Presentation Fiscal Year 2011 Nov 2010 Oct 2011 Your Neighbors on - - PowerPoint PPT Presentation

Fairlington Arbor Draft Budget Presentation

Fiscal Year 2011 Nov 2010 – Oct 2011

Your Neighbors on the Finance Committee

Rachael Robinson – Treasurer Les Bergen Bill Jenkins James Moser* Deborah Santiago

*Former Arbor resident and Treasurer

Presentation Outline

• Process
• Major Factors
• Operating Budget
• Reserve Budget
• Assessments and Income
• Questions

Process

• Operating Fund

– The operating fund provides for the maintenance, operation, and normal repair of the common and limited common elements

• Replacement Fund (Reserve Account)

– The replacement fund provides for the major repair and replacement of the common and limited common elements

• Per our condo documents, we must maintain 25% of the current annual

assessments in this account

• A Five Year Plan

– Provides greater confidence in long term stability of replacement fund

• Comprehensive Reserve Study

– Provides backing for Five Year Plan

• Past, Present, and Future

– Operating expenses have risen an average of 3.6% per year

• ver the past 10 years. Assessment increases may be

higher in order to contribute to reserves and cover reserve items, like roof replacement. – Careful management has kept expenses in check – Water Usage

• Arlington County water rates started rising dramatically in 2005, but appear

to be moderating

• Water now represents over 25% of our operating expenses
• Conservation is critical

– Do not water the grass – Water shrubs and trees in the early morning or late evening when it is cooler – Run the dishwasher and washing machine only with full loads – Turn off the faucet when brushing teeth – Take showers instead of baths – Monitor for leaky pipes and running toilets and take corrective action as necessary

Major Factors

Major Factors

• Sewer Laterals (replacement fund item)

– Contract to renew our sewer lines commits us to $100,000/yr until 2014 (work will complete prior to 2014) – Essential project - our sewer lines are fragile

• They are made of terracotta and were installed in 1943
• Investment Returns (replacement fund item)

– Interest rates on bonds, money markets and CDs have come down – We have drawn down our reserves as our roof replacement and sewer lining work has continued

• Less money on which to earn interest

Major Factors

• Roofs (replacement fund item)

– The Arbor has 58 buildings all built in 1943

• They were built with a mixture of 50, 75, and 100 year rated slate roofs

– Planned replacement of 50 year rated roofs began in 1997

• 23 done, 7 to go
• Replaced with 75+ year rated slate

– 17 roofs are rated for 75 years and reach design life in 2018

• Reserve Study indicates a possible life span in excess of 150 years!

– Our roofs are in excellent shape and are monitored closely

• Reserve Study indicates that more thorough repairs when problems arise will

extend service life

• Reserve Study indicates that chimney, gutter, and trim repairs should be

undertaken on units undergoing roof replacement

Operating Budget

Administration and Payroll

• Postage: Increase allows for $500/budget and election mailings; $200 for incidental mailings
• Management Fees: 3% increase for CFM
• Prop and Liability Insurance: allows for small cost increase
• Telephone expenses: budget line increased to include hard line at the pool
• Health Insurance: provides coverage of health insurance premiums (CFM is seeking new

provider, estimates 10% increase)

• Maintenance Salaries: incorporates pay raises for staff and provides an overtime budget

FY 2009 Actual FY 2010 Budget FY 2010 Current Est. FY 2011 Proposed Administrative Postage $939 $500 $1,150 $1,200 Printing and Copying $0 $100 $274 $0

• Misc. Administrative

$12,752 $5,500 $10,400 $12,000 Audit $3,755 $4,000 $3,675 $4,000 Legal Expenses $1,489 $4,500 $2,300 $4,500 Management Fees $48,954 $48,960 $48,960 $50,429 Prop and Liability Insurance $62,141 $63,276 $62,427 $63,500 Insurance Deductable $6,777 $0 $15,000 $0 Uncollectable Charges $154 $0 $0 $0 Condo Fees $2,139 $2,266 $2,266 $2,381 Telephone Expenses $2,074 $2,400 $3,200 $3,000 Community Outreach $2,984 $3,200 $2,200 $2,200 TOTAL ADMINISTRATIVE $144,158 $134,702 $151,852 $143,210 Payroll Payroll Taxes $9,056 $10,561 $10,400 $10,900 Health Insurance $21,751 $22,600 $22,417 $24,600 Employee Benefits $0 $1,034 $0 $0 Workers Comp. Insurance $4,224 $5,280 $4,300 $6,900 Maintenance Salaries $118,413 $132,008 $132,000 $138,000 TOTAL PAYROLL EXPENSES $153,444 $171,483 $169,118 $180,400

