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Reply To: Paying for the Horizon project

Forum Home Forums Horizon Project – Have your say! Paying for the Horizon project Reply To: Paying for the Horizon project

#57834

Response posted on behalf of Richard Rawlinson, Chairman of the Finance Committee and sponsor of the Horizon Project.

Answers to your questions are as follows:

1. How much have we spent to date on fees and what is our total commitment in fees, in the event that all of this is voted down again?

The budget is £250k and £200k will be spend by the end of this calendar year; the other £50k is essentially committed. TRA are £82k, there are then landscapers, cost consultants etc that go along with that; costs for Rosie who is helping with the communications and management of the programme are another big chunk, and then there are smaller amounts for the several surveys, the videos etc. This is what was authorised by Main Committee and so far, we are on budget

2. Have any of the projects been committed to? If not, when will we get a chance to vote? Will the vote be put to the full membership, as the previous West Wing project?

Nothing has been committed to. There will be a comprehensive survey of all members (as there was with the West Wing) that we now expect to run in November. Based on that, we hope that Main Committee can identify a recommended trajectory and that will go to Voting Members for approval or not in 2022. Then, each major project within that will be subject to separate justification and members’ vote, as and when we come to it, and after it has been designed.

3. Can the Horizon Committee consider putting to the members three options, along with timeframe and loss of use of the Club for each of the below plans:

1. Something simpler, less expensive solution can be presented, eg. max. £5m, along the lines I am suggesting?
2. The “moderate plan” for £14.5-16m
3. The “comprehensive plan” for £30.5-32.5m

There will be a low cost plan that allows us to stay within existing resources. That low cost plan does not include a pool, however. The resources available would go to the tennis pavilion, cricket pavilion, winter tennis bubble and all the renovations we need to do. There would not be additional money for a second pool and, for sports, that is a lower priority than the pavilions which are in such bad shape, and the tennis bubble, which address a top need and is not very expensive.

4. How much money do we have in the bank and what would the impact be on member subscriptions? For example, can the Club afford up to £30m and is there really a need to spend this money now, rather than keep it for future developments like possibly enlarging the gym or a new tennis pavilion?

As of today, £18.6 million in liquid assets (bank deposits and ETFs). But more to the point, we have £11 million spendable from reserves, once you allow for the normal run down of cash during the year and the need to hold c£3 million in prudential reserve.

All the programmes would be implemented over 10-15 years and during that time we accumulate some more money – especially if subscriptions increase. Assuming that the Off-Peak to Full Member conversion does go through (which adds nearly £5 million to spendable cash from their entrance fees), then we estimate that about 5% on average subscriptions would make a big contribution, and to implement comprehensive solutions to all the various issues would mean about 10% on average subscriptions and a period of up to 15 years to execute – or at least, to pay for it (we could readily borrow some money to decouple the building timing from the time to pay for it). That does assume we can and do run member catering at operating breakeven and that we continue with a reduced but still significant events business. On the other hand, if the proposed changes to our subscription and entrance fee discount structure go though, the increase in full subs would be 4-5% less than these increases I just mentioned, which are in average subscriptions (if the discounts are changed, other subs go up more than the full sub).