Quote:
Originally Posted by Goldwingnut
Might want to double check your monthly amenity fee in your water will, I don't think $215-220 is mathematically possible, yet. Above $200, is possible, but few are there, yet.
My first few budget meeting years ago when I first started on CDD10's board defiantly had me shaking my head. Some studying and working through the process brought enlightenment and understanding. The complexities exist because of the laws put in place to keep local governments from running amuck. In retrospect the CDD budgets are a walk in the park compared to the county budget. I first started looking at the county budgets about 7 years ago, long before I ever considered running for the BOCC, it is a quagmire of accounts and funds that first appear to be a shell game trying to hide money. In reality it's just the opposite, it's about accountability, transparency, and traceability and once you understand it you can trace every penny from source to expenditure. Granted, tracing it might even challenge Rube Goldberg, but it can be done.
While the potential exists to reinstate some or even all of the deferred CPI adjustments, that potential continues to decrease as new properties are sold and properties that received the deferral are resold and their Amenity Fee is adjusted to the current Prevailing rate. As the percentage of properties that have existing deferrals in effect decreases and resultant revenue increases diminishes, the potential fallout from such an increase probably doesn't justify the diminishing gains.
I do disagree with you on the potential of a "huge monthly increases" coming, there is no mechanism or legal avenue to enable these increases in the governing documents (deed restrictions). The deed restrictions only give 3 methods of increasing the Amenity Fee - the creep, the reset, and the gimme.
The Creep is simply the annual CPI adjustment that allow the Amenity Fee to creep up slowly.
The Reset is when an existing property is sold the amenity fee is reset to the current Prevailing Rate - this one saves us (the budget) from the pitfall of the Creep as the CPI never keeps up with the real cost increases, but the Prevailing Rate, as I've stated previously, comes from a balance sheet that looks at the real costs to operate the amenities.
The Gimme is one that to my knowledge has never been used, it allow for an adjustment of the Amenity Fee if a majority of the residents approve of adding a new amenity, then the Amenity Fee can be raised an amount to cover the additional operating and R&R expenses. The residents demand "Gimme a covered pool in every neighborhood" then the response is "Gimme another $5/month to cover the costs". Given the way some people squeal about a nickel increase in the cost of anything, a Gimme will never happen.
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I tried to check my amenity fee this morning, but without a bill & my PIN, I was stymied. I know I pay +/- $305, when my Irrigation is shut off. I'm fairly certain it's over $200, but not $225. The truth is, the monthly Amenity Fee is a drop in the bucket and doesn't come close to my weekly golf budget, so I don't pay much attention to it.
I don't disagree the overall philosophy of the District, is transparency. They make a solid effort to provide all the information and detail anyone could possibly want. As you point out, it's a quagmire of information and very difficult and complicated to sort through.
The "Gimme" is the wild card in my opinion, but in a different way than you characterize it.
The "spending creep", driven by residents' (IMO) unrealistic expectations of existing services/amenities, produces a "hidden creep". Community Watch being a prime example. Residents expect more and more from Community Watch and spending creeps, without any legitimate way to fund their unrealistic expectations. Golf course maintenance is another one. While I disagree with the way the Executive Courses are maintained, I don't think anyone is stealing money. The District is spending what they say they're spending, but it's not enough to produce conditions acceptable to residents.
Because of the current funding/budget parameters in place to control "fees", the District is in a tenuous position. They need funding to meet Residents' expectations, but they're limited in their ability to raise fees. If you're forced (by artificial restraints) to fund an operating budget without the ability to generate sufficient revenue, you're left with in the unenviable position of needing to borrow (or Bond), to provide the needed financial resources to pay the bills. Which based on the limited budget meetings I've intended, I think is happening. (& if asked 6-8 months ago, I could give specific examples, but I no longer recall the specifics that set me off last year.)
So with respect to:
"I do disagree with you on the potential of a "huge monthly increases" coming, there is no mechanism or legal avenue to enable these increases in the governing documents (deed restrictions)."
I respectfully disagree with your contention. The way you spend more money than you have, is you borrow it. Whether you "borrow it" from the Social Security System as the US Congress does, or borrow it in some other way, it's the only way to get it. The structure of the Amenity Fee "guarantees per the governing documents", leave no alternative.
Which means at some point, you have to "pay the piper", in the same way our children & grandchildren will eventually have to address the Federal Deficit (& in no way should that be interpreted as "political". I'm talking economics and certainly don't mean to invite political discourse).
JMO, YMMV.