STUDY COMHITTEE REPORT :Ir. Nelson, Chairman of the Brake Performance Study Committee, delivered this report. He reported on the review and suggested changes the committee made to the Defense Construction Supply Center concerning Federal Brake Lining Specification HH-L-361. Suggestions were made to the Defense Construction Supply Center on friction and wear levels using the J-661 quality control procedure. The Chairman reported in detail on the recommendations that the Committee made to the Defense Construction Supply Center on this specification. In addition, he noted the changes to DOT 121 (Air Brake Systems Standard) and a suggestion and recommendation that the NHTSA interpretation of the court decision be circulated to the Uernbership. His re!>ort covered the HHTSA' s five year plan for rule-making llhich had several items concerning aftermarket brru~e linings and automotive brake systems. In addition, "rr. aelson mentioned the Vehicle Equipment Safety Commission's V-14 Regulation for a brake wear warning device, and a recommendation made to the Vehicle Equipment Safety Commission concerning the height of the lining manufacturer's identification on the edge of drum brake linings, Upon motion duly made, seconded and unanimously passed, it was; RESOLVED: To accept the report of the Brake Performance Study Committee as ~-1ritten. FEDERATION OF EUROPEAJ."'i liAHUFACTURERS OF FRICTION UATER!ALS (FEMFU) It was suggested that with completion of Hr. Nelson's report that it would be appropriate to discuss activities in Europe at this time. The Secretary l-las asked to read his report on his attendance at the European Federation's meeting in England in Hay 1979. In this report, he reported on their Permanent TechnicalCo~ttee's activities on correlation of vehicle tests and Chase machine tests. He indicated that there ,.,ere some areas of correlation but difficulties -.:Tith correlating the 80 l1PH hot friction test. The Secretary reported to the Federation on activities in the United States including items such as the NHTSA five year plan, publication of the Institute's "Friction l!aterials Hork Practices Guide," a legislative draft prepared by an industry group for an "Asbestos Health Hazards Compensation Act," and the general subject of asbestos in friction materials in the United States. FMSI 02147 :mmTES OF TEE AlliJUAL HEETTIW -6- June 13 & 14, 1979 In this report, the Secretary noted 'Tork being done by FEllFU experts for the International Standards Organization (ISO). Other items noted -v1ere a warning sign for asbestos materials in Great Britain, and a slide program entitled A11 sbestos--Fighting a Killer," promoted by an international union. After the Secretary's report on activities at the Federation's meeting in Hay, IIr. Robert Join of the Federation amplified on certain activities in Europe. A question was asked about the United Kingdom label on friction material packages in the context of a labelling scheme for all carcinogenic products. The possibility of extending the United Kingdom's labelling suggestions to the European community was noted. In discussion, it was noted that in the United States the OSHA asbestos warning labels are on most US products. The British system has a special logo or symbol, ~-1hich is a circle a in red colors. Mr. Join indicated that he would send a copy of this suggested symbol. Further, 11r. Join commented that the "OE only 11 concept in Europe is dying, and that replacement friction material manufacturers' views are now being accepted. Mr. Join was complimented on his Federations's work on correlation between Chase friction machine tests and vehicles, and it was indicated that this is a difficult and expensive program. Upon motion duly made, seconded and unanimously passed, it was; RESOLVED: To accept the Secretary's report on the Federation of European ~1anufacturers of Friction Haterials (FEHFM) Meeting. ilENBERSUIP COUtaTTEE REPORT Hr. Gordon Carrigan, Chairman of the Hembership Committee delivered his committee's report. rre indicated the increase in membership. He noted also that there had been several changes in recent ~7eeks which prevented him from preparing a final report until the ~Teek immediately prior to the meeting, Among recent activities was the acceptance of the application by the Guardian Corporation of Brighton, Massachusetts to serve as an Active uember of the Institute. The Guardian Corporation's application had been handled by mail ballot and the Hembership voted Guardian Corporation in as an Active i1ember just prior to the meeting. ilr. Carrigan noted the recent application received from Canadian-Distex application and the Lima-International application. Both the Canadian-Distex application and the Lima-Internation~l application were then reveiwed at th~ Board of Directors meeting, and the Board voted to recommend acceptance of these ttto applicants as Regional Uember and Licensee Member respectively in the Institute. The Secretary indicated that the Canadian-Distex application could be considered for balloting at this Hembership Meeting. It 't-Tas necessary to have three-quarters of the Active l1embers vote affirmatively on accepting a ~1ember. As of June 13, 19 79 there ~-1ere 18 Active l1embers. This lTould require an affirmative vote of 14 Active ltembers. There were 14 Active Hembers attending this meeting, including the proxy from Ur. Zacharias of Carlisle Corporation held by Hr. Perritt. This proXy had been received prior to the Annual i!eeting. An additional proxy was available for voting by the Secretary, from Hr. Scandrett of Scan-Pac. This would make 15, with 14 vote~ necessary for accepting a new member. 