“Your oil’s fine, but your blood - Sun City West Active Adult … · 2009-08-31 · Health of...

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“Your oil’s fine, but your blood-sugar level’s a little low.”

We’re a Team – With Distinct Responsibilities

Governing Board Management (GM)Hires a General Manager Hires Staff

Drafts/Adopts Policy Follows Policy

Oversight of Operation Manages Association

Reviews/Adopts Budget Proposes/Manages Budget

Seven Standing Committees Works with Committees

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1. Managing and following the Governing Documents▪ Bylaws, CC&Rs, Articles of Incorporation

Rules, Regulations and Procedures Ensuring compliance with State and Federal Laws Seeking legal advice when necessary

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2. Managing People Goal: Happy, productive & goal-oriented employees

3. Managing Assets

Protecting Facilities $150 Million in assets

Updating assets Maintaining existing assets

Managing Money Budgeting Hiring CFO Constantly monitoring expenses Ensuring GAAP is followed

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4. Working with Governing Board Board sets policy; GM carries it out Nine-directors = nine personalities GM Reports to the President Monday Ops Meetings Committees advise GM/GB Leadership is all about relationships Meetings, meetings, meetings

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5. Managing Problems Safety first

Information sharing is key

“Seek first to understand, then to be understood.”

- Steven R. Covey

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6. Planning for the Future

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“Never, ever, think outside the box.”

Long Range Planning Issues

1. Changing Demographics

2. Infrastructure Health/New Projects

3. Coordination of Community Service Agencies

4. Our Anti-HOA Planned Community Legislature

5. Water Concerns

6. Bylaw/CC&R, Age Restriction

7. Too Many Courses?

8. Energy Conservation

9. Health of Sun City West Businesses

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6. Planning for the Future

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When planting your cats, make sure to space them 6 inches apart

so they have room to grow.

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• Emails• Letters• Meetings• Walk-ins• Editorials• Social Media

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• PORA handles initial complaint (except age violations)

• May require some legal action• Face to face meetings• Legal/Court action

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Amenities & Facilities Valued at $150,000,000

• 7,035 Acres• 11 square miles• 17,106 roof tops• Population – 31,000• Annual budget $25 million• Four recreation centers• 3.2 million sq. ft. of asphalt• Seven Association golf courses• A 30-lane bowling facility with pool,

billiards and snooker tables• Private Library for membership• Two mini-golf courses• Four fitness centers• Six swimming pools

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Amenities & Facilities Valued at $150,000,000

• Six whirlpool/spas• 21 tennis courts• 5 platform tennis courts and

24 pickleball courts• 2 racquetball courts• 3 walking tracks (1 indoor

and 2 outdoor)• Woodworking shop• Metal working shop• 4 grass lawn bowl courts• 14 bocce courts• 5 shuffleboard courts

• Softball field• 2 volleyball courts• 2 dance ballrooms• Wii games• 2 dog parks (1 for large dogs

and 1 for small dogs)• Stardust Theater• 111 Charted Clubs

• You can’t please everyone.

• Be flexible.

• Check the Governing documents.

• You are not a policy-maker.

• Surround yourself with good people.

• Have a good sense of humor

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Keys to Managing a $25 Million Company

SUN CITY WESTANNUAL REPORT - JUNE 2018

General Manager

Mike Whiting

THE WOODPECKER’S GOT TO GO

• We’re in great financial shape

• No Debt

• We maintain our amenities

• Sun City West Standards

• We have over $22.5 million in reserves

• We educate our residents

• Forums

• TORCH Citizen’s Academy/ Rec Center News / Website

• Weekly/Monthly Board Meetings

• We plan for the future

• 5 Year Financial Plan

• Reserve Study

• Both are updated yearly

• We’re Tax Exempt

• No Federal or State Corporate Taxes

• Reduced Property Taxes on Golf Course Properties

• We invest our tax savings back into the Association--

• Recreational & Golf Activities

• Recreational & Golf Facilities

• Recreational & Golf Equipment

SUN CITY WEST IS 40 YEARS OLD

▪ $115 Million in Assets

▪ $65 Million in Assets Need Replacement over the next 30 years

ASSETS

151 Roofs at 302,571 Sq. Ft.240 A/C Units in service

ASSETS

2,012,238 Sq. Ft. of Asphalt Parking Lots

ASSETS

257,074 Sq. Ft of Flooring

ASSETS

Irrigation Systems (7 golf courses,

streets, landscaping)

Wells (7 at $1.5 Million)

1,000,000 gallons per course per day, 300 HP motors

ASSETS

Golf Equipment

123 units of golf course equipment includes 56 mowers (does not include any golf cars)

ASSETS

276 Sand Bunkers

Tennis Complex

16 Courts +

4 Platform Courts +

6 at Kuentz

ASSETS

Pickleball

8 Courts at RHJ +

18 Courts at Palm Ridge

ASSETS

DEL WEBB CURRENT POPULATION

AND MEMBER DUES COMPARISON

HOW DO WE STACK UP?

