reserve analysis
DESCRIPTION
RESERVE ANALYSIS. FUNDING REQUIREMENTS & METHODS TO MEET THEM. RESERVE FUND-WHY WE HAVE IT. A SEPARATE FUND TO MEET FUTURE CAPITAL EXPENDITURES FOR THE ASSOCIATION TO PROTECT THE ASSOCIATION FROM AN UNFORSEEN CAPITAL EXPENDITURE OR AN EMERGENCY EVENT A BY-LAW REQUIREMENT. - PowerPoint PPT PresentationTRANSCRIPT
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RESERVE ANALYSIS
FUNDING REQUIREMENTS & METHODS TO MEET THEM
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RESERVE FUND-WHY WE HAVE IT
A SEPARATE FUND TO MEET FUTURE CAPITAL EXPENDITURES FOR THE ASSOCIATION
TO PROTECT THE ASSOCIATION FROM AN UNFORSEEN CAPITAL EXPENDITURE OR AN EMERGENCY EVENT
A BY-LAW REQUIREMENT
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WHAT ARE THE RESERVES’ CAPITAL OBLIGATIONS
CURBS AND GUTTERS
SIDEWALKS
DETENTION POND
STREETS: MAINTENANCE & REPAIR
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WHY RESERVE STUDY WAS INITIATED
DID NOT KNOW THE SCOPE OF THE ASSOCIATION’S CAPITAL RESPONSIBILITIES-PARTICULARLY STREETS
DID NOT KNOW THE AMOUNT OF FUNDS NEEDED TO COVER THE MAINTENANCE OF THESE ITEMS
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RESERVE STUDY-RESULTS ASSESSED THE CURRENT STATUS OF THE
RESERVE FUND & FUNDING LEVELS CONCLUDED THAT THE RESERVE IS
CURRENTLY UNDERFUNDED TO MEET PROJECTED FUTURE EXPENSES
CONTENT IS A BLUEPRINT-A TOOL-USED TO PROJECT FUTURE FUNDING LEVELS
PROPOSED THREE SCENARIOS TO MEET FUTURE FUNDING
GIVES THE STATUS OF CAPITAL ITEMS
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RESERVE STUDY SCHEDULE OF CAPITAL EXPENDITURES
YEAR 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
YEAR # 1 2 3 4 5 6 7 8 9 10 11 12 13
EXPENITURES*
RESURFACE ASPHALT PAVEMENT $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $117,733
ASHPHALT PAVEMENT CRACK SEAL/REPAIR $0 $0 $5,250 $0 $0 $0 $0 $5,250 $0 $0 $0 $0 $5,250
CONCRETE REPAIR REPLACEMENT $0 $3,250 $0 $3,250 $0 $3,250 $0 $3,250 $0 $3,250 $0 $3,250 $0
DETENTION AREA MAINTENANCE $0 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000
TOTAL COSTS $0 $5,250 $7,250 $5,250 $2,000 $5,250 $2,000 $10,500 $2,000 $5,250 $2,000 $5,250 $124,983
INFLATION ADJUSTED COSTS $0 $5,434 $7,766 $5,821 $2,295 $6,235 $2,459 $13,359 $2,634 $7,155 $2,821 $7,665 $188,858
INFLATION RATE 3.50%
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RESERVE FUND-CURRENT & PROJECTED STATUS
CURRENT SCENERIO
PROJECTED ANNUAL FUNDING & EXPENTITURES 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
YEAR END RESERVE FUND BALANCE $35,688 $35,130 $32,182 $31,159 $33,712 $32,297 $34,706 $26,045 $28,151 $25,686 $27,593 $24,597 ($160,074
)
CAPITAL EXPENDITURES $0 $5,434 $7,766 $5,821 $2,295 $6,235 $2,459 $13,359 $2,634 $7,155 $2,821 $7,665 $188,858
TOTAL REVENUE-ALL SOURCES $4,887 $4,876 $4,818 $4,798 $4,848 $4,820 $4,868 $4,698 $4,739 $4,691 $4,728 $4,669 $4,187
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PROJECTED YEARLY BALANCES FOR CURRENT LEVEL OF SAVING & INVESTMENT
RETURNS
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
($200,000)
($150,000)
($100,000)
($50,000)
$0
$50,000 RESERVE FUND
YEAR
FUN
D B
ALAN
CE
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STATUS OF CAPITAL ITEMS
WHAT WE NEED TO DO & WHEN
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CURBS & GUTTERS
BASICALLY IN GOOD CONDITION
A FEW NICKS HERE & THERE
NO MAJOR EXPENSES IN NEAR FUTURE
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SIDEWALKS WALKING PATHS IN
GOOD CONDITION-MINOR REPAIRS ONGOING AS NECESSARY
GAPS BETWEEN SIDEWALK & CURB NEED IMMEDIATE REPAIR-A LIABILITY ISSUE
SIDEWALK APRON
CURB
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DETENTION POND GENERALLY GOOD CLEARING AROUND
GRATING NEEDS TO BE ADDRESSED WITHIN THE NEXT YEAR
GENERAL CLEAN-UP ON YEARLY BASIS
