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Budget draft projects $894,000 increase in wages and benefits; committee hears staffing and revenue details
Summary
Finance presented the operating budget draft showing an $894,000 year‑over‑year increase in wages and benefits driven by a planned merit pool, mid‑year timing, FTE additions and insurance costs; the draft projects positive cash flow to the reserve fund and includes new and converted positions for collections and HR safety coordination.
Cliff (finance staff) briefed the Budget and Finance Committee on the proposed FY25–26 operating budget, highlighting payroll and benefit changes and key operational assumptions.
Cliff said the draft budget returns about $8.1 million in positive cash flow to the reserve calculation and funds approximately $5.6 million of proposed capital projects. He said wages and benefits in the operating budget are budgeted to increase $894,000 year over year. Components cited in Cliff’s presentation included a timing effect from this year’s wage change (July–December impact: $141,000), an up‑to‑4% merit/wage pool (budgeted impact $278,000), a minimum‑wage assumption for the latter half of the year (50¢/hour; $36,000 impact), 1.0 FTE(s) and staffing changes (~$225,000), a workers’ compensation increase ($50,000) and an assumed 8% increase in health insurance costs.
Cliff and committee members discussed two staffing changes included in the draft: moving the safety coordinator to a full‑time HR position and adding an in‑house collections clerk. Kirsten Peterson said expanding the safety role will allow more proactive investigation, training and coordination with the carrier. Regarding collections, staff said leaning at 60 days and doing more upfront in‑house collections (instead of early legal transfers or third‑party collection) increases workload but keeps control and reduces fees; staff estimated outside collection agency fees could be roughly $120,000 annually in comparable scenarios and said the association currently collects about $39,000 per month in delinquent dues activity.
Cliff also highlighted operational volumes used in the budget: about 320,000 golf rounds budgeted for the year, roughly 22,000 distinct members checking into recreation facilities (about 500,000 non‑club rec center check‑ins in the prior year), and approximately 10,382 distinct club members tracked through ClubTrack. He drew attention to a “green team” recruitment/education position (roughly 0.6 FTE) intended to introduce new golfers; staff reported the program averages about 290 participants annually and that a recent graduating cohort produced 37 graduates with 18 becoming “avid” golfers. Cliff said the projected revenue lift from green team conversions could be about $33,000 per year and roughly $500,000 over five years if similar conversion rates persist.
Cliff summarized reserve‑fund modeling: the draft projects an ending reserve fund balance of about $30,000,004.20 for FY25–26 and a fully funded balance percentage of roughly 45%. Committee members requested additional detail on staffing composition (open positions and where in the budget they are captured), and several asked staff to publish supporting line‑item detail and make schedule and committee presentations available to residents. Several committee members also asked for additional context on wage benchmarking: staff said an Employers Council/Payfactors comparison of the association’s 93 unique positions produced an average pay level at about 88% of market average for positions captured in the survey (roughly 60% of positions had a direct Arizona match and the rest used regional comparators).
No formal committee vote occurred; staff will supply further line‑item detail and divisional committee meetings (Sports Pavilion and Golf committees) will present supplemental budget details in coming days.
