(Jan. 19, 2017) If Brett Hill gets his way, homeowners in Ocean Pines will not see an increase in assessments or membership fees during the next fiscal year.
Hill, the interim general manager, presented his first budget draft during public meetings last week. That document was also posted online as of Jan. 9.
The total proposed budget for fiscal year 2017-18 includes $13.5 million in total revenues against $13.5 million in total expenses, a decrease of more than $985,000 in both columns. Basic assessment rates would stay at $921, while the waterfront rate would remain at $1,367.
The proposed budget eliminates the controversial “five-year funding plan,” which was renamed “legacy funding” in 2015. That component, established eight years ago to fund major capital replacements, was deemed no longer necessary according to Hill, who said all of the projects it addressed had either been completed or were undergoing renovations.
The elimination of that portion of reserves would account for a roughly 12 percent decrease in the overall reserve contributions.
The reserve balance as of May 1 is expected to be about $4.91 million. As of April 30, 2018 that number is projected to drop about 5 percent, to $4.68 million.
In a budget overview section of the document, Hill said payroll expenses were significantly impacted by a 50-cent increase in the minimum wage, affecting both the lowest wage earners and “the respective positions directly above them who now become at or near minimum wage.” Health care benefits also increased roughly 10 percent.
Casino revenues, generally allocated for road repairs in Ocean Pines, were reallocated for renovations to the administration building, namely expanding the police department.
Bulkhead replacement reserves would remain flat pending a “long term investment strategy.”
Amenity revenues were projected to increase about $1 million, largely driven by a 38 percent ($200,670) expected increase in beach club revenues. There, Hill hopes longer hours during both the summer and the shoulder season will allow the association to tap into a larger market base. Yacht club revenues are also expected to increase by 26 percent, or $394,485.
Meetings with the OPA Budget and Finance Committee were scheduled to run three days last week, although they were wrapped up after just one day, last Wednesday.
Hill, who was elected to serve on the board last August and appointed general manager just weeks later, said he didn’t know what to expect during his first set of budget hearings.
“I was not a part of the [budget] process at all last year and I only heard horror stories from both the board and the staff as to it was a fairly painful process, so I was prepared for, I guess, much worse that what I walked into [during the meetings],” he said.
He said the flat level of assessments came from a mandate from the board, and that he expected that to remain in the final, approved budget.
“I think, with where we stand right now waiting for the reserve study back [and] input from our outside consultant on payroll and salaries, we really don’t have strong guidance to make any big changes,” he said. “The most conservative route is to maintain the assessment level until we have the proper information to really document which way it needs to go – and when.”
Hill said it was fair to say that major changes could come in the following fiscal-year budget.
A special session was called for Friday, Jan. 20 at 10 a.m., when Hill is scheduled to present the proposed budget to the board. He will submit the budget draft to the public during a meeting on Jan. 28 at 12:30 p.m.
All meetings were scheduled in the community center on 235 Ocean Parkway.
To view the budget draft, visit www.oceanpines.org/wp-cont…/uploads/…/01/Budget-Report-1.pdf.