HOA Dues: Fact or Fiction?

Layne Varney

Is it true that we had an HOA dues increase because of the redecorating and upgrades to the clubhouse?

That is 100% FICTION.

As mentioned in a previous “Fact or Fiction” article, the SunBird Golf Resort has a reserve fund, which is accompanied by a massive, almost overwhelming long-term planning spreadsheet that captures almost everything that the SunBird community owns or uses, as well as the estimated lifespan of each said item. This spreadsheet includes air conditioner replacements, flooring, painting, vehicles, furniture, lighting fixtures, roads, all sport courts, improvements to the fitness room, and pool major renovations and maintenance, and so much more.

Each year, we are surprised to find that we have more to add to this schedule. For instance, most of our glass double doors at the clubhouse needed to be replaced—and let’s not forget the elevator repairs. Each item is included in our long-term budget according to lifespan or maintenance needed. Pretty much all of the upgrades for the clubhouse and other facilities were included in the reserve fund, the capital improvement fund, or the special projects fund and has already been slotted for this year, in addition to the monies already saved and budgeted for.

This year’s dues increase actually is primarily due to the mandatory increase of the minimum wage and sick leave benefits for part-time employees. And before anyone says anything, please let it be known that no one is saying the increase is not deserving. However, it does increase costs for all businesses, employers, and consumers.

Over the past several years, the minimum wage has gone from $8.05 per hour with no sick pay for part-time or seasonal employees in 2016 to $12 per hour and up to 40 hours of paid sick time for all employees in 2020 (a more than 50% increase in wages over four years, not to mention the sick pay for all part-time employees). We also have to ensure that our full-time employees continue to receive their just and fair merit increases. Again, no one is saying it is not deserved, but it does come at a cost to the consumer.

As an example, say a cook or a server calls in sick. We now pay that employee for their time off and then pay another employee for covering their shift—essentially doubling the pay for 40 hours per year for approximately 35 employees. Then, of course, with wage increases, comes employer tax increases.

Our total HOA dues increase this year will be 4%, which equals $40 ($3.33 per month for each household). This increase is pretty reasonable, especially if it means giving employees (pending annual merit reviews) a better family wage.

Although wages and taxes are the single greatest increase in the 2020 budget, it is not the only reason the increase was necessary, and it is not because of our food and beverage amenity. As a side note, the food and beverage department had an increase of sales around 8.7% (as of the time of this article) and a decrease in expenses.

However, there will always be “cost of living” increases, such as utilities, materials, food and beverage costs. It is our hope (now that we should be up to date in the three-year tiered wage increases) that we can expect to be closer to a cost of living increase, if necessary, in the coming years.

More detail about this year’s budget has been explained at the board of directors business meetings held at 10 a.m. on the fourth Monday of each month in the ballroom. Please attend these meetings so that you can hear firsthand about all processes, and let us know your concerns. Due to schedules, this could not be included in the October edition, but hopefully, you all received the timeline for the budget process in advance and you were able to make the meetings. Be sure to mark your calendars for next year, as the timeline does not change and the process is very informative.

Timeline for budget discussion:

April: Board and department manager discussions

August: First draft budget is distributed to the finance committee

September: Finance committee review, discussion, and recommendations

September: Board of directors review and discussion

October agenda meeting: Board of directors discussion and final revisions

October business meeting: Board of directors final proposed budget and board vote

Be sure to attend your annual meeting, scheduled for March 2, 2020.

Again, if you have questions or concerns, you can always come to the board of directors meetings, finance committee meetings. You also can visit the SunBird website, contact the SunBird office, or make an appointment with Layne Varney, the SunBird general manager. He is very accommodating and able to answer any questions you may have.

“Fact or Fiction” will be a new monthly article established to help to enlighten and educate our community about the many amenities and other financial operations of the SunBird community.

Showing the state vote and the wage schedule

From the Dec. 28, 2018, Arizona Republic:

“These increases are the result of Proposition 206, a statewide ballot measure that passed with 59 percent of the vote in 2016. That proposition earlier boosted the state’s minimum to $10 in 2017 from $8.05 an hour in 2016, followed by an increase to $10.50 in 2018.The fourth hike will take the minimum wage to $12 an hour in 2020.

“Proposition 206 also required a minimum amount of paid sick leave beginning in July 2017—generally starting at five days off each year for workers at larger employers. Arizona now has one of the most generous policies in the country regarding paid sick leave.”