Archives for August 2015


BCA Board and Finance Committee Host Work Session on New Reserve Study

Posted August 21, 2015 at 3:11 PM
Monday, August 31, 2015
6 p.m.
Harbour Pointe Clubhouse

Message courtesy of Brandermill Community Association
As of June 30, 2015, the BCA Replacement Reserve Fund had a balance of $1,064,567. The monies in this Fund are generated each year by a portion of the general annual assessment that each member pays. These monies can be used for replacement, major repair or rehabilitation work on our common assets.

The Virginia Property Owner’s Association Act (POA) requires that associations, like Brandermill, conduct a reserve study once every five years. A reserve study identifies all of the capital assets of the association, their estimated useful life, their remaining useful life (thus identifying approximately when they will need to be replaced), and an estimated cost of the replacement. A typical reserve study will extrapolate a replacement schedule out 30 or more years. The results of the study are critically important to the long-term financial health of the association and its ability to maintain our community assets.

The Board of Directors and the Finance Committee will be holding a joint meeting to conduct an interactive work session with the Association’s contracted Reserve Advisor (Design Management Associates, Inc.). This work session will take place on Monday, August 31st at 6 p.m. at Harbour Pointe Clubhouse. Members are welcome to attend in order to gain an understanding of the Replacement Capital Reserve Fund and how the annual contribution to the fund is calculated.


Highlights of August 10, 2015 BCA Board Meeting

Posted August 14, 2015 at 4:25 PM
Important Note: The below highlights are reported based on unofficial notes taken by NRC representatives who attended the above BCA meeting. Although we believe the below reporting is reliable and strive for accuracy, we cannot assure 100% accuracy. It is recommended to all readers that they read the approved BCA Board Meeting minutes when published.

Member Voice

Mamie McNeal (Planters Wood) thanked the BCA Board for their recent success in bringing the abandoned property in Winterberry to public auction. She expressed her hope that they would soon be able to achieve similar results with the abandoned property in Fortune’s Ridge. President Davis acknowledged the special efforts of Director Pearson.

President’s Report

President Charlie Davis noted that it had been a good media week for Brandermill, referring to the recent "Best & Worst" edition of Richmond Magazine. Brandermill ranked No. 1 as the "Best Neighborhood for First-Time Home Buyers in Chesterfield" and "Best Neighborhood for Empty Nesters in Chesterfield County," while ranking third as "Best Family-Friendly Neighborhood in Chesterfield." More information on other Brandermill rankings may be found in the August 2015 edition of The Village Mill.

First Vice President’s Report

First Vice President Greg Pearson reported that we are continuing to look for volunteers for the Planning Committee and the Marketing & Communications Committee. The BCA Board noted that volunteers of the Planning Committee are needed to help plan the development of the 2016 Capital Budget.

Director’s Report

Director Bob Malek reported on the second Hydrilla meeting regarding future plans to combat the growth of hydrilla in Swift Creek Reservoir. He reminded members that 10,500 sterile carp were released into the reservoir in 2010. While the carp ate all of the hydrilla, it also consumed other vegetation. The lake is now again infested with the invasive hydrilla.

Director Malek reported that the County plans to periodically release additional sterile carp into the reservoir but in smaller quantities. The County released 1,000 carp in April of this year and will release an additional 2,000 carp in September/October 2015, followed by another release of 1,000 in the spring of 2016.

Director Malek explained that the idea is to introduce enough carp back into the reservoir to control the hydrilla but not so many as to eliminate native vegetation. Since the released carp are sterile, this phased process will ensure that not all of the carp die off at the same time and that some carp are always present to consume the hydrilla.

Director Friedel asked if the group had looked at the deleterious effects of hydrilla. He and Director Malek pointed out that hydrilla: (1) makes boating difficult, (2) is an eyesore and (3) could dramatically affect water quality since the plants release bad chemicals into the water when they die and decompose.

Treasurer’s Report

Treasurer Friedel reported County data indicated the assessed value of all commercial property in Brandermill is approximately $203.3 million. The assessed value of residential property ($843.3 million) and reconciled commercial property yields Brandermill's total assessed value at approximately $1,046,597,000. (See page 7 of the August 10, 2015 Board packet for more detail.)

