Landings Association’s first Budget Workshop a Success

More than 30 residents attended The Landings Association's first Budget Workshop at Delegal Creek Marina on October 16 at 6 p.m. Director of Budget, Planning & Analysis Dianne Talcott presented the Budget Process and was followed by Assistant General Manager Karl Stephens who presented the Budget Overview. Talcott reminded the audience that The Landings is nearing its 50th birthday and with that golden anniversary comes the need to address the aging infrastructure within the community. She explained that with the size of The Landings, which is home to approximately 8,500 residents, 91 miles of road, 313 Center Islands, 151 Lagoons,and countless other assets, the budgeting process is a detailed, and lengthy one. However, the budgeting process is well worth the time and effort to ensure funds are allocated appropriately. She then explained that the Annual Property Owners Assessment (Homeowners Dues) is allocated to the two key funds that keep The Association operating efficiently and effectively. These are the Operating Fund and the Capital Reseves Fund. "The amounty of the assessment allocation depents on the current infrastructure needs," Talcott said. "It is important to remember that the Operating Fund and the Capital Reserves Fund are both very important, but they serve very different functions. The Operating Fund includes items such as staffing, landscaping, repair and maintenance and insurance, and the Capital Reserves Fund includes the repair and replacement of assets such as roads, paths, storm drains, etc. It is imporatant to note that the Capital Reserves Fund is a restricted fund. It is not a 'rainy day' fund." Talcott then shared examples of The Landings Association's revenues and expenses. The largest revenue stream for the Association is the Owner Assessments which comes in at 64% followed by commercial vehicle registration, architectural fees, Dog Park fees, boat storage, and fuel sales. As for expenses, like with most service-based organizations, staffing leads the list with 54% followed by landscaping, road repair and replacement, storm drain repair and replacement, repair and maintenance, insurance for Common Property, Engineering Studies, and lagoon expenses. Talcott switched the discussion to how the Association approaches the budget process for both the Operating and Capital Reserves funds. "Our Operating Fund budgeting approach is two-pronged," she said. "We look at Historal Trends which is exactly what it sounds like, eamining items based on past trends. We also use Zero-based Budgeting where line itmes are prepared from zero. This two-pronged approach is the industry standard for Homeowners Associations. As for our Capital Reserves Approach we review our Capital Asset Management Plan othewise known as CAMP for any changes that can be made. These changes could be based on manufacturing updates and vendor recommendations. Each item in CAMP is analyzed each year for changes to cost or useful life and then these changes and expenditures are review with our Reserves Subcommittee. It is imporatant to note that we plan for six years out and create cash flow projections accordingly" The Association's Budget Review process starts in June of each year and for several months, the annual draft budget is created and then evaluated and re-evaluated over several months by staff.  Once created, the draft budge is reviewd by Budget Liaisons, and Board of Directors via reports and discussions. The Budget is approved at the December Finance and Board Meetings, and then the Budget Book is compiled, distributed, and posted online for the community. Talcott turned the meeting over to Stephens who reviewed the Budget Overview. He shared with the group the Operating Fund Comparison from 2018 through the proposed 2020 Budget. He explained that because the 2018 Assessment Vote failed, the Assessment for 2020 will remain flat at $1,850.