November 30, 2017
Neighbors,
At the November meeting your board reviewed our expenses for 2017; summarized projected expenses for 2018 mindful of the various increases proposed by our providers; prioritized the various proposed projects; and, discussed the reserve or contingency fund. We came to a consensus and this resulted in our adopting a budget for the next year.
Every year the budget and the accountant’s financial report are published on line for the homeowners’ perusal. As a homeowner and a non-accountant I realize trying to comprehend a spread sheet of small print numbers can be daunting. Even if one has experience reviewing these documents, there is no explanation of the rationale for why a particular amount of money was allocated.
I am writing this letter to try to provide an overview to the fine print.
First, there are expenses. A few examples from 2017 were $70K for garbage pickup; $75K for snow removal; $165K for insurance; $57K for road maintenance and repair; $15k for sewer system repair and maintenance. The property is aging and there is a considerable amount of repair and replacement constantly occurring. These costs tend to only go up not down as we all know. Costs for goods and services in the Tahoe area tend to be higher than elsewhere- buy a pint of ice cream at the local 7-11 if you doubt me.
The next issue is how do we pay for the above, i.e. our dues. Our 2017 dues were $2875 per quarter. Periodically we review where we stand in relation to other properties in our area. Although there are marked differences between the various condominium projects on the west shore there is some perspective to be gained by doing this. For example, quarterly dues at Fleur du Lac are $15K; Chambers Landing, $3750; Tahoe Tavern, $2750; Cedar Point, $3200 plus an $40K assessment in 2016 for the swimming pool; North Shore Condos, $2550; St Francis Condos, $2200; Tahoe Marina, $1950 plus an $8K assessment in 2016.
At the November meeting our board decided that a $50 or 1.7% increase to $2925. per quarter will allow us to continue to maintain our roads; renovate the piers and patios; cull the dead trees to minimize fire potential; preserve the historic Dollar properties to prevent further deterioration; plow the snow; staff the summer activities; pick up the garbage etc. etc. It will also allow us to continue to add to our contingency fund.
We have almost $500K in our reserve or contingency fund. This sounds like a lot of money but it really is not. My research, including discussions with previous board members and our accountants, has revealed
estimates of one to two million as reasonable amounts for this fund. The least “seat of the pants” recommendation came from our accountant and was that two million dollars is what we should have. For example, if a catastrophic event (e.g., an earthquake) destroyed our sewer system, rebuilding it would cost a million dollars.
I promise to you this board will continue to be prudent with our monies and at the same time will make every effort to preserve the beauty of our property. Chinquapin boards have traditionally had an antipathy to assessments. There have been only three to the best of my recollection in the thirty years I have owned my unit. We will endeavor to continue that approach.
Charles Quaglieri, President CHOA