June
15, 2010
Dear
MKL Resident,
The
Financial Committee (FC) of the MKL Association has studied long term capital
projects of MKL. In doing this, the FC conducted Community Outpost meetings in
2009, and recently presented its conclusions and recommendations to the MKL
community in an �Inform Meeting�, held on May 20, 2010. The Inform Meeting
Presentation, and Minutes of the Inform Meeting, can be found on the MKL
website. (Instructions on accessing the documents on the website are given later
in this email.) �Attendance at the Outpost
and Inform meetings was somewhat low, and to ensure the FC understands the
sentiment of the MKL community on its proposals, we�d appreciate you taking a
few minutes to read this summary of the FC�s findings, and provide feedback to
the FC on its proposals.
Summary
The Problem:
Long
term, large-scale maintenance projects for the lake, water company
and roads will cost MKL roughly $650,000 per decade (about $650 per-household per-year).
In the past 10 years, our dues have increased substantially, and much of this
increase was directed towards large scale infrastructure maintenance projects, which
had not been planned for. But the ravages of time continue and before you know
it, it will be time to do large scale maintenance again. The FC has proposed
several methods to ensure funding is available to meet these projects, while limiting
future dues increases to an amount necessary to meet inflationary increases in
operating expenses.
The Proposal:
1.
Establish a Membership fee for new
property owners at MKL. The FC selected this option because such fees are
common to homeowner associations and condos with common property. This fee
would be 1% of the sale price of the property, would be paid by the buyer at
closing, and would go into effect on July 1, 2011. It would not be applicable
to persons moving within the community, or to new owners receiving property via
inheritance. This fee is estimated to effect about 4 property
transfers per year, and generate $300,000 per decade. (This funding source
would effectively unload residents of dues for infrastructure projects of about
$300 per-household per-year)
2.
Reduce property taxes on Lakeshore lots
by 50%, by putting some of the lots into a conservation
easement and tax-abated status. This would render the lots undevelopable,
and thus un-sellable, in return for paying no taxes on them. (Some Lakeshore
lots are already in this status � this proposal would put more of them into it).
This proposal should generate about $190,000 per decade. The FC selected this
option because:
a.
a. Residents have indicated an aversion
to increased development at MKL. Tax savings would be a way of generating funds
without increasing dues. (This funding source would effectively unload residents
of dues for infrastructure projects of about $190 per-household per-year.)
b.
It seemed to the committee to be
wasteful of resident dues to continue to pay taxes forever on property where
there is a very high probability that it would never be sold or developed. Nevertheless,
the six most valuable lots owned by Lakeshore would not be subjected to any restrictions
and would thus be available for a future sale in the event of an unanticipated
major emergency.
3.
Continue at least half of the current
$400/yr/residence roads fee after the current road loan is paid off in 2012.
This $200/yr/residence should generate about $186,000 over the decade. As
discussed in the Q&A section of the MKL website, the disposition of the current
roads fee will be discussed at the January 2012 Annual Meeting.
4.
Put these accumulated funds into
separately (and conservatively) managed Reserve Funds.
Without
increasing dues or assessments, these measures should generate about $676,000
for the decade, approximately the dollar requirement needed to meet the
large-scale maintenance projects.
The
full Inform Meeting Presentation and Minutes of the Inform Meeting (as well as other
background material on the FC�s proposal) are available on the MKL Website. The
straw poll below is also available there. Here are instructions on how to log
onto the website:
web address: wwww.mountkemblelake.org
login: mklresident
password: 425
After
you log onto the website, the yellow �What�s New� box on the first page contains
a link to a page with information on the FC work, the Inform Presentation and
this proposal.
Thanks
for your participation and input.
The
Straw Poll: What Do You Think?
Please
take a few minutes to answer the following 5 questions and send us your
response. Note that this is only a straw
poll - your answers aren�t binding, and your votes and comments will be
kept anonymous. An official balloting process will proceed after the committee
has evaluated the responses and sentiment of the MKL community. To respond by
email just copy and paste the questions below into a reply email. �After pasting the questions, eliminate the Yes
or No you don�t want, leaving the one you do want. Please email your response
to densonlori@yahoo.com.
If you don�t want �to answer by email, you
can print off the questions or use the hard copy put in your mailbox, circle
your answers, and put it in Lori Denson�s mail box at 20 Primrose Trail. Please
vote early, but not more than once per household! We�d appreciate hearing from
you by June 24.
Straw
Poll Questions:
1.
Do you support creating Reserve Funds as a way to meet large scale cyclic maintenance
project costs:
����������������������� ��������Yes ��������No
������������������ 2. Do you support a 1%
membership fee paid by new property owners?
��������������������������������������������������
Yes ��������No
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 ��������No
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��������� �No
If you answered No to
question 4, please suggest an alternative method for lot selection:
5.
Would you like a committee member to contact you by telephone or in person to
discuss some aspect of the FC proposal?
���������������������������� ���Yes ���������No
Please
provide any other information/opinion/suggestions/comments you�d like the FC to
know: