Final Results of Finance
Committee Straw Poll
July 14, 2010
Below are the results of the recent straw poll conducted by the
Finance Committee (FC), including summaries of respondents� comments and the FC
responses to those comments. Verbatim comments are available from the FC upon
request.
Total Respondents = 42
1. Do you support creating
Reserve Funds as a way to meet large scale cyclic maintenance project costs:
Yes = 81% (34) ������� No = 17% (7) No Response = 2% (1)
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Community Comment Summary: There were no
community comments other than yes/no
2. Do you support a 1% membership fee
paid by new property owners?
Yes = 79% (33) ������� No = 21% (9)
Community Comment Summary: Five community members
provided comments to this question. One person provided comments supporting the
concept as the right thing to do for the community. Another provided commentary
regarding their concerns over creating a large reserve fund. Three comments
were provided regarding preferences for alternates to the percentage concept
for funding.
FC Response: Adequate reserves are a
standard way for Home Owners� Associations (HOAs) to
meet cyclic maintenance obligations, and membership fees of 1% are also a well
accepted rate to help fund such reserves. Moreover having adequate reserve
funds shows the fiscal responsibility of an HOA, and
can be used to advantage when selling one�s property � prospective buyers can
rest assured that the community is funding the upkeep to the facilities they
are buying into.
3. Do you support putting all but 6 Lakeshore
lots into a conservation easement with tax abatement, and putting the tax
savings into a Reserve Fund?
Yes = 90% (38) �������� No = 5% (2) ������ ��������� Depends
on the lot = 5% (2)
Community Comment Summary: Two people provided
comments to this question. One respondent did not want to sell any property.
The second comment supported placing lots into tax abatement status, but was
unsure of the correct ratio of lots in/out of abatement.
FC Response: The FC�s proposal does
not include selling any property because it believes that community sentiment
is strongly against any more development at MKL. Instead the FC proposed
reducing property taxes on the lots it does own by putting some of them into a
conserved (and thus tax abated) status.
4. If you said yes to question 3, please
answer this question: The FC recommended keeping
in their current unabated tax status the six most valuable lots, with value
based on the Harding tax assessment. The committee modified this approach based
on Inform Meeting input suggesting that tax appraisals may not be a good valuation
technique. Based on recommendations from three members of the MKL community
active in the real estate industry, the list of the six most valuable
properties was modified. Do you agree with this method for determining which
lots to keep unabated?
����� Yes = 74% (31) �������� �������� ��������� ��������� No
= 12% (5)
Depends on the lots = 7% (3) ����� ��������� ��������� No Answer = 5% (2)
Not Enough Information = 2% (1)
Community Comment Summary: Three
people provided comments to this question. One noted that they would prefer
placing ALL lots into tax abatement status. Two comments supported the methodology
used.
FC Response: The FC thought that at
this time cutting our tax bill by about 50% would satisfy the needs for the
reserve funds. Since a well run HOA should review its financial status every
five years or so, the health of the reserve system can be checked at that time
and the disposition of non-abated lots reviewed.
If you answered No to question 4, please
suggest an alternative method for lot selection:
Community Comment Summary: Three people provided
comments. Two of the comments suggested putting the lots with the highest tax
obligations into tax abatement status. The third comment raised concerns about
the selected lots and adjacent property owners.
An
additional 6 people had comments for Question #4 which did not fall into the
above two areas. One person suggested selling lots to adjacent homeowners and
putting the proceeds into the reserve fund. Four of the comments indicated
confusion over which lots were being included/excluded for tax abatement. Two
comments indicated that the respondents would prefer a different methodology be
used to select the lots.
FC Response: The FC�s goal was foremost
to reduce the community�s real estate tax obligation, and it picked a target of
about 50%. So long as sufficient lot taxes are taken off the tax rolls the only
differences for meeting the 50% by tax abating low-taxed lots vs. high-taxed
lots were: a) the number of properties that would need to be abated to achieve
the 50% figure and, b) the salability of those lots kept in a non-abated status.
The FC reasoned that if the purpose of keeping lots in a non-abated status was
for their potential sale, those lots deemed �most valuable� would also be the
most salable, and thus used that criteria in selecting lots to be kept in their
current, non-abated, status.
5. Would you like a committee member to contact
you by telephone or in person to discuss some aspect of the FC proposal?
Yes � One Respondent No � 41 Respondents
Community Comment Summary: Although not wanting
to be contacted, one respondent reiterated his comment that the Membership Fee
is unfair.
FC Response: Membership fees are a
very common way of funding the needs of an HOA or condominium, and are not considered
unfair or even regressive. It is true that someone who sells a property shortly
after buying it will not receive much benefit from their membership fee, but
that is true of almost all the fees they pay upon buying a property, e.g. real
estate commissions, title searches, surveys. And the proposed MKL membership
fee will be well known to prospective buyers as a non-refundable fee.
Please provide any other
information/opinion/suggestions/comments you�d like the FC to know:
Community Comment Summary: Fourteen respondents
provided additional comments. The majority of comments (6) acknowledged the
need for long term funding and agreed with the methodology selected. One
respondent did not think any lots should be put into tax abatement status. Two
comments did not agree with the methodology used. One respondent noted that all
lots to be sold need to �perc�. Another comment did
not support the reserve concept as presented. Two comments involved selling
lots and putting the money into the reserve funds. One comment provided
suggestions regarding road maintenance. �
FC Response: The FC thought it
unwise to continue to pay taxes on lots whose probability of sale was extremely
small and the tax savings on which could provide a ready source of income for
the reserve funds. Re the �percing� of lots, the FC
has not recommended that any lots be sold, and given the likelihood of never
selling any, paying to have them perc-tested is an
expenditure that was felt was not justified. In any case they would have to be perc-tested at the time of sale, were they ever to be sold.
�Percability� in the present is no guarantee of �percability� in the future.