1 FMSI 02148 . InUTES t"lF ~HE AlT:TUAL :IEETEJG -7- June 13 & 14, 1979 Upon motion duly mP.de, seconded and unanil!lously passed, it ~ms; ~ESOLVED: To accept the application for Regional Uembership filed by Canadian-Distex Corporation of Hontrt:!nl, Quebec, Canada. Upon motion duly made, seconded and unanimously passed, it 'Tas; r~SOLVED: To accept the application for Licensee ilembership filed by Lima International Parts and Sales of Lima, Ohio. At the Board of Directors meeting ~Thich preceded the Annual iiembership Heeting, Hr. Stuart Comins, Delegate from Auto Friction Corporation, asked that its membership be transferred to a sister corporation, P.T. Brake Lining Company, Inc. At the Board Heeting a resolution was passed unanimously accepting the transfer of membership from Auto Friction Corporation to P.T. Brake Lining Company, Inc. Upon motion duly made, seconded and unanimously passed, it was; RESOLVED: To accept the Uembership Committee report as written. PUBLIC RELATIONS CQ1.111ITTEE REPORT J.-1r. Simon, Chairman of the Public Relations Committee reported on activities for the 1978-79 fiscal year. He mentioned releases to the trade press including the election of officers, the address that Hr. Baynes of Delco-Uoraine gave at our June 1978 Heeting, and publication of the "Friction Materials Hork Practices Guide." l1r. Simon thanked the President, i1r. iiessier for his assistance during the fiscal year. l1r. Simon noted that over 40,000 copies of the "Friction Haterials '-Jerk Practices Guide" had been distributed to l1embers, and additional copies had been sent directly to outsiders. At the Board l1eeting on June 12, 19 79 it was recommended that the Institute contact other aftermarket organizations such as APRA, ASIA, and CFS. These t~ould be contacted to seek their additional distribution. of the booklets. These would be provided by the Institute on a no-charge basis. Upon motion duly made, seconded and unanimously passed, it was; RESOLVED: To accept the report of the Public Relations Committee as t-7ritten. BUDGET COMMITTEE REPORT Mr. Ogilvie, Chairman of the Budget Committee read his committee's report. This report presented a line by line budget amount for each of the major expense categories. It noted that the major expense items are salaries, rent, pension expense and legal expense, uhich altogether account for about 80% of the budget. These items are decided by actions of the Board of Directors--particularly salary and pension expense. The report FMSI 02149 ~lli~UTES OF THE AHi.lUAL ~~ETIHG -3- June 13 & 14, 1979 recommended a 1979-80 expense budget of $95,810 which was about a 5% increase over the budget for the previous fiscal year. At the Board of Directors meeting on June 12, the pension payments to ttl sa Duschek were increased by $600 which would bring the new proposed budget to $96,410, about a 5-1/2% increase over that of 1978-79. At this point questions were raised concerning write-offs of receivables by the Institute. It was noted at the June 12, 1979 Board l1eeting that the Institute would continue to pursue collection of the Hayes-Albion receivable for $850 for the annual fee for the last half of the 1977-78 fiscal year. In the meanwhile, a receivable of $500 from Implementos Hetalicos Lara, S.A. of Venezuela had been l7ritten-off because of non-payment of dues. There had been no activity 'rlth Implementos Metalicos in the 1978-79 fiscal year. An earlier write-off of a fee receivable ,..1as that of Silver Line 4 or 5 years ago. The Institute received a small settlement on that receivable from the Bankruptcy Court in Los Angeles, California. A member questioned details of the pension plan ~v-here over $500 is paid to Connecticut General Life Insurance Corporation to file the paper work required by EP~SA. It was suggested that it might be simpler and less costly for the Institute, and better for those who receive pensions, if Individual r~tirement Accounts or Keogh Plans could be used; The Secretary indicated his interest in such plans but that in their present form the Keogh Plan is only for the self-employed and the IRA does not permit a benefit level equivalent to that provided under the Institute Plan. If the benefits to the retiree from an IRA Plan could match the FMSI Plan, it would be in the best interests