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Pie chart of 2024 budgeted operating expenses.

Assumption of Community Operations

In late 2023, Southshore Master Association and District agreed on an optimization plan where the District would assume responsibility for operating the District’s assets.

This includes maintaining and operating the community centers and landscaping.

 

The District is in the middle of an RFP for management/hospitality services and landscaping.  The contracts are expected to be awarded at the February 2024 board meeting. 

 

The estimated date for the hand over is April 1st which coincides with the expiration of the Master Association's landscaping contract.

Budget Considerations

2024 marks the first year that all the community’s landscaping will be under the community’s control.  By the start of the 2024 growing season, filing 19 landscaping will have been accepted by the District.  This was the last section of landscaping from the community’s construction.

 

Labor costs continue to increase driving operating expenses higher.  Southshore’s operating expenses are labor driven (i.e. lifeguards, landscape maintenance, community center staffing). 

 

Annually the District’s debt service incrementally increase as principal payments increase over time.

Operating Expense Considerations

The District was able to leverage the Southshore Master Association's prior year budgets and unaudited 2023 financial statements as a basis for budgeting.

In 2023 the District performed pond maintenance and provided safety and security services.  These services will continue in 2024 and have been combined with the remaining operations.

 

 In 2022 and 2023, the Master Association performed fence repairs and staining.  The District intends to continue fence repairs and staining on a annually basis.  

Schedule of 2024 Budgeted Operating Expenses
Schedule of Debt Service
Chart with annual debt service payments and forecasted home values.

Debt Service Considerations

As of January 1st, 2024, current outstanding debt totaled - $57,530,000.

 

Total 2024 debt service payments will be $3,294,143 with principal balance decreasing $1,445,000 or 2.5%.

Although Southshore is not completely built-out,  current home values are at a point that the community can fund future debt service obligations without an impact to operations. 

 

The chart reflects annual debt service payments and current home values increasing just 1% every two years reflecting estimated future homes values outpace annual debt service obligations.

Reserve Considerations

Reserve funds are dedicated for future planned expenditures supported by an independent reserve study.

 

Reserves are available to fund expenses without sacrificing day to day operations.

 

Reserves are only needed for organizations that own or have contractual obligations.

As of November 30, 2023, the District had a general fund cash balance of $1,918,806.

 

In 2024, the District budgeted $530,622 in reserves contributions.

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