Bonita Fairways Master Association Discussion Capital Reserve Budget January 17, 2013
MEETING OVERVIEW
Background history and Plan – Don Griffin
The initial Capital Budget – Keith Barbero
Questions and Answers – Mike Preston
FORMAT
Please hold your questions, there is a lot to cover
All legal aspects of this process have been reviewed and approved by legal council
Overview of Presentation
History of Bonita Fairways
Organization
Organization Chart
Current issues
Operating Budget vs. Capital Reserve Budget
How it effects us
How do we proceed from here
How does the golf course fit in
History of Bermuda Fairways
Main Clubhouse 1993
Carousel Cove 93-2005
BF Master 9/25/1997
CH deed 11/1/2005
Commons CH 1998
New Developer 2005
Rosewood A & B 2005
Bermuda Links 2005-6
The Gardens 2006-7
Recession-construction stops
Summary of Neighborhoods
Neighborhood
Association
Voting
Unit
Voting
Representative
Carousel Cove 107 Allen Bouley
Rosewood A 24 Robert Lustro
Rosewood B 44 John Sims
Bermuda Links 142 Mike Preston
The Gardens 134 Jay Denz
Remaining Units 299 Developer
Total 750
CONDOMINIUM DEVELOPMENT
Developer buys land
Creates the condo entity with the MASTER DEED
Master Association (MA) managed by the developer
The roads and clubhouse are built
Condo buildings completed and sold
Developer TURNS OVER MA to unit owners
Unit owners elect their own Board of Directors
Self managed from that point on
ORGANIZATION CHART
Current issues
The common elements are deteriorating
Clubhouse, pool, roads, tennis and bocce courts
Developer not required to fund a Capitol Reserve Fund
Previous developer did minimal maintenance
The Budgets
Current OPERATING BUDGET is:
$445 annually to the Bonita Fairways operating budget
This is to maintain the property
Landscaping, utilities, repairs and maintenance
Current CAPITAL BUDGET - None
Budgets
OPERATING BUDGET
Annual Insurance
Landscaping
Repairs and Maint.
Utilities, Electric, water & sewer, gas
Cleaning
Management fee
CAPITOL BUDGET
Replace big items
Roads, Roof
Air conditioning units
Carpet replacement
New projects
WE DO NOT HAVE A CAPITOL BUDGET
UNFUNDED CAPITAL BUDGET
Most of our common elements are 20 years old
Maintenance has been minimal over this period
Bonita Fairways is incomplete
We do not control the board of directors
We do not have a Capital Reserve Budget
The new developer is not responsible for capitol items
The worn infrastructure affects property values
THE PLAN- for the unit owners:
Manage the Board as if TURNOVER has occurred
Agree to fund the Capital Budget
Create a planning committee for the Capital Budget
Planning Committee is made up of the five presidents
The presidents are the voting representatives
They vote for their neighborhood associations
THE PLANNING COMMITTEE
Identify projects and costs
Prioritize based on need
Work with the Master Association Board-Mr. Klinger
Work with the golf course in cost sharing
Define project scope, get bids, engage vendors
Manage projects
THE MASTER ASSOCIATION
Mr. Klinger represents the Board of Directors
Opens a new checking account for Capital Budget
The Planning Committee submits projects to Mr. Klinger
He approves projects
Vendors are engaged, work is done
Invoice is approved by the Planning Committee
Mr. Klinger pays invoice out of Capital Checking Account
Ability Management is not involved
THE GOLF COURSE
The Golf Course is our neighbor
We share many elements such as roads, ponds, landscaping on West Terry Street, and the parking lot
Historically, we have paid to maintain these elements
Recently with Mr. Klinger’s help the Golf Course is now paying 50% of landscaping on West Terry, and will pay 50% of new fountain in the main pond at the entrance.
There is more to do, but we need to establish a Capital Budget
We can then approach the Golf Course for participation.