Treasurer Friedel commented that the financial results for the first six months of 2015 are included in the Board Packet (see pages 8-24 of the August 10, 2015 Board packet). He noted some of the year-to-date (YTD as of June 30, 2015) Operating Budget Variances: $2,245 deficit for Annual Election, $10,003 deficit for Legal Fees and almost $7,000 deficit for Supplies. Despite these specific items, actual YTD (as of June 30, 2015) spending in the Operating budget is $33,022 below the budgeted amount.

Director Hillman asked if the pool maintenance expenditures were reflected in the financial reports; Manager Bailey answered in the affirmative (see page 11 of the August 10, 2015 Board packet).

Referring to the Replacement Capital report (page 11 of the August 10, 2015 Board packet), Director Leonard asked why some of the budgeted projects showed no spending year-to-date. He expressed his concern that we are running out of time to complete these projects during the warm months and specifically asked about the budgeted $109,000 for maintenance of the asphalt walking paths.

Manager Bailey responded that the Maintenance & Ecology Committee has been studying where specific improvements and maintenance are required and noted that the Committee is still planning to complete this work in the fall. The Reserve Advisor at the August 31, 2015 Board work session (6 p.m., Harbour Pointe Clubhouse) on the new Reserve Study will also be presenting information on what areas might need specific attention.

Community Manager’s Report

Manager Bailey reported that the rental registration letter and form have been mailed to all residential property owners and that completed registrations are beginning to be returned. The BCA is revising its rental property records and will keep those records current and accurate.

Manager Bailey reported that the Community Services Committee is discussing the possible creation of a community playground in Harbour Pointe.

He also reported that we have reached 1,006 pool memberships.

Manager Bailey expanded on President Davis' report on the "Best & Worst" edition of the Richmond Magazine, referring to the August 2015 edition of The Village Mill. A number of Brandermill's commercial enterprises, including Brandermill Woods, the Boathouse Restaurant and Gold’s Gym, has received recognition in this survey of Richmond residents. He noted that the staff is already talking about how to achieve first place in next year’s "Family-Friendly Neighborhood" category.

Manager Bailey presented draft changes to the Maintenance & Ecology Committee's charter (see pages 39-40 of the August 10, 2015 Board packet) to the BCA Board. One of the main changes would be to change the name of the committee to Community Appearance & Maintenance Committee.

In reference to Item 8 of the proposed charter change ("Engage and activate resident participation in activities that enhance the appearance, vaue and livability of Brandermill"), Director Leonard asked how the Committee proposed to carry this out. Manager Bailey cited the recent clean-up work in McTyre’s Cove and the Brush Pickup Program as ways in which this Committee would continue to work toward improving the appearance and value of Brandermill.

Director Leonard recommended that any project proposed by this or any other committee requiring the expenditure of BCA funds be justified by a cost benefit analysis. Various members of the Board and the Community Manager responded that if the money is budgeted, the proposed projects are submitted to the Community Manager and he makes the determination as to the value of the proposed project.

Director Hillman moved to approve the name and charter changes as recommended. This motion was seconded and unanimously approved.

Presentation of the BCA Student Scholarship Award to Matthew Rock

Manager Bailey announced that Matthew Rock (Sandy Brook) is the first recipient of the BCA Student Scholarship Award and reported that Rock had been presented with a scholarship check by the BCA at an earlier ceremony.

Rock thanked the Association and talked about his past participation as a volunteer with the Chesterfield County Fire Department. Rock reported he has volunteered 450 hours with the Fire Department this year and plans to start college at John Tyler in the fall, transferring after two years to VCU to complete his degree. He noted that his goal is to become a Chesterfield County Fire Marshall and Inspector.

The BCA Board presented Rock with a resolution to thank him for his volunteer contributions to Brandermill. The members in attendance applauded to show their appreciation for Rock’s contribution to the community through his work as a volunteer with the Fire Department and for his plans for the future. Several members of the BCA Board congratulated Rock for having a clear plan for his future studies and work in the community.

