MVF Finances - July 2014

Overall results through the end of July continue ahead of budgeted projections led by greater than expected revenues from assessment collection fees, disclosure fees and advertising as well as lower than budgeted personnel and operating expenses.

MVF overall net income for the month is $4,807 which is greater than the budget and July 2013. Year to date net income is $896,401 which exceeds the budget by 68.6% and July 2013 by 87.3%.

The following summarizes MVF’s overall results for July 2014:

- Total revenues through July were $4.8M which exceeds the budget by 3.7% and exceeds the same period in 2013 by 10.8%.

- Total operating expenses through July were $3.9M, which is 4.6% under budget and 1.4% over the same period last year.

- Reserve Fund contributions through July were $554,169 as prescribed in the 2014 budget.

- Year to date expenditures for reserve related assets total $1,512,861 vs. $519,404 in 2013.

- Capital contribution fees received through July were $179,231 vs 105,163 in 2013. A lump sum payment of $110,000 was paid to MVF during February 2014 related to the sale of the Cider Mill apartment complex. Included in 2013 is a $39,600 payment related to the sale of the Avalon-Rothbury apartments.

Operations Fund:

Current Month

Budget: For the month of July 2014, the revenue budget variance is slightly better than the budget primarily due to better than expected revenues from disclosure fees and a recovery in the summer camps and classes but offset partially by lower management fees. Personnel costs are favorable to the budget due to lower than budgeted summer season wages due to weather related pool closings. Operating costs budget variance is primarily due to lower than budgeted business, program supplies, occupancy costs, legal costs and office expenses.

Prior Year: For the month of July 2014 vs. July 2013, the revenue variance is due to higher assessments from the Designated User assessment increase effective January 1, 2014 as well as greater assessment collection fees, advertising revenues and PPM revenues in Community Management but offset partially by lower camp and class revenues. Personnel costs are higher than the year ago period primarily due to higher seasonal wages vs the year ago period. Operating cost variance is due to lower costs from maintenance expenses but offset partially by higher office expenses and supplies.

Year to Date

For the year-to-date period ending July 2014, the budgeted revenue variance is primarily due to higher than budgeted assessment collection fees, advertising revenues, disclosure revenues via homewisedocs.com, rental fees and the capital contribution fee received from the sale of the Cider Mill apartments; however these are offset partially by a significant shortfall in camp registration revenues. Personnel costs budget variance is due to several vacant positions, which have now been filled, and lower than expected summer/seasonal wages, but is partially offset by higher than budgeted workers comp due to an adjustment based on the results of the 2013 salary audit. Operating cost budget variance is due to lower than expected business expenses, office supplies/expenses, equipment maintenance, legal and landscaping/maintenance costs. Reserve/capital costs reflect the higher revenue received from the Cider Mill capital contribution fee being moved from the Operating Fund to the Reserve Fund. Reserve contributions have been made pursuant to the budget.

MVF Balance Sheet:

Through the end of July 2014, MVF continues to maintain very a solid financial position with nearly $7.7M of its $14.5M assets (53.6%) currently invested or held in bank accounts. While using undesignated reserves the last 2 years (2012 & 2013) to keep assessments low, MVF holds nearly $1.6M undesignated operating surplus which is partially allocated to ongoing capital projects and will be used as part of the 2014 budget year to maintain the MVF assessment the same for the 3rd year in a row.

Investment Activity:

The investment committee met Monday July 14 to discuss the final draft of the proposed Reserve Investment Policy. The policy was crafted by the committee in April 2014 and was reviewed by the Audit committee in May. The final version of the policy was a hybrid of the 2 committees where the investment criteria and allocation of assets were based on the investment committee discussions and the audit committee provided recommendations on adequacy of controls. A few final revisions were made and the policy, as amended, was approved by the Board at the July Board meeting.

Capital Spending:

As of the end of July, 2014, year to date capital expenditures totaled $1,414,073 of which 1,251,885 is related to Designated Users related and $162,188 is MVF.