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HI 2015 draft budget shows losses based on two funding scenarios
HOLIDAY ISLAND -- If Holiday Island finances some of its capital projects over the next five years, it can reduce considerably its bottom line operating loss figure in 2015, according to draft budget figures considered by the board at its Oct. 20 workshop.
District Manager Dennis Kelly is proposing to finance $464,500 in capital projects through 2019 by taking out a 10-year loan. Under this scenario, the budgeted operating loss next year would drop from $217,172 to $67,942.
In 2015, he is proposing to allocate $176,000 from loan funds, with $70,000 going to a water system telemetry upgrade, $60,500 (each year for three years) to paint and rehabilitate the 9-hole drinking water booster tank on the island and $46,000 (each year for four years) to sewer lift station rehabilitation. Other projects include water meters/electronic billing software ($95,000 each year for four years, beginning in 2016), and the Fire Station #1 tank rehabilitation and paint at a one-time fee of $23,500 in 2016.
"I don't see why we should finance; we should just pay for it," said Commissioner Greg Davis about financing these projects.
"It'll cost you $130,000 over 10 years to borrow $600,000," said Commissioner Ken Mills.
"Why can't we borrow the money from our reserves and make payments back to it?" Davis asked.
Other capital projects for 2015 and beyond would be taken from reserve funds. Next year those total $325,000, while equipment reserve fund projects total $138,335.
Kelly said he is trying to "squeeze in" a 1.5 percent cost of living raise for employees. He is also ready to look at changing the undesignated reserves funding figure from 35 percent to 25 percent of budgeted expenses.
A comparison chart shows that in 2015, at 35 percent, the district would fund the reserve account with $1,018,142; at 30 percent with $872,693 and with 25 percent at $727,245. If it funds at 25 percent, it will give the district almost $300,000 more for operating expenses.
"We'd have all the money we need," he said.
Asked what is driving the request for a telemetry system upgrade, Water/Wastewater Superintendent Dan Schrader said four of the existing eight telemetry sites do not work.
"We can't see the level on the tanks," he said. "We're having to go in manually to adjust them. At night, it overflows and usually goes down the road."
He said this is "not really" contributing to the district's high rate of water loss, a statement with which Mills disagreed.
The board discussed several water and wastewater problems, from tanks needing paint and rehabilitation to pressure-reducing-valve replacements to leak detection and repair.
Road program requests include $196,800 for asphalt overlay and patching and $146,000 for road sub-base restructure.
In other projects, Golf Pro Barry Storie said he would like to have a deck off the breezeway at the Clubhouse, with a stage and garden area for photos to attract more wedding traffic. It would be built by volunteers, he said.
"I don't look at [the Clubhouse] as [belonging to the] golf course; it's more a facility building," he said, "We've done a lot with it."
Kelly said there has been increased wedding traffic.
Kelly also had scheduled $45,000 in capital costs in administration for the three apartments beneath the district office and wants to have a property management company rent them out. The district would recoup about $15,000 a year in rents, he said.
Davis suggested putting that project off for another year. Commissioner David Makidon said, "I'm not sure you could get someone in there long-term."
The board will continue to work on the budget in upcoming meetings, and Kelly said he is looking at having final approval by the last meeting in November.
The board will meet Monday, Oct. 27, at 9 a.m. at the district office at 110 Woodsdale Drive.