SUN CITY, AZ

Community Size (rooftops)

27,500

Current Member Dues

(based on 2 owner household)

$496

SUN CITY, GEORGETOWN, TX

Community Size (rooftops)

9,900

Current Member Dues

(based on 2 owner household)

$1,130

SUN CITY ANTHEM, NV

Community Size (rooftops)

7,451

Current Member Dues

(based on 2 owner household)

$1,212

PEBBLECREEK, AZ

Community Size (rooftops)

6,200

Current Member Dues

(based on 2 owner household)

$1,224

SUN CITY GRAND, AZ

Community Size (rooftops)

9,802

Current Member Dues

(based on 2 owner household)

$1,370

SUN CITY SUMMERLIN, NV

Community Size (rooftops)

7,779

Current Member Dues

(based on 2 owner household)

$1,392

SUN CITY LINCOLN HILLS, CA

Community Size (rooftops)

6,783

Current Member Dues

(based on 2 owner household)

$1,452

SUN CITY FESTIVAL, AZ

Community Size (rooftops)

7,220

Current Member Dues

(based on 2 owner household)

$1,668

SUN CITY ANTHEM, AZ

Community Size (rooftops)

3,800

Current Member Dues

(based on 2 owner household)

$1,680

ARIZONA TRADITIONS, AZ

Community Size (rooftops)

1,768

Current Member Dues

(based on 2 owner household)

$1,716

SUN CITY ORO VALLEY, AZ

Community Size (rooftops)

2,488

Current Member Dues

(based on 2 owner household)

$1,790

SUN CITY MESQUITE, NV

Community Size (rooftops)

6,378

Current Member Dues

(based on 2 owner household)

$1,824

SUN CITY ROSEVILLE, CA

Community Size (rooftops)

3,110

Current Member Dues

(based on 2 owner household)

$1,872

SUN CITY APPLE VALLEY, CA

Community Size (rooftops)

1,700

Current Member Dues

(based on 2 owner household)

$2,208

ROBSON RANCH, AZ

Community Size (rooftops)

4,600

Current Member Dues

(based on 2 owner household)

$2,362

VICTORY AT VERRADO, AZ

Community Size (rooftops)

3,500

Current Member Dues

(based on 2 owner household)

$2,400

CANTA MIA, GOODYEAR, AZ

Community Size (rooftops)

1,700

Current Member Dues

(based on 2 owner household)

$2,748

TRILOGY AT VISTANCIA, AZ

Community Size (rooftops)

5,450

Current Member Dues

(based on 2 owner household)

$3,036

SUN CITY WEST, AZ

Community Size (rooftops)

17,192

Current Member Dues

(based on 2 owner household)

$930

$465 if one on the deed (40%)

DEL WEBB

CURRENT

COMMUNITY

SIZE COMPARISON

DEL WEBB

CURRENT

MEMBER DUES

COMPARISON

MEMBERSHIP DUES

PER FY (FOR YEAR

ENDING JUNE 30)

$1

10

$1

10

$110

$127

$127

$127

$1

33

$1

33

$1

48

$1

70

$1

74

$1

80

$2

07

$2

25

$2

58

$2

96

$3

25

$3

37

$3

55

$3

70

$385

$4

08

$4

08

$420

$435

$445

$4

65

$0

$200

$400

$600

$800

$1,000

$1,200

2013 - 4.1%

Incr

2014 - 6.0%

Incr

2015 - 0.0%

IMPACTMinimum Wage + Compression

Voter Initiative

$600,000

or

$20/member

$8.05

$10.00

$10.50

$11.00

$12.00

24.2%

5.0%

4.8%

9.1%

0%

5%

10%

15%

20%

25%

$5.00

$7.00

$9.00

$11.00

$13.00

$15.00

2016 2017 2018 2019 2020

Minimum Wage 2016-2020

Min Wage % Increase

OUR ELECTRIC BILL4% rate hike - APS

Actual Projected

FY2017 FY2018

Recreation Centers $582,192 $619,500

Golf Courses $710,058 $806,600

(300 HP 1,000 ft. deep well pumps)*

*Less rain = more expense to pump water

❑ Fuel (gas) prices are up by 10%

❑ Fertilizer and chemicals costs are up (Petrochemicals)

❑ Building materials costs are up

THE RECREATION CENTERS ARE

VERY EFFICIENT ….

HERE ARE EIGHT REASONS

WHY:

GOLF

▪ USGA Recommends: 18 personnel/course

▪ Rec Centers has: 15 personnel/course

▪ Savings/Year $840,000 ($3/member)

RECREATION CENTERS

▪ Cities Provide Activities

▪ Recreation Leaders

▪ Recreation Coordinators

▪ Recreation Centers:

▪ Clubs & Volunteers

▪ Class Program – Self Sustaining

▪ 317,000 Estimated Hours (@ Minimum Wage + payroll taxes)

▪ Estimated Savings $3,750,000

AQUATIC CENTERS

▪ Cities Provide

▪ 2 Lifeguards/Pool

▪ Recreation Centers:

▪ No Life Guards/One PT Monitor

▪ 15 hours/day per pool

▪ Estimated Savings $900,000

STREET LANDSCAPING

▪ Cities

▪ Landscaper with Benefits = $38,000/year

▪ Recreation Centers:

▪ Prides x $0 = $0/year

▪ 6500 minimum estimated hours (3 FTEs)

▪ Estimated Savings $114,000

STREET MAINTENANCE

▪ MCDOT Maintains Roads

▪ 137,528 Linear Feet of Main Roads

▪ Does not include any side streets

▪ That’s 26 miles @ $550,000 per mile to repave

▪ APS Maintains Street Lighting

▪ Estimated Savings $ 14,300,000!

OPERATING EXPENSESExcludes Capital and Depreciation

▪ Employee Wages & Benefits

▪ Competitive Wages & Benefits

▪ NO Pension System

NO UNION

UNION DEMANDS = INCREASED WAGES AND BENEFITS

Facilities

Maintenance

Stats

Facilities

Maintenance

Staff

FACILITIES MAINTENANCE

▪ 240 A/C Units

▪ 208 Toilets

▪ 1,072,449 Gallons of Pool & Spa Water

▪ 159 Pieces of Exercise Equipment

▪ 2,012,238 Sq. Ft. of Parking Lots

▪ 325,321 Total Sq. Ft. Under Roof

▪ And SO much more!

15 F/T Employees and 1 P/T Employee Maintain It ALL!

“I CAN’T BELIEVE HOW MUCH THERE IS TO DO HERE!”

“I CAN’T BELIEVE HOW CLEANAND WELL-MAINTAINED IT IS!”

IN THIS 40-YEAR-OLD COMMUNITY, I HEAR TWO THINGS ALL THE TIME:

Let’s talk about water

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But seriously…

Where do we stand with water

in Sun City West?

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In 1 year, SCW uses

2,300,000,000gallons of

water

Yes, 2.3 BILLION gallons

RESIDENTIAL: 1.1 billion gallons (average resident uses 100 gallons/dayx 29,000 residents/tenants x 365 days)

RCSCW GOLF COURSES: 1.2 billion gallons (3,828 AF x 324,851 gallons/AF) ______________________________________________________Total for SCW Home and Golf = 2.3 billion gallons

Does not include commercial use

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What is an Acre-Foot?324,851 gallons

• Covers a football field to 1 foot depth

• Serves 2.5 SCW homes for 1 year

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1 acre-foot would just about fill the Chase building in Downtown Phoenix!

Name: Chase Bank CenterAddress: 201 N. Central Ave.Height: 486 feetFloors: 40

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Phoenix

Lake Mead

Lake Havasu

What happens in Lake Mead affects Phoenix and Tucson (CAP Canal)

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Arizona gets 1.6 million acre-feet/year

So what’s happening with Lake Mead?

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• Shortage would be declared at the start of a year if water levels drop below 1,075 feet above sea level

• If a shortage is declared, states must reduce water consumption

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Levels are dropping!

Dead Pool = zero water available; agreements end

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How likely arewater reductions?

So how is the Colorado River divided?

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It ONLY works if everyone is involved!

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That means

Sun City West

also needs to do its part

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RCSCW’s situation

• SCW’s 2,372 AF allotment benefits residential use

• SCW uses 3,500 to 4,000 AF/year on our golf courses • Grandfathered rights

• Effluent credits

• RCSCW golf course water is all groundwater – the Best of the Best!

• RCSCW groundwater rights are grandfathered (granted in perpetuity)

• But remember … the Colorado River Basin States are in this together!

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Water

Availability

Golf TrendsDemographic

Shifts

Three issues in particular can have dramatic impacts on our future, depending on how they trend:

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What do we know?

➢ We have a 50-year generation span with various interests

➢Demographic shifts will force changes to properties, clubs, events

➢Golf numbers will stay level or drop off

➢There will be increased demand for new, outside activities using limited greenspace

➢ Dues must remain reasonable while rising gradually to cover the costs of utilities, insurance, wages, equipment, etc.

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What are we unsure about?

➢Will drought continue?

➢Will water rationing kick in?

➢What specific facility changes will our new population demand?

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Two things we know for sure:

1. Any major changes we make to address water shortages, golf trends or changing demographics will be very expensive!

2. Planning ahead let’s us avoid special assessments.

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