was the third consecutive year ….
was the third consecutive year with an assessment increase of over 10%.
The average increase from 2023-2025 was 10.96%, according to the presentation. “I can understand shareholder frustration with that, absolutely,” Potter said, adding that the average increase from 2015-2025 was 4.96%, and the average increase from 22 years ago through today— 2003 through 2025—is 4.41%.
“So having an increase somewhere between 4-6% is probably a reasonable general approximation for what should happen for the foundation,” he said. But soaring insurance costs over the past three years, along with long needed adjustments to employee salaries and wages, temporarily derailed that goal.
Per GRF’s audited financial statements, in 2023, GRF insurance cost was $945,631.63; in 2024 that soared to $2.51 million, an increase of nearly 3 times the prior year’s expense. The 2024 cost is nearly six times the amount spent in 2019. 2024’s insurance expenditures fell $1.57 million short of GRF’s budget projection for that year.
To meet the unanticipated expense, the 2025 budget did not allocate monies to replenish the foundation’s capital fund, which is used to finance new projects, and redirected those monies to build up funding needed to pay the insurance down payment every year, a cash event that has exploded in impact for GRF. Capital expenses in 2024 and 2025 were limited to projects relating to safety and liability reduction.
With careful management from the Board and staff, the 2025 budget is performing well with a positive variance of nearly $900,000 through September with a year-end positive variance probable, barring an unforeseen financial event. Plus, GRF is on track to have allocated $1.1 million toward the annual insurance down payment, which is estimated to be at approximately $1.5 million in December. “When you consider that this time last year, GRF has zero amount to cover the payment, this is a quantum leap and quantum improvement in our cash positions,” Potter said. But the 2026 contribution to the Operating Contingency fund that was approved by the board is just under $200,000, which leaves the fund short of its target of $2.5 million.
The 2026 budget also directs $1 million to the capital fund, which has not received meaningful funding since 2022.
Insurance aside, employee salaries and wages at $11.8 million is the largest line item of the GRF budget. GRF continues to evaluate ways to responsibly manage this expense while attracting and retaining top talent to serve the needs of the shareholders.
The goal this year and into 2026 and beyond is to create a balanced budget as the last three years of GRF operations ended in deficits, and four of the last six years have ended in deficits. Overall, the 2026 budget seeks to replenish liquid cash in the capital fund, maintain or increase liquid cash in the operating fund, maintain the current service level for residents, and preserve the strength of the reserve fund, which is used to maintain all GRF amenities.
Potter acknowledged that GRF’s budget challenges cannot all be solved in a single fiscal year. But the 2026 budget is a continuing step in the multiyear process of improving the GRF’s financial outlook.
—GRF staff report