of the Institute to discontinue its Pension Plan and have employees move to an IRA plan. Upon motion duly made, seconded and unanimously passed, it was; RES~LVED: To accept the Budget Committee report as written. Upon motion duly made, seconded and unanimously passed, it was; RESOLVED: To accept the 1978-79 expense budget of $96,410, which includes a $600 increase in the pension payments to Hiss Duschek. NOMINATING COM!.UTTEE REPORT Hr. J. H. Greenen, Chairman of the Nominating Committee reported. He advised that the following three directors' two year terms were expiring as of June 30, 1979: Ur. Ronald L. Cutler, Abex Corporation; Ur. Ronald R. Moalli, Raybestos~Wnhattan, Inc. and Mr. Francis E. Messier, Bendix.Corporation. !tt. Greenen also advised that terms for the foll~~ing four directors will not expire until June 30, 1980: Mr. Hilliam Simon, Brassbestos Manufac~ur ing Corporation; Ur. J. H. Greenen, iJuturn Corporation; Mr. Stuart Comins, P.T. Brake Lining Company, Inc. and Hr. G. A. Carrigan, S.K. l-lellman Corporation. Hr. Greenen submitted the names of Mr. Cutler, Hr. Moalli, , and Hr. Uessier for nomination to the two year terms starting on July 1, 1979 to expire on June 30, 1981. This would continue the three directors on the ~ard for :m<JCber two year term. A motion ~v-as made that the nominations h cloZJed, The Chairman asked tihether there t,..ere any nominations from the FMSI 02150 iliNUTES OF THE Ai'fl!UAL iiEETIHG -9- June 13 & 14, 1979 floor. A member recommended that Hr. Kaminski of the S .K. l-lellman Corporation be nominated for the tlro year term as Director commencing July 1, 19 79 and expiring June 30, 1981. The Secretary advised that l!r. Kaminski's name could not be placed in nomination, as Ur. Gordon Carrigan of S.K. H'ellman already se~ed on the Board. A member then placed the name of Mr. John Hoore of Reddaway !.1anufacturing Corporation in nomination for a two year term as Director. Upon motion duly made, seconded and unanimously passed, it was; RESOLVED: That nominations for the Board of Directors be closed. Ur. Greenen appointed Ur. Drislane, Secretary; Hr. Jackson, Legal Counsel and Hr. Kick of the l1embership to supervise the collection and counting of ballots from the Members for election of the three Board ~Iembers for the terms comencing July 1, 1979 and ending on June 30, 1981. Counsel advised that according to the Constitution and By-Laws a simple majority of the members present would:be required to elect Directors. llr. Drislane, Secretary, collected ballots from Delegatee and authorized representatives of the Hembers. Fourteen ballots were collected. By majority vote the following three directors '~ere elected for tht two year terms: Mr. Ronald L. Cutler, Abex Corporation; Ur. Ronald R. Hoalli, Raybestos-Uanhattan, Inc.; and l1r. Francis E. Hessier, Bendix Corporation. ASBESTOS STUDY COUHITTEE REPORT Mr. Harry Wagner, is Chairman of the Asbestos Study Committee. The Secretary read Mr. Wagner's report. Hr. t~agner reported on uork that the Committee had completed. In particular he pointed to the "Friction liaterials Work Practices Gui4e" which was published during this past fiscal yeat. Over 40,000 copies were then sold to the Hembership. This booklet was completed by the Committee and the Task Force in the early part of the 1978-79 fiscal year. Mr. Uagner pointed to his conc&rn on industry sponsored legislation proposing a "federal" Asbestos .Health Hazards Compensation Act. He was particularly concerned by the proposed financing of a compensation fund based on a tonnage assessment imposed upon industry. llr. Wagner questioned the effects. that such lepslatioa.. could have on fdction materials manufacturers. Mr. Wagner also poia&ed t.o recent activity by the Environmental Protection Agency's Offia~ of ToXic Substances Control. A report prepared. for them by the IIT Research- ImJrttute, pointed to brake rep4U.rs as an area of concern as regards asbestos exposure. The Chairman asked for input from the Directors and Members on an industry position, and recommendations on how to support such a position. An area of immediate concern in !1r. Hagner's report was the legislative draft of an 11Asbestos Health Hazards Coinpensation Act." A draft had been circulated to the Hembership in Uay 1979. In the original draft manufacturers of automotive friction materials were considered to b~ Class I parties ~~ho ~~ould be assessed $325 per ton bast!d on consumption 15 years prior to its contribution. I.t was pointed out that friction materials manufacturers were subsequently dropped into a Class II category where the assessment would be. $32.50 per ton. Whether this was occasioned by the friction materials manufacturers' reaction to this draft legislation is not certain. FMSI 02151 l!INUTES OF THE Al'f..'lU!..L NEETI:lG -10- June 13 & 14, 1979 A member questioned some definitions concerning the "responsible party." In the draft this indicates that it is a corporation, partnership, joint