OCEAN PINES – The association’s proposed budget for the coming fiscal year will advance to a town hall meeting following last week’s board review.
Last week, the Ocean Pines Association Board of Directors held a meeting to review the preliminary proposed budget for fiscal year 2022-2023. General Manager John Viola noted the budget came with some revisions following meetings with the association’s Budget and Finance (B&F) Committee.
“This is a detailed review for the board and for the association,” he said. “At this point, our team has put forward a proposed budget to the B&F team. They scrubbed everything and gave us their feedback, which we reviewed and incorporated.”
The proposed fiscal year budget includes total revenues of $16,833,944 and expenditures of the same. While the spending plan initially proposed a $1 decrease in assessments, Viola last week proposed using $450,000 in surplus to reduce the non-water lot assessment from its current $996 to $925, or a reduction of $71.
“Right now we’re running a nice surplus for this year,” he said. “So that’s all factored into this budget.”
While he acknowledged some funding challenges – mainly resulting from minimum wage increases and inflation – Viola said the association continues to see improved amenity performance and revenue growth.
“Our amenities are showing organic growth in revenue,” he said. “We, across the board, have had expense efficiencies, which has all been reflected in this budget, as well as the surplus you’ve seen we’ve generated this year, as well as last year that we recognized.”
Viola said the association recognized a $1.19 million surplus in fiscal year 2021.
He proposed using $450,000 of that money for a one-time assessment reduction, $350,000 to replenish the roads reserve fund and $60,000 for the association’s T-docks project. The remaining $334,991, Viola said, would be added to an estimated surplus of nearly $1.09 million in fiscal year 2022.
“We would have a balance of $1,422,483 still in our surplus, even after those three items,” he said. “We can use this surplus … if we want to increase or at least allocate to our reserves.”
Viola also presented board members with the contribution schedule for the association’s general replacement reserve fund, which projects a reserve rate of 25.8% by fiscal year 2026-2027. That percentage, however, could grow if the association eliminates contributions for replacing the golf course irrigation system.
“If we, as a community or this board, decided that we are going in a different route for this irrigation system, it would be an even higher percentage,” he said.
The board last week met with several department heads, including those from police, public works, and recreation and parks, to review their individual budgets. Fire department staff also presented their requests, which includes a $254,000 increase for compensation.
“This is based on adding additional employees that we are requesting,” said Capt. Harvey Booth, “and providing retirement, insurance, etcetera for two people we already brought on full time.”
Directors also reviewed the summary of capital projects, which eliminated $600,000 for the golf course irrigation replacement.
“The main change we made was taking the golf course irrigation out,” said Finance Director Steve Phillips. “That was the big-ticket item, $600,000. So our total general replacement went down significantly.”
Viola also highlighted the $125,000 in funding for the administration building.
“We did want to renovate the interior of the administration building,” he said, adding the funds would be used for a new HVAC system, as well as new ceilings and flooring. “I want to ask to put this in the budget.”
During the review session last week, the board voted to reallocate $350,000 in surplus to replenish the roads reserve fund and to use $60,000 in surplus to fund the T-docks project.
Officials say the next step is to hold a town hall meeting, which is scheduled for Feb. 1 at 11 a.m. The board is expected to vote on the budget in late February.