Operating Budget

Utilities and Maintenance

• Water/Sewer: allows for a 3% rate increase by Arlington County and assumes the community

continues to carefully monitor water usage

• Exterior Painting & Décor: will return from a four year to a three year painting cycle; plan to

paint Courts 1, 2, 7, 10, 12 in FY11; beginning in FY12 will paint 4 courts per year

• Repair/Maintenance Roof: decreased due to substantial savings offered by new contractor

FY 2009 Actual FY 2010 Budget FY 2010 Current Est. FY 2011 Proposed Utilities Electricity $9,317 $12,900 $9,000 $10,000 Water/Sewer $173,695 $200,000 $184,000 $190,000 TOTAL UTILITIES $183,012 $212,900 $193,000 $200,000 Repairs & Maintenance Electrical Supplies $1,107 $600 $500 $600 Sewer Maintenance $2,378 $1,000 $9,000 $3,000 (Ext.) Painting & Décor $63,708 $54,000 $54,000 $80,640 Interior Maintenance $100 $1,600 $1,000 $1,600

• Misc. Operations Maintenance

$7,892 $10,000 $10,000 $10,000 Gutter Porch & Dormer $10,140 $10,000 $10,000 $10,000 Rep/Maint-Concrete $1,572 $3,500 $6,000 $3,500 Rep/Maint Roof $2,515 $15,000 $10,000 $10,000 Rep/Maint Vehicle $1,825 $4,000 $4,000 $4,000 Rep/Maint Tennis Court $3,137 $1,000 $1,000 $1,000 Rep/Maint Fence $899 $500 $500 $500 TOTAL REPAIR & MAINT. $95,273 $101,200 $106,000 $124,840

Operating Budget

Pool, Landscaping, Services & Taxes

• Pool Management: continue with our new pool contractor at same cost as in FY10
• Repair/Maintenance Pool: covers for both pools will help protect the new whitecoat
• Pool Telephone: line zeroed out – the new hard line is billed alongside the office

phone/internet/fax

• Landscaping Contract: extends into 2011 with minimal increase to cover cost of aeration
• Trash Removal: contracts extends into 2011 with no increase
• Snow Removal: budgeted at five year average, not including FY10 with its record snowfall

FY 2009 Actual FY 2010 Budget FY 2010 Current Est. FY 2011 Proposed Pool Expenses Pool Management $32,455 $33,908 $32,455 $32,455 Rep/Maint Pool $3,164 $4,000 $8,000 $17,000 Pool Furniture $193 $500 $0 $500 Pool Telephone $1,040 $720 $87 $0 TOTAL POOL EXPENSES $36,852 $39,128 $40,542 $49,955 Landscaping Landscaping Other $8,764 $6,000 $5,000 $6,000 Tree Trimming $4,025 $7,000 $8,000 $7,000 Landscaping Contract $63,528 $67,000 $64,800 $67,500 TOTAL LANDSCAPING $76,317 $80,000 $77,800 $80,500 Maintenance Service Agreements Snow Removal $7,501 $8,000 $42,641 $8,000 Trash Removal $67,443 $68,678 $68,230 $68,230 TOTAL SERVICE AGREEMENTS $74,944 $76,678 $110,871 $76,230 Taxes & License Personal Property Taxes $560 $500 $500 $500 Income Taxes $0 $1,440 $1,260 $1,275 TOTAL TAXES AND LICENSES $560 $1,940 $1,760 $1,775

Reserve Budget

2010 Update

Reduced contributions to reserves due to higher than budgeted operating expenses, including:

• Insurance Claims

– Sewer Collapse – Winter Blizzard – August windstorm

• Snow Removal
• Storm Sewer Repairs
• Concrete Work

Note, however, that lower than budgeted reserve expenses (roof) will result in a higher than budgeted ending balance.