enterprise or other entity engaged in (1) the manufacture and sale of any product or substance containing asbestos,. and (2) the import for sale or distribution of products cont~ining asbestos. Then there is a reference to tobacco manufacturers. One question concerned ~ihO is the "first processor." l'lhere a friction materi~ls manufacturer purchases all yarn ~rl.th the asbestos in the yarn uouldn' t the provider of the asbestos yarn be the first processor? Or would it be the processor l-7ho finishes the asbestos yarn and sells it first as a finished product. It was suggested that an answer cannot be made at this meeting. Definitions of items such as a first processor would be part of the complications of such legislation. As indicated, the "responsible party" doe apply to importers but it ~-Tould be difficult to assess importers of friction materials 15 years ago to pay in current years. If such legislation were to be effective in 1980 manufacturers would then pay their first assessments based on 1965 asbestos consumption. In response to a question, the Secretary indicated that it was his belief that Johns-Manville was the main proponent of the suggested legislation. Also in response to a question, the Secretary indicated that he had called the Asbestos Information Association (AIA) and Mr. Pigg indicated that the AIA had no position on this legislation. H~ever a membe~ suggested that it is likely that AIA would ha~e a different position than would a friction materials manufacturer. A member suggested that with these problems facing our industry that the situation is similar to conditions in the middle 60's when the various states were proposing safety legislation for brake linings and the Federal Government was proposing regulations after passage of the National Traffic and Notor Vehicle Safety Act. It was suggested that the industry should make a solid presentation to the Federal regulatory authorities concerning proposed regulations effecting friction materials manufacturers. It was stated that at the Board of Directors }~eting on June 12, the Directors planned to ask the Asbestos Study Committee to make. recommendations concerning the Institute's position in the areas of an "Asbestos Health Hazards Compensation Act," and regulations by the EPA's Office of Toxic Substances Control. It asked what supporting-data do we have for an industry position. What type of supporting data would the Institute need? How would the Institute go about getting this data? It was recommended by the Board that the Asbestos Study Committee come back to the Board with a plan for action by the Institute. After such a plaa is presented the Board would act on planned activities and positions for the Institute. It was suggested that in some cases the Delegates would need the support of their management. They might be asked to have people serve on a Task Force concerning these problems. It ~7as stated that the Institute does- not have the information necessary topresent a solid case to Washington. The Institute will need good information, statistics and perhaps medical history. tVhile it was suggested that the Institute and its members should be responsive to the regulatory input; a member asked what could be done nmi. At this point, a member suggested that one thing that could,be done ~-1as to ~-1rite letters to Senators or Congr~smau concerning the problems. our industry faces in their districts. At this point the P1:'esident, Ur. t1essier, showed a special report that ''~as put out by the United States Chamber of Commerce entitled "A Letterwriters Guide to Congress." It t~as suggested that this was a ,.1orthwhile report and copies should be distributed to the Membership. The Secretary was directed to have copies distributed. FMSI 02152 i~Ii.lUTES OF THE AiHUAL HEETDG -11- June 13 & 14, 1979 A member stated that there vas Canadian data availab!.e concerning asbestos exposure studies that might be of interest. Hr. Carrigan ~rae asked if he could get the name of this Canadi~n study and send it to the Institute. It was suggested that if Institute members have their own, or have access to fiber count information in br&te repair shops, and have any medical history or other on such repair shops, this could be most valuable. Hr. Join commented on the Horld Health Organization's conclusion concerning asbestos as a carcinogen. The Asbest-os Study Committee l'lill be asked to gather information and present proposals for the Institute as regards representing friction materials manufacturers lTith regulatory authorities. It was stated that the Asbestos Information Association has been quite strong in their representations concerning the overall asbestos industry, but they have not been able to articulate vi~~oints of the friction materials industry. As regards the report prepared by the Illinois Institute of Technology Research Institute (IIT report) there ~-1ere comments made that some of the conclusions in this report Here rather "squishy." Several rebuttals are being made to the IIT Research report, but a main problem-is that they are.extrapolating results from the studies by l1ount Sinai Hospital on N~T York ~!unicipal Garages to the general repair shop. The general repair shop does not grind or machine brake linings and their main exposure comes from blm1ing out the ~7ear debris. There is a question as to whether there is any real release of asbestos fibers as such by this particular operation. All studies show that the asbestos fibers in wear debris are quite short and cannot be measured under the OSRA definition of a fiber longer than 2 micron length. However, Dr. Selikoff's team, working with the Horld Health Organization, has apparently come to a conclusion that there is no safe level for asbestos exposure. Haunt Sinai alleges that the fibers shorter than 1 micron that cannot be vi~7ed optically are just as hazardous as the longer fiber asbestos. Upon motion duly made, seconded and unanimously passed, it was; RESOLVED: To accept the report of the Asbestos Study Committee as \'Tritten. FEE FORlfiJLA CQl.UliTTEE REPORT l!r. Jim IIellow, Chairman of the Fee Formula Committee reported. The l1ritte~ treport that had been prepared prior to the meeting was based on catesoriea reported by Active Hembers and assessments on Regional liembers and Licensees based on the fee schedule in effect for the 1978-79 year. Based on this fee formula, using last year's rates, the projected fee income for 1979-80 would have been $82,350. ~~. Mellow advised that at the Board of Directors meeting ou June 12 the Directors voted an increase of approximately 10% in the fee formula. This was made to project fee income of approximately $90,000. Ur. Uellow indicated the following fee structure as voted by the Board of Directors. Active Hembers: Basic fee: $1,050 per member Categories: $700 per reported category Regional Members with US rights: same fee structure as Active Hembers Regional Uember regular: Increase fee to $1,450 Regional ttember Associations: Increase fee to $2,400 Licensee t~mbers: Increase fee to $550 fMS\ 02'\53 ; r~iii.lUTES ! '1:::!: AiT~HJAL :~ETLJG -12- June 13 & 14, 1979 Upon motion duly made, seconded and unanimously passed, it ~ras; RES0LVTID: To accept the Fee Formula l>.eport as written uith the revisions voted by the Board of !Jirectors. Ii.lVEST:1EPT ADVISORY COl1!UTTEE REPORT i.ir. Simon, Chairman of the Investment Advisory CoiDI!Iittee delivered his committee's report. In summary Mr. Simon reported that approximately $45,000 had been transferred from time-deposits into US agency obligations paying a little over 9%. Also, the Institute invested some of its funds in the Phitehall :~oney ~!arket Fund managed by the Vanguard Group. This fund has been payine approximately 10% interest. Investment balances projected at June 30 showed about a $5,000 increase over that shown on June 30, 1978. A question tras raised concerning the expense budget for a non-profit corporation. The Institute's investments sh~T about $175,000 balance, which is approximately the same as the Institute's retained earnings on the balance sheet. A question was asked as to what accumulation of capital a non-profit corporation could have. Counsel indicated that the acce~ted rule by the Internal Revenue Service is that a non-profit organization can have retained earnings approximating 2-1/2 times its annual expenses. There is no problem for the Institute at this time, as the 2-1/2 figure would permit accumulated retained earnings of over $225,000. Upon motion duly made, seconded and unanimously passed, it was; P.ESOLVED: That the report of the Investment Advisory Committee be accepted as written. IiJSTITUTE DEVELOPtlEl:1T COMt1ITTEE REPORT ~r. Ron Cutler serves as Chairman of the Institute Development Committee. There t~as no trritten report for this committee as Mr. Cutler met t.,ith other members of the committee on June 12 to reviet~ items referred to it. An item referred to the Institute Development Committee concerned the possible enlargement of the Institute to include manufacturers who did not manufacture friction materials. This was occasioned by a request of Aimco Industries Limited of Canada to be considered as an Active Uember of the Institute. This toTas discussed at the June 12 Board of Directors Heeting and the Directors, by a vote of 6 to 1, decided that they would not consider enlarging the Institute to include companies that do not manufacture friction materials. As regards the specific request of Aimco, it t'las noted that they had been accomodated in that a representative from Aimco had been invited to sit as an Associate on our Data Book and Technical Committee. In response to a question, the type of member who would have been considered had the Institute considered expansion l~ould be manufacturers such as Aimco, Wagner, EIS and others. fMS\ 02154 -13- June 13 & 14, 1979 11r. Phil Grim is Chairnan of the Data Book and Technical Cornni t te~. The Secretary read ~~r. Grim 1 s report. This report covered it~ms such as membership of the coomittee and treatment of the Institute's reeist~red trademarks in Institute catalogs. I!.r. Grim advised that a nel-l printer had been taken on for printing of tht:! "19 79 Supplement to the 1978 Brake Shoe Identification Catalog." 