Neighborhood News
Monthly Assessment Change
Posted on Dec 1st, 2009
At the May 2009 Annual Meeting of the Scofield Ridge Condominium Association, there was a discussion concerning the potential for an increase in the monthly HOA dues. Ever since the inception of the community, the monthly assessment has remained $185 per month, a note of pride on the fiscal health of the Association. However, due to several reasons outlined below, the Board has voted to increase the monthly assessment from its current level of $185 per month to $200.
The reasons for the increase are:
• The water/sewage costs have continued to increase and now consume 30% of the annual budget or approximately $135,000.
• As the community is also aware, we are in the midst of repainting the entire community in three phases, with each phase costing $100,000.
• Also, as part of a reserve study, it was recommended that the Association set aside 27% as a transfer to capital reserves. This would amount to $124,000 being redirected from the budget back to reserves and push the deficit to over $177,000. It was the Board’s conclusion that this was too aggressive of a strategy and would require either enormous cuts in ongoing expenses or require an unacceptably large increase in the monthly assessment to enact. However, the Board concluded that in order to meet any short-term financial challenge, the reserve would still need to be reinforced. Therefore, it settled upon half the amount recommended: 13%.
The Board is also pursuing additional measures on water conservation, from additional promotion of water saving appliances, regular reviews of consumption, replacement of faulty lines and equipment, etc. The Board has directed the property manager to contact those units in which the consumption has been excessive. While some units have lowered their consumption, others have offset those savings and now are under review.
The Board is also reviewing the status of our financial accounts to see if there are any other investments that can be utilized to maximize the return on our reserves. In order to do this, there has to be a balanced approach between the risk of financial attrition by remaining in lower-returning yet more secure accounts (and thus losing purchasing power to inflation) or assuming more risk with higher yielding investments.
In summary, let’s celebrate the hard work of current and past Board of Directors for managing the reserves efficiently and effectively. This has enabled the SRC Community to maintain the same level of HOA dues of $185 for over 6 years. For a community our size (69 buildings, 209 units), this is truly an unheard of feat. For the economic and budgetary reasons outlined above, the Board will increase the assessment to $200 per month. The new HOA Dues will be Effective January 2010.
Respectfully submitted…
Scofield Ridge Condominium Community Board of Directors