(Dec. 10, 2015) Despite its exclusion from the budget guidance document recently approved by the OPA Board of Directors, the notion of a financial rollover mechanism refuses to, well, roll over.
The issue was brought up again last Thursday during a budget and finance committee meeting in the administration building. The advisory group originally floated the notion of a rollover, or “grandfathering” clause, during a meeting in September.
Essentially, the mechanism would create a process for money that was earmarked for a project, but not spent, to carry over into the next budget without again going through the approval process.
When Director Tom Terry brought that to the board the following month, however, it was removed from the draft document. According to Terry, the concept was too difficult for some to swallow.
“It is not an easy thing for people to understand,” he said on Thursday. “There are people on the board today who believe you should have everything completely done – all the business plans, everything in line – before you put anything in a budget.”
Terry said he was a big believer in the concept, but admitted, “I didn’t win this one. I just couldn’t get it across as to what we were trying to do.”
He went on to say part of the problem was that the rollover became “more of a political issue … than it is a money management issue.”
“When you spend dollars that technically weren’t in the budget, people raise their hand and [say], ‘there they go again, spending unbudgeted dollars,’” Terry said, adding, “There were other agendas that got attached to this that muddied the water.”
Assistant Treasurer Pete Gomsak agreed the issue became political.
“Good common sense judgments by the board to do something that didn’t get completed the year before resulted in certain segments of the community being critical of the board for unauthorized, unbudgeted items,” he said. “It can be solved very simply by good board decisions and being able to withstand criticism.”
Budget committee chairwoman Pat Supik said the group would work on its own resolution to define a rollover mechanism and would likely introduce that to the board in January.
“We’re going to work on a model to define the structure,” she said. “I’m hoping the reserve study [also due in January] may give legs to the concept of rollover capital.”
Also included in the original budget guidance sent to the board was a salary review, the addition of human resources and IT positions, consolidating contracts by including outside vendors, and creating a nonresident membership fee for using association facilities.
Virtually all of those proposals were either modified or outright rejected by the time the final budget guidance document was approved in November.
Terry said the salary study did not make the final cut, but added that the board could revisit that notion in the future, possibly doing it internally. The IT position, he said, was included in the final document, but the human resources was not.
He also said the suggestion of consolidation was somewhat redundant with current practices, and said “some form” of nonresident fee could be in the works, but that it was not included in the approved budget guidance.
The issue was brought up again last Thursday during a budget and finance committee meeting in the administration building. The advisory group originally floated the notion of a rollover, or “grandfathering” clause, during a meeting in September.
Essentially, the mechanism would create a process for money that was earmarked for a project, but not spent, to carry over into the next budget without again going through the approval process.
When Director Tom Terry brought that to the board the following month, however, it was removed from the draft document. According to Terry, the concept was too difficult for some to swallow.
“It is not an easy thing for people to understand,” he said on Thursday. “There are people on the board today who believe you should have everything completely done – all the business plans, everything in line – before you put anything in a budget.”
Terry said he was a big believer in the concept, but admitted, “I didn’t win this one. I just couldn’t get it across as to what we were trying to do.”
He went on to say part of the problem was that the rollover became “more of a political issue … than it is a money management issue.”
“When you spend dollars that technically weren’t in the budget, people raise their hand and [say], ‘there they go again, spending unbudgeted dollars,’” Terry said, adding, “There were other agendas that got attached to this that muddied the water.”
Assistant Treasurer Pete Gomsak agreed the issue became political.
“Good common sense judgments by the board to do something that didn’t get completed the year before resulted in certain segments of the community being critical of the board for unauthorized, unbudgeted items,” he said. “It can be solved very simply by good board decisions and being able to withstand criticism.”
Budget committee chairwoman Pat Supik said the group would work on its own resolution to define a rollover mechanism and would likely introduce that to the board in January.
“We’re going to work on a model to define the structure,” she said. “I’m hoping the reserve study [also due in January] may give legs to the concept of rollover capital.”
Also included in the original budget guidance sent to the board was a salary review, the addition of human resources and IT positions, consolidating contracts by including outside vendors, and creating a nonresident membership fee for using association facilities.
Virtually all of those proposals were either modified or outright rejected by the time the final budget guidance document was approved in November.
Terry said the salary study did not make the final cut, but added that the board could revisit that notion in the future, possibly doing it internally. The IT position, he said, was included in the final document, but the human resources was not.
He also said the suggestion of consolidation was somewhat redundant with current practices, and said “some form” of nonresident fee could be in the works, but that it was not included in the approved budget guidance.