Annual Budget & Policy Report 2022-2023 Flipping book edit

Annual Budget & Policy Report 2022-2023 Flipping book edit

May 23, 2022 Dear Owners,

On May 16, 2022, the Board of Directors adopted the annual Budget for the fiscal year, beginning July 1 , 2022 and concluding June 30, 2023. As a result, the monthly assessment will increase 5.5%, from $419 to $442/month. The Consumer Price Index, currently hovering around 8%, had the single most impact on decisions related to contracts as well. The attached Budget Summary, is broken into three basic categories: 1) Operations requires almost $405/month in assessment. Wages, Utilities and Landscaping are the big-ticket items impacting the operations expenses. Even with a 5% minimum Cost of Living increase for most of the staff, employee costs make up just over 43% of the operating budget, which sets ORPS in the middle of the 35-50% typically found in the hospitality/ resort industry. Other unsettling variables, which impacted contingency, is the effect of inflation on utilities and the insurance market. Finally, the landscape contract with Vintage, which also faces inflation challenges and minimum wage mandates, was negotiated down to a 5.5% increase from a requested 9%. 2) Reserve Fund contributions go toward a fund specifically set for repair, maintenance, and replacement of major components such as roofs, carpets, roads, pool equipment and the like. The monthly assessment contribution is almost $78, and with interest generates more than $1,150,000 annually. Reserve projects tackled over the off-season will include major road and curb/gutter repairs and replacements, primarily in Phase 1 and 2, as well as replacement furniture at the La Palma pool. Satellites will continue to be improved through the use of Reserve Funds. 3) Capital Fund contributions are for future projects, both smaller in scope and to partially fund longer- term facility improvements. The vast majority of this contribution comes from Resort fees, which will be increased to $20/night and totals more than $203,000 annually. A Dog Park, paid from the Capital Fund, is a major off-season project. If all the expenses were tallied up and divided by the 1,213 lots which make up the community, the monthly assessment would be almost $510. The Resort has significant non-assessment income, such as the daily Resort Fee, Laundry, Bar, and others, which total almost $1,110,000 and offset expenses that would ordinarily have to be borne by assessments. In the additional materials provided behind the Budget are more detailed information on the management of this almost $7.5MM corporation, including how Reserve Funds are calculated. Also find other attachments, many of which are required by California law, dealing with Collection Policies, Dispute Resolution, Insurance, etc. Included is a Request for Annual Notice of Address, Representative and Rental Status form. Key is the Annual Notice of Address form, which is a requirement per California Civil Code, Section 4041. Please note that this form does not mean you cannot receive information via email but is to confirm where you would like things such as ballots for the annual election of directors sent. There are also information sheets regarding things like Lot Maintenance, Payment Information for Assessments, and an "Opt-in" form. To receive notifications and documents electronically, the Association must have the "Opt-in" form signed by the Owner and have it on file. I encourage participation since it significantly curtails printing and postage costs for annual distributions such as this. Just follow the instructions on the form and return it to the front desk in the Administration building or email it to [email protected]. The Resort is quiet right now, due to the off-season, but I look forward to another post-Covid year, which showed how much fun you can have when you’re "home again." Respectfully, Ed Vitrano, General Manager

69411 Ramon Road, Cathedral City, CA 92234 - (p)760-328-3834; (f)760-328-7852; orps.com

2022-2023 ANNUAL BUDGET REPORT

1. Budget Summary See enclosed Budget Summary for your review. The complete Budget may be obtained by a request to [email protected]. 2. Assessment & Reserve Funding Disclosure Summary See enclosed Assessment and Reserve Funding Disclosure Summary for your review, which includes a: A. Reserve Funding Summary B. Reserve Funding Plan C. Procedures for Calculating Reserves 3. Major Component Repairs The Board of Directors has not deferred or eliminated any repairs or replacements of any major reserve components . Anticipated Special Assessments The Board of Directors does not, at this time, anticipate the need to apply a special assessment during the course of the current fiscal year to repair, replace, or restore any major component or to provide adequate reserves, therefore. However, the Board reserves the right to approve a special assessment for unplanned major expenses in the upcoming year. At the present time, the Board of Directors uses that portion of the monthly assessments allocated to reserves as its mechanisms to fund reserves. 5. Outstanding Loans The Association does not have any outstanding loans. 4.

6.

Insurance Summary See enclosed Insurance Summary for your review.

7.

Charges for Documents provided See enclosed for Charges for Documents provided for your review.

OUTDOOR RESORT - PALM SPRINGS 2022-2023 Budget Summary July 1, 2022 - June 30, 2023 Approved by the Board May 16, 2022

ITEM

ANNUAL

MONTHLY/UNIT

REVENUE

Assessments

6,433,729

442.00

Total Administration Revenue (Including Assesments)

6,740,303

463.06

Total Rental/Reimburesement Revenue

565,269

38.83

Total Lifestyles Revenue

216,000

14.84

Total Golf Revenue

21,760

1.49

TOTAL REVENUE

7,543,332

518.23

EXPENSE

Total Administration Expense

836,277

57.45

Total Resort Services Expense

204,908

14.08

Total Lifestyles Expense

341,399

23.45

Total Golf Expense

93,210

6.40

Total Grounds & Greens Expense

1,542,038

105.94

Total Security Expense

456,821

31.38

Total Mailroom Expense

63,027

4.33

Total Facilities Expense

287,094

19.72

Total Maintenance & Repair Expense

556,650

38.24

Total Vehicle Expense

82,568

5.67

Total Utilities Expense

1,039,299

71.40

Total Insurance Expense

397,842

27.33

Budget Contingency

288,678

19.83

TOTAL OPERATING EXPENSE

6,189,809

425.24

Total Reserve Contribution

1,150,124

79.01

Total Capital Contribution

203,399

13.97

TOTAL GROSS EXPENSE

(7,543,332)

518.23

NON-ASSESSMENT INCOME

1,109,603

(76.23)

ASSESSMENT INCOME

6,433,729

442.00

NET INCOME/LOSS

0

0.00

Assessment and Reserve Funding Disclosure Summary For the Fiscal Year Ending June 30, 2022 (1) The regular assessment per ownership interest is $419 per month, of which approximately $72.57 is allocated to reserves, monthly. (2) No additional regular or special assessments have been scheduled to be imposed or charged, regardless of the purpose, by vote of the board and/or members: (3) Based upon the most recent reserve study and other information available to the board of directors, will currently projected reserve account balances be sufficient at the end of each year to meet the association's obligation for repair and/or replacement of major components during the next 30 years? Yes X No The information contained within the reserve study includes estimates of replacement value and life expectancies of the components and includes assumptions regarding future events based on information provided by and supplied to the Association’s Board of Directors and/or management. Some assumptions inevitably will not materialize, and unanticipated events and circumstances may occur subsequent to the >Page 1 Page 2 Page 3 Page 4 Page 5 Page 6 Page 7 Page 8 Page 9 Page 10 Page 11 Page 12 Page 13 Page 14 Page 15 Page 16 Page 17 Page 18 Page 19 Page 20 Page 21 Page 22 Page 23 Page 24 Page 25 Page 26 Page 27 Page 28 Page 29 Page 30 Page 31 Page 32 Page 33 Page 34 Page 35

Made with FlippingBook - professional solution for displaying marketing and sales documents online