2

HRCA BudgetHRCA Budget•

The annual budget is a financial and operational document that is designed to carry out the obligations of the HRCA.

•

The annual budget also follows the policies of the Board of Directors, which reflects the requests for services and facilities by the members.

3

AgendaAgenda

•

2011 Budget Process

•

Ongoing Revenue Generation and Expense Controls

•

Goals & Assumptions

•

HRCA Finance Committee

•

2011 Budget Drafts

–

Administrative–

Backcountry–

Recreation–

HRCAA & Scholarship

•

Questions

4

Finance CommitteeFinance Committee

•

Scott Lemmon, Chair/Treasurer (Telecommunications)

•

Douglas Campbell, (Banking Management)

•

Lyle Daley, (Federal Government Agencies)

•

Sheela Damle, (Management, Consulting)

•

Christophe Granger, (Hospitality-Country Club)

•

Dave Martz, (Defense Estimator)

•

Jody McNerney, (Corporate Banking)

•

Christopher Tefft, (Financial Analyst)

•

Kyle Spain, (Telecommunications)

•

Stephanie Young, (Telecommunications, CPA)

5

2011 Budget Process2011 Budget Process•

June through October 2010 –

Draft Budget Development

•1,000 hours of staff / supervisor time

•

August through October 2010 –

Finance Committee Review

•Meetings to review each aspect of the HRCA, HRCAA, & HRCSF

•Over 300 hours of volunteer and staff time

•

October 12 -

Board Review with Finance Committee

•

October 15 –

Budget Draft mailed to Delegates

•

October 19 -

Presentation to Delegates

•

October 19 -

November 16 Community input

•

November 16 -

Board Adoption of a budget

6

Revenue GenerationRevenue Generation (Ongoing Annual Impact)(Ongoing Annual Impact)

•

Transfer fees (increased from $50 to $100)

$ 75,000

•

Lien Fees (increased from $40 to $75)

$ 35,000

•

Late Fees (increased from $20 to $25)

$ 7,000

•

17 Sub-Associations managed

$242,000

–

Only added 1.25 FTE(s)

•

Net gains on sale of lien assignments

$ 5,000

–

Gains were $54,000 in 2009

•

Online Yellow Pages

$ 35,000

•

New or expanded Recreation Programs

$150,000

7

Ongoing Expense ControlsOngoing Expense Controls

•

Staff related reductions

–

Cut 15 benefitted positions since 2006

$ 100,000+

–

Seasonal employee wages frozen

$ 7,500

–

Control of Program staffing & contract labor

$ 92,000

–

Reduced operating hours $ 45,000

–

Registration / membership reductions

$ 40,500

–

Maintenance, janitorial & program positions vacant

$ 23,500

–

Reduced recruiting/employee development

$ 25,000

–

Limit pay increases to 1.67% instead of 2%

$ 29,000

8

Ongoing Expense ControlsOngoing Expense Controls

•

Utilities (Savings in utilizing Transport Gas vs. Xcel)

$12,000

•

Telephone service and maintenance reduction

$24,000

•

Office supplies contract / controls

$ 8,000

•

Office Equipment Lease contract / usage / controls

$10,000

•

Reduced Assessment printing expense

$10,000

•

Expense reduction on Activity Guide production

$ 9,000

9

Ongoing Expense ControlsOngoing Expense Controls

•

Health Insurance Benefits reduction

$123,000

–

Reduced benefits and changed carriers to restrict increases

–

HRCA 5% per year compared to 12% average industry

increase

•

Workers Compensation controls

$ 7,000

•

Marketing plan expenses

$ 10,000

•

In house management and control of web site

$ 12,000

•

Reduced Bond Trustee Fee

$ 1,000

•

Banking Fees

$ 5,000

10

Total Annual SavingsTotal Annual Savings

•

Revenue Generation

$ 549,000

•

Staff Related Reductions

$ 304,700

•

Expense Controls

$ 231,000

Total Annual Savings

$1,084,700

11

2011 Budget Assumptions2011 Budget Assumptions

•

CPI (Consumer Price Index) for the year ending June 30, 2010 is 1.7%, (US Department of Labor, Bureau of Labor Statistics, All Urban Consumers for the Denver / Boulder CO area)

