CA expects level revenue, approves budget

March 08, 2009|By Larry Carson | Larry Carson,

Though the harsh economy has prompted spending cuts and increases in fees and membership rates, Columbia Association leaders say the good news in the budget for next year is that revenue is expected to hold steady and residents will see no change in the property lien rate.

The association's board of directors recently put the finishing touches on the $57.8 million spending plan for fiscal year 2010, which starts May 1. As is custom, the board made adjustments to the second year of a two-year budget approved last winter.

"This is to make sure we're in better [fiscal] health in case anything does happen to us," said Chairman Tom O'Connor of Dorsey's Search, who is retiring from the board next month. "We're still projected to have a decent year, but we're in a position so that if things go south, we should be OK."

The final vote was 7-2, with Philip W. Kirsch of Wilde Lake abstaining.

Oakland Mills board member Alex Hekimian, a longtime critic of CA spending before his election to the board last year, voted against the plan. He called for either reducing the lien rate or keeping fees and membership rates from rising.

"I wanted to give a break to Columbia residents," Hekimian said.

The other "no" vote came from Cynthia Coyle of Harper's Choice, who opposed the increase in rates and membership fees.

"We want to encourage more people to use the facilities," Coyle said. "I felt it was not necessary."

O'Connor countered that the board has taken steps in recent years in the name of fiscal responsibility. The board cut the lien rate from 71 cents to 68 cents per $100 of a home's assessed value several years ago. And last year, the board cut taxable increase in a home's value from 3 percent to 2.5 percent - half the rate used for Howard County government's property taxes.

"We've done those types of things," O'Connor said.

The association's top seven staff officials will see their annual bonus payments cut in half in the year starting May 1, and employee raises were reduced from 3.5 percent to 3 percent. The budget is crafted to leave a $3.2 million surplus designated to help reduce the organization's $37 million in long-term debt. Overall, the operating budget is to spend $57.8 million of the $61 million expected in revenues, $593,000 less than originally planned.

The board's vote last week also approved an $8.9 million capital budget, though $818,500 worth of projects are deferred for fiscal 2010. That results in $1.8 million being deferred over the two-year budget period.

With the association having adopted a two-year budget in 2008, O'Connor said only relatively minor "tweaks" were made for the second year.

Those included cutting the president's 15 percent annual bonus to 7.5 percent as newly hired Phillip Nelson prepares to assume that job from retiring Maggie J. Brown. The next six most-senior officials will get a 5 percent bonus instead of 10 percent. Both cuts amount to a $55,000 savings.

The half-percentage-point drop in employee pay raises is projected to save $104,000, while $100,000 more was cut for items such as travel, training and education.

In the capital budget, $500,000 was deferred for repairs to the pond dam at Hobbit's Glen Golf Club. An additional $250,000 was deferred from stream restoration projects planned around Wilde Lake, and $300,000 in work to create a mini-water park at the Stevens Forest swimming pool was also put off.

Still, Hekimian argued that the board is undertaking too many projects before completing those already identified.

"The capital budget is still too large," he said.

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