Deferred maintenance
Ceiling tiles Rusting windows
Deferred maintenance
Wiring & Carpeting Kitchen Drains
Deferred maintenance
Damaged Wall Rusting Frames
Deferred maintenance
Bocce Court Rust Bubbler Pitted
Deferred maintenance
Tennis Court Landscaping
CAPITAL ITEMS
Main Kitchen Stove Food Warmer
Capital Items
Old Carpeting Pitted Plumbing
Capital Items
Bocce Court Paving - Dumpster
Capital Items
Patio Finish Obsolete Kitchen
Capital Items
Air Conditioning Interior Decor
Keith Barbero
Operating Budget
A detailed projection of all estimated income and expenses based on forecasted revenue during a given year.
Capital Budget
The term "Capital Budget" is used to describe how managers plan significant outlays on projects that have long-term implications such as the purchase of new equipment and the introduction of new products or services.
EXAMPLES
Operating Budget • Maintenance of buildings
• Cleaning
• Telephone
• Postage and charges
• Insurance
• Minor purchases
• Maintenance Janitor etc.
• Accountant - Lawyer
• Unexpected costs (5% of costs)
Capital Budget • Kitchen Equipment
• Well and Irrigation Equipment
• Roads, Landscaping
• New Roof for Building
• New Carpeting in Building
• Capital Reserve Fund
• New Fitness Center Equipment
• Lake Restoration
REMEMBER
AS HOMEOWNERS, WE OWN THE MASTER ASSOCIATION PROPERTY
MR. KLINGER, AS DEVELOPER, MANAGES AND CONTROLS THE MASTER ASSOCIATION PROPERTY UNTIL HE DECIDES TO TURN IT OVER TO US
GOAL -PROPERTY VALUE
This effort started by the Presidents and a few owners
Since last spring much has been done
Many ideas have been considered
Goal is to improve condition of our capital assets
This will result in more attractive and usable clubhouse
This will increase our individual home values
This proposal is the result of these efforts
WHAT NEEDS TO BE DONE?
Develop a way to raise funds to update capital items
Collect money and have it managed by the owners
Method to prioritize needs for the most impact
Maximize our return on investment with improvements
This must be an owner driven effort with visibility
HOW TO ACCOMPLISH THE GOAL
Owners must accept that we OWN the property
BUT, it is CONTROLLED by the MA Board of directors
This is essentially Mr. Klinger, the new developer
Mr. Klinger will work with us to achieve our goal
It also benefits his interests
Each of us will be contributing to the Capital Fund
There may be participation from the golf course
The developer pays for operating expense shortfalls
Planning committee collects and controls the budget
Planning committee establishes priorities
Needs and Wants to Date. This is by no means a firm final list. It is the result of the Work done to date by the Presidents and Volunteers,
and the Numbers must be firmed up in many cases.
Project Estimated Cost Road Need $150,000 Club House Interior Need Interior Decorating $50,000 Furniture $10,000 Kitchen Equipment $30,000 Fitness Center possible rent $80,000 Air Conditioning $20,000 Kitchen downstairs and other Room $20,000 Bocce Courts Want $25,000 Pool $50,000 Apron Surface Trees in Center Other Landscaping Need $75,000 Lakes Need $50,000 Reserves Need $200,000 (Roofs, Roads Driveways, Paint Building, Pool)
SUMMARY
The preliminary list totals $560,000 or $1,240 per door
We have rounded that to $451,000, or $1,000 per door
We assume there will be some golf course participation
We assume some of this is operational expense to be paid by the developer
There is a need to establish a Capital Reserve Fund.
This is just good fiscal management
Bocce Courts in Highland Woods Next Door
Tarpon Cove on Wiggins Pass
T A R P O N
C O V E
F I T N E S S
C E N T E R
The Proposal
Presidents pass a $1,000 per unit special assessment
Presidents create the Planning Committee
Committee / developer implement special assessment
Committee / developer control funds, and set priorities
Committee estimates costs on projects
Committee provides updates on project status
Important!
This Assessment Projection is not
expected to exceed $1,000 Per Door
Payment options
Pay $1,000 one time
Pay $500 annually for 2 years
Thank You for your
SUPPORT!
ANY QUESTIONS?