Committee weighs $6M master-plan funding options, dues/APF surcharges and timing of irrigation projects

Sun City West's Budget & Finance Committee spent the bulk of its meeting reviewing multi-year reserve-fund models and options to fund a community master plan, including proposals to collect temporary dues and APF surcharges to preserve a 40% fully funded balance (FFB) while adding capital for renovations.

Cliff (staff) presented baseline modeling that shows, under the current budget, a projected reserve balance of about $47.2 million by 2040 and an FFB of roughly $74 million (about 64% FFB) if the committee does not add master-plan capital. He identified approximately $3.6 million already sitting in reserve-study funding tied to three candidate renovation areas (the Couns, the library, and the social hall) that could be applied to master-plan projects.

To create additional capacity, staff modeled injecting $6 million of new capital for master-plan projects over four years (2M, 2M, 1M, 1M). That scenario would provide about $15.2 million for master-plan work when combined with existing annual new-capital allocations, but it would also lower near-term reserve ratios: modeling shows the FFB percent would dip below 40% around the 20292035 irrigation-project years before recovering to the 40% target by the mid-2030s.

To fund the $6 million while holding a 40% FFB in modeled scenarios, staff proposed a temporary additional dues charge of $20 per member per year and an additional $300 APF collected over five years (in addition to the budgeted dues and APF increases already included in the operating model). "If we tacked on a $20 dues increase ... and we collected that $20 for the next five years, and we also added $300 in APF ... we could fund the 6 million and hold our 40%," Cliff said. He framed the approach as preferable to a single special assessment because it spreads the cost and reduces immediate household impact.

Alternate approaches were modeled. One option lengthened the irrigation-project cadence (spreading pump-station and irrigation projects over three-year gaps rather than two). That approach required smaller annual member increases (an example modeled $5 dues and $100 APF extra) to keep the FFB at 40% but added estimated inflation-driven construction risk and a modeled $2.3 million increase in total irrigation costs if projects were deferred into later years.

Committee members stressed trade-offs: several opposed deferring irrigation projects because delay increases future costs and operational inefficiencies; others preferred the temporary dues/APF surcharge as a less disruptive alternative to a one-time assessment. Residents and online participants asked about donation or endowment options; staff said private donations are possible but legal/tax constraints limit formal endowment structures under the association's status.

Cliff said the committee's modeling and the master-plan consultant work (expected later this year) will be brought to the governing board for workshop discussion in the coming weeks. The committee directed staff to present these funding options, the reserve impact and irrigation-timing trade-offs to the board and to continue community engagement before any formal voting on rate changes or assessments.