Reserve Budget

2010 Update

• Interest rates continue

to be low

• Higher than budgeted
• perating expenses will

result in the actual transfer to reserves to be less than the budgeted contribution

• New roof in Court 12 is

complete and well under budget

• Sewer Lateral work is

in process – fixed cost

FY 2010 FY 2010 Budget Projection Beginning Balance 586,376 586,376 Income Interest Earned 9,600 8,400 Annual Contribution 150,843 125,703 Total Income 160,443 134,103 Capital Expenditures Sewer Laterals (100,000) (100,000) Roof (140,000) (84,300) Total Expenditures (240,000) (184,300) Ending Balance 506,819 536,179

Reserve Budget

Five Year Plan

• Continues basic plan established in 2010 Budget 5- Year Plan
• Accelerate replacement of concrete asbestos roofs
• Revised roof cost based on new bids

FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Budget Forecast Forecast Forecast Forecast Forecast Assessment Change 6% 5% 5% 4% 4% 4% Beginning Balance 586,376 536,179 457,287 440,858 416,261 401,749 Income Interest Earned 8,400 8,500 8,893 8,486 8,099 9,240 Annual Contribution 125,703 160,408 170,427 182,757 199,323 216,831 Total Income 134,103 168,908 179,319 191,243 207,422 226,071 Capital Expenditures Roofs (84,300) (132,800) (95,749) (90,840) (93,565) (96,372) Sewer Laterals (100,000) (100,000) (100,000) (100,000) (83,350) Asphalt/Paving (22,510) Vehicle

• (25,000)

Tot Lot

• (22,510)
• Signage
• (15,000)
• General Operating

Total Expenditures (184,300) (247,800) (195,749) (215,840) (221,935) (96,372) Ending Balance 536,179 457,287 440,858 416,261 401,749 531,448

Assessments and Income

• Proposed 5% assessment increase, ~$11 per unit per month
• Reduced interest income due to lower rates and lower reserves
• Increases contribution to reserves to address sewer lining and

accelerate near term roof replacement schedule

FY 2009 Actual FY 2010 Budget FY 2010 Current Est. FY 2011 Proposed Income Assessments Residential Assessments $914,519 $968,874 $969,385 $1,017,318 Total Assessments $914,519 $968,874 $969,385 $1,017,318 Other Income Interest Income $5,097 $9,600 $8,400 $8,500 NSF and Late Charges $1,517 $0 $854 $0 Miscellaneous Income $1,045 $0 $1,241 $0 Bad Debt $0 $0 $0 $0 Total Other Income $7,659 $9,600 $10,495 $8,500 Total Income $922,178 $978,474 $979,880 $1,025,818 TOTAL OPERATING EXPENSES $764,560 $818,031 $850,943 $856,909 INCOME less EXPENSE $157,618 $160,443 $128,937 $168,908 Contribution to Reserve $143,499 $160,443 $134,103 $168,908 From Interest $5,097 $9,600 $8,400 $8,500 From Assessments $138,402 $150,843 $125,703 $160,408

Assessments and Income

Five Year Plan

• Covers latest water rates and consumption averages
• Inflation on most items assumed at 3% per year
• Reduced interest income due to lower rates and lower reserves
• Bolsters contribution to reserves to address sewer lining and

accelerate near term roof replacement schedule

FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Budget Budget Budget Budget Budget Assessment Change 5% 5% 4% 4% 4% Residential Assessments 1,017,318 1,068,184 1,110,911 1,155,347 1,201,561 Interest Income 8,500 8,893 8,486 8,099 9,240 Total Income 1,025,818 1,077,076 1,119,397 1,163,446 1,210,801 Total Expenses 856,909 897,757 928,154 956,024 984,730 Contributions to Reserve 168,908 179,319 191,243 207,422 226,071

Questions?

