Sun City West budget committee backs proposed 4.9% dues increase, defers $300,000 website project pending RFP

Christine Novello, chair of the Sun City West Budget & Finance Committee and the association treasurer, said the committee had consensus to forward the operating budget to the governing board without changes and to move a policy review (FI‑12) on to the board for final consideration.

The decision matters because the committee and residents debated how the association balances one-year operating needs with long-term capital funding. Committee members and residents discussed a $300,000 capital line for a website redesign that the governing board removed on April 17, the mechanics of the reserve fund, a projected $100,000 drop in operating interest income and the recommended 4.9% membership‑dues increase (to $598). Resident Bruce Lees urged cutting the dues rise to 3.5% ($590) and argued the stripped $300,000 could permit a smaller increase; the committee and staff explained why those accounts are modeled separately.

Committee finance staff member Cliff said, "The only change since our last meeting is that the website redesign that was in the capital budget was not voted to move forward in the budget." He and Novello explained the governing board kept the concept but directed the general manager to create a scope of work and specify it in an RFP before funding the project. Novello said that if the RFP and scope are ready, the board could reconsider the project before the next budget cycle; otherwise the item would be revisited in the following year’s budget modeling.

Staff described why association interest income on operating cash is expected to fall next year. Cliff said major planned capital spending — notably an irrigation project that started this year and is roughly $5.5 million — has reduced the amount of operating cash available to place in short‑term investments, reducing short‑term interest earnings in the operating account even though the funds are earning returns within the reserve fund. He explained that capital expenditures are paid from the reserve fund and that operations and reserve budgeting are modeled separately.

Bruce Lees, a resident who addressed the committee during public comment, said he had proposed lowering the membership‑dues increase from 4.9% ($598) to 3.5% ($590), estimating that removing the $300,000 capital line would create approximately $218,912 in budget room. Lees also questioned a projected $100,000 decline in interest income and suggested investing available operating cash in short-term CDs or high‑yield accounts.

Novello and staff replied that the association models a recurring transfer from operations into the reserve fund (a guideline discussed at about 7.5% in the packet, though Novello said that figure is not codified in policy) because assessment/permit fees and investment income alone cannot fully fund needed capital work. Staff said the $300,000 removed by the governing board remains in the reserve fund and described that removal as a deferral: the funds stay available but are not currently budgeted for project spending until scope and approval occur.

Committee members who spoke during the public portion — including Ed, Rick, David, Chris, John, Jim and Micky — described the multi‑meeting review of line items, expressed general support for the committee’s process, and urged continued transparency. Novello reminded attendees the Budget & Finance Committee will continue meeting through June to complete its work; the next meeting announced in the session is May 20 at 9 a.m. Novello also noted a separate CapTrust quarterly investment update will be presented to the governing board at its upcoming workshop.

General Manager Steven provided a real‑time operations update after a resident asked about a leaking pool roof, saying staff had identified the leak at Palm Ridge, taken interim measures and were awaiting a vendor to complete repairs.

Decisions recorded by the committee included consensus approval of the April 15 meeting minutes, a recommendation to forward policy FI‑12 to the governing board, and a committee recommendation that the governing board adopt the operating budget as proposed with no changes. The governing board’s earlier action to remove the website redesign from the capital plan was described in the meeting and staff said the board asked for more detailed scope and an RFP before any funding is approved.

The meeting included extended discussion distinguishing short‑term operating cash (used for daily liquidity and short‑term investments) and long‑term reserve fund accounting (used to pay capital projects). Staff highlighted modeling assumptions used for planning (including a modeled annual new‑capital assumption of about $1.4 million) and the committee emphasized that policy and budget choices would affect dues and reserve‑fund health over time.

Questions raised during public comment about workforce costs and the share of the budget devoted to wages prompted staff comment that Sun City West, as a service organization, typically has a large share of expenses tied to wages and benefits and that the committee and staff review such costs annually. Novello closed by reminding residents that committee applications were open (deadline mentioned in the meeting) and that the governing board must adopt the association budget by the end of May under the bylaws.