For many years KICA’s Annual Report was included with the Annual Meeting election materials. This report was more of a “year in review,” focusing on the association’s major projects and accomplishments throughout the prior year. This year, the report focuses solely on financial information and was moved to a later distribution date so that any figures were based on the approved audited financial statements made available in the spring.
The 2017 Audited Financial Statements, along with other financial information, can be viewed at kica.us/finances. To view the full Treasurer’s Report presentation from the 2018 Annual Meeting, visit kica.us/treasurerreport.
In January, Digest launched the first in a series of articles and surveys on the core services provided by KICA. While big projects such as the Sandcastle renovation are exciting, execution of a set of basic responsibilities is the backbone of the community. The purpose of this series is to inform, but also to gain broad-based feedback from our members via brief surveys.
The May Digest featured the second article in this series, focusing on Land and Lakes Management. Read the article online.
As with the first article in the series about Security and Safety, KICA asks members to take a moment to answer a few questions regarding KICA’s Land and Lakes Management.
Over the last several months, the KICA Finance Committee has worked to craft a new Investment Policy Statement to govern the manner in which the community’s reserve funds are invested. At last week’s meeting, the committee voted unanimously to send this draft to the KICA board for consideration. KICA’s standard procedure is to share policy drafts with the community for input prior to making a final decision. After reviewing the attached draft, if you wish to share any comments, please send them to email@example.com no later than 5 p.m. on Wednesday, May 2.
KICA funds major repair expenses (planned repair and replacement of roads, bridges, drainage, etc. – not unplanned major expenses such as storms) from three primary sources:
Contributions to Reserves (CTR’s): CTR’s are transfer fees on real estate sales, and represented 43% of reserve fund revenue in 2017.
The Reserve Assessment: Formally referred to as the Supplemental Annual Assessment, this assessment is billed to all members along with the Annual Assessment. It represented 39% of reserve fund revenue in 2017.
Commercial Access Fees: Commercial Access Fees are charged to contractors and other service providers who perform work on Kiawah Island. Beginning in 2017, a portion of these fees was allocated to the reserve fund for major repairs. They represented 14% of total reserve fund revenue.
The remaining revenue (4% of total in 2017) is provided by investment income.
In some years these revenue sources are sufficient to cover all reserve expenses. However, there are times when expenses exceed revenue, and reserve funds are needed to make up the difference. Having a healthy reserve is the best way to avoid special assessments, and KICA’s reserve stands at $7.5 million today.
KICA’s investments have historically been held primarily in cash and money market accounts, though in recent years the association has built a small ($3.8 million) laddered portfolio of high quality, “A” rated or better corporate bonds. This strategy has improved KICA’s investment returns, but not enough to keep pace with inflation. Continued losses in purchasing power could have a significant negative impact on KICA’s reserve funds over time.
The Finance Committee has drafted a new investment policy with the goal of keeping up with inflation. The committee believes this can be accomplished by investing approximately 70% of the funds in fixed income investments similar to what we have done in the past (individual investment grade bonds with maturity of 10 years or less) and 30% in equities (active and indexed mutual funds, no individual stocks or alternative investments). This balanced investing strategy has historically been very effective (it has never lost money over a 5-year period), although it would be subject to some moderate level of risk and volatility. More aggressive approaches weren’t deemed necessary to meet KICA’s objectives.
The management of the portfolio (within policy guidelines) will be the responsibility of Moneta Group. This firm has done an outstanding job managing KICA employees’ 401K funds, and was selected after an extensive review process by the Finance Committee and Board of Directors.
Thank you in advance for your input. Any decisions on this topic will be reported after the May Board meeting.
Introducing Around Kiawah, KICA’s new member-to member email discussion group. Around Kiawah offers a four-in-one platform; subscribe to just one topic category, all four, or anywhere in between. Select from events, classifieds, property services and discussions.
This unmoderated discussion platform will replace the outdated KICA-List platform. Assuming most users of our former KICAList will move to Around Kiawah, there may initially be a slight delay in verifying property ownership. After the initial phase, verification is expected to be prompt. KICA-List will be phased out on May 1, 2018.
For more information or to sign-up for Around Kiawah, visit kica.us/around-kiawah.
Did you know you can pay your annual assessment online for no additional fee? Payment for this assessment is securely processed by Payment Service Network (PSN).
On Thursday, Dec. 7, representatives from KICA, Kiawah Partners (KP) and the Kiawah Conservancy officially signed and executed the Parcel Trade Agreement. The agreement was approved by vote of the membership in September, with 87% of the voters supporting the trade.
Representatives from KICA, KP and the Conservancy Signed the Parcel Trade Agreement on Dec. 7, 2017.