•

150 new properties

•

No additional increases in late, legal, lien fees

•

Resale transfers increase 5%

•

Interest earnings at 0.75%

•

Sub-Association Services 3% average fee increase

•

Yellow Page advertising revenue $35,000

12

2011 Budget Assumptions2011 Budget Assumptions•

Overall staff salaries limited to 2% increase based on performance

•

No increase in benefited positions

•

Medical benefit maximum increase 5%

•

Property/Casualty insurance rates remain flat

•

Operating expenses from 2-4%

•

Reserve study budgeted at $10,000

13

2011 Budget Assumptions2011 Budget Assumptions

•

No change in facility operating hours

•

Eliminated low use day camp hours

•

Utilities increase over the 2010 Forecast

–

Commercial Natural gas prices to increase 15%

–

Commercial Electricity costs to increase 13%

–

Commercial Water costs to increase 3%

•

New HRMD Storm Water maintenance fee $7,500

•

Trash service savings $24,000 (Pro Disposal Preferred Provider)

•

Recreation Reserve transfer increased to $700,000

14

Administrative FunctionAdministrative Function

•

Covenants, Administration and Finance

•

Sub-Association Management

–

Serving 17 communities

•

Community Relations–

Community Events

•

Backcountry Wilderness Area

15

Community RelationsCommunity Relations

•

Community Events

–

Farmers Market/Street Market

–

July 4th

Celebration•

July 4th

Parade

•

July 4th

Community Fireworks

–

Easter Egg Hunt

–

Circus

–

Carnival

–

Teas & Tastings

–

Home Improvement Expo

–

Craft & Jewelry Shows

–

Recycling Events

–

Rodeo

–

Film in the Park

–

Trick or Treat Street

–

Mother Son/Father Daughter Masquerade Balls

–

Doggie Splash

–

Hometown Holiday Celebration

16

Administrative FundsAdministrative Funds

•

Administrative Operating Fund

•

Administrative Reserve Fund

•

Backcountry Fund

•

Backcountry Reserve Account

•

Special Project Account

•

OSCA Fund

17

Administrative Operating Fund BudgetAdministrative Operating Fund Budget

Revenues

$ 2,867,200

Expenses

2,649,200

Net Operating Revenues

218,000

Transfers 218,000

Due from Prior Years Operating Funds$ 0

18

Administrative Revenue Sources

Other Revenue3%

Assessments53%

Community Events13%

Sub-AssnManagement10%

Late, legal, lien transfer fees21%

19

-

50,000

100,000

150,000

200,000

250,000Re

venu

es

A ctual 200 4A ctual 200 5A ctual 200 6A ctual 200 7A ctual 200 8A ctual 200 9Foreca st 2 010B udge t 201 1

Year

Sub-Association Management Services

20

Administrative Expenses

Community Events7%

Transfers8%

EmployeeExpenses

57%Other Expenses

28%

21

Administrative Fund TransfersAdministrative Fund Transfers

To Capital Equipment

$ 9,000

To Administrative Reserve

$ 24,000

To Backcountry Fund

$ 160,000

To Backcountry from Special Project

$ 25,000

Total Administrative Fund Transfers

$ 218,000

22

Administrative Transfers

Reserve Fund9%

Capital Equip5%

0% Special Project to

Backcountry12%

Backcountry Fund74%

23

Administrative Capital / Reserve BudgetAdministrative Capital / Reserve Budget

CapitalComputer/Software

$ 9,000

ReserveComputer/Software

$22,000

(1/2 payment for an Event Tent) 2,000

Total

$24,000

24

2011 Backcountry Operating Budget2011 Backcountry Operating Budget

Operating Revenues

$ 55,300Transfer from Admin Fund

$ 160,000

Transfer from Special Project Acct

$ 25,000Total Revenues

$ 240,300

Less Operating Expenses

$ 240,017Less Capital Equipment Transfer

$ 21,500$ 261,517

Net Operating Revenues (Deficit)

($ 21,217)

25

Recreation FunctionRecreation Function

•

Facility Operations Function

•

Recreation Programming Function

•

Transfers

26

Recreation FundsRecreation Funds

•

Recreation Operating Fund•

Recreation Reserve Fund

27

Recreation OperationsRecreation Operations•

HRCA manages 315,000sq. ft / 7.2 acres of indoor recreation facilities.

