TREASURER's CORNER
Betty Schneider has been an active participant in Casa Bahia board activities for the past 25 years. She has served as a board member for eight years and is currently the board treasurer. Betty is retired. She worked for over 20 years as the office manager for a multi doctor dental practice.
It is my objective, and the objective of the board, to provide finanical information to our homeowners so that they might better understand our budget and the finanical status of the HOA.
It is my objective, and the objective of the board, to provide finanical information to our homeowners so that they might better understand our budget and the finanical status of the HOA.
The 2010 Budget
In my first discussion, I’d like to address our current budget situation.
As can be seen in the first chart below, we exceeded our 2009 budget of $252,570 by almost $15,000. The main cause of this increase can be seen in the second chart, which shows the budget categories of Building Maintenance and Contracts as the two contributors. Within Building Maintenance, the main cause of the increase was building plumbing, accounting for approximately $13,000 of the increase.
As can be seen in the first chart below, we exceeded our 2009 budget of $252,570 by almost $15,000. The main cause of this increase can be seen in the second chart, which shows the budget categories of Building Maintenance and Contracts as the two contributors. Within Building Maintenance, the main cause of the increase was building plumbing, accounting for approximately $13,000 of the increase.
The reason our plumbing expenses went up significantly is that the board voted to aggressively pursue the clean out of common area drains that serve our individual units. This decision was based on the fact that we have had far too many the sewage and plumbing back ups in individual units over the past two years. A single backup in a unit caused by a clogged common area pipe can easily cost the Association $10,000 to $15,000 in cleanup and replacement costs.
We have instituted a firm schedule for the clean out of both horizontal and vertical common area drains serving individual units. The kitchen lines are scheduled to be cleaned out approximately every 18 months and the lavatory lines will be cleaned approximately every three years. It is anticipated that this policy will save the Association thousands of dollars in repair and remediation costs in the coming years.
The third chart shows how our 2010 budget has been adjusted since the passage of the Special Assessment. You will note that we are now able to fund the Building Maintenance budget in line with what our 2009 actual costs were.
The third chart shows how our 2010 budget has been adjusted since the passage of the Special Assessment. You will note that we are now able to fund the Building Maintenance budget in line with what our 2009 actual costs were.
Our Recent Special Assessments
At the last several monthly board meetings during the Homeowner’s Forum, there was some inaccurate information being bandied about concerning our last two special assessments. To set the record straight, I’d like to recap the reasons for these assessments and the amounts involved.
The need for the second to last special assessment was first presented to the homeowners on 17 September 2007. This assessment was for $284,000 to be paid in three installments in 2008. The three major items in this special assessment was:
$180,000 for the upgrading of our two elevators,
$125,000 for the upgrading of our two building entryways and
$65,000 for the repair of three northwest corner balconies.
The difference between the above total for these three projects and the special assessment total of $284,000, was to be paid out of the Reserves.
Unfortunately, the estimates for the first two 2008 projects were too optimistic and an additional expense of $46,000 was incurred. The 2009 budget was exceeded by $15,000 primarily because of increased building plumbing repairs, an accelerated hydro jetting schedule and an increase in our building insurance premiums.
In putting together the 2010 budget in late 2009, it became clear that the current level of income for the Association would not cover the normal projected expenses for 2010 nor would it cover the 2009 shortfall. In addition, we experienced a major roof leak in 2009 which damaged six units. The estimate for this repair was $122,000 which, of course, was not in the budget.
A second special assessment was announced to the homeowners on 14 December 2009 at the Annual Homeowners Meeting. This special assessment for $209,000 is shown below. Note that the water intrusion repairs to the six damaged units amounts to almost 60% of this special assessment:
$122,000 water intrusion repairs to six units.
$46,000 elevator/entryway project overrun.
$20,000 2010 operating budget shortfall.
$15,000 2009 budget overrun.
$6,000 State mandated jacuzzi upgrade.
In summary, over the past 12 years we have had a total of four special assessments;
2001-$35,000 for termite tenting.
2003-$81,000 for sewer repair, water damage and the installation of an automated garage ventilation system.
2008-$284,000 for elevator & entryway upgrades.
2010-$209,000 for water damage repairs and project overruns.
The need for the second to last special assessment was first presented to the homeowners on 17 September 2007. This assessment was for $284,000 to be paid in three installments in 2008. The three major items in this special assessment was:
$180,000 for the upgrading of our two elevators,
$125,000 for the upgrading of our two building entryways and
$65,000 for the repair of three northwest corner balconies.
The difference between the above total for these three projects and the special assessment total of $284,000, was to be paid out of the Reserves.
Unfortunately, the estimates for the first two 2008 projects were too optimistic and an additional expense of $46,000 was incurred. The 2009 budget was exceeded by $15,000 primarily because of increased building plumbing repairs, an accelerated hydro jetting schedule and an increase in our building insurance premiums.
In putting together the 2010 budget in late 2009, it became clear that the current level of income for the Association would not cover the normal projected expenses for 2010 nor would it cover the 2009 shortfall. In addition, we experienced a major roof leak in 2009 which damaged six units. The estimate for this repair was $122,000 which, of course, was not in the budget.
A second special assessment was announced to the homeowners on 14 December 2009 at the Annual Homeowners Meeting. This special assessment for $209,000 is shown below. Note that the water intrusion repairs to the six damaged units amounts to almost 60% of this special assessment:
$122,000 water intrusion repairs to six units.
$46,000 elevator/entryway project overrun.
$20,000 2010 operating budget shortfall.
$15,000 2009 budget overrun.
$6,000 State mandated jacuzzi upgrade.
In summary, over the past 12 years we have had a total of four special assessments;
2001-$35,000 for termite tenting.
2003-$81,000 for sewer repair, water damage and the installation of an automated garage ventilation system.
2008-$284,000 for elevator & entryway upgrades.
2010-$209,000 for water damage repairs and project overruns.