Consideration of Amendments to the Financial Policy – First Reading

Finance Committee Chair Bob Gregory presented the proposed amendments (see pages 41-56 of the August 10, 2015 Board packet) to the BCA Board. He highlighted some of the more important changes as recommended by a unanimous vote of the Finance Committee:
  • Reorganize the investment policy by creating a revenue subcommittee of the Finance Committee to handle investment income. This subcommittee would include the Community Manager, Finance Chair, Treasurer and other Association members with investment experience who do not have a business relationship with the BCA. This committee would look at ways to responsibly maximize the investment of Association funds.
  • Delete the local vendor preference policy. The committee feels the current policy guidelines are restrictive and recommends leaving vendor selection to the judgment of the Staff and BCA Board.
  • Recommend discontinuing use of the purchase order control system due to other controls in place to govern contracts. The amended policy would include an RFP and formal bid requirement for all contracts over $10,000. If a contract/project is between $3,500 and $10,000, the Committee recommends that a requirement of three written proposals or bids. These could be via email or letter, stating a cost estimate as opposed to the current requirement of formal bids (RFPs). The Committee also recommends that for contracts below $3,500, the purchase order system does not add to financial controls and that it be discontinued. In practice, the amended policy would require approval by the Controller for purchases/contracts under $3,500, including committees' budget requests. If not included in the budget, these contracts would go to the Community Manager for budgeting before approval by the Controller. Chair Gregory estimated that about 67% of all contracts fall within the $3,500 to $10,000 range and stressed that most of the BCA expenditures will require three written proposals or estimates.
  • Recommended lowering the amount that the Community Manager can approve from $10,000 to $5,000. This would require that projects exceeding $5,000 be approved by the BCA Board.
Note: In addition to the "Amendments to the Financial Policy" presented in the August 10, 2015 Board Packet, the NRC offers a red-lined version of this amended policy based on the last BCA Board-adopted version of the Financial Policy dated July 9, 2012, with the budget process amended on June 10, 2013. Formatting in the NRC red-line version was made for ease of readability. Any discrepancies between this version and the one shown in the Board packet are accidental, and the version in the Board packet should be considered correct.

In response to a question from Director Pearson regarding the use and control of BCA credit cards, Manager Bailey clarified that the three credit cards corresponded to corporate billing accounts.

Director Malek asked about the credit cards being under the control of the Controller. Manager Bailey explained that the credit cards are under the control of the BCA Controller and are kept in the Controller's office.

In response to additional questions from President Davis, Manager Bailey clarified that the Controller controls the use of Association credit cards and that the credit cards and receipts are returned to the Controller after use. The Community Manager and the Controller then review all credit card purchases to ensure accountability.

President Davis noted that these amendment changes are intended to improve accountability in Brandermill and avoid the financial accountability problems that other area HOA’s have experienced.

President Davis noted that the Finance Committee is also seeking comments and input from Association members as well as the Directors. He asked for clarification on the process for members wanting to give input and suggestions. Manager Bailey responded that a synopsis of the amended policy will be included in this week’s e-newsletter with a link to the full policy. Manager Bailey also noted that members may contact Chair Bob Gregory (Riverbirch Trace) or him (manager@bca.com) with input or questions.

President Davis asked the Finance Committee to clarify for the record why there is a need for this significant rewrite of the Financial Policy. Chair Gregory responded that the Finance Committee feels the current policy is somewhat outdated and that the amendments improve accountability and clarity. With regards to BCA investments, he stated that the Finance Committee felt the proposed policy changes provide for the creation of a subcommittee so that members with investment experience can be utilized as subcommittee members without needing to be full members of the Finance Committee.

Director Pearson asked why Brandermill is only charging finance charges of 8% when finance charges are commonly higher. Treasurer Friedel responded that Brandermill should work to ensure that all members are treated fairly, not necessarily to duplicate what others are doing. Chair Gregory responded that the Finance Committee will look at what is allowable in the area under the law and reconsider the current rate of 8%. Director Pearson also questioned the wording regarding late payment charges on quarterly assessments, noting that this is set at 10% but, when accrued quarterly, could total up to 40% of the total assessment.

Director Leonard asked the Finance Committee and the Directors to consider revising the current percentage that the Community Manager is authorized to exceed on a budgeted capital project. He pointed out that the current policy allows a 15% variance on budgeted projects at the discretion of the Community Manager. He noted that he feels this is too high and suggested that this is the fiduciary responsibility of the BCA Board. Chair Gregory asked what percent Leonard felt was appropriate to which Leonard responded he felt 5% would be more appropriate. Director Hillman agreed with this suggestion.

