Here is a text version of the newsletter that was mailed out this week.
Dear Winterchase Residents 3-14-2018
Important Information requesting feedback!
We hope that your year is off to a fantastic start! Your board has been hard at work behind the scenes preparing financial reports and planning for the future of our subdivision. As you will notice, the playground is up and running. We replaced the missing swings, and it is wonderful to hear the sounds of children utilizing the equipment. Additionally, the lights out front are working. We hope to keep everything working as expected.
Attached you will see a financial report from our treasurer Will Godfrey. We appreciate the hard work that he has put into running the numbers for us. As you can see from this report, in 2017 Winterchase HOA spent more money than was fiscally sound. Many expenses are contractually obligated for 2018. Our board did not sign the contracts, yet we are legally obligated to adhere to them. Therefore, we will either have to raise dues to continue with the management company, or wait to drop the management company in December of 2018.
At the end of 2018, all operating reserves will be spent on management services and additional expenses previously mentioned.
In an effort to recover funds without raising dues, the early discount has been discontinued. HMS has already noted the change on the 2018 invoices. Winterchase HOA has options on how to move forward; therefore,
Our board is wanting to hear your opinions!
Regarding management, we can:
- Raise dues to $450/year to cover the cost of a non-regulated management company for financial services or slightly more for full management. Every year management companies raise their pricing by 3%, so every year dues will need to be raised to cover annually increasing fees.
OR
- Do not raise dues and hire a regulated financial institution to invoice and manage homeowner dues. This is what your current board proposes. No resident volunteer would be responsible for collecting the dues, and we could keep our dues low by doing volunteer work as was our custom for 20 years. (We will attempt to cover the cost by removing the early discount but might need to raise dues by $10-$15 in a couple of years.)
We raised these issues before being elected. We want to return to normal. The board is willing to raise dues and oversee the management company if that is the will of the membership. We only wish we could have stopped the expenses and loss of financial reserves earlier.
We are also updating our by-laws in an effort to ensure normalcy. Appropriate elections did not take place last May and were postponed until October 13th. In the new bylaws, at least two directors will be up for election every year. The board can continue to be the same 5 people if no one chooses to run; however, every year residents will have the opportunity to run for election. Also, every year directors can change positions as desired. Unless someone wants to run this year, this election cycle will begin in 2019 giving the current directors at lease 1 year on the board before being up for re-election. Terms will be for 2 years, with the exception of our first term being shorted because of the shenanigans of last year.
Beyond elections, the bylaws ensures the annual meeting will be held in May and at the pool house. Elections will take place at the annual meeting. A management company or any new expenses beyond 10% of the annual budget ($3,250 in 2018) requires involving the membership to ensure that a board cannot alter our basic governance without notifying the membership. Please take the time to look and give us your feedback.
We are delaying the deadline to pay dues to May 1st, instead of what HMS presented on the invoices.
2018 annual meeting will be held Saturday, May 5th at 11AM at the pool house.
Survey on last page, WinterchaseHOA.com, [email protected] or through FB.
We welcome your feedback and want to see our neighborhood thrive!
Winterchase Board of Directors
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Treasurer’s Report
Going from 2016 to 2017 here is what was listed in our accounts.
Checking: $14,583.55
Savings: $15,010.81
Expenses from 2016 were $29,926.94 and went up to $36,618.30 in 2017. That’s a difference of $6,691.36 from the previous year(the cost of HMS give or take a few dollars).
Looking at our top 3 expenses of the year, which make up about 77.5% of our budget are Landscaping, the pool and HMS. We spent a total of $36,618.30 and the big three cost a total of $28,867.31. The break down of cost will be shown later.
Now if we haven’t had great financial oversight by the previous treasurer prior to the past few years, we would have over spent our funds.
We spent $36,618.30, in which we only take in $31,150 per year. That’s a deficit of $5,468. With that being said, in order to cover the cost of this year dues will have to be raise by $61 per house hold to a total of $411. Knowing that, we can say that every house doesn’t pay so that means dues would actually have to go up higher just to offset the cost of those not paying, that means looking at about $450 per house to help cover the cost. The previous board knew they would have to increase dues 5% per year to cover the cost, or they would bleed the savings account to cover the cost before being forced to increase dues.
Now for the breakdown of the big three expenses:
Pool Landscaping HMS
Permit $308 Contract $6,011 Fees $4750
Contract $3,599 Pond $1,175 Postage $403
Maint. $2,032 Flowers $210 Printing $200
Supplies $163 Meeting $600
Phone $585 Total of $5,953
Water $1,587 Additional Costs assoc. with HMS
Electric $3,353 Non-audit $1,500
Improvement $564 Tax prep $265
Liability ins. $946
Late Fees $506
Total of $12,194 Total of $7,501 Total of $9,171.25
In closing, if we keep up this rate of spending without raising dues we would consume our savings in about 3 or 4 years. We must cut back on spending or raise dues, in which I would be in favor of cutting spending instead of raising dues. Out of our 3 big expenditures the one that would be easiest to control is HMS. We start 2018 with $6,614.04 in our checking account(difference of $7,969.51 from 2016) and $18,012.38 in savings(addition of $3,001.57 from 2016).
If you have any questions I would be glad to answer them to the best of my ability.
William Godfrey
Winterchase Treasurer
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Survey
Please take a minute to fill out our 2 question survey about yearly dues and updated by-laws: Winterchase HOA Survey
If you have any questions, comments, or concerns please reach out to us in one of the following ways:
Email: [email protected]
Facebook (private): Welcome Winterchase!