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As of the end of September 30, 2017, operating expenses as a whole are running below budget by 8%. As fall common area maintenance expenses are incurred, I expect that overall that percentage will drop, but operating expenses should still remain slightly below budget overall.
As expected, the largest operating expenses continue to be utilities, trash collection, landscaping, and repairs and maintenance.
Jan-September 2017 Operating Expense
The north pool area incurred some non-recurring expenses. In June, the lounge chairs were re-strapped at a cost of $3040.00. This was a much-needed expenditure and one that will extend the life of the chairs. Also in June, the north pool tile was cleaned and sealed at a cost of $1075.00, and in July a water heater was replaced at a cost of $1040.00. The south pool area had a pump replaced at a cost of $1305.00 in June. Sidewalk repairs were made in August at a cost of $4036.00. In the future, sidewalk repairs will be a reserve item expense.
Contributions to the reserve fund are at $129,000.00. We are budgeted to contribute $175,000.00, which will be met in December. All of our homeowner dues for 2017 are current and paid in full.
We have been able to earn slightly more interest on both our operating funds and on our reserve funds as interest rates have risen. Year to date, interest income is $1770.00 over last year. It is the board’s policy to keep the operating funds and reserve funds separated, fully protected by FDIC, and to earn a competitive rate of interest. The majority of our operating funds are earning between 0.80% and 0.90%. Our reserve funds are invested in money market accounts earning between 0.75% and 1.10%. In addition, the board began investing in six-month CD’s in order to earn a higher rate of interest. Currently we have a $75,000.00 CD earning 1.06% and a $55,000.00 CD earning 1.37%. The $75,000.00 CD matures in November and will be rolled over into another 6 month CD.
The board is currently working on both the operating budget and reserve budget for 2018.