The 2015 budget development was led by the General Manager working with Finance Operations to incorporate the inputs from all the department managers. The fundamental budget development process had been enhanced to include added year to year budget analysis and ability to analyze changes in expense categories across multiple cost centers. Continued use of a zero base planning model for labor expenses enabled the ability to review changes to prior year’s budget. These enhancements allowed HOA staff to continually provide a higher level of precision in this year’s labor planning and budgeting process.
Maintaining the high standards of community appearance as the facilities mature presented many financial challenges. Aging infrastructure, aging golf and fitness equipment, proposed water rate increases, street maintenance cost and maturing landscaping cost were among the many upward budget pressures. The addition of new facilities and new units to maintain has added to the 2015 budget pressures. New home and resale home closings were again positive for 2014. The home closings for 2015 are forecasted to track close to the 2014 results. The HOA assessment delinquencies have been kept to less than 0.4% overall utilizing the HOA Delinquency Administrative Procedure with continued process improvements.
The annual Golf membership fees were unchanged for 2015; however, an additional $1 per round has been added to each round played including the annual memberships. This fee will be set aside in a separate account to fund the future golf infrastructure requirements. The 2015 revenue target is expected to yield a slight surplus in addition to the $1 fee per round. As in past years, the 2014 budget includes a $322K HOA subsidy for Golf taxes, insurance and RCI service fees and consultants.
The Food & Beverage Department is continually implementing operational improvements to match homeowners’ needs. As a result the F&B Department had another successful year in 2014 with all budget targets exceeded. The restaurants will continue to provide greater and consistent level of service to enhance your dining experience and to retain your business and help support your community. The 10% discount, when using your homeowner card with approved credit privileges, will be continued in 2015. The subscription to wedding website advertising was renewed in 2015 to increase banquet sales and revenue.
The Long Range Plan had been expanded to identify additional assets and the replacement costs not previously recognized. This annual update has been integrated into the budget development process and will occur during the first half of the year. This Long Range Plan is the key to defining a strategy to address major expenditures in the future, reduce the likelihood for special assessments and protect home values. In 2014, $345,842 of the Reserve funds was utilized to fund assets that were identified in the Long Range Plan. The Reserve (Long Term Savings) account balance net of the 2014 withdrawal was $6.1M at the end of 2014.
Two homeowner meetings were held in early November to review the community financials and budget requirements for 2015. A thorough and detailed budget presentation combined with a discussion provided residents insight into the efforts by the General Manager, Finance Operations, Department Directors, the Board and the staff to efficiently manage the community cost. The meetings provided homeowners the opportunity to better understand the financial requirements and challenges that face the community.
The Board approved the 2015 budget at the November 19, 2014, Homeowners Associations Board Meeting. This budget resulted in a $120 increase in annual HOA dues bringing the 2015 HOA assessment to $1,980 per household. The Reserve (Long Term Savings) contribution will remain unchanged at $230/house/year. The HOA will again utilize withdrawals from the Reserve account in 2015 to fund planned asset replacements identified in the Long Range Plan.
The accompanying pie chart and data table depict the specific 2015 budget requirements for each function in the community and break out that portion of your HOA dues needed to support each function. A complete detailed copy of the 2015 PebbleCreek HOA Budget is available to view at the Resident & Guest Services at the Eagle’s Nest Clubhouse front desk and has also has been posted on the PebbleCreek HOA website at www.pebblecreekhoa.org. A copy of the 2015 homeowner budget presentation and accompanying budget information article are posted the PebbleCreek HOA website.