Current draft would see assessments increase $30

By Josh Davis, Associate Editor

(Jan. 18, 2018) Although original budget projections for Ocean Pines in fiscal year 2019 were that basic annual assessments could increase $60, that number was cut in half during deliberations between General Manager John Bailey and the budget and finance committee on Tuesday

A public hearing for the updated proposal is scheduled for Saturday at 10 a.m. at the Tern Grille.

Changes from the original proposal, as outlined by Bailey during the conclusion of the meeting, were:

• Payroll costs at the finance department would be cut by $17,853, saving about $2 in assessments. That amount would have paid for a part-time staffer.
• Payroll in public works was reduced $75,594, equivalent to two full-time employees, saving about $9 in assessments. Public works and general maintenance, collectively, added five positions last year. The agreement was made that justifications only remained for three of the five.
• An additional $47,000 was added to the fire department budget, based on a presentation by fire personnel during committee deliberations last week. That added about $5 to assessments.
• Golf revenue projections were increased by $25,000, saving about $3 in assessments.
• Payroll at the yacht club was reduced to 44 percent of expenses, cutting $238,000 from the budget and trimming assessments by about $28.

Additionally, cutting bulkhead collections reduced assessments by $19 and funding road depreciation added $26.

“It’s basically $30 off of the $60 that’s currently proposed, which leaves us with $30 instead of $33 for deficit recovery,” Bailey said.

“The hearing that’s taking place this coming Saturday … is based upon the numbers we just went through,” he added. “The PowerPoint presentation that we’re creating will be based upon what we did today.”

Bailey had proposed a separate, stand-alone assessment of $33, per property, per year, for five years, but that number decreased to $30 based on the budget alterations.

Assistant Treasurer Gene Ringsdorf cautioned against labeling the assessment a “five-year plan.”

The association ran into issues a few years back, when a capital-purchase collection labeled the “five-year funding solution” lasted seven years.

“That is just going to get us into a PR nightmare,” Ringsdorf said. “Say we’re going to attempt to reduce it through operational gains for this year, and maybe next year … but don’t say we’re going to do it for five years, because we might turn this ship around and not have to do it.

“We’ve already seen some of the reaction by labeling it a five-year plan and I think we can’t do that again,” he added.

Committee member John Trumpower also wondered if deficits from the previous two years, about $1.4 million, needed to be made up at all.

“This is not money we owe,” he said. “As a property owner I’ve already paid it, in my last year’s and the year previous assessments. There’s no legal obligation to pay this.

“I would like to see that money used for something positive going forward,” Trumpower continued. “We’ve got a new ballgame going here – let’s get some new uniforms. Let’s not look to the past as a failure … let’s move forward.”

Association Treasurer Pat Supik disagreed, saying the deficit was not merely “a balance-sheet animal.”

“It is real – it is cash that we don’t have. We have no operating reserve at all, because we budget zero and we aim for zero every year,” she said. “If we lose $1 million a year we have to fund that from the reserves, which we can’t do without a supermajority of the board.

“It means that our checkbook is a minus $1 million,” Supik added. “We do need to replace that $1 million and it needs to go into the operating account. It’s not something that we’re going to buy anything new with – we’re basically going to pay the bills we already incurred with it.”