SOA 2020 Budget Presentation

 

The Somersett Owners Association (SOA) presented an overview of the proposed 2020 Budget at an Owner meeting held last night (October 9th) at The Club at Town Center (TCTC). Unfortunately, attendance was disappointing as only about a dozen owners (exclusive of Board and Staff members) showed up. Perhaps because Owners really have no say over the Budget and must rely on the Finance Committee and Staff “professionals” to come up with a Budget based on projected income, expenses and reserve requirements. So what is the bottom line that most Owners are interested in?

Monthly Assessments:

  • Assessments associated with TCTC and Private Gates & Streets will remain the same at $89/month and $54/month respectively.
  • Common Area Assessments will be increased by $13/month. That is, from $92/month to $105/month. This equates to a 14% increase over 2019. The maximum the Board can increase without owner vote is 15%. This increase is apparently necessary to 1) replace depleted operating cash, 2) bring reserve funds to more acceptable levels, and 3) potentially pay down on the current $6M loan debt, a consolidated loan from 2018 that combined separate loans for TCTC, Canyon 9, SGCC Purchase and Rockery Wall Repairs into a single loan with more acceptable terms. Paying down on this debt will provide more “headroom” for future loans if required.

Special Assessments:

  • No special assessment is contemplated or expected for 2020. The 2018 Loan and 2019 Special Assessment adequately covered the Rockery Wall repair costs, with some monies left over that will be kept in reserves. The other wall of concern (i.e., at Roundabout 2) is being monitored, with no sign of required near term repairs.

2020 Bottom Line Totals Per Assessment (Cost Center) Area:

  • Common Area:  Total Revenue $4,392,590, Reserve Contribution $430,000, Total Operating Revenue $3,962,590, Total Operating Expenses $3,962,590
  • TCTC:  Total Revenue $$2,374,602, Reserve Contribution $353,000, Total Operating Revenue $2,021,602, Total Operating Expenses $2,108,402
  • Gates:  Total Revenue $571,052, Reserve Contribution $305,000, Total Operating Revenue $266,052, Total Operating Expenses $266,052
  • Total Consolidated Budget: Total Revenue $7,338,244, Reserve Contributions $1,088,000, Total Operating Revenue $6,250,244, Total Operating Expenses $6,337,044.

One can see from the above, that the SOA is a large enterprise, and that an experienced staff is required for its management.

For those interested in the Presentation details, a copy of the Presentation is available on the SOA website (www.somersett.net) under the “SOA/Committees and Meetings” tab (login required) entitled “2020 SOA Budget Presentation Powerpoint (PDF)”. For those who do not have login capability, the Presentation (as extracted from the SOA website) may also be accessed via the following link:

2020 SOA Budget Presentation

The October 9th Budget Presentation meeting provided a simplified overview of the proposed 2020 Budget. The finalized and more detailed Budget will be approved at the October 16, 2019 Open BOD Meeting. Subsequently, no later than November 2, 2019, the approved Budget will be mailed to all Unit Owners. Owner ratification of the Budget will then occur at the November 18, 2019 annual Owners Meeting. Note that ratification is essentially guaranteed given the provision of Article II, Section 6 “Budget” of the SOA CC&R’s which states: “Unless at that meeting seventy-five percent (75%) of all voting power of Owners rejects the budget, the budget is ratified, whether or not a quorum is present”.