MVF Finances - September 2014

Treasurer’s Summary

Overall results through the end of September 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 $84,817 which is better than the budget and September 2013. Year to date net income is $695,790 which exceeds the budget by 76.4% and September 2013 by 345.1%.

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

- Total revenues through September were $6.1M which exceeds the budget by 2.9% and exceeds the same period in 2013 by 10.3%.

- Total operating expenses through September were $5.4M, which is 3.3% under budget and .5% over the same period last year.

- Reserve Fund contributions through September were $712,500 as prescribed in the 2014 budget.

- Year to date expenditures for reserve related assets total $1,641,148 vs. $603,745 in 2013.

- Capital contribution fees received through September were $199,894 vs 127,114 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

The results from the Foundation’s Operating Fund at the end of September, 2014.

Budget: For the month of September 2014, the revenue budget variance is lower than the budget primarily due to lower than expected revenues from advertising and camps/classes. Personnel costs budget variance is primarily due to a lower than expected seasonal wages. Operating costs budget variance is primarily due to lower than budgeted business, occupancy costs, and office supplies/expenses. The negative amount under Reserve/Capital budget shows the expected use of undesignated reserves, which was not necessary.

Prior Year: For the month of September 2014 vs. September 2013, the revenue variance is due to higher assessments from the Designated User assessment increase effective January 1, 2014 but offset partially by lower camp and class revenues and management fees. Personnel costs are higher than the year ago period primarily due to higher benefit costs vs the year ago period whereas full-time wages and seasonal wages offset favorable/unfavorable variances. Operating cost variance is due to lower costs from maintenance and legal expenses but offset partially by higher business and office supply/expenses.

The results from the Foundation’s Operating Fund through the end of September, 2014.

For the year-to-date period ending September 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 at lower graded positions, and lower than expected summer/seasonal wages. 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. Note that the September also projected to use $55,452 of undesignated reserves which was not necessary.

Balance Sheet:

As of September 30, 2014, MVF’s Balance Sheet is as follows: Through the end of September 2014, MVF continues to maintain very a solid financial position with nearly $7.4M of its $13.8M 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 $1.7M undesignated operating surplus which is partially allocated to maintain the MVF assessment the same for the 3rd year in a row.

Investment Activity:

No new activity to report. As of September 30, 2014, the reserve investment portfolio remained invested 100% in fixed income securities; however, with the recently revised Investment Policy, the committee will meet October 28 to discuss how best to diversify the portfolio based on the new policy.

Assessment Collections:

As of the end of the 3rd quarter of 2014, the unit delinquency rate decreased to 9.8%. The marks the lowest the delinquency rate has been in the 3rd quarter since 2010 and the first time since before 2004 that the rate stayed the same or actually decreased from the 2nd quarter. While, after only 1 quarter since the usual rate drop of pool season, it is difficult to determine whether it is the result of the continued and consistent efforts of the collections team purusing lawsuits, garnishments and 2014’s initiative of oral exams. Regardless, the collections team has worked very hard and deserves credit for the current quarter results!