As the Columbia Association board is working toward approving budgets for 2005 and 2006, the staff is attempting to dispel the belief that the homeowners association is operating with a budgetary surplus.
Despite CA being left with $4.5 million after income and expenses for 2005, Rafia Siddiqui, vice president for administrative services, told residents Thursday night at a public forum on the proposed budgets that the association still has to borrow money.
"This is not a surplus, this is not a cash flow," Siddiqui told more than 40 residents at the Slayton House in the Wilde Lake Village Center.
The association refers to the $4.5 million as an "increase in net assets," and it expects to borrow $4 million in 2005.
Joel Pearlman, a spokesman for the Alliance for a Better Columbia, a citizens watchdog group, told Siddiqui that her interpretation of the association's budget was "totally misleading." He said the $4.5 million was indeed a surplus and a profit.
"I hope it's a matter that you don't understand it, not that you're trying to mislead the public," Pearlman told Siddiqui.
However, Joan Lancos of Hickory Ridge said Siddiqui explained the budget - comparing it to a homeowner's budget - the same way Lancos had explained it to her constituents when she served on the Columbia Council.
Lancos applauded the association for improving its budget details, making it easier for people to understand.
"I see improvements in your methodology, in getting information out," she told Siddiqui.
For 2005, the association anticipates $52.2 million in income with a $4.5 million increase in net assets. The 2006 budget includes $53.4 million in income with a $5.6 million increase.
The board is scheduled to approve the 2005 budget next month, when it will also conditionally approve the 2006 budget. In a pilot program, this is the first year CA is working with a biennial budget.
CA President Maggie J. Brown said the process should save CA time while not "compromising budgetary control."
The budgets call for a 10-cent reduction in the association's annual charge, which is based on property values. That would make the rate 63 cents per $100 of valuation assessed on 50 percent of the fair market value of the property.
This move comes after east Columbia property assessments increased an average 33.4 percent when the state reassessed values in 2002. West Columbia homeowners just received their updated assessments, and properties there increased an average of 47.4 percent.
On Thursday night, Lancos - who said her home assessment jumped 58 percent - asked whether the association would consider dropping the rate more now that the west Columbia reassessment information has been released.
Siddiqui said she was sure the board is looking into a number of variables while addressing the rate.
CA's major project expenditures will include:
$1.7 million for the 2006 budget to dredge Lake Elkhorn.
$750,000 in 2006 to restore the banks of the Little Patuxent River to reduce the sediment flow into Lake Kittamaqundi.
$675,000 in contingency funds in 2005 for planning and permit fees for a new Columbia Association headquarters.
$5.3 million in contingency funds for headquarters construction costs in 2006.
Both capital budgets include funds - $100,0000 in 2005 and $125,000 in 2006 - for upgrades to some of Columbia's older swimming pools.
The budgets also include a combined $540,000 for major renovations at the Jeffers Hill and Stevens Forest pools.
That money is in addition to the more than $390,000 combined in the budgets for maintenance and adding other features to Columbia's outdoor pools.
Some residents questioned the money proposed for outdoor pool amenities.
Linda Hitzelberger, chairwoman of the Hickory Ridge Village Board, asked Rob Goldman, CA's vice president for sport and fitness, why the association needs to spend a "major chunk of change" on the pools.
Goldman said the upgrades - which are part of the council's strategic plan to revitalize Columbia's older pools - are not "based on providing a return on investment for every dollar spent."
Board member Cabell Greenwood of River Hill echoed Goldman's statements, saying that he considers Columbia's pools part of the association's community services, and that's why the pools aren't run on a for-profit basis.
"We have to be realistic with our expectations," he told the audience. "If we want those amenities, they do cost money."