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GM update includes latest proposed assessment figures

(Jan. 22, 2021) After five days of public budget review spread out over several weeks, the proposed assessment for fiscal year 2021-2022 now stands at $1,021. 

That represents a $35 increase over the prior year assessment of $986. However, just a few weeks prior, the proposal was for a $121 increase. 

The Ocean Pines Budget and Finance Committee held four public budget review sessions on Jan. 5-8, and the Board of Directors reviewed the budget during a single day-long session, on Jan. 19.  

Speaking on Wednesday night during his monthly report to the Board, General Manager John Viola said he factored in guidance from the committee and the Board in his latest budget reconciliation. 

Viola said the proposed assessment increase includes $30 towards rising medical insurance costs, $13 for salaries, and $7 for property and casualty insurance. Part of the increased salary costs are caused by the state's mandatory minimum wage increase, Viola said.  

Also factoring in are $17 towards Aquatics, $7 for Beach Parking, $6 for bulkheads and $5 for fire and EMS services.  

Items that lowered the recommended assessment included Public Works (-$16), depreciation (-$14), Police (-$13), Golf revenue (-$4) and Recreation and Parks and Racquet Sports revenue (-$3).  

Viola said the budget was prepared "without a COVID adjustment," meaning each department was asked to budget for a normal year. He added that some departments, like Aquatics, still budgeted conservatively. 

"Even if there isn't a COVID [pandemic], there will be some type of an effect on this amenity because it may take time for people to come back to the pools,” he said. 

"And, let's face it, we don't know what will be mandated by the government," Viola continued. "That's the effect on the assessments ... there's a lot of assumptions this year, a lot of challenges, [and] certainly a lot of variables." 

Viola said the decrease attributed to Public Works was because three open positions will not be filled.  

"We've not eliminated them, but we believe at this time that we won't have to fill them and there obviously will be savings," he said. "Same thing with the Police – we have an open position, among other things." 

Viola said drainage improvements were a top priority in the budget, and that $350,000 in casino impact grants would be reallocated for drainage projects. He said the transfer would help save homeowners more than $40. 

"Normally we have money for roads. This year, we're going to allocate that money towards drainage," Viola said. "If we hadn't done that, there would have been another increase in the assessment of $44." 

Also factoring into the budget, Viola said an expected favorability from the current fiscal year would help close out a prior-year operating deficit of roughly $180,000.  

Only three years ago, Viola said, the operating deficit totaled $1.6 million.  

"With this budget, with this allocation of favorability, the number is going to be zero," he said. "We believe we'll have extra favorability, which we right now will use as a cushion" to help protect against further losses related to the pandemic.  

Viola also gave a preview of the December financials, which show a net operating loss of $260,000 for the month. That includes a $50,000 reversal of allowance for doubtful accounts, Viola said, which was a one-time charge.  

Projections for the end of fiscal year 2020-2021 remain roughly $650,000 favorable, Viola said.  

To view the December financials, visit https://oceanpines.org/documents/10184/104881/December+2020+OPA+Financials.pdf.  

Next steps in the 2021-2022 budget process include a Board of Directors public hearing on Saturday, Feb. 6 at 9 a.m., and a final vote to adopt the budget on Saturday, Feb. 20 at 9 a.m.