By Brian Harding
Eastman’s annual Operating and Capital Budget is a vital tool for managing our community. From the first emails to committee chairs and staff requesting input to the Board of Directors’ eventual approval, the preparation process for Eastman’s Operating and Capital Budget takes approximately six months. Although the general manager completes most of the detail work on our budget, it is the Finance & Budget Committee that coordinates and oversees the process and approves the version that goes to the Board for approval for the fiscal year beginning April 1.
THE BUDGET:
- projects the level of revenue to be received
- designates the programs and activities to be funded
- establishes the expected level of costs to operate and maintain ECA’s buildings and common areas, and
- identifies the specific equipment to be purchased and capital projects to be undertaken during the year.
The process officially begins in August at the annual Leadership Forum, when the budget is discussed with Eastman’s Board of Directors, Council Executive Committee, Special Place chairs, and committee chairs. In September, the official “budget call” for monetary requests and supporting documentation goes out to staff and chairs of committees. The general manager and chief financial officer review the submissions and then hold meetings with stakeholders to discuss the requests in detail.
The requests for operating expenses and capital projects and equipment almost always exceed available funds, so the general manager prioritizes these requests and develops a recommended budget. Established programs and activities, and maintenance of the existing infrastructure are the first priorities. In addition, there is an ongoing effort to build an operating surplus as a hedge against unexpected expenses like the severe winter conditions experienced in recent years. After those steps are taken, any new initiatives or programs from the approved Plan 2020 can be included.
After a lengthy process, the general manager develops a recommended budget. The document then passes to the Finance & Budget Committee in November, when another round of reviews, discussions, and meetings begin. The committee’s objectives are to ensure that the budget is achievable and includes realistic projections for revenue and expenses; that it addresses objectives provided by the Board at the start of the budget process; and that it adequately funds the programs, amenities, and infrastructure maintenance required for the successful operation of the community.
The Finance & Budget Committee’s recommended budget is then submitted to the Board of Directors in January. At the same time, an Open Forum is held to give owners the opportunity to discuss the proposed budget, ask questions, and make suggestions. The directors spend the next month reviewing the budget and related supporting documents, and then adopt an official version with any approved changes in February. The adopted budget then becomes the guiding document for Eastman’s operating and capital activities for the fiscal year.
This comprehensive budget development process helps to ensure that the activities and efforts planned for the fiscal year are consistent with the Plan 2020 vision for Eastman as a “sustainable, intergenerational, recreational community that offers an active, four-season lifestyle.”
As Chief Financial Officer, Brian Harding has been preparing budgets at Eastman since 1994. He is a graduate of the University of New Hampshire and earned an MBA from Boston University.
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