ACHOA Budget and Finance Committee 2019 Draft Budget Presentation

Transcription

1 ACHOA and Finance Committee 2019 Draft Presentation Committee 10/2/2018 1

2 } This is a Draft for 2019 and your input tonight will assist in finalizing the 2019 for Board approval at the November 6, 2018 Board Meeting. PLEASE ASK QUESTIONS. } Once the Board approves the, the will be forwarded to community members for ratification at the ACHOA Membership Annual Meeting December 11,

3 } Key questions addressed by the ACHOA & Finance Committee for 2019: Should the ACHOA maintain Status Quo ly assessments which are below the inflation level? Should the ACHOA raise ly assessments consistently, with the expected 2.7% inflation rate? Should the ACHOA raise ly assessment to increase the underfunded Contingency Fund ( Rainy Day Fund) from $154,000 towards two s of cash on hand which would be $417,772? Should the ACHOA continue to fund Capital Projects at $5.00 per to add new amenities and services over time? 3

4 } ARROWCREEK HOA - ASSESSMENT INCREASE HISTORY (AS OF 10/9/18) 1997 to 2006: $ per assessment 2007: $ per to fund Reserve and filed lawsuit against developer. 2009: Reduced to $ per after developer lawsuit settled. 2013: $218 per Reserve Fund increase. 2018: $238 per - increase to fund both Operating, Capital and Reserve 4

5 } ACHOA Follows Zero Base ing as required by NRS 116: Zero-based budgeting (ZBB) is a method of budgeting in which all expenses must be justified for each new period. } The process of zero-based budgeting starts from a "zero base," and every function within an organization is analyzed for its needs and costs. } s are then built around what is needed for the upcoming period, regardless of whether each budget is higher or lower than the previous one. 5

6 } This is a Designed to support the Associations 2017 to 2020 Strategic Plan. } The Seven Strategic Focus areas that follow and planned inflation rate of 2.7% were considered in developing the draft budget. 6

7 } Strengthen the Brand and Reputations of ArrowCreek } Enhance the Residents Center } Expand Amenities and Offerings } Unify the ArrowCreek Community 7

8 } Create a Vibrant Trail System and Outdoor Fitness Circuit } Improve the Curb Appeal of ArrowCreek through Landscaping } Maintain Existing Roads 8

9 } The ACHOA is a mature community of twenty years that continuously requires updating, replacement, and repair through the Reserve Fund. } The ACHOA over time must develop new amenity offerings to maintain relevance through the Capital Fund. } This Draft 2019 includes an $8.00 per Month Assessment Operating Fund increase. ($96.00 annual cost per lot for the Operating Only) } There is no Special Assessment. 9

10 } Affirm the Capital Fund Expenditures for new community amenities. } Affirm the Reserve Fund Funding and Expenses that are modified for inflation. } Affirm the Operations Funding And Expenses that recognize fuel price increases, wage inflation, utility increases, insurance increases, material increases, and contracted vendor price increases. 10

11 Assessment Per Month 1,085 Members 2019 Reserve Change Proposed 2018 Approved 2018 Actual Projection Operating $ per $ per $ per Reserve (Min is $) $85.00 per approved $85.00 per $85.00 per Capital Projects Fund $5.00 per $5.00 per $5.00 per Basic Assessment $ per $ per $ per Sub-gate Assessment $5.00 per $5.00 per $5.00 per Sub Gate Members $ per $ per $ per 11

12 Revenue 2019 Ver 4S 2018 Approved 2018 Projected Actual Residential Assessments - $246 per $ 3,202,920 $ 3,101,616 $ 3,100,664 Contribution to Reserves - $85 per $ (1,106,700) $ (1,106,700) $ (1,107,720) Capital Projects - $5 per $ (65,100) $ (65.100) $ (65,100) Gate Assessments $5 per $ 16,500 $ 16,560 $ 16,560 Contribution to Reserves-Gates $ (5,376) $ (5,400) $ (5,400) Road Snippet Assessment-$37 per $ 7,992 $ 7,992 $ 7,992 Contribution to Reserves-Road Snippets $ (6,912) $ (6,912) $ (6,912) AC Country Club Assessments $ 5,904 $ 5,712 $ 5,712 ADRC Submittal Fees $ 36,000 $ 29,600 $ 38,000 Gate Transponders & Clickers $ 25,080 $ 24,996 $ 19,711 Social/Recreation/Activity Fees $ 1,380 $ 1,200 $ 1,700 Room Rental Fees $ 1,200 $ 900 $ 1,300 Late Fees & Interest $ 8,100 $ 8,100 $ 8,865 Construction Penalties $ - $ - $ 500 Compliance Fines $ 3,000 $ 3,000 $ 1,625 Interest Earned - Operating Accounts $ 6,000 $ 6,291 $ 6,176 Grant Income $ 103,000 $ 25,000 $ - Total Revenue $ 2,232,988 $ 2,045,835 $ 2,023,668 12