•

Additional Outdoor Pool Cabanas + Buildings total (5) buildings or 8,600 sq. ft.

•

700+ Employees–

Only 112 Benefited Employees

•

Avg. Hours of operation,17 Hours/Day

•

Closed (4) days per year

28

Recreation ProgramsRecreation Programs

•

3 Planning periods (Activity Guides) per year

•

Diverse programming for all ages

•

Fees cover expenses

29

2011 Budgeted Program Revenues2011 Budgeted Program Revenues

•

$4,568,000 in revenues

•

25% of total revenues

•

Projecting 4% growth in 2011 revenue over 2010 Forecast

30

Recreation Operating Fund BudgetRecreation Operating Fund Budget

-

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

5.00R

even

ues

inm

illio

ns

1997 1999 2001 2003 2005 2007 2009 Budget2011

Year

HRCA Program Revenue Growth

31

Recreation Operating Fund BudgetRecreation Operating Fund BudgetRecreation Expenses

Programs OperatingExpenses

15%

Utilities7%

Transfers24%

Facility OperatingExpenses

11%

Facility OperatingStaff43%

32

Recreation Operating Fund BudgetRecreation Operating Fund Budget

Revenues

$18,439,440

Facility Operating Expenses

$ 6,861,210

Program Expenses

$ 2,746,880

Multi-Facility Expenses

$ 4,488,220

Total Operating Expenses

$14,096,310

Net Operating Revenues

$ 4,343,130

Transfers

$ 4,339,790

Net Operating Revenues after Transfers

$ 3,340$ 3,340

33

Recreation Operating Fund BudgetRecreation Operating Fund BudgetRecreation Revenue Sources

Other1%

Programs25%

Facility Operating3%

Assessments71%

34

Recreation Operating Fund BudgetRecreation Operating Fund BudgetRecreation Expenses

Programs OperatingExpenses

15%

Utilities7%

Transfers24%

Facility OperatingExpenses

11%

Facility Operating Staff43%

35

Recreation Fund TransfersRecreation Fund Transfers

To Capital Equipment

$ 46,000

To Bond Requirements

$3,593,790

To Recreation Reserve

$ 700,000

Total Recreation Fund Transfers

$4,339,790

36

Recreation Operating Fund BudgetRecreation Operating Fund BudgetRecreation Transfers

Capital Equip Net1%

Bond Repayment83%

Reserve Fund16%

37

Recreation Capital BudgetRecreation Capital Budget

Computer

$ 4,000Ultraviolet Disinfection System WR

$ 36,520

SR -

Storage Shed

5,480

Total Recreation Capital

$ 46,000

38

Recreation Reserve BudgetRecreation Reserve Budget

Computer/Software/Telephone $ 44,400

Northridge

150,510Southridge

95,740

Eastridge

158,290Westridge

91,630

Emergency Reserve

100,000

Total Recreation Reserve

$640,570

39

Recreation Reserve FundRecreation Reserve Fund

•

Used for replacement of major assets

•

Reserve study completed in 2006-Estimated replacement cost and useful life-Estimated interest earnings and inflation-Will perform new reserve study in 2011

•

2011 Transfer of $700,000 from the Recreation Operating Fund

40

Recreation Reserve FundRecreation Reserve Fund

12/31/09 Balance $3,003,412

2010 Reserve Transfers

600,000

Interest Income

25,000

2010 Expenditures

(740,000)

Estimated 12/31/10 Balance $2,888,412

2011 Reserve Transfers

700,000

Interest Income

21,000

2011 Expenditures

(640,570)

