by Jan Ek
Financial Report:
Litigation is pending against the Recreation Centers of Sun City, Inc. (“RCSC”) concerning the organization’s authority to assess the Preservation and Improvement Fee (“PIF”) used to fund major structural improvements and restorations to the recreational facilities in the community. While RCSC believes the challenge is without merit, RCSC has a responsibility to proceed with caution until the issue is resolved. In view of this, by unanimous vote of the Board of Directors, RCSC has suspended new PIF contracting until further notice. This means the Willowcreek/Willowbrook golf course project and the South pro shop/golf cart storage project scheduled for 2017 will be postponed.
RCSC completed 2016 well within its operating and capital budget for the year. We ended 2016 with an $821k positive variance from budget in gross income; $109k of such coming from the golf division alone. In 2016 we operated $461k better than budget for wages, payroll taxes and employee benefits and we also spent $551k less on general operating expenses than budgeted. However, we spent $543k more on repairs and maintenance than budgeted and $226k more on utilities than budgeted. Additionally, our cost of insurance for the operation of the corporation was $58k more than budgeted.
Each division operated better than budget as follows: Building & Infrastructure ended 2016 with $668k positive variance from budget; Member Services accumulated a $116k positive variance from budget, the General & Administration Division operated $303k better than budget, Food Service Division had a $27k positive variance from budget, Bowling operated $27k better than budget and Golf beat their budget by $138k. Overall our net excess before depreciation was $1,279,277 better than budget for 2016.
Please remember that the net excess before depreciation is used for capital expenditures, which always includes any capital project under $300,000 or one with a useful life of less than 15 years.
Bowling:
The annual New Year’s Eve party was held at Lakeview Lanes and 147 bowlers attended. Champagne was provided to all of the party goers to ring in the New Year! Add prizes and drawings and a good time was had by all. As always Roger Beebe and the Sun City Bowling Association did an outstanding job organizing and sponsoring the event.
Beginning February 1, the RCSC Bowling Division will be raffling two bowling balls for RCSC Cardholders that are rostered members of an RCSC bowling league. The bowling balls were donated by Sun City AZ resident Bruce Lamb of Your Strike Shop. There will be two winners (one man, one woman) and the drawing will be held on March 6, 2017.
Cardholder Services:
Payments on past due assessments decreased again in December with the rate being 8% of the past due balance. In contrast to November, overall accounts receivable decreased by 1.3% in December. This decrease was exclusive to current assessments with all past due categories staying flat or increasing. November assessments went 30 days past due at a 6.9% rate, which is the highest monthly rate in three years. October assessments went 60 days past due at an increased rate as well of 4.2%. Payments from our third party collections firm ended the year with payments in 2016 totaling $211,937.
Payments made by Cardholders through the online RCSC Web Portal in December totaled $57,012. Year to date web portal payments totaled $955,789, short of the $1M mark. In 2016 over 3,600 property owners used the web portal to make payments.
Overall Total Accounts Receivable was unchanged in December from the start of the year. A chart of the ending Total Accounts Receivable for the past eight years is below.
In December, property transfer related balances decreased by almost 8% and lender owned related balances decreased by 10% in December. Outstanding balances related to property transfers represent approximately 52% of all receivables due and 55% of past due balances.
Trustee sale notices on Sun City AZ properties increased again to 54 properties at the end of December. The number of properties owned by lending institutions remained relatively unchanged this month at 16 properties.
Human Resources:
RCSC offers a workplace wellness program to employees designed to support healthy behavior in the workplace and improve health outcomes. The stated goal is to improve employee health while helping to alleviate the impact of enormous increases in medical insurance premiums.
As an incentive, participants are offered a reduction in their cost of the shared insurance premium. Annually, those individuals participate in a Health Risk Assessment which includes biometric screenings followed by completion of an online health assessment. Screenings, scheduled for next week, include: total cholesterol, HDL cholesterol, blood pressure check, glucose and waist circumference measurement. Those completing the process will receive a reduction in their medical insurance premium for 2017.
The passing of Proposition 206, The Fair Wages & Healthy Family Act, raised Arizona’s minimum wage to $10 per hour effective January 1, 2017. As a result, RCSC’s pay ranges required revision and employees pay had to be adjusted to at least the minimum of their range by January 1. In addition, the new law requires employers to post the labor law poster, communicating the new minimum wage, on employee bulletin boards in each work location. RCSC is in compliance with the requirements.
Member Services:
On Wednesday, January 11, we kicked off our Sundial concert series with Journey Unauthorized, a tribute to the band Journey. What a way to start the series! It was fantastic to see all those who came to the front of the stage to dance and sing along with the band.
Discover Sun City AZ, a program designed to let new residents in Sun City AZ become familiar with RCSC, Chartered Clubs and other valuable organizations in our beautiful active adult community was held Wednesday, January 18.
We ended January with a tribute to the Righteous Brothers on the 25th. They wooed our sold out crowd with all the hits that put the Righteous Brothers on the charts!
We have four more shows in February at Sundial that you won’t want to miss. Remember, reserved seating tickets are still on sale at the Clubs & Activities Office in the Lakeview Center.
On Wednesday, February 1 we present Strait Country, the most true-to-life George Strait tribute performance in the Valley today. On February 8, we bring the Original Grass Roots singing all their hits! We then welcome to the stage Fairchild Blues, a tribute to the Blues Brothers on Wednesday, February 15! The following Wednesday, February 22, we will present Yesterday, a band who has performed all over the world, portraying the Beatles!
Last, but certainly not least, we strongly recommend that all RCSC Members attend the Annual Membership Meeting in the Sundial Auditorium on Monday, February 27 at 6pm. Please attend and review the 2016 highlights, the goals and objectives planned for the future and the 2017 budget.
General:
For those who may not be aware, the monthly management reports are available on our website www.suncityaz.org under the RCSC tab. Also, if you have not done so already please sign up on the RCSC email list where you can designate topics of interest and stay in the loop with RCSC news alert emails!