tiburon peninsula club 2008 financial review and a look ahead finance committee meeting - february...
TRANSCRIPT
Tiburon Peninsula Club
2008 Financial Review
and a Look Ahead
Finance Committee Meeting - February 5, 2009
2008 Overall Review
One Giant Step in the right direction…
A few more baby steps remain…
Club Financial Underpinnings
• Dues pay for operations only
• Activities are financially self-sufficient (Tennis, Swim, Fitness, F&B, Youth)
• An Emergency Reserve Savings Account is maintained (set at 2 months or oper. expenses = $370,000)
• Capital Replacement funds are reserved annually (reserves for depreciation)
• New member initiation pay for capital expenses (maintenance/replacement & new projects)
Initiation Fees Dues Non-Member Surcharges
Cap-Ex andDebt Retirement
Revenues
ExpensesAdministration
Facility Operations
Aquatics
Fitness
Food/Bev
Tennis
Youth
Activity Specific
Member Charges
Non-Member Activity Charges
Activity Fee
Activities – Set at Operational Breakeven
Monthly Debt Retirement Fees
MortgagePayments
Personnel/Operations- Aqua
Personnel/Operations - Fit
Personnel /Operations– F/B
Personnel/Operations - Tennis
Personnel/Operations - Youth
TPC - Strategic Financial Model
20%
80%
TPC - Tactical Financial Model
Initiation Fees Dues Non-Member Surcharges
Cap-Ex andDebt Retirement
Administration
Facility Operations
Monthly Debt Retirement Fees
MortgagePayments
Reserve Savings Account
(2 mos. of Ops Expense)
Cap Ex Cash/Checking Acct
Operating Cash/Checking Acct
Code RED – An unexpected event wipes out Reserve Account – immediate member assessment is considered
Code Orange – Reserve Savings Account is Not Full; All Initiation Fees Flow into Reserve Savings until Full + Examine Expense Cuts + Consider Dues Increase
Code Green – Reserve Savings is full; all initiation goes toward Capital Expenses & Debt Retirement.
0% of the time
20% of the time
80% of the time
* Currently 2 months of Op Expense = $370,000
Operating Condition “Code”
TPC – Capital Reserve and Accelerated Debt Retirement
Initiation Fees$495,000
I
Capital Reserve“Replacement”
$250,000/yr
Reserve Savings Account
(2 mos. of Ops Expense)
Cap Ex Cash/Checking Acct
Assume Membership “roll” – 33 members/yr at “steady state”
Gross Initiation Fees (@$15,000 non-refundable fee) - $495,000
II
Cap-Ex New Projects$245,000/yr
Mortgage Debt Retirement
I. To meet upkeep and replacement demands
II. To fund “new” Cap Ex projects
In the event of a slow new membership period, I. has preference to II. by 2:1 until $250k is deposited into I.
At the end of every year – one half of I and II balances will be applied to mortgage prepayment.
Half of Year
End Balance
Initiation Fees Dues Non-Member Surcharges
Revenues
Expenses
Aquatics
Fitness
Food/Bev
Tennis
Youth
Activity Specific
Member Charges
Non-Member Activity Charges
Activity Fee
Activities – Set at Operational Breakeven
Monthly Debt Retirement Fees
Mortgage
Personnel/Operations- Aqua
Personnel/Operations - Fit
Personnel /Operations– F/B
Persn/Ops - Tennis
Persn/Ops - Youth
TPC Comprehensive Financial Model
20%
80%
Administration
Facility Operations
Operating Cash/Checking Acct
ICapital Reserve“Replacement”
$250,000/yr
Emergency Reserve Savings Account
(2 mos. of Ops Expense)
Half of Year
End Balance
IICapital Expense
New
Capital Expenses
2008 Activity Performance Comparison
Activity ’08 Net ’07Net ’08Rev(k)’07Rev(k)
Tennis -$7,833 -$203,000 $564 $419
Swim -$8,651 -$107,000 $258 $338
Fitness -$7,010 -$83,000 $238 $70
F&B -$63,764 -$14,000 $449 $326
Youth $4,173 $40,000 $187 $147
2008 Club Finances
Operations - $196,228
Sum of “5” (activities) - $83,085
New Member Initiation $330,000
Capital Improvements - $678,609
Severence/Deferred Comp - $250,000
Loan Proceeds $1,055,000
Sum $177,078 (into Emergency Reserve)
Looking Ahead - 2009
Operations is set to breakeven – high confidence
The Big Five are set to breakeven – 4 of 5 confident
The Linchpin for ’09 Finances – New Member Enrollment
New Member Enrollment
As of Jan 1, 2009:
Actual TPC Target Town Limit
Regular: 648 670 700
Senior: 148 150 approx (formulaic) 175
_________________________________________________
Strategy –
Front load the annual enrollment process in order to have some visibility into the performance of the new member list. Its performance dictates Capital Spending.
Steps Taken –
50 acceptance letters sent last week (Town Waitlist at 109)
Initiation financing option offered (full payment by 12/31/09 req’d)
Out of Town Waitlist being vetted – approx 40 names
Estimated Upcoming Capital Ex
1. Clubhouse Committed High Low1.1 Rear clubhouse modifications 47,150$ 1.2 Add walk-in refrigerator 22,812$ 1.3 Trophy Case 3,000$
2. Aquatics2.1 Salt water filtration in the main pool (TBD) ?2.2 New pool furniture 35,000$ 2.3 Drain Covers for main pool – (Graeme Baker Pool Act) ?
3. Tennis3.1 Completion of shade structure 15,000$ 3.2 Resurface walkway decking 8,500$ 3.3 Lower court improvement projects (viewing area; restrooms; adding courts; security) ?3.4 New lights for upper tennis courts (two courts annually) 21,000$ 3.5 Add two more tennis courts in the parking lot ?
4. Locker rooms4.1 Address renovations to boy’s and girl’s locker rooms 30,000$ 4.2 Reconfigure massage rooms with employee lounge ?
5. Fitness Area5.1 Modifications to existing restroom5.2 Reupholster benches and chairs ?
6. Administration6.1 Completion of Northstar software application 10,000$
7. Club Grounds7.1 Water Well 20,000$ 7.2 Solar Panels ?
33,500$ 158,962$
Probability '09