By Robert O. Jester
Finance Advisory Committee Chair
As published in The View, April 2023:
Question of the Month: What is the annual Budget Mailer and why is it important?
Each year as required by California law, you, the residents of Sun City Shadow Hills, receive a “Budget Mailer.” The term, Budget Mailer, is probably not descriptive enough for what is really contained within it and why it is important for you to review it. I hope to let you know its importance in this article.
The cover letter sets out the applicable law that the mailer complies with and outlines for you its contents, and you will be aware quickly that the Budget Mailer contains a great deal of information that is important for you to know.
The President’s Message contains, each year, the monthly assessments that you are required to pay, and it specifies each area of the Association finances that it is designed to cover for the coming year. For example, you learn what portion of the assessment is attributed to the Operating Fund that covers the Association’s monthly expenses. There is also a colorful chart that highlights how much each of the day-to-day costs contribute to the total Operating Fund budget. This is followed by Pro Forma Capital Improvement and Replacement Fund Budget summaries for your information.
You are also provided the Association’s Reserve Study Summary along with the Statutory Reserve Funding Disclosure Statement. These reserve study documents explain how much of the assessment is attributed to the Reserve Fund and the Replacement Fund budget. In 2023, $62.41 of your monthly assessment goes to the Reserve Fund, which is the fund that will replace all the components used in the operation of this community that reach the end of their useful life. The actual reserve study lists all these items, but because of its length you receive a summary prepared by the reserve specialist who researched and prepared the study. The Association each year hires only reserve consultants who are registered with the state and meet the state-designated requirements to prepare such studies.
You also receive the Association’s collection policy, foreclosure policy, and its alternative dispute policy. This is followed by a summary of all the insurance coverages that the Association carries for the protection from claims and replacement of facilities.
Finally, you receive the notice of the Design Review Process that must be followed with respect to your property and the enforcement duties that this advisory committee has, if you fail to comply with the required design processes and your property repair and upkeep obligations. Many of these failures may result in fines, so it is important be aware of all the design review requirements of the Association.
So, this “Budget Mailer” is your guide to the Association finances for the next year, your monthly assessments, and the backup information that is accumulated to establish the budget and assessments. The Budget Mailer is a must-read for you to stay informed and understand your responsibilities as a resident of Sun City Shadow Hills.
Note: If you have misplaced your 2023 Budget Mailer, you may find it on the SCSH website under the HOA tab, then HOA Finance & Planning file, then Budget Mailers
Contact the author at firstname.lastname@example.org.