Director Malek questioned Chair Gregory regarding the funds that are invested and would be under the control of the investment subcommittee. Chair Gregory responded that these funds are part of the Reserve Fund. Currently monies in the Reserve Fund are invested in certificates of deposit which are earning less than 1%. Treasurer Friedel commented that considering inflation, this low current rate of return reduces the purchasing power of the community’s Reserve Fund. Chair Gregory suggested that members with investment experience might obtain a higher rate of return on investment without significantly increasing risk, noting that the Finance Committee needs to look at what the legal restrictions are regarding investments by HOA’s. Treasurer Friedel also suggested that there are established guidelines regarding responsible investment practices which could be used to govern the investment management by the Finance Committee.

Consideration of 2016 Budget Guidelines

President Davis drew the attention of the Directors to the 2016 Budget Guideline Questions on page 57 of the August 10, 2015 Board packet. He specifically noted the first question which asked, “What percentage of increase/decrease in non-assessment revenue should be considered? (Non-assessment revenue streams = marina, pools, boat rentals, storage lot, etc.)”

During a discussion about pool fees, Director Blom commented that the pools, with the current pool fees, have become a much more legitimate amenity. He and other Directors expressed a desire to let the pool fees stabilize as-is or to allow a slight decrease.

Director Friedel asked the Directors to consider a different approach. He asked the BCA Board to consider where it wants the community to go, including projects requiring funding, and to base its proposed budget upon that vision.

Director Pearson indicated that he would like to see a zero-based approach to budgeting. He suggested that the Directors look at the revenue; most of the Association revenue come from assessments. He suggested that we ask the Finance Committee to consider if assessments need to be increased rather than look at individual projects or line items and build from there.

Director Hillman suggested a strategic planning session is needed to determine which projects need to be included and funded. Director Pearson responded that he agreed that we need to identify new projects and existing projects that need expansion in order to determine if an increase in the budget is indicated.

President Davis asked each Director to send their answers to the Budget Guideline Questions to Manager Bailey as guidance on how the 2016 budget should be formulated.

Directors Malek and Blom suggested that Manager Bailey and/or President Davis suggest projects that might be needed to continue improving the appearance and value of Brandermill and to use this as a basis for developing the budget.

Manager Bailey clarified that questions were being posed now because he is looking for some general guidance from the BCA Board. He asked the Directors to tell him now if they wanted a budget that provides for a "no increase in assessments". This would expedite work on the budget as he would not spend months on developing a proposed budget which may include spending for new projects or increased spending on existing projects, if the BCA Board ultimately does not support an assessment increase.

Director Pearson updated the BCA Board on the HOA salary survey, noting that he has contacted 14 large scale Virginia associations. He noted that eight of these associations are interested in participating and sharing salary data by position. He expects to get final responses by the end of August. This should provide a good template for reviewing our existing salary ranges.

Director Malek then suggested that the Community Appearance & Maintenance Committee provide member suggestions to the BCA Board as a basis for building the budget. Treasurer Friedel commented that he endorsed Director Malek’s suggestion because the budget should be built from the bottom-up, beginning with the committees, rather than from the top down. He noted that building budgets from the bottom-up is the process used by corporate America.
 

BCA Work Session on New Reserve Study

Posted August 7, 2015 at 3:51 PM
The BCA Board of Directors will conduct a joint meeting with the Finance Committee on August 31, 2015 for a work session on the Reserve Study. The work session will be held at the Harbour Pointe Clubhouse at 6:00 p.m. Plan on attending to learn more about how your assessment dollars are allocated and spent.
 

Information Packet for August 10, 2015 BCA Board Meeting

Posted August 7, 2015 at 3:49 PM
The information packet for the upcoming BCA Board meeting is now available for downloading.

Agenda items include:
  • Presentation - BCA Student Scholarship Recipient Matthew Rock
  • Consideration of Amendments to the Financial Policy*
  • Consideration of 2016 Budget Development Guidelines
*Note: In addition to the "Amendments to the Financial Policy" presented on pages 41-56 of August 10, 2015 Board Packet, the NRC offers a red-lined version of this amended policy based on the last BCA Board-adopted version of the Financial Policy dated July 9, 2012, with the budget process amended on June 10, 2013. Formatting in the NRC red-line version was made for ease of readability. Any discrepancies between this version and the one shown in the Board packet are accidental, and the version in the Board packet should be considered correct.

We encourage residents to attend BCA Board meetings to learn of Brandermill "happenings". For a quick snapshot of what the BCA Board will be discussing, please read the agenda located on the first page of the Board Packet.