Minutes for June 8,
2007
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Board of Trustees
Workshop Hearing – Budget 2007-2008
Friday, June 8, 2007
12:00 p.m. – Building D&E
The Barefoot Bay Recreation District held a workshop/hearing on June 8, 2007 in Building D&E, Barefoot Bay, Florida, to discuss the 2007-2008 fiscal year budget. Chairman John Keegan called the meeting to order at 12:00 p.m.
Thought for the Day
Mr. Keegan welcomed residents to the “continuation” of the budget workshop begun on June 1st. The agenda set out today will deal with recent changes. Ms. Daddario research indicates the District should go by Florida Statutes. Ms. Daddario will explain some of the rules and regulations the Community Manager goes by to establish a budget and balance sheet. The Board will then continue discussion of expenditures and employee salaries. Mr. Klosky will report on his meeting with the Home Owners Association regarding entertainment. Mr. Keegan assured the residents they would have a chance to talk about the budget at the regular meeting following the workshop.
Roll Call
Ms. McCahan called the roll. All Trustees were present. Counsel was not required.
Ms. Daddario commented the biggest change in the budget is the 2% COLA rather than the 5% merit and COLA increase in salaries which added approximately $92,000 to the budget. On the revenue side, Mr. Kormondy increased revenue projections for the Golf department to $769,619. EZ-Go prices are actually $8,000 not $5,000 in the capital budget. $5,000 was moved from security miscellaneous to the EZ-Goes. The bottom line is still $529,740 in capital expenditures. Ms. Daddario commented in prior year budgets the District proposed to spend $1,000,000 last year and $800,000 this year on capital budgets. The $70,000 that was going to come out of capital budgets and go into the operating budget is “just smoke and mirrors”. The money is still coming out of the same account. If you are only putting $529,740 in there and you’re spending a million of it, you’re going to come up “a little short”. Shortfall comes out of your reserves. Ms. Daddario’s sole intention when creating the 2007-2008 budget was to avoid depleting reserves so the District can keep a healthy position. If the District proposes to spend $800,000 this year as well, and we are only allocating $400,000 to capital, the other $400,000 has to come from reserves. This is what was budgeted last year to accomplish this year. Ms. Daddario urged the Board not to deplete reserves in the current year. The $9.00 increase that was intended to fund capital needs to stay in capital until this community is back on track. Ms. Daddario commented it will take this year and next year to complete all the projects on the list. It will be done in the most economic and efficient manner without depleting the reserves. Ms. Daddario said when she proposes cost reductions it is because she does not want the community to experience an additional raise in assessments this year.
Ms. Daddario commented the audited financial statement was presented to the District to review and finalize. She found no errors or discrepancies. It was prepared according to the GASB-34. [We] have been separating everything into funds when it should have been departmentalized. The Government is specific about funds and what they can be used for. The District has a General Fund; everything except the Debt Service should be in that General Fund. The accounting firm has combined all of the formerly individual funds. Money is differentiated and spent according to the budget. The “bottom line” is what is overspent or what [you] have left over. There are two types of financial statements used for governmental presentation. One is called a governmental statement, which is on a modified accrual basis. This is a budget-driven statement specifically identified by funds going in and expenditures coming out. The governmental statement is converted to a government wide statement in the process. Ms. Daddario discussed the differences.
Mr. Keegan commented the auditors would be present at the June 26th meeting.
Mr. Klosky reported on his meeting with the Homeowners. (Reference: attached). December 2nd appears to be the only date they want to sponsor a joint venture with the District. Ms. Daddario asked if a Homeowners event were to fall on a Friday night, are they asking the District not to have entertainment that night? Mr. Klosky replied “Yes”, but all the events the Homeowners would be holding fall on Saturdays. December 2nd, the kickoff for the Christmas season, is on a Sunday night. Mr. Keegan asked if it were true the Homeowners chose not to participate in Easter, Mother’s Day and July 4th? Mr. Klosky said that was true. They also do not wish to take over the Lounge entertainment or the street dances.