13 Expense Department (Details Provided Latter in Presentation) 2019 Draft Vers. 4S 2018 Approved 2018 Projected Actual Administration $ 75,670 $ 90,410 $ 84,801 Communications $ 36,000 $ 35,900 $ 42,924 Payroll & Benefits $ 1,318,086 $ 1,320,708 $ 1,086,767 Insurance $ 88,990 $ 86,512 $ 77,141 Utilities $ 196,150 $ 187,680 $ 175,989 Landscaping $ 38,000 $ 38,000 $ 41,175 Operations $ 36,400 $ 36,018 $ 30,557 Contracted Svcs. $ 142,800 $ 107,600 $ 90,931 Repair & Maint. $ 289,390 $ 279,680 $ 262,035 Professional Svcs. $ 283,900 $ 285,500 $ 257,745 Taxes $ 1,200 $ 1,200 $ 783 Total Expenses $ 2,506,636 $ 2,469,208 $ 2,156,848 13

14 Capital Projects Revenues and Expenses 2019 Draft Ver 4S 2018 Approved 2018 Projected Actual Revenues Revenue $5.00 per $ 68,100 $ 65,220 $ 69,891 Balance Sheet Surplus $ 354,130 $ 375,000 $ 350,000 Total Revenue and Cash $ 422,230 $ 440,220 $ 418,891 Expenses Equipment Depreciation $ 43,200 $ 43,200 $ 33,262 Vehicle Depreciation $ 24,000 $ 24,000 $ 22,000 Total Depreciation Non Cash $ 67,200 $ 67,200 $ 55,262 14

15 Expense Department 2019 Draft Ver 4S 2018 Approved 2018 Projected Actual Capital Project - Other Projects # 2 $ 2,520 $ 15,000 $ 3,333 Capital Project - Fire Access Gates at Harbottle $ 20,000 $ 0 $ 0 Park parking area # 1 Capital Project - Website Development # 3 $ 8,000 $ 10,000 $ 11,000 Capital Project - Marketing & Public Relations # 3 $ 6,000 $ 0 $ 2,250 Capital Project - Toro Workman MDX Gas 16HP # 2 $ 14,239 $ 0 $ 0 Capital Project - Riding or Stand Up Lawn Mower $ 0 $ 0 $ 13,244 Capital Project - Park Benches Bust Stops & $ 4,500 $ 0 $ 0 Concrete Pads # 2 Capital Project - Playground Remodel & Upgrade $ 20,000 $ 0 $ 0 Residents Cntr # 1 Capital Project - Wind Screens for Pickle and $ 5,000 $ 0 $ 0 Tennis Courts # 2 Capital Project - Seating Areas Pickle Ball and $ 10,000 $ 0 $ 0 Tennis # 3 Capital Project - ADA Chair for Swimming Pool # 3 $ 7,500 $ 0 $ 0 Capital Project - Master Hiking Trail # 1 $ 10,000 $ 0 $ 5,000 Capital Project - Improvement Studies # 3 $ 3,000 $ 12,000 $ 5,000 Capital Project - Res. Center Planning # 3 $ 6,000 $ 50,000 $ 8,003 Total Expenses without Depreciation $ 117,359 $ 87,000 $ 57,530 15

16 Operating and Capital Revenues and Expenses 2019 Draft Ver 4S 2018 Approved 2018 Projected Actual Total Revenue and Cash $ 422,230 $ 440,220 $ 418,891 Total Expenses without Depreciation $ 117,359 $ 87,000 $ 57,530 Surplus or (Loss) $304,871 $353,220 $361,361 Operating Revenue $ 2,232,988 $ 2,045,835 $2,023,668 Total Expenses $ 2,506,636 $ 2,469,208 $2,156,848 Surplus or (Loss) ($273,648) ($423,373) ($133,180) Total Capital and Operating Surplus or (Loss) $31,223 ($70,153) $228,181 16

17 } In the past the Board has maintained a Contingency Fund ( Rainy Day Fund ) of two s projected expenses as recommended by the Independent Accounting firm to avoid Special Assessments. } Two s would equal $417,772. } As of September 30, 2018 the sum is actually $154,000 which was depleted to handle the Emergency Drainage Projects this year. } Surplus Funds from 2018 and projected 2019 can be used to build up the Rainy Day Fund. 17

18 } The Browning Update Reserve Fund Report for 2019 has not been published pending the updates and all the road work completed for } The 2018 Road Work Projected funded by the Reserve Fund encountered higher material and labor costs than expected. } An updated report will be reviewed and approved at the November Board Meeting. 18

19 } The Reserve Committee will evaluate planned work for the next five years to maintain a minimum of 50% Funding level in an attempt to not raise assessments in There are no guarantees until the full update has been analyzed. } The report will be published shortly. Therefore the following reflects the information from the 2018 report. 19

