ASSOCIATION NEWS Cont’d

Board Meeting Highlights July 6 and July 20, 2023

• General Manager Marilyn Smith reported that the 2024 budget process is underway. The final budget will be presented in an open meeting in October. Casta has received information from the City of Mission Viejo about a plan for a four-story parking structure at the Oso Creek Golf Course.

• Landscape Supervisor Bill Thornton reported there were 351 landscape maintenance requests in June, bringing the total to 1,523 for the year. The Greenbelt Committee is recommending that all Acacia groundcovers between Gates 1 and 2 be replaced with fire-retardant plants.

• Maintenance Supervisor Ed Pedroncelli reported on projects underway. He asked residents to refrain from driving over wet asphalt. Doing so requires further repair.

• Recreation Director Valerie Hanich reported Casta will switch from DwellingLive to iGate software on August 15. All homeowners will be mailed information about setting up an account to register guests. The Board:

• Accepted the June 2023 financial report, as shown on this page.

• Accepted the delinquency report and the filing and recording of liens for the properties listed.

• Approved a list of 12 trees and a list of 10 trees from W.B. Starr for removal due to danger, damage, health, and potential sewer issues at a cost of $7,635 and $6,690 respectively.

• Approved the purchase of new microphones for the Vista Room from Sound Image for a total not to exceed amount of $17,599.68.

• Approved termite inspection and treatment of common area buildings and entering into an annual contract with Accurate Termite and Pest Control in the amount of $4,560

• Approved six landscape maintenance extra work items for a not to exceed amount of $12,215.

• Approved the final version of the Casta del Sol Traffic Rules and Regulations and authorized distribution and notification to homeowners per General Notice requirements.

• Approved tree removals and corrective pruning in all five areas by Great Scott Tree Service at a cost of $368,310.

• Approved Saddleback Fence & Vinyl Products to repair/replace the fencing at the Tennis/Pickleball courts for a total not to exceed cost of $8,024.50.

• Approved Ad Hoc Committee revised Casta del Sol Financial Policies and Procedures document as presented, deleting all references to Board Liaisons.

• Approved Casta del Sol Policy Guidelines for Board-appointed advisory committees as recommended by the Ad Hoc Committee.

• Approved extra landscape maintenance work and materials for seven items for a not to exceed cost of $6,101.89.

• Approved the formation of an Ad Hoc Committee to review the plans from the City of Mission Viejo for work on Casta del Sol Drive.

• Approved the revised 2023 Master Tree List.

• Approved plumbing repairs for 28132 Calle Casal due to common area tree root damage for a total cost of $7,668.

• Approved the appointment of Randy Thompson as Chairman of the Reserves Committee, effective immediately.

• Approved the contract matrix for the Association’s contracts as presented. The August meetings of the Board of Directors will be held August 3, 2023, at 9 a.m. in the Vista Room and on August 17 at 1 p.m. in the Vista Room

Fran Morgan, Courier staff

June Treasurer’s Report

Total HOA Assets as of June 30, 2023 are $8,558,516.

• Operating Cash: $ 2,539,289

This includes $643,233 in cash, $996,056 invested in a money market account and $900,000 invested in CDs. One CD matured at the end of June and was rolled over. There is one CD that will mature at the end of July which will be reinvested at the current highest rate possible. The rates for a six-month CD are currently in the range of 5.35 - 5.0%.

• Reserve Cash: $5,637,110

This includes $1,216,753 invested in a money market account and $4,200,000 invested in CDs. There are 5 CDs maturing in July. Three of these will be reinvested in CDs at the highest possible rate. We will need to increase the cash available starting in August to cover the costs of asphalt and tree removals. Also included in the total is interest of $64,429 and an amount due from Operating of $155,927.

• Capital Improvement Cash: $274,806

This account is funded by budgeting $8 per month per residence. This results in a monthly Capital contribution of $15,416 plus interest. The only expenditure in June was for the purchase of a Sun Pac storage container for $3,827. Potential capital projects such as a dog park, pickleball courts etc., are being reviewed by the Facilities Committee.

• Outstanding Accounts Receivable: $74,957

June’s Accounts Receivable reflects a decrease of 14% from the prior month. Correction to last month’s report: Outstanding Accounts Receivables for May was $87,204. Allowance for Bad Debts has gone down from $60,697 to $27,353. Note: Allowance for Bad Debts is an estimate of receivables that will not be paid. The Allowance is adjusted Quarterly in March, June, September, December, and is equal to outstanding receivable balances over 91 days.

The following are highlights of our Operating expenses as of June 30:

• General & Administration has a positive variance of $8,688 partly due to the adjustment in bad debt expense. Printing and postage expenditures are low, but do not reflect the recent ballot mailings. Legal Fees remain high at $26,353 over budget.

• Land Maintenance, LM, has a significant surplus of $328,000. Tree removals are over budget by $21,654 and more removals are expected. Future expenditures for LM contract are unknown at this point. Opening of the sealed bids for the new LM contract is scheduled on July 21.

• Recreation/Lifestyle has a positive variance of $17,071.

• Repairs & Maintenance has a positive variance of $15,778.

• Traffic Control has a positive variance of $2,547.

• Utilities has a positive variance of $244,396 primarily due to Water with a positive variance of $246,044 due to the significant rain this winter. We anticipate increased water usage as we move into the hotter months. Gas is over budget by $16,450.

Treasurer Comments

The year-to-date, YTD, June surplus is $805,281. The YTD budget of actual surplus from June through December is $654,497. The surplus is largely due to positive variances in Land Maintenance and Utilities.

The Budget and Finance Committee discussed whether to transfer some of the surplus funds to Reserves. Due to the emergency tree removal project and the unknown increase in the Land Maintenance contract, Budget and Finance agreed that we need more information before making a recommendation to transfer funds from Operating.

This Treasurer’s Report as of June 30, 2023, is being submitted to the Board of Directors for their review and acceptance. Once accepted by the Board, this report will be filed.

Respectfully submitted by Susan G. Ashby Casta del Sol Board of Directors, Treasurer