The Lounge seats 84. Mr. Allan commented even if all those people were drinking, entertainment is just not cost effective. Mr. Allan suggested having entertainment only on Fridays. Mr. Allan contends because it is the Board’s responsibility to define the budget, the Board actually does have control over who is hired and fired in that sense. If the Board eliminates the money for a position, that position no longer exists. Mr. Allan referred to a letter the Board received from the Food and Beverage Manager. Mr. Allan said he was annoyed to receive the letter a week after the Board suggested the entertainment director position should probably be eliminated. Mr. Allan suggested the Food and Beverage Manager be fired as well. Mr. Keegan reminded Mr. Allan the Board was not allowed to talk about positions. Ms. Daddario commented Mr. Allan had never come into the Administration office to review receipts; there is a difference in receipts with and without entertainment. Ms. Weglein commented during the months the snowbirds are gone receipts go down. Ms. Daddario commented she had a portfolio and resume on the Food and Beverage Manager that exceeded anyone who had been in the Bay “in years”. He has had to solve problems of improper inventories, pilfering and other mismanagement. Ms. Daddario pointed out she hired a Manager who could accurately manage an important department. Regarding the amount of time Mr. Raponi works, the “gentleman” who used to make more than double what [we] are paying Mr. Raponi, did not work 365 days a year by himself. Mr. Raponi should not be asked to work 365 days a year, either. Ms. Daddario commented Lessie was making $16 an hour; Mr. Raponi makes $12. Ms. Daddario also pointed out the bar tenders and waitresses do not have to work 365 days a year.
Ms. McCahan asked who does the clerical work for Mr. Raponi. Ms. Daddario responded Lessie had hired someone to assist her. She just didn’t give her a title. Lessie said she couldn’t work 80 hours a week, and Mr. Raponi can’t either. Ms. McCahan clarified that “This is all that would be”. Ms. Daddario responded “Exactly.” Mr. Keegan said the Bay spends about $350,000 for the pools and get no return. Food and Beverage provides $573,000 revenue. This is largely from entertainment. To abolish this revenue would have a large impact on assessments.
Mr. Allan responded that Ms. Daddario loves to point out he doesn’t visit the office; however, he phones in and talks to her. He said documents had been requested by Joe Klosky “and we still haven’t seen ‘em”. Ms. Daddario replied “They’ve been in your package twice now.” Ms. Daddario said the computer is set up to capture information by budgeted line items not by identification as “the 19th Hole” and “the Lounge”. Liquor, for instance, is bought in bulk and placed in inventory to be used where it’s needed. Mr. Klosky concurred with Mr. Allan that a breakdown of the Lounge and the 19th Hole are desirable. Ms. Crouse has concerns about the receipts from the Lounge. She did the figures in her head and surmised there might be $350 in profit on an average night with entertainment. Ms. Crouse’s “breakout” figured the cost of doing business at approximately $89 an hour. She asked Ms. Daddario if the Lounge had enough business to average $89 an hour. Ms. Daddario replied those are the day’s receipts not just 3 hours; the Dart League brings in $90 without entertainment, and staff still has to be paid. Ms. Crouse remarked that at that rate no event in the Lounge is cost effective. Ms. Daddario said the budget shows the cost of goods, i.e., alcohol and food. What is not shown is what percentage is food and what is alcohol. That information is written on each day’s receipt envelope from the individual registers. Ms. Daddario explained staff schedules and that overtime is strictly discouraged to hold down expenses. Ms. Daddario said in light of the fact that the current budget contained a $134,000 loss estimate for Food and Beverage, and currently the loss has been held to $20 or $30,000, it’s a vastly improved position. Ms. Daddario expects that by the end of the year Food and Beverage will approach “break even”. Ms. Daddario commented she’s been watching the daily receipts.
