August 10, 2004
Board of Supervisors
of Sebring Improvement District
5306 Sun ‘n
Dear President, Vice President and Supervisors:
Subject: Fiscal Year 2005 Proposed Budget
I am pleased to present for your consideration the proposed operating and capital improvement budget for the fiscal year effective
October 1, 2004
September 30, 2005
(FY 2005). In accordance with the Sun ‘n Lake of Sebring Improvement District’s Charter and Policy Manual, the Board of Supervisors exercises full control over the budget and is responsible for ensuring prudent fiscal management of the district. The board will hold public hearings on the proposed budget and adopt the annual budget not later than the regular board meeting during the month of August for implementation on October 1 of the new fiscal year.
This proposed budget is a plan for funding district requirements and meeting community needs while being sensitive to competing demands. I am pleased to state that this budget holds the line on the District Maintenance Assessment. The budget is fiscally sound and balanced with NO INCREASE in the District Maintenance Assessment. We are at a crossroads where we can begin to enjoy the benefit of additional revenues from land sales and from growth within the district. With new revenue sources now available to the General Fund, we are now able to dedicate additional assessment revenue to the Golf and Restaurant Fund without impacting general operations.
Departments completed a very thorough analysis of their operations and submitted proposed budgets that included requests for new funding that were identified as critical to operations. While more than $3 million in new programs, capital outlay and capital improvement programs have been requested, only a small fraction of those new requests have been recommended for funding in the proposed Budget. The final determination for funding new programs and capital improvements will rest with the Board of Supervisors in the adopted budget that you approve.
The FY 2005 proposed budget is a continuation of the quest to address the issues and achieve the goals as outlined in the strategic planning session held by the Board of Supervisors on
March 14, 2003
. During that session, specific recommendations were made and timetables established to enable the district to move forward with growth, service to our residents, and a plan for future growth through new development. Many of these issues were addressed and put in place in the FY 2004 adopted budget. This proposed budget furthers our mission and continues to follow the priorities as set forth by the Board of Supervisors. It represents our commitment to thinking and acting strategically and striving towards making Sun ‘n
the best community in
This budget plan was developed following four (4) primary steps: identifying major issues; ensuring that the guiding principles are applied through use of the budget document; integrating the underlying philosophy, concepts, and policies contained in this document into all levels of district government; and publishing the annual budget document so that our customers and the general public will have the opportunity to learn and understand more about the financial environment and its effects on the Sun ‘n Lake operating capacity and to ensure that they are cognizant of the competing demands in the decision-making process.
I wish to thank the board, staff and community representatives who have been patient, accepting and trusting of the changes and the possibilities for the future. I believe we are on the right track in fulfilling the District’s mission and community’s vision and the organization goals: a vibrant community and “A picture perfect place to live.”
Major Items in the FY 2005 Proposed Budget
· General Fund - Annual Maintenance Assessment - Additional revenues derived primarily from land sales and expenditures in the FY 2004 adopted budget place the district in a favorable situation of not having to increase the proposed FY 2005 District Maintenance Assessment. Necessary programs and infrastructure improvements such as street paving, drainage, sidewalks and other infrastructure requirements have been funded in the proposed FY 2005 budget. No debt or loans are required or recommended.
· Golf and Restaurant Fund - I am recommending an increase in golf membership dues and fees from outside players. In addition, the $207 assessment to golfers has now been rolled into the membership dues so there will no longer be a separate bill. The new rates are listed in the rate schedule located in the Appendix of this document. Food and Beverage Operations continue to improve and should be very close to breakeven near the end of this fiscal year.
· Water and Sewer Utility Fund No increases in rates are included in the FY 2005 proposed budget plan. An in-depth rate study has been recommended in this budget to be completed in late 2004 or early 2005.
The proposed budget for FY 2005 is one that fulfills the infrastructure needs of the community, allows service to our residents and customers and continues to place the welfare of our employees at a high level. This proposed budget is a well balanced plan to keep operating expenses at reasonable levels and one that will enable Sun ‘n Lake to continue to attract new residents and also maintain our strong performance from employees. Our commitment to employees is strong and, equally important, is funded without significant financial burden on the community. Fund balance at the end
of FY 2005 will be stable and meet the boards stated priority of maintaining a reserve of 20 to 25 percent of budget.
The outlook for the district’s financial position continues to be good. With the sale of land to National Recreation Properties, Inc. (NRPI) and other outside entities vying to buy large blocks of property, our financial position has never been better.
Capital Improvement Planning and Debt Capacity
All of the capital improvement projects recommended for approval in the proposed FY 2005 budget can be funded through our current revenues sources. While borrowing is, in some instances, the prudent method to finance long term improvements, especially when interest rates are at record lows, debt financing did not occur for projects identified in the FY 2004 adopted budget. The FY 2005 proposed budget has been structured on pay as you go funding. Two large capital improvement projects not funded in FY 2005 proposed budget are a new fire station and a new community center. In the event the Board of Supervisors desires to fund these new capital improvement projects, debt financing is recommended.
The General Fund continues to be debt free. The only remaining debt is within the Golf and Restaurant Fund - financing of the 4th nine holes of golf for $1 million; and in the Water and Sewer Fund - financing of the 2nd wastewater treatment plant of $300,000. The golf loan will continue to be paid from golf membership revenues received in FY 2005.
Employee Pay and Benefits
Employees are our most valuable resource. I share the philosophy that we must be committed to compensate employees fairly, provide opportunities through training and development and professional growth, and provide an excellent benefits package. In the FY 2004 adopted budget, the board adopted a pro-employee funding package which included implementation of the classification and compensation study recommendations, a cost of living adjustment, and an enhanced benefits program for all employees. The proposed FY 2005 budget funds the continuation of these programs. The success of the District ultimately rests with the employees who are dedicated to serving the needs of the community. No single item is of more importance to the success of this District. I urge the board’s continued support for these programs.
Finally, I am pleased to submit to you the Fiscal Year 2005 Proposed Budget. I invite the Board of Supervisors to focus on the priorities, programs and objectives contained in the proposed budget. As I have previously stated, many of these programs were started in FY 2004 and this is simply a continuation towards meeting our goals as defined in the Strategic Planning Session held in March 2003.
Department Directors will present their individual budgets and requests. Many of their requests were not recommended by the General Manager, however, I have urged each department to present their respective items to the Board.
Staff and I are ready to work with you to facilitate your review and answer any questions you might have. We believe we have balanced the priorities of the Board, the needs of the community, and the welfare of our most valuable resource, our employees. I recommend this budget and believe it will move us closer to accomplishing our vision for the District.
I want to recognize the department directors and district employees who have contributed significantly to the successful development of this budget. The Budget Committee has guided the staff through this budgeting process with a singular objective, producing a balanced budget that meets the needs of the Board and serves as a planning tool for the upcoming fiscal year.
In conclusion, Mr. President, Vice President and Supervisors, staff and I are prepared to assist you in any way that we can while you consider the options before you. We are also prepared to implement the budget that you approve.
Very truly yours,
Interim General Manager