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ATTENTION ALL HOMEOWNERS
On Wednesday, January 13th, 2021, we will be repairing an issue on the rod. Which in turn will require the building to have no hot water from 10 AM to 5 PM.
We apologize for the inconvience but the repair is neccessary.
January 7, 2021
Dear Caravelle Homeowner:
As previously communicated, your Board has been investigating the possibility of reducing various operational and financing costs without compromising the financial viability or operational stability of The Caravelle. Based upon The Caravelle’s current financial position, together with its existing monthly cash requirements, the Board is prepared to move forward on the following:
Included in a previous communication, the Board noted that The Caravelle’s water usage and related costs had increased unexpectedly.
One final note, the Board wishes to inform the membership of an ongoing situation among the Association and a number of The Caravelle’s homeowners. It involves the matter of uncollected past due assessments.
Your Board of Directors
December 22, 2020
Dear Caravelle Homeowners,
There seems to be some confusion and frustration that dues are being lowered by 10%.
Here is a recap of some of the financial concerns and obligations for which the Association continues to be responsible. A copy of the 2021 budget has been posted on the website www.ramresorts.com for your review.
2021 contribution to the Reserve Fund Cash Balance of approximately $418K. Currently the Association has approximately $112K in a Reserve Money Market account and a 2021 budgeted Reserve Fund contribution of approximately$202K.
I would now like to address the financial viability of the 30% reduction in the dues for the 2021 budget year which is being advocated by some of our homeowners.In its simplest evaluation,the proposal will cause extreme financial damage to the stability of the Association's financial position which in tum will be forced down to the homeowner level in the form of a potential special assessment or other unpleasant circumstance.
• An additional 20% would reduce dues and related cash into the Association's funding of
These factors cited alone without taking into consideration the Reserve Cash understatement comes to approximately $725K. This value exceeds the additional 20% reduction in dues by a factor of $69K.
The Board has also reviewed the cash flow consequences of an additional 20% or $656K reduction in the Association's dues structure. The 2021 budget was prepared using the accrual method of accounting. The 2021 budget was then adjusted for the decrease in dues and for the impact that certain cash-based transactions have on the cash position of the Association throughout the 2021 year. Based upon the consequences of these modifications to the Association's cash requirements, the model demonstrated that the Association would be out of cash in April 2021. By the end of 2021 the Association would be required to acquire an additional $529K in funding to brings it cash position back to break even. Obviously, the Association cannot operate without cash nor can it operate with a zero cash position. The Association would be forced to special assess the membership, reduce its operating costs, reduce services, or a combinationall.
I am actually a little surprised to hear a petition is going around. Who wouldn't sign a petition to reduce dues? Whomever decided to start this petition should have reached out to the management company to make sure their thoughts were correct. There is a budget which is included in this email. Believe me, we the board would love to reduce the HOA dues even more. If you look at your budget, this is not feasible at this time. As I always say, this board did not put us in this financial situation but has worked hard to clean up the property and slowly get us out of this financial position.We also have a responsibility to everyone to keep the resort financially stable.
If you look at the Reserve Cash which is stated at $ 112K, the Association's Reserve Cash is extremely underfunded.One incident of any kind and we will be going out for an assessment. We do have other loans to pay off. The Caravelle is a business. To run this business properly, I don't expect everyone to agree. The extreme financial correct process would have been to leave the HOA dues the same and build up reserves close to a million dollars and pay off the last loan. That would make us a financially secure association. We did not go that route because we the board were thinking of the homeowners. I can't help what has happened in the past. I can only work to make the future better for the association.
I have had a number of homeowners bring to my attention this list of projects and the expenses with those projects. I assure you, we by no means are going to do that entire list of projects.Due to our financial situation,we will only do the projects that are a must. If you look at the budget you will see that there is no possible way to reduce HOA dues more at this time. We all are in the same boat. I would love to have my HOA dues reduced but not at the detriment of the financial stability of the resort. The thought process is seeing where we are in the near future with reserves, projects that are a must, and paying down the last loans. We would evaluate our financial situation at that time.We then would look at another decrease in dues.
Caravelle's Board of Directors