co-op, where we establish our ….

co-op, where we establish our budgets during summer of the previous year. In a gas station, raising prices involves changing your roadside sign. If a co-op faces any earthshaking change in the global environment after adopting its budget, it must live with its decision for the next 16 months.

The pricing pressures GRF and your Mutual face are worrisome, just like the ones you face. Take construction materials such as lumber, roofing and concrete. Those costs are expected to rise 14.1% by the end of 2022. Appliances, like replacement ovens, range tops and refrigerators, represent another huge cost for the Mutuals. GRF can’t find standard replacement appliances, even at prices averaging 20% more than a year ago.

Our dedicated role in serving residents means Leisure World and the Mutuals are particularly affected by labor costs. In the 2021 GRF budget, labor represented 60% of the Foundation’s total costs. In Spring 2022, finding ourselves struggling to recruit and retain talented, dedicated workers, GRF made the same decision as many other employers: to raise salaries to levels competitive with our peers. After an internal study comparing GRF’s compensation with area companies vying for the same workers, GRF made long-overdue adjustments in wages. For several years before the pandemic-fueled inflation, we had not given any cost-of-living increases. We’ve had to try to catch up in a single year.

As a result, GRF directors have been told that about 90% of next year’s GRF assessment increase will be devoted to increased salary and benefits that help our workers cope with their own inflationary woes.

The bad news you see on television and experience in your shopping trips? It’s the same state of affairs in which the GRF directors, and your own mutual directors, are operating (except with tons more plywood, and fewer quarts of milk).

In the coming weeks, I’ll share how GRF is responding to keep your out-of-pocket costs as modest as possible, and offer encouraging news in coping with the current economic environment.