Where Does CA’s Money Go

Where Does CA’s Money Go?

This article is published on the January 2018 issue of  “The Villager”.

In this issue, I am writing to show how costly it is for the Columbia Association (CA) to maintain and fix its current facilities.  This article partially responds to the question I heard during the holidays, “Where does CA’s money go?” Many residents see their annual charge continuing to increase and the gym membership is more expensive than ever.

As a CA board member, I want to make sure the association is spending its money wisely. CA has an annual budget of approximately $70 Million. Besides our human resource costs (the organization has around 270 full-time employees and 700 part-time employees), the Association must continually make capital improvements that come at a cost.

In June 2016, the CA board was presented with a 5-year capital improvement plan. Based on recently conducted facility assessments, the plan estimated the following replacement costs (in 2016 dollars) for 7 buildings:

Athletic Club replacement                  $24M

Ice Rink replacement                          $16.5M

Art Center replacement                      $3.3M

Stonehouse replacement                     $6.5M

The Other Barn replacement              $4.5M

Teen Center replacement                    $3.5M

Maintenance Facility replacement     $11.5M

As an alternative to full replacement, the report also identified needed improvements, upgrades, and repairs for each of these buildings. Ultimately, the CA board only approved funds for improvements to the Ice Rink (FY18) and the Athletic Club in (FY18-19). The proposed FY19/20 budget finishes this work and starts improvements for the Art Center and Stonehouse. In addition to these facilities, CA still has the Supreme Sports Club, Slayton House, Kahler Hall and many other facilities which need upgrades and repairs.

Five Year Capital Spending Budget

The 5-year capital improvement plan estimated that the following capital budgets were needed just to maintain, repair, and upgrade existing facilities:

FY2018           $23.2M

FY2019           $19.6M

FY2020           $17.8M

FY2021           $16.5M

FY2022           $17.5M

These budgets do not include things like dredging Lake Elkhorn, the rental of CA’s headquarters building, or construction of any new facilities. Over the next ten years, the organization needs $5M just for pond management. Using this information, a priority list was established and the CA Board budgeted money for the Ice Rink and Athletic Club. In FY19/20, we plan to spend $4.7M on the Supreme Sports Club. Into the foreseeable future, CA will continue to have multi-million-dollar capital requirements to repair/upgrade/maintain our facilities and associated items. Any decision to construct a new facility will require additional capital funding and as well as operating funds.

Renovation or New Construction

Of course, when presented with the costs of fixing/repairing/upgrading a facility, the CA Board should look at whether a replacement would be more cost effective. In fact, when considering how to proceed with the Hobbits Glen Clubhouse and Owen Brown Tennis Bubble, the CA Board decided that replacement made better economic sense. Therefore, a new Hobbit’s Glen Clubhouse was built, and a new indoor tennis facility is under construction in the Village of Long Reach.

Happy New Year and I am looking forward to hearing from you.

Chao Wu, Ph.D.

River Hill Representative to Columbia Council and Columbia Association Board of Directors

Email: superbwu@gmail.com Website: http://www.chaowu.org

Disclaimer: This letter only represents Dr. Chao Wu’s personal opinion. It does not represent River Hill Board of Directors nor Columbia Association’s Board.

 

2018-1-The Villager Cover

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