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STREETS-ASPHALT SEAL & REPAIR
STREETS ARE FOR MOST PART IN GOOD CONDITION
NEED TO IMPLEMENT AN ASPHALT CRACK SEALING PROGRAM
INTERSECTION AT RIVERBED AND VALLEY STREAM NEEDS IMMEDIATE ATTENTION
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STREETS-REFACING CURBS STRONGLY
ADVOCATED BY OCRC AND BIRMINGHAM SEALCOAT
DISCOURAGED BY ULTIMATE CONCRETE
SUPPOSEDLY LENGTHENS THE LIFE OF STREET
ROUTE & INSERT SEALER
STREET CURB
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REFACING CURBS: EXAMPLE COST: $15,000-
$20,000 DURATION: 5YRS+
FROM ULTIMATE SEAL-10YRS+ FROM BIRMINGHAM SEALCOAT
PURPOSE IS TO PREVENT DAMAGE BETWEEN STREET & CURB
SHERMAN STREET
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PROS & CONS ON REFACING CURBS
PROS COULD LENGTHEN
LIFE OF STREETS COULD
POTENTIALLY DELAY COSTLY RESURFACING
CONS ULTIMATE
CONCRETE HAS DOUBTS ABOUT PROCESS
IS NOT WIDELY PRACTICED
EXPENSE PERSONAL
OBSERVATION
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PARK STREET-EXAMPLES OF REFACING CURBS-A NEGATIVE
RESULT
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BOARD INITIATIVES TO RESERVE STUDY RESULTS
FORM A COMMITTEE TO VERIFY CONCLUSIONS
HAVE THE COMMITTEE CHOOSE A METHOD FROM THE RESERVE STUDY TO BEST MEET FUTURE FUNDING
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RESERVE COMMITTEE COMMITTEE CONSISTED OF
JOHN VON ALLMEN RICHARD WOODMANSEE MIKE GOULD JEFF BUCHOLZ
PURPOSE: ASSESS THE RESULTS OF THE RESERVE STUDY
RECOMMENDATIONS ASSESS THE CONDITION OF ASSOCIATIONS’
CAPITAL ITEMS RECOMMEND A FUNDING METHOD TO MEET
FUTURE CAPITAL EXPENSES
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THREE SCENARIOS TO MEET FUNDING NEEDS
STEPWISE INCREASES
24% ANNUAL INCREASES TO RESERVE FUND PORTION OF ASSOCIATION DUES
ADDITIONAL ASSESSMENTS
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STEPWISE INCREASES
BEGINNING FUND BALANCE $30,802 $35,692 $38,035 $40,946 $48,801 $63,311 $76,992 $97,700 $110,605 $134,708 $154,681 $179,473 $199,822
FEE REVENUE $4,190 $7,031 $9,875 $12,719 $15,563 $18,407 $21,251 $24,095 $24,095 $24,095 $24,095 $24,095 $24,095
INVESTMENT EARNINGS $700 $746 $803 $957 $1,241 $1,510 $1,916 $2,169 $2,641 $3,033 $3,519 $3,918 $701
CAPITAL EXPENTITURES $0 $5,434 $7,766 $5,821 $2,295 $6,235 $2,459 $13,359 $2,634 $7,155 $2,821 $7,665 $188,858
ENDING BALANCE $35,692 $38,035 $40,946 $48,801 $63,311 $76,992 $97,700 $110,605 $134,708 $154,681 $179,473 $199,822 $35,760
ANNUAL FUNDING PER UNIT $53 $89 $125 $161 $197 $233 $269 $305 $305 $305 $305 $305 $305
YEAR 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
PERCENT RATE OF RETURN OF INVESTMENTS 2.00%
INCREASED FUNDING PER UNIT (2010-2017) $36
TOP FUNDING LEVEL (YRS. 2018-2029) $305
TOTAL BALANCE-MUST BE GREATER THAN 0** $20,760
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STEPWISE CHART20
10
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
$0
$50,000
$100,000
$150,000
$200,000
$250,000 FUND BALANCE
YEAR
YR. E
ND
BAL
ANCE
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CONCLUSIONS OF COMMITTEE ALL WERE IN AGREEMENT THAT A
FUNDING SOLUTION TO ADDRESS THE RESERVE SHORTFALL SHOULD BE IMPLEMENTED IMMEDIATELY
FOUR CAPITAL PROJECTS SHOULD BE ADDRESSED IMMEDIATELY FIRST: SIDEWALK SEPARATION AT CURBS SECOND: CRACK & SEAL OF ASPHALT THIRD: CLEARING OF DETENTION POND FOURTH:SOLICIT BIDS FOR REFACING OF CURBS
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WHERE DO WE GO FROM HERE?
RECOGNIZE THAT THE COMMON ELEMENTS ARE OUR RESPONSIBILITY COLLECTIVELY-WHICH INCLUDES ROADS
RECOGNIZE THAT CURRENT DUES ARE NOT SUFFICIENT TO MAINTAIN THE COMMON ELEMENTS IN THEIR CURRENT CONDITION
STRIKE A BALANCE BETWEEN THE NEEDS OF THE COMMUNITY TO THE ABILITY OF THE HOMEOWNER TO PAY
RE-ASSESS ON A YEARLY BASIS-USING SPREADSHEET AS A MONITORING TOOL