President's Update - 8-24-2022

Wed, 08/24/2022

The annual budget for The Landings Association is approved in December by the Board of Directors. The groundwork for an approved budget begins months in advance and is currently underway for the 2023 budget. This process is inclusive of TLA staff consisting of department directors and staff, as well as community volunteers with industry-specific backgrounds who serve on committees to ensure fiscal responsibility.

The first part of the budget process begins with the review of the Capital Asset Management Plan (CAMP). Staff (and consultants, including engineering firms, as required) review useful life and estimated costs for all assets under their purview and make necessary changes each year.

While the CAMP review process is underway, operating budgets are thoroughly reviewed by department directors along with general management and finance staff. There are many factors that are vetted during the budget review process. Programs and expenses can be evaluated based on obligation, need, and/or expectation.

Part of this review includes appointing Budget Liaisons. These Budget Liaisons are members of the Finance Committee, appointed by the Treasurer to work with an individual department during the budget process. Department directors meet with their assigned budget liaison to review each line item in their annual operating budget and Capital Asset Management Plan. At the conclusion of the department budget process, each Budget Liaison will present the budget information for their respective department to the Finance Committee.

Reviewing budgets at a department level is only one part of the budget process. The Reserves Subcommittee is also heavily involved in the budget process. Members are appointed by the Treasurer and are members of the Finance Committee. This committee looks at cash flow documents that are produced as a result of the proposed operating budgets and capital asset plans to evaluate available cash not only for one year but also for an additional five years, for a short-term view, as well as a total 25-year term, for a long-term view.

With the conclusion of the Budget Liaison meetings, staff are currently engaged with our Professional Reserve Analyst to make necessary updates to CAMP including current and future inflationary factors that need to be considered to prepare cash flow documents. Engaging the Reserves Subcommittee will occur within the next few weeks to review the assets that are planned for repair and replacement and the cash flow documents as a result of the operating budget preparation and capital asset plans for the next five years.

Your Association will begin hosting Budget Information Sessions in October, explaining various aspects of the Association’s budgeting process, including how money is allocated, investment strategies, and how our dollars are spent. As we approach another Assessment (Homeowners Dues) Vote in 2023, this is an excellent opportunity for everyone to get a closeup view of the extreme care staff take in managing our money. I hope all of you will make plans to attend the sessions, or watch the livestream. Please watch for Association email bulletins outlining more details as they become available.    

This article was originally published by The Landings Association on their website.

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