Rachael Robinson – Treasurer Les Bergen, Bill Jenkins, James Moser, Deborah Santiago

BACKUP

Assessments Schedule

FY 2010 FY 2011 Change Arlington 293.89 308.58 14.69 Barcroft End 193.77 203.46 9.69 Barcroft Inside 188.93 198.38 9.45 Braddock End 156.63 164.46 7.83 Braddock Inside 151.79 159.38 7.59 Clarendon End 235.76 247.55 11.79 Clarendon Inside 230.91 242.46 11.55 Dominion 272.90 286.55 13.65 Edgewood End 209.92 220.42 10.50 Edgewood Inside 204.27 214.48 10.21

• Proposed 5% assessment increase
• Average increase of $11 per unit per month
• Effective 1 November, pending budget approval

Neighborhood Comparison

• Data sourced from fairlington.org and

fairlingtonvillages.com (community newsletters and minutes), and MRIS listings

• No representation of accuracy is made or implied

Arbor Mews Meadows Glen Commons Green Villages # of Units 367 277 342 352 229 169 1,703 Monthly HOA Fee - Inside Clarendon Current / Proposed 242 $ 281 $ 278 $ 327 $ 322 $ 338 $ 309 $ Date Implemented 1-Nov-10 1-Aug-10 1-Jan-10 1-Jan-10 1-Jan-10 1-Oct-09 1-Oct-10

Sewer Table

Lateral Liners is currently working in the Arbor. It is expected that 8-10 laterals will be lined in 2010.

Court Address Feet Status 1 3410A-3416B S Utah 136 Repaired 2002 1 3418-3428 S Utah 171 Repaired 1984 1 3430A-3436B S Utah 102 Repaired 2009 2 3440-3450 S Utah 93 Lateral Liner 2009 2 3452A-3456B S Utah 98 Lateral Liner 2008 2 3458-3462B S Utah 157 Lateral Liner 2009 2 3464A - 3468 S Utah 123 Lateral Liner 2009 2 3470A-3474B S Utah 114 Lateral Liner 2009 2 3476-3480 S Utah 70 Lateral Liner 2009 2 3482-3488 S Utah 68 Lateral Liner 2005 3 3500-3514 S Utah 123 Lateral Liner 2006 3 3516-3526 S Utah 242 Lateral Liner 2009 3 3528-3546 S Utah 151 Original 3 4401-4411 S 36th 114 Lateral Liner 2005 4 3601-3611 S Wakefield 132 Original 4 3613-3617 S Wakefield 109 Original 4 4500-4504 S 36th 83 Lateral Liner 2009 4 4506-4510 S 36th 65 Lateral Liner 2008 4 4512-4514 S 36th 50 Lateral Liner 2008 4 4516-4518 S 36th 68 Lateral Liner 2008 4 4520-4522 S 36th 64 Original 5 4415 S 36th 63 Original 5 4419-4421 S 36th 75 Lateral Liner 2009 5 4425-4435 S 36th 62 Lateral Liner 2007 5 4437-4439 S 36th 78 Lateral Liner 2007 5 4441-4453 S 36th 64 Lateral Liner 2007 5 4501-4505 S 36th 62 Original 6 3501-3515 S Wakefield 134 Repaired 1988 6 3517-3527 S Wakefield 216 Lateral Liner 2006 6 3529-3539 S Wakefield 164 Lateral Liner 2005 6 4507-4517 S 36th 54 Repaired 1998 7 3459-3469 S Wakefield 130 Lateral Liner 2009 7 3471-3477 S Wakefield 237 Lateral Liner 2007 7 3479-3485 S Wakefield 310 All Plumbing 2004 7 3487-3497 S Wakefield 10 All Plumbing 2004 8 3407-3415 S Wakefield 76 Original 8 3417-3423 S Wakefield 31 Lateral Liner 2006 8 3425-3435 S Wakefield 46 Lateral Liner 2007 8 3437-3443 S Wakefield 66 Lateral Liner 2007 8 3445-3453 S Wakefield 59 Original 9 4500-4508 S 34th 103 Repaired 1995 9 4510-4528 S 34th 130 Repaired 9 4530-4540 S 34th 68 Original 10 4400-4410 S 34th 70 Original 10 4412-4422 S 34th 124 Repaired 1995 10 4424-4432 S 34th 114 Original 11 3610-3620 S Taylor 50 Lateral Liner 2009 11 3622-3632 S Taylor 50 Lateral Liner 2005 11 4300-4310 S 36th 65 Lateral Liner 2009 11 4314-4318 S 36th 76 Repaired 2000 11 4322-4332 S 36th 104 Lateral Liner 2009 12 4400-4410 S 36th 99 Lateral Liner 2009 12 4414-4416 S 36th 97 Lateral Liner 2009 12 4418-4428 S 36th 164 Lateral Liner 2009 12 4430-4444 S 36th 103 Lateral Liner 2009 12 4446-4452 S 36th 91 Lateral Liner 2009 12 4454-4460 S 36th 115 Repaired 12 4464-4470 S 36th 60 Original Fairlington Arbor Sewer Lateral Status