Estimated 12/31/11 Balance

$2,968,842

41

2010 Accomplishments2010 Accomplishments

•

Controlled operating costs

•

Over 100 community events

•

Developed and implemented preferred provider trash program with Pro Disposal–

No trash service fee for HRCA facilities or events

–

Direct savings for Homeowner, $1.68 Million Dollars

–

Safer and cleaner neighborhoods with one day per week pick up

•

Developed and implemented Yellow Pages Directory

•

CNN Money Magazine,

“12th

Best Places to Live”

•

Forbes,

One of the best places to move

•

Business Week, One of the best places to raise your kid

42

2010 Accomplishments2010 Accomplishments•

Lifeguarding exceeds industry standards

–

Highlighted by news media

•

Partnered with Cherry Hills Community Church a community-wide clean up day–

Over 2,500 volunteers (neighbors helping neighbors)

•

Established an Enrichment Pre-school Program

•

Expanded Programming in the Backcountry

–

Archery Range

–

Wilderness Hikes

•

Expanded volunteer efforts in the Backcountry to help save money

43

Budget Options to offset projected 2011 Budget Options to offset projected 2011 Recreation function shortfallRecreation function shortfall•

1.75% RFC Assessment increase of $.067 / mo or $8.00 / yearConsistent with 2009-10 CPI increase at 1.7%

OR A COMBINATION OF SOME OF THE FOLLOWING:Revenue Generating•

Charge non-member seniors for facility use

$ 6,000•

Charge non-member Metro District/Centennial Water staff recreation use fee

$ 8,000

•

Charge non-profit organizations for room rentals (Toastmaster, Scouts, Historical Society, etc.)

$ 5,000•

Charge all sub-associations for room rentals

$ 5,000Sub-total

$ 24,000

•

Charge every person $2.00 per visit for outdoor pool use

$173,000•

Offer non-resident Annual Recreation Memberships (150 homes @ $750) $112,500

44

Budget Options to offset projected 2011 Budget Options to offset projected 2011 Recreation function shortfallRecreation function shortfallCost Savings (implemented at all recreation centers)

–

Reduce facility staff and supplies

$150,000–

Reduce parking snow removal plowing at 4”

of snow vs. 2”

20,000–

Eliminate TV’s, music and WiFi

service

9,000–

Close outdoor pools when school begins (approx August 10th) 38,000–

Reduce volunteer / committee expenses

15,000–

Close “Drop in Childcare”

(Nurseries)

12,000–

Sub-total

$244,000

–

Reduce operating hours at each facility by two hours per day $231,000•

Reduce operating hours at each facility by one hour per day

$115,520 •

Reducing operating hours at one facility by one hour per day $ 28,880

–

Reduce funding for major repairs(Exercise equipment not replaced as needed)

$225,000

–

Reduce / eliminate proposed staff salary increases (2%)

$150,000

45

2010 Proposed Assessment2010 Proposed Assessment ChangeChange

Actual

Proposed

2010

2011

Increase

% Inc

Qtr Amt

AFCA $ 51.00

$ 51.00

$ 0 0%

$ 12.75

RFCA

$449.00

$457.00

$ 8.00

1.75%

114.25

Total

$500.00

$508.00 $ 8.00

1.57% *

$127.00

•

The CPI (consumer Price Index) for year ending June 30, 2010 is +1.70%, US Department of Labor, Bureau of Labor Statistics, Denver/Boulder region.

46

2011 Budget Summary2011 Budget Summary

•

Total Revenues projected: $21,357,290

•

Maintain quality facilities and services

47

•

37 Cultural Events•

Event Revenues

•

SCFD Grant Funded•

Community Partner funded

Separate 501(c)3 Cultural Organization

48

Cultural Affairs AssociationCultural Affairs Association

Revenues

$186,900($64,000 SCFD Grant)

Operating Expenses

$186,900

Net Revenues

$ 0

49

•

Sponsorship Funded•

Event Revenues

•

$127,000 in scholarships in 2004-2010

Separate 501(c)3 Organization

Scholarship FundScholarship Fund

50

Highlands Ranch Community Scholarship Highlands Ranch Community Scholarship FundFund

Revenues

$ 19,274

Operating Expenses 22,650(includes $20,000 scholarships)

Net Revenues (Deficit)

($ 3,376)

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