by Mike Conroy
Following a joint meeting with the Montgomery Village Foundation (MVF) Board of Directors and Audit Committee on August 27, the MVF Board approved the 2016 Proposed Budget for publication (see pages 29 to 36). A 30-day comment period is now open for questions or comments on the draft budget.
Executive Vice President (EVP) Dave Humpton began the meeting noting the work staff had done to prepare the draft budget. He said the focus for 2016 was minimizing assessment increases; funding strategic plan initiatives, the 50th Anniversary Celebration, priority capital projects, reserve requirements and staffing for programs and services; and updating the 5-year financial plan.
The 2016 budget calls for increases in both the MVF and Designated User (DU) assessments; the MVF increase is lower than previously projected and, and the DU increase is slightly higher than projected in the previous 5-Year Plan.
Chief Financial Officer Greg Snellings presented the proposed budget summary, noting that there would be small increases in both the MVF and DU funds, totaling $1.90 per unit, per month. He said the MVF Fund increase is lower than expected, and he hoped that by the time the budget was ready for approval, that an even lower amount could be approved; the DU Fund increase is slightly higher than expected.
In his budget summary, Snellings noted that proposed assessment increases for 2016 were necessary to keep in line with the 5-Year Plan. The MVF assessment is projected to increase $.65/month, but based on 2015 trends, may potentially be lowered before the budget is approved, and the DU assessment is project to increase $1.25/month. This increase is in conjunction with spending $258,000 from Undesignated Reserves. Over the next five years, the proposed increase in both the MVF and DU funds is approximately 3 to 4 percent per year. Increases in the DU fund will mainly be used to cover costs of renovating pools, according to the Pool Study. Apple Ridge Pool is set to begin renovation this year; upon further investigation, the North Creek and Stedwick pools have swapped places in the list, with North Creek being the next in line and slated for completion in 2019.
Snellings reported that since its inception, the Capital Contribution Fee has raised $557,282 and a projects another $108,400 in 2016. The budget proposes that $100,000 be spent in 2016 on capital projects; $40,000 for a new fountain in Lake Whetstone and $60,000 for park amenities, once the county dredging and outfall tower projects are complete.
Personnel costs include general merit and benefit assumptions for staff. The budget proposes a 2 percent merit increase pool and a continued 6 percent 401k match for staff. Due to increases in healthcare, a $20 per pay increase in flex benefit dollars is also proposed. No new positions are proposed; however, DU summer wages will increase slightly due to an increase in minimum wage requirements by Montgomery County.
Other proposed expenses include legal collection costs; bad debt; the 50th Anniversary Celebration; the final phase-in of Water Quality Protection Fee increases; postage for bi-lingual assessment notices; and user fee camp and class program costs.
Contributions to Reserves (CTR) increase slightly from 2015 to be in line with the Reserve Study, totaling $1,025,212, the first time in MVF history that over $1 million has been set aside for reserves. The MVF Fund will receive $299,000 and the DU Fund will receive $726,212, with contributions made monthly. The budget assumes a CTR on funding 75 percent of replacement costs over a 30-year period.
Reserve expenses for 2016 include: tot lot replacement; concrete and asphalt repairs; Nature Center repairs; South Valley Park field restoration and goal post replacement; MVF Office technology; community center repairs and maintenance, including the Stedwick Community Center kitchen replacement; the Apple Ridge Pool renovation; other general pool repairs; and tennis court maintenance. This amounts to a necessary $2,284,102 and another potential $637,658 in reserve spending.
The MVF 2016 Proposed Budget and budget presentation can be viewed in their entirety and are available for download on the Foundation website at www.montgomeryvillage.com. A full copy of the budget may also be viewed at the MVF Office, 10120 Apple Ridge Road, during regular business hours. Residents are encouraged to review the budget. For the next 30 days, comments or questions can be directed to CFO Greg Snellings via e-mail at email@example.com or in writing to Montgomery Village Foundation, Inc., ATTN: 2016 Proposed Budget, 10120 Apple Ridge Road, Montgomery Village, MD 20886.