We have known for months now that the Tetra/Lake House debacle was certain to put upward pressure on the Reston Association budget. Assessments would surely rise if there wasn’t belt tightening at RA. CEO Cate Fulkerson, who acknowledged responsibility for the Lake House cost overruns, now proposes an out-of-cycle revision of the 2017 budget and a $55 per homeowner assessment increase due Jan. 1. The budget increase, as far as can be deciphered from documents made available by the CFO and CEO, includes a lot more than the additional $700,000 for the gold-plated Lake House. At least four more capital projects are planned and, interestingly, the Capital Reserve fund will increase by more than $1 million although it currently contains more than its recommended level of funding.
Staff costs are the major contributor to the surge. Generous increases in salaries and benefits (with bonuses alone totaling about $400,000) and the addition of three new “planners” for a cool $255,000 lead the parade of additional costs. RA already has five professionals making base pay over $100,000 each. “Merit pay” increases of 3 percent are included nearly across the board, it seems. Employee benefits also include generous health insurance and 401k retirement plans with quite modest employee contributions.
Make no mistake about it. I do not resent good pay and benefits for employees who work hard to serve our community. I prefer to see them treated more fairly than what has regrettably become the norm in the United States today. Still, it appears from the numbers we are seeing that it is time for a serious review of salary and benefits within RA, with a view to at least reining in their growth.
Perhaps as worrisome as the lavish current and proposed spending is the budget process itself. The presentation to date is being characterized as unintelligible by some Board members and residents. For example, it is not at all clear how the budget relates to the core mission of Reston Association and its shorter term objectives within the mission. Perhaps I am old fashioned, but I believe budgeteers should provide a one-page summary budget broken down by function and by organizational element with a total at the bottom. This summary must have three columns—prior year, current year and budget year, something readily understandable to the Board and to the assessment payers.
The documents provided to date are so muddled that two Board members actually suggested recently that, rather than burrow through all the multi-colored tables and graphs, the Board should just give the CEO an assessment number and let the staff construct a budget from the number! This would of course relieve the Board of actually deciding what they want the organization to accomplish as the logical foundation for arriving at a coherent budget.
At this point, the Board needs to give staff clear guidance needed for revision of the budget. The guidance should: 1) include no more funding for Tetra/Lake House until the audit of that project is complete and lessons from it applied; 2) cancel all new positions; 3) cancel new, non-emergency capital projects; 4) call for a thorough, independent examination of RA’s salary and benefits structure and policies with a view to restraining future growth; and, 5) direct the CEO and CFO to develop a budget model for future years based on, and built from, the RA mission statement and goals which can be summarized in one page by goals and one by organizational element.The RA Board needs to step up to restore order and logic to the process.