OCEAN PINES – Officials in Ocean Pines this week voted to adopt its annual budget with a $100 reduction in assessments.
On Wednesday, the Ocean Pines Association Board of Directors voted unanimously to approve the budget for fiscal year 2022-2023.
The spending plan for the coming year reflects total revenues and operating expenses of $13,951,508, bulkhead, drainage and replacement expenses of $1,169,921, and capital expenditures of $1,302,255. Assessments, officials noted, would be reduced by $100. The bulkhead differential for waterfront lots will not change.
“Today is going down as a historic day for Ocean Pines, as the board will vote, for only the second time, on a budget that will result in the reduction of assessments,” Association President Colette Horn said. “The last time our assessment was reduced was in 2014, with a $5 reduction.”
In his remarks this week, General Manager John Viola acknowledged the association would have to account for insurance premiums, minimum wage increases and inflation in the coming year. Other challenges, he added, included “mark to market” adjustments for certain positions.
He noted, however, that the association continued to see improved amenity performance and revenue growth. As a result, officials propose using $650,000 in current surplus to reduce the assessment by $100.
The assessment rates approved on Wednesday include $896 for non-water lots, $1,334 for non-water estate lots, $1,511 for water lots, $2,266 for water estate lots, $986 for water non-bulkhead lots, $1,479 for water non-bulkhead estate lots and $7,579 for commercial lots.
Viola also told Pines residents this week the association projected a surplus, ranging from $1.3 million to $1.6 million, at the end of the current fiscal year. He attributed around $700,000 of that surplus to amenities, organic growth and the reduction of expenses.
“That hasn’t been realized yet,” he added.
Finance Director Steve Phillips also highlighted the association’s reserve balance, which is estimated to total $5.88 million by the end of the current fiscal year and $6.9 million by the end of fiscal year 2023.
He added that the general replacement reserve would be 26.9% fully funded in fiscal year 2022-2023 and 30.8% fully funded in fiscal 2026-2027.
“As you can see, the percentages are trending upward,” he said.
Wednesday’s vote to approve the spending plan for the coming year follows a series of meetings with Viola, board members, association staff and members of the Ocean Pines Budget & Finance Committee to review the proposed budget. The vetting process also included a public hearing to address residents’ questions and concerns.
In recent years, the association has worked to eliminate a $1.6 million operating deficit inherited by the association’s prior administration. Viola told residents this week that deficit has since been eliminated.
“That infamous $1.6 million operating deficit has been paid down …,” Viola said this week. “About $800,000 came from assessments, and the other $800,000 came from favorable to budget.”
In her comments this week, Horn not only recognized the association’s membership for their support, but also association staff and board members.
“I wanted to thank John and staff for the work that has allowed us to make this adjustment,” she said. “And I want to thank this board and the preceding board for providing leadership and support to make those improvements possible.”
With no further questions, the board on Wednesday voted unanimously to approve the fiscal year 2022-2023 budget, which goes into effect on May 1, the start of the new fiscal year. The board this week also voted to establish a 6% interest rate on delinquent fees for the coming year. A copy of the association’s budget for fiscal year 2022-2023 has been made available on the association’s website, oceanpines.org.