3e also discussed items such as possible computerized typesetting of catalogs and various technical matters. Upon motion duly made, seconded and unanimously passed, it Has; filiSOLVED: To accept the report of the Data Book and Technical Committee as ~'lritten, ~ISTQ~ICAL SALES REPO~T The Secretary reported on the Historical Sales Program for calendar year 1978. He showed the list of all members t-7ho had reported during calendar 1978. It lras noted that of 18 Active !fembers, 14 reported at least once during calendar 19 78. It \oras also pointed out that 4 Regional l1embers ldth the rights of Active :~embers had reported statistics at one time. during calendar 1978. A member stated that it would be N'ell to try to get additional reports from members to get better sales statistics information. The Secretary indicated that some members had difficulty t-lith the Historic-al Sales Program this pas.t year. For example, !Ir. Carrigan was unabl~: to report Hellman figures because of difficulties tlith computers for two recent installments but had n~., started reporting again. !fr. Burgess indicated that they had been subpoenaed by the Federal government concerning their sales statistics and t-Tere no longer participating in the program for that reasC?O~ Eecause of changes at Safeguard their last repo~t was missing, and because of changes at Lear-Siegler in Jew Castle, the report for the last' quarter was not sent in. .Hr. Ogilvie t-Tas asked if he t-Tould contact !1r. Anderson in Danville to file these statistics. The Secretary indicated that certain members did not participate because they ~1ere not marketing automotive type friction materials. Some industrial product inforootion does not fall into the type of reporting categories used in our program. Upon motion duly made, seconded and unanimously p~sed, it was; RESOLVED: To accept the report on Historical Sales as written. AnNUAL Z.fEETING COllMITTEE REPORT Ur. Ross Kettering, Chaiman of tht:! Annual Ueeting Committee read thd report. His report recommended that the Institute return to the Ocean Reef Club in 1980. In case there t-las dissatisfaction with Ocean Reef, the Committee recommended the Homestead in riot Springs, Virginia. In addition, the report made recommendations on inviting ~-1ives to the Annual Meeting, and if so resorts in the area near Disney Horld t-1ere suggested. FMSI 02155 ~l!NUTES OF THE ANNUAL HEETUG -14- June 13 & 14, 1979 At the Board of Directors 11eeting on June 12, 1979, because of the dissatisfaction expressed uith Ocean Reef Club, the Board voted to accept the recommendation to attend the Homestead in Hot Springs, Virginia in June 1980. Also, at that meeting, the Board voted against the recommendation to invite ~>~ives to attend the Annual Heeting. Upon motion duly made, seconded and unanimously passed, it was; P~SOLVED: To accept the report of the Annual Meeting Committee as written. OTHER BUSINESS There being no further items on the agenda, the President asked if there were other items of business to be conducted. A member asked about the Aimco request to become an Active Hember. It l>~as explained that one reason that Aimco had requested Hembership ~ms to participate more fully in decisions as regards lining and shoe assignments and also to provide information of this nature to the Institute. The Aimco request was somewhat satisfied by the appointment of a representative from Aimco as an Associate member of the Data Book and Technical Committee. A representative from Aimco has continued to serve on this committee. A question arose as concerns use of the FUSI numbers and problems with manufacturers who might not be eligible for Institute Membership. The Secretary advised that he had received an application from World Auto Parts in Buffalo, New York. ~.J'orld Auto Parts was not a manufacturer of either friction materials or shoes and and was not eligible to serve as either an Active Member or a Licensee.- World Auto Parts was anxious to use the copyrighted FMSI numbers and trademarks in marketing their products. They operate on an exchange basis, taking old cores and reselling them for use in the aftermarket, It was suggested that perhaps something could be done to make a licensee type membership available on a fee basis to manufacturers like World Auto Parts even though they were not now eligible for Membership. This question was referred to the Institute Development Committee for their recommendations. ***** There being no other business brought to the attention of the Membership, upon motion duly made, seconded and unanimously passed, it was; RESOLVED: To adj oum. Adjourned: 10:00 AM E. W. Drislane Secretary FMSI 02156