Ms. Daddario: If the strongest crowd pleaser can not bring in the revenue (Rob & Toni), then Wednesday nights are over until the snowbirds arrive. That is the kind of decision making that we do every day. We don’t just decide to spend and lose money. We watch every bit of it. We look at our daily receipts. We talk about things we can do to change things and make them better. I am not going to make a foolish decision to lose money. It is not my plan to fail at this job. So I will do whatever I need to do based upon the information that I have to make a good decision that will be for the benefit of this community. And I’m asking that you accept my advice in that respect.
Mr. Ferris concurred with Mr. Allan. Mr. Ferris referred to the Charter under Article V,“Board of Trustees, #1, General Powers and Duties.” Mr. Ferris referred to Article IV, #9 “To emloy” (Ordinance No. 84-05 attached for reference). Mr. Ferris said the first synonym for “employ” is to “assign or hire”. The antonym is “to discharge”. He said this made it clear to him the Board of Trustees does have the right to run the Bay, and that also means hiring somebody. Mr. Ferris maintained the Board has the right according to the Charter to employ positions or to discharge positions. Mr. Keegan responded that once the Board received that right from the Charter, we also have the right to delegate it. In the instance of Barefoot Bay, that has been delegated to the Community Manager. Mr. Ferris said he agreed with that, but when it comes to the budget, it is the duty of the Board to the residents of Barefoot Bay to trim it if they can and make it more efficient.
Ms. Weglein concurred with Mr. Ferris and Mr. Allan. Ms. Weglein said the Trustees are discussing positions, not the people in them. Ms. Weglein objects to the fact that the Bay is not advertising the positions that are available. And assistant to the Food and Beverage manager should have been advertised. Ms. Daddario responded that she had not created an assistant position. The person helping Mr. Raponi has been working primarily on the entertainment and advertising; Mr. Raponi delegated some of his responsibilities to her. She is not an assistant Food and Beverage person. She is doing computer research and clerical duties, and some of her time cards reflect only 16 hours a week. Prior Food and Beverage managers have had a full time assistant. Ms. Weglein pointed out the budget lists her in that position “and that is wrong”. Ms. Daddario explained the “helper” can be called anything [you] want, but the fact remains tasks must be done and one person can not do it alone. Ms. Weglein agreed no one works 365 days a year; she feels, however, even the “Entertainment Director” was not posted as a job that was going to be available, and that is a new position “with us”. Ms. Weglein commented “more and more of these positions are being filled and there is nothing posted on the bulletin board.” Or in the newspaper; it is also happening in the office. Ms. Weglein objected to moving a person from one job to another.
Ms. McCahan said when she was Food and Beverage liaison she saw that Mr. Armstrong had, in his computer, the receipts from the Lounge and 19th Hole separated. Ms. McCahan commented the real question is, are we going to support the amenities we have here even if they don’t make money. If an amenity isn’t making enough money, are [we] shutting it down, including golf? We live here. We pay fees to have amenities. That’s the basic concept. And who decides?
Mr. Keegan asked the Board for consensus: keep the entertainment expense in the budget or take it out. Mr. Allan asked it be dropped to $15,000. If the Entertainment Director is clerical, her wages can be dropped from $12 an hour to $10 an hour. Ms. Donohue reintroduced a cover charge. Mr. Keegan said that item could be voted on in the regular meeting following the workshop.
Ms. Daddario said the payroll information has been revised to reflect the 2% COLA for an overall net saving of $96,332. This amount is added into (page 5) “reserve for future contingencies”. Mr. Allan asked if this included the reduced hours. Ms. Daddario replied it does. Mr. Allan suggested $50,000 should go into the Emergency Disaster Fund and the other $50,000 go into the reserve fund. Mr. Keegan asked Mr. Allan to bring that up in the regular meeting to vote on.
Ms. McCahan commented Golf had been raised last year 5% and asked the Board to consider reducing the figure to 3%. Ms. McCahan asked that the assessment be raised $1.50 a month instead of making a jump all at once every 2 or 3 years.
Mr. Keegan said the audience will be able to respond to the workshop in the regular meeting.
Adjournment
Mr. Keegan entertained a motion to adjourn Ms. Donohue made the motion. Second Mr. Ferris. The workshop adjourned at 1:00 p.m.
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