Sewer Map

Completely Lined Partially Repaired Completely Repaired Original Terra Cotta

Court 1 Court 2 Court 3 Court 10 Court 9 Court 8 Court 7 Court 6 Court 5 Court 4 Court 11 Court 12

Roof Table

Court Address Original Roof Type Replaced Roof Type Year 1 3410A-3416B S Utah Bangor 1 3418-3428 S Utah Bangor Vermont 2001 1 3430A-3436B S Utah Bangor 2 3440-3450 S Utah Vermont 2 3452A-3456B S Utah Asbestos Cement Vermont 2007 2 3458-3462B S Utah Asbestos Cement 2 3464A-3468 S Utah Asbestos Cement Vermont 2006 2 3470A-3474B S Utah Asbestos Cement Vermont 2005 2 3476-3480 S Utah Buckingham 2 3482-3488B S Utah Vermont 3 3500-3514 S Utah Asbestos Cement Vermont 2003 3 3516-3526 S Utah Bangor Vermont 1998 3 3528-3546 S Utah Asbestos Cement Vermont 2005 3 4401-4411 S 36th Buckingham 4 3601-3611 S Wakefield Vermont 4 3613-3617 S Wakefield Vermont 4 4500-4504 S 36th Bangor 4 4506-4510 S 36th Buckingham 4 4512-4514 S 36th Bangor Vermont 1998 4 4516-4518 S 36th Vermont 4 4520-4522 S 36th Vermont 5 4415 S 36th Tile 5 4419-4421 S 36th Vermont 5 4425-4435 S 36th Vermont 5 4437-4439 S 36th Bangor Buckingham 1984 5 4441-4453 S 36th Vermont 5 4501-4505 S 36th Buckingham 6 3501-3515 S Wakefield Buckingham 6 3517-3527 S Wakefield Asbestos Cement 6 3529-3539 S Wakefield Bangor Vermont 2002 6 4507-4517 S 36th Buckingham 7 3459-3469 S Wakefield Vermont 7 3471-3477 S Wakefield Buckingham 7 3479-3485 S Wakefield Buckingham 7 3487-3497 S Wakefield Vermont 8 3407-3415 S Wakefield Bangor Vermont 1999 8 3417-3423 S Wakefield Asbestos Cement Vermont 2004 8 3425-3435 S Wakefield Asbestos Cement Vermont 2002 8 3437-3443 S Wakefield Asbestos Cement Vermont 2004 8 3445-3453 S Wakefield Bangor Vermont 1997 9 4500-4508 S 34th Asbestos Cement 9 4510-4528 S 34th Buckingham 9 4530-4540 S 34th Vermont 10 4400-4410 S 34th Vermont 10 4412-4422 S 34th Bangor 10 4424-4432 S 34th Asbestos Cement Vermont 2003 11 3610-3620 S Taylor Bangor Vermont 1997 11 3622-3632 S Taylor Bangor Vermont 2000 11 4300-4310 S 36th Vermont 11 4314-4318 S 36th Bangor Vermont 1997 11 4322-4332 S 36th Vermont 12 4400-4410 S 36th Bangor Vermont 2000 12 4414-4416 S 36th Vermont 12 4418-4428 S 36th Asbestos Cement Spanish Slate 2010 12 4430-4444 S 36th Asbestos Cement Vermont 2003 12 4446-4452 S 36th Asbestos Cement Vermont 2003 12 4454-4460 S 36th Buckingham 12 4464-4470 S 36th Buckingham

Fairlington Arbor Roof Status

Roof Map

Replaced Vermont - 75 yr Replaced Buckingham - 100 yr Replaced Spanish Tile - 100 yr Original Bangor / Asbestos Cement - 50 yr Original Vermont - 75 yr Original Tile - 100 yr Original Buckingham - 100 yr