“We would like to thank everyone who helped make this trade a reality,” said KICA COO Jimmy Bailey. “This agreement is not just beneficial to KICA, but to the entire Kiawah community.”
Part of the agreement included KP granting the Kiawah Conservancy a favorable purchase option on a 6.2-acre parcel directly across from Kiawah Island Real Estate that has zoning and development rights for 19 units. As was announced by the Conservancy earlier today (view full announcement), they have officially raised enough funds to purchase the land.
“We would like to congratulate the Conservancy and the community for raising the necessary funds to protect this parcel of land,” said Bailey. “This transaction, along with the two parcels acquired by KICA through the vote, will help protect the entrance to our island in perpetuity.”
For more details and background on the Parcel Trade agreement, visit kica.us/parceltrade.
Construction at The Sandcastle is really coming along! We were lucky enough to get a look at the progress on Thursday, Dec. 7. The majority of work so far has been focussed on the entry way and first floor fitness space (which is being completely reimagined to add additional space and eventually provide gorgeous ocean views!).
KICA COO Jimmy Bailey presented the 2018 budget for approval at the Nov. 6 board meeting. This presentation highlighted the variety of concerns and considerations taken into account during budget creation.
Hear Jimmy Bailey’s comments and explanations of the presentation by watching on the KICA YouTube Channel.
Loggerhead sea turtle nesting season is in full swing. Nesting activity typically begins in mid-May, and female turtles will continue coming ashore to nest until August. Nests will begin hatching in July and finish by October.
During nesting season, it’s important that we do all we can to protect this threatened species from any further perils. To avoid unintentional harm to these beautiful creatures, follow these tips during nesting season:
-If your property is visible from the beach, turn out all exterior lights (flood and deck) from dusk to dawn.
-If any interior lights are visible from the beach or cast light on the beach, close blinds or drapes at 9 p.m. or turn them off.
-Flashlights should not be used on the beach at night during nesting season. Do not carry flashlights or play flashlight tag on the beach.
-Fill in large holes dug on the beach at the end of the day, as adults and hatchling sea turtles can become trapped in them.
-Observe sea turtles quietly from a distance – never disturb a nesting sea turtle or hatchlings.
-Do not shine lights on a sea turtle, including cell phones and flash photography.
Help keep Kiawah special and our turtles safe by following these guidelines or sharing them with family, friends and vacation rental guests. Learn more about Kiawah’s Loggerhead population.
During Hurricane Matthew, KICA received damage to 23 of its 25 boardwalks. Our general maintenance team was able to get some of these boardwalks re-opened with minor repairs. The timeline for boardwalks requiring extensive repairs is somewhat longer, though all involved have been extremely cooperative in order to expedite this important work.
KICA uses a consulting structural engineer to ensure what we build is safe and will withstand many years of “normal” wear and tear. Once that work is complete, it then goes through the approval process with the Architectural Review Board (ARB) and the Town of Kiawah Island (TOKI). This ensures TOKI’s ordinances are followed, as well as the regulations imposed by the South Carolina Department of Health and Environmental Control’s Office of Ocean and Coastal Resource Management (SC DHEC-OCRM).
We initially placed the priority on boardwalks in the area of Eugenia Avenue to Windswept, as this was an area where KICA had no open boardwalks.
– As of Feb. 15, KICA has completed construction on boardwalks 8A, 9, 12, 13, 14, 15 and 16.
– We just received approvals on 7, 10, 29, 31 and 33, and are proceeding to contract shortly.
– Our other boardwalks remain in design.
KICA has been and will continue to send weekly updates on its boardwalk repairs in the Thursday email update to the membership. (Access the Beach With Safety)
Policies and Regulations
In building the beach boardwalks, KICA adheres to design regulations specified by the ARB, TOKI and SC DHEC-OCRM. To comply with these regulations, boardwalks must meet the beach perpendicular to the shore and within 10 feet of the primary dune. In the five years preceding the storm, we had rebuilt 22 of our boardwalks (approx. $1 million) and were fortunate that significant accretion of the beach resulted in a dune profile suitable for ramps in most locations. Unfortunately, those dunes are gone – along with the bulk of the previous five years’ investment. This loss has necessitated we use steps as a repair solution in many locations.
We are not permitted, under normal regulations, to run a boardwalk parallel to the shore and dune line, and must seek an exception for this type of construction. Our preference is to build ramps perpendicular to the shore where the dune profile accommodates this type of design; however, Hurricane Matthew has caused us to consider new guidelines that provide an objective way to determine where exceptions should be considered.
One of those new guidelines considers the density of property located near a boardwalk. Areas where larger than average numbers of KICA member properties are concentrated in close proximity will be given extra consideration for ramps. This will result in our applying for ramps at boardwalks 8B, 22, and 27. As the map image below indicates, these are high density areas and we believe exceptions are warranted: