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Westside Board Approves Hefty Dues Increase
Written by Greg Hankins, Editor   
Sunday, 13 December 2009

    Looking to rebuild its reserve funds after spending more than $500,000 on repairs to the Lake Auman dam, the Westside Board on Friday approved a dues increase of thirty-six percent on improved lots and sixty-nine percent on unimproved lots.
Image    Homeowners will see their annual dues increase from $705 to $960, while the dues for lot owners will jump from $425 to $720. Members of the Seven Lakes West Landowners Association [SLWLA] will be asked to ratify the increases by voting to approve the Fiscal Year 2010-2011 budget at the annual meeting in March.
    The West Side last increased dues in FY 2007-2008, by roughly five percent.
    "We have advanced our dues significantly," Director John Hoffmann said after the Board's vote to approve the new Fee Schedule, "under the overarching premise of building reserves. I don't think anyone can fault us for that. We just spent a half million dollars on the dam, and we have the schedules for road paving and so forth that show we need the money to be out there at X date. So everything we are doing is very fiscally sound."
    Board members acknowledged that, because previous boards had deferred dues increases in order to allow all Westside neighborhoods to reach dues parity, they were faced with asking the landowners to approve an unusually large increase this year.
    "We're establishing the baseline from which future increases are going to be, percentage-wise, significantly smaller than this," Secretary Ed Tuton noted.
    Still, Community Manager Joan Frost said, Westside dues are a bargain. "Of all the communities we manage, you have tremendous amenities, beautiful amenities, for a very, very low rate," Frost said.
    Dues parity became an issue for the Association when the Westside neighborhoods were merged into a single Association in 2004. Beacon Ridge and Pinnacle landowners were paying dues significantly lower than those paid by landowners in Seven Lakes West proper. A schedule of regular increases for Beacon Ridge and The Pinnacle was negotiated as part of the merger agreement. Last year, all communities reached the point at which their dues were equal.
    The Board's approval of the dues increase was made contingent on a review of the Association's legal documents by Director Ed Silberhorn. Silberhorn and other Board members recalled being told, at some point, that the ratio of homeowner's vs. lot owner's dues was stipulated in the Association's legal documents. Though that seemed likely to turn out to be an urban legend, Silberhorn planned to review all of the documents to make sure — including all six sets of covenants for the various neighborhoods that make up Seven Lakes West.
    A presentation on the FY 2010-2011 budget is planned for the January 26 evening Board Meeting. Annual meeting packets will be mailed out shortly thereafter, including a ballot that will allow landowners to vote on the budget approved by the Board on Friday.

 


Twenty-six cents to rebuild reserves
    Treasurer Kathy Kirst told The Times that twenty-six cents of every dues dollar paid in FY 2010-2011 will go for rebuilding the Association's reserve accounts, fourteen cents will be spent on capital projects, and the remaining sixty cents will cover operations.
    The FY2010-2011 budget allocates $634,700 to capital expenditures, including a contribution of roughly $440,000 to the Association's various reserve funds. By contrast, this year's budget contributed only $30,000 to reserves.
    Kirst told The Times that the community will need to spend more than $6 million over the next twenty-five years on capital projects, according to the latest audit of Association books. A repaving schedule developed by former Infrastructure Director Ray MacKay indicates SLWLA will need $1 million for that function alone by 2014. The road reserve currently stands at $306,000. So the budget approved by the Board includes a $250,000 contribution to the road reserve account.
    Total reserves were $1.3 million going into FY 2009-2010, but $553,000 in expenditures — mostly the Lake Auman Dam remediation — had reserves down to $758,000 by August, the lowest level in years.
    
Critical capital projects
    The proposed budget includes same-year funding for several capital projects that Board members characterized as critical, including:
    •    $31,000 for repairs to the dams on three ponds, including the lower Lakeway Mall pond.
    •    $27,000 for road drainage.
    •    $40,000 for repairs to deteriorating culverts that carry water under Longleaf Drive.
    •    $20,000 for license plate detection cameras at the gates.
    •    $15,000 for the installation of six fire hydrants.
    •    $9,000 for road shoulder erosion control.
    •    $10,000 to continue the Lakeway Mall Drainage project.
    •    $16,000 to develop a master plan for the front and back entrances. The Board approved a contact with the firm LandDesign for this item during the Financial Retreat.
    •    $18,000 for fencing adjacent to the Parkwood Subdivision, which will connect with fencing installed last year back of West Side Park.
    •    $15,000 for guardrails on either side of Longleaf Drive drive at its intersection with Lakeway Drive.
    "Most of this has to do with the roads, dam repairs, and storm drainage issues that require us to take action," Infrastructure Director Goodman said. "It's the only prudent thing we can do. They're all high priorities because they are unavoidable."
    
Fee Schedule revised
    In addition to approving an increase in landowners dues, the Board adjusted several other fees — though the objective was more to improve operations than to raise revenue. Fee income is a relatively minor portion of the Westside's revenue stream. Of the $1.7 million in anticipated FY 2010-2011 revenues, $1.47 million will come from landowners dues.
    Adjustments to the fees included:
    •    West Side Park Great Room rental fees were raised from $300 to $400 for informal groups and non-profits, and from $700 to $1,000 for outside organizations using the facility.
    •    Fees for the boat and trailer storage lot were modified to reflect the amount of space the trailer or RV actually occupies.
    •    A $150 transfer fee was added to cover the administrative costs of adding a new member to the Association, to be paid as part of closing costs.
    
Pool access procedure changed
    In the fee schedule approved on Friday, the Board simplified fees for use of the West Side Park pool, dropping the weekly, monthly, and season passes offered this past Summer, leaving only the $5 per day guest pass. Though it is not part of the budget per se, the Directors reached consensus on new procedures for pool access, based on input from a Community Manager for a CAS-managed community in Durham.
    Next season the Association will issue photo ID cards to landowners. Two adults will be designated the "primary cardholders" for each household and will be able to bring up to four guests each to the pool. Other members of the household aged 16 or older will be "secondary cardholders," able to visit the pool unescorted, but not permitted to bring guests.
    Any guests in excess of the four allowed each primary cardholder will be required to pay a daily $5 fee for use of the pool.
    The Durham community that SLWLA is using as its model for this system uses photo IDs that are also electronic "proximity cards" that can be used to open the pool gate. The West Side will not use the electronic cards during the 2010 pool season, but has set aside $15,000 in the capital budget as a reserve against installing a proximity card system in spring 2011.
    A big change at the pool will be the removal of the diving board, which will allow the pool to be operated without lifeguards — a savings of $15,000 in the operations budget.
    
Other budget issues
    Also during Friday's Financial Retreat the Board:
    •    Eliminated the Fourth of July fireworks display, which cost $10,000 last year and was expected to cost $14,500 next year.
    •    Added a new $3,000 line item for the assembly and disassembly of the community's Christmas decorations. Director Milligan pointed out that volunteers could not be counted on to be able or willing every year to devote the hundreds of hours that went into assembling this year's holiday display.
    •    Turned down a $90,000 request from Director Hoffman that would have paid for manning the back gate for up to nine months. Hoffmann had planned to install a temporary guardhouse at the gate, at a cost of $5,000 — in order to allow residents to experience the benefits of a manned back gate — and then survey the community on its willingness to fund that security enhancement on an on-going basis. The $90,000 would have funded full-time guards, assuming the Board decided to make the manned back gate permanent.
    •    Turned down a suggestion from Treasurer Kathy Kirst that a separate dues charge be eliminated for undeveloped lots that are used solely for septic fields. Director Adam Wimberly said he saw the advantage of the move to the owners of the lots -- but not to the Association. He noted that the Architectural Review Committee is forming a subcommittee to explore a variety of issues surrounding "septic" lots.
   
 
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