Marion Moskal, Finance Team
The 2021 budget development was led by the general manager working with Finance Operations to incorporate the budget inputs from all the department directors. The fundamental budget development process kept separate the operating budget from the reserve funded projects. The challenge for the 2021 budget was determining the impacts of the COVID-19 pandemic on the daily operation to comply with CDC guidelines. Staff continued to use the zero-based planning model for labor expenses to incorporate wage challenges in today’s environment.
The budget process continued to focus on maintaining the high standards of community appearance as the facilities mature. Aging infrastructure, wage increases, street maintenance cost, and additional landscaping cost were among the many upward budget pressures for 2021. New and resale home closings finished strong for 2020. The Community Enhancement Fund will have accumulated approximately $1.091M by the end of 2020. These funds have been deposited in a separate account and are being managed by our Investment Advisory Group (IAG) for optimal investment yield.
Golf Operations was presented with several budget challenges for 2021. As a result, the residential daily fee was increased by $2 per round and the annual golf membership fees have been increased by 5.7% to cover the increased cost of golf operations. The Golf Infrastructure Fund (GIF) contribution will now be funded by the HOA Reserve Dues contribution rather than golf revenue.
The Food & Beverage Department had to adjust its operation in light of the COVID-19 pandemic and the CDC guidelines. This resulted in a lower forecasted revenue for the 2021 budget. The overall effect was a slightly lower F&B amenity dues cost of $16.35/home/month. The restaurants will continue to provide a consistent level of service to enhance your dining experience and to retain your continued support.
The Criterium Reserve Study recommendations have been incorporated into the Long-Range Plan and will be the basis for reserve funded project expenditures in the 2021 budget year. The 2021 reserve contribution was increased by an additional 1% plus an additional $13/home/year to cover some of the Golf Infrastructure Fund (GIF) contribution that was previously covered by golf revenues. For 2020, a projected $7.1M of the reserve funds will have been utilized to fund asset replacements and the Eagle’s Nest golf course renovation that were identified in the Long-Range Plan. This will leave the reserve account balance, net of the projected 2020 withdrawals, of approximately $8.5M at the end of 2020.
A Zoom homeowner meeting was held in early November to review the community financials and budget requirements for 2021. A detailed budget presentation provided residents with insight into the efforts by the general manager, Finance Operations, Dept. Directors, the HOA board, and staff to efficiently manage the community cost. This Zoom meeting provided homeowners the opportunity to better understand the financial requirements and challenges that face our community. For 2021, the budget presentation provided the detailed financials for the Operating Fund Budget and a summary of the planned project expenditures to be funded from the reserve.
The board approved the 2021 budget at the Nov. 18, Zoom Homeowners Associations Board Meeting. This approved budget will decrease the operations dues by $29/home/year to $1,952, however, there will be an increase to the reserve dues contribution by the same amount to a total of $776/home/year. The net result will be no increase, thus leaving the 2021 HOA dues assessment unchanged at $2,728 per household/year.
The accompanying pie chart and data table depict the specific 2021 budget requirements for each operating function in the community and break out that portion of your HOA dues needed to support each function. A copy of the 2021 PebbleCreek HOA budget has been posted on the PebbleCreek HOA website at www.pebblecreekhoa.org. A copy of the 2021 homeowner budget presentation and accompanying budget information article and pie chart have also been posted on the PebbleCreek HOA website.