The Recreation Centers of Sun City West Governing Board on May 22 unanimously approved revisions to financial policy FI‑12 that formalize a multi‑tier investment approach and expand the target equity allocation for long‑term reserve funds to 25% from 10%.

The change, advanced by the Budget and Finance Committee working group and moved by Director Novello, was presented as a way to preserve short‑term capital while seeking modestly higher returns on funds that the association does not expect to use for at least a decade.

During debate, Director Novello summarized the proposal to the board: "FI 12 is the investment of, of our, funds, investment of association funds. It's our reserve funds." He said the working group recommended codifying current staff practices and adding explicit buckets for near‑term, medium‑term and long‑term capital. Director Novello told the board that "those funds would be really retained in cash and cash equivalents" for near‑term needs, and that the recommendation would "expand ... the target for the amount of funds that we do invest in equities up to 25% from the current 10%." The changes were described as applying only to funds that the association projects it will not need for at least 10 years.

Board members stressed continuity and fiduciary caution. Director Hurley noted board turnover and warned that policy can be changed by future boards. Director Rhodes, a long‑time member of the committee, urged trustees "don't panic, stay the course" and supported the revised allocation as a prudent long‑term strategy. Directors also discussed reporting and oversight: CapTrust, the association's financial advisor, will continue to manage the fund and provide reporting that distinguishes short‑, medium‑ and long‑term allocations tied to the board's annual financial plan, the CFO said.

The motion—"that the Governing Board approve in gross language revisions to financial policy FI12 '12 investment of association funds as redlined"—was moved by Director Novello and seconded by Director Williams. The voice vote was recorded as unanimous, 8‑0, and the board directed staff to post the revised policy.

The new FI‑12 language requires the association to hold near‑term cash and cash equivalents to limit valuation risk on funds needed within five years, to maintain a medium‑term allocation for items projected within a five‑ to ten‑year horizon, and to permit a modest equity allocation (up to 25%) only for reserves projected to be held 10 years or longer. The board and the Budget and Finance Committee said CapTrust will continue to manage a single fund but will be required to provide regular summaries showing compliance with the short/medium/long‑term targets tied to the association's annual financial plan.

The vote marks a strategic change to how Sun City West intends to manage its reserves while preserving liquidity for near‑term capital needs. The board expects CapTrust and staff to present implementation details and regular compliance reports to the Budget and Finance Committee.