20 Description Beginning Balance 6,705,926 7,305,038 5,283,664 5,645,800 4,633,604 New 5 Yr. 5,262, % Inflated Expenditures * 552,922 3,162, ,820 2,265, ,956 1,756,304 Reserve Contributions 1,042,560 1,042,560 1,042,560 1,172,880 1,197,276 1,222,179 Lots/Month 1, % Increase 0% 6.25% 0% 5.6% 2.1% 2.1% Net Interest * 109,474 98,361 85,397 80,318 77,321 78,674 Ending Balance 7,305,038 5,283,664 5,645,800 4,633,604 5,262,245 4,806,794 Fully Funded Balance * 9,278,472 9,843,574 8,432,166 9,178,881 8,302,526 9,110,741 Funded % 78.7% 53.7% 67.0% 50.5% 63.3% 52.8% 20

21 } ACHOA Members are required to pay for the life of the assets that have been consumed by and future ACHOA Members need to pay the life of the assets consumed in the future. } Present Cost to replace 100% of all ACHOA assets is $22,232,009 and Estimated Future Replacement Cost is $27,316,

22 } The Big Four Projects have increased the actual expenditures in [Roads, Drainage, Resident Center Refresh, Landscape] } 2019 actual paid projection subject to further review is at $3,620,394 as reflected in August 2018 statements.[$3,925, ] } However, Reserve Monthly Assessment remains the same. $85.00 per per lot at this time. 22

23 Categories 2019 Ver 4S 2018 Approved 2018 Projected as of Description Administrative $ 24,570 $ 45,210 $ 33,345 Communications $ 25,580 $ 26,400 $ 32,075 Insurance $ 60,000 $ 60,000 $ 55,122 Operations $ 6,000 $ 6,000 $ 5,483 Professional Services $ 277,600 $ 273,800 $ 238,531 Property Taxes $ 1,200 $ 1,200 $ 0 Total Admin Exp. $ 395,170 $ 412,610 $ 361,556 23

24 Categories 2019 Vers 4S 2018 Approved 2018 Projected As of Description Administrative $ 5,200 $ 5,200 $ 5,973 Payroll & Benefits $ 639,625 $ 622,525 $ 499,808 2 New FTE Workers Comp $ 7,500 $ 7,500 $ 6,049 Auto Insurance $ 4,800 $ 2,724 $ 2,482 Insurance Increase Utilities $ 112,700 $ 112,700 $ 110,562 Water rates increase Landscaping $ 38,000 $ 38,000 $ 41,175 Operations $ 1,500 $ 1,500 $ 711 Contracted Services $ 142,800 $ 107,600 $ 96,931 Fuels Prevention Repair & Maintenance $ 206,726 $ 201,216 $ 178,597 Vacuum Truck & Snow Professional Services $ 6,000 $ 9,000 $ 6,000 Drainage Total Facilities $ 1,164,851 $ 1,107,965 $ 948,288 24

25 Categories 2019 Vers 4S 2018 Approved 2018 Projected as of Description Administrative $ 38,000 $ 33,000 $ 40,461 Communications $ 3,600 $ 3,600 $ 3,077 Payroll & Benefits $ 95,998 $ 94,257 $ 85,770 Workers Comp. $ 1,419 $ 1,413 $ 966 Utilities $ 62,470 $ 58,200 $ 49,823 Water rates Operations $ 2,100 $ 1,718 $ 1,644 Repair and Maintenance $ 59,600 $ 56,000 $ 55,780 Taxes $ 25 $ 25 $ 19 Total Expenses $ 263,212 $ 248,213 $ 237,540 Committee 10/2/

26 Categories 2019 Vers 4S 2018 Approved 2018 Projected as of Description Administrative $ 3,000 $ 2,400 $ 3,265 Payroll & Benefits $ 582,463 $ 603,926 $ 501,189 Turn over Insurance $ 15,271 $ 14,875 $ 12,522 Utilities $ 14,200 $ 14,200 $ 9,644 Operations $ 26,800 $ 26,800 $ 22,719 Repair & Maintenance $ 18,504 $ 17,904 $ 16,375 Total Expenses $ 660,238 $ 680,105 $ 565,714 26

27 Categories 2019 Vers 4S 2018 Approved 2018 Projected as of Description Administrative $ 4,900 $ 4,600 $ 4,757 Communications $ 4,800 $ 3,800 $ 5,500 Repair & Maint. $ 600 $ 900 $ 300 Professional Services $ 26,700 $ 26,700 $ 24,589 Total Expenses $ 37,000 $ 36,000 $ 35,146 27

28 Categories 2019 Vers 4S 2018 Approved 2018 Projected as of Description Utilities $ 6,780 $ 6,540 $ 6,532 Repair & Maintenance $ 4,560 $ 4,560 $ 11,283 Total Expenses $ 11,340 $ 11,100 $ 17,815 28

29 } This draft will be further amended based upon input from the Board, & Finance Committee Members and ACHOA lot owners in attendance tonight. } Version Five will be close to the Final Version that will be recommended to the Board at the November Board meeting. } Thank you for your input and questions. 29