Sixth Avenue West THOA #2
6th Avenue
Golden, CO 80401
Level 1 Reserve Analysis
Report Period – 01/01/12 – 12/31/12
Client Reference Number - 4027
Property Type – Townhomes
Number of Units – 102
Fiscal Year End – December 31
Final
Version
Date of Property Observation - February 29, 2012
Project Manager G. Michael Kelsen, RS, PRA
Main Contact Person Mr. Ryan Willoughby, Community Manager
Report was prepared on -
Wednesday, December 05, 2012
P.O. Box 1762  Castle Rock, CO 80104  Phone (303) 790-7572  Fax (303) 688-3083
www.aspenrs.com
Table of Contents
SECTION 1:
Introduction to Reserve Analysis--------------------------------------------------------------page 1
General Information and Answers to FAQ’s------------------------------------------pages 2 - 3
Summary of Reserve Analysis------------------------------------------------------------------page 4
SECTION 2:
Physical Analysis (Photographic) -----------------------------------------------------pages 1 - 27
SECTION 3:
Financial Analysis
a)
b)
c)
d)
e)
f)
g)
h)
i)
j)
k)
Funding Summary-------------------------------------------------------------------------------------page 1
Percent Funded – Graph----------------------------------------------------------------------------page 2
Asset Inventory List-----------------------------------------------------------------------------------page 3
Significant Components Table---------------------------------------------------------------------page 4
Significant Components – Graph------------------------------------------------------------------page 5
Yearly Summary Table-------------------------------------------------------------------------------page 6
Yearly Contributions – Graph-----------------------------------------------------------------------page 7
Component Funding Information------------------------------------------------------------------page 8
Yearly Cash Flow Table-----------------------------------------------------------------------------page 9
Projected Expenditures Year by Year – Graph ----------------------------------------------page 10
Projected Expenditures Year by Year --------------------------------------------------pages 11 - 12
SECTION 4:
Glossary of Terms and Definitions------------------------------------------------------pages 1 - 2
Introduction to the Reserve Analysis –
The elected officials of this association made a wise decision to invest in a Reserve Analysis to
get a better understanding of the status of the Reserve funds. This Analysis will be a valuable tool
to assist the Board of Directors in making the decision to which the dues are derived. Typically,
the Reserve contribution makes up 15% - 40% of the association’s total budget. Therefore,
Reserves is considered to be a significant part of the overall monthly association payment.
Every association conducts its business within a budget. There are typically two main parts to this
budget, Operating and Reserves. The Operating budget includes all expenses that are fixed on
an annual basis. These would include management fees, maintenance fees, utilities, etc. The
Reserves is primarily made up of Capital Replacement items such as asphalt, roofing, fencing,
mechanical equipment, etc., that do not normally occur on an annual basis.
The Reserve Analysis is also broken down into two different parts, the Physical Analysis and the
Financial Analysis. The Physical Analysis is information regarding the physical status and
replacement cost of major common area components that the association is responsible to
maintain. It is important to understand that while the Component Inventory will remain relatively
“stable” from year to year, the Condition Assessment and Life/Valuation Estimates will most likely
vary from year to year. You can find this information in the Asset Inventory Section (Section 2)
of this Reserve Analysis. The Financial Analysis Section is the evaluation of the association’s
Reserve balance, income, and expenses. This is made up of a finding of the clients current
Reserve Fund Status (measured as Percent Funded) and a recommendation for an appropriate
Reserve Allocation rate (also known as the Funding Plan). You can find this information in
Section 3 (pages 1 – 13) of this Reserve Analysis.
The purpose of this Reserve Analysis is to provide an educated estimate as to what the Reserve
Allocation needs to be. The detailed schedules will serve as an advanced warning that major
projects will need to be addressed in the future. This will allow the Board of Directors to have
ample timing to obtain competitive estimates and bids that will result in cost savings to the
individual homeowners. This will also ensure the physical well being of the property and ultimately
enhance each owner’s investment, while limiting the possibility of unexpected major projects that
may lead to Special Assessments.
It is important for the client, homeowners, and potential future homeowners to understand that the
information contained in this analysis is based on estimates and assumptions gathered from
various sources. Estimated life expectancies and cycles are based upon conditions that were
readily visible and accessible at time of the observation. No destructive or intrusive methods
(such as entering the walls to inspect the condition of electrical wiring, plumbing lines, and
telephone wires) were performed. In addition, environmental hazards (such as lead paint,
asbestos, radon, etc.), construction defects, and acts of nature have not been investigated in the
preparation of this report. If problem areas were revealed, a reasonable effort has been made to
include these items within the report. While every effort has been made to ensure accurate
results, this report reflects the judgment of Aspen Reserve Specialties and should not be
construed as a guarantee or assurance of predicting future events.
1
General Information and Answers to Frequently Asked Questions –
Why is it important to perform a Reserve Study?
As previously mentioned, the Reserve allocation makes up a significant portion of the total
monthly dues. This report provides the essential information that is needed to guide the Board of
Directors in establishing the budget in order to run the daily operations of your association. It is
suggested that a third party professionally prepare a Reserve Study since there is no vested
interest in the property. Also, a professional knows what to look for and how to properly develop
an accurate and reliable component list.
Now that we have “it”, what do we do with “it”?
Hopefully, you will not look at this report and think it is too cumbersome to understand. Our
intention is to make this Reserve Analysis very easy to read and understand. Please take the
time to review it carefully and make sure the “main ingredients” (asset information) are complete
and accurate. If there are any inaccuracies, please inform us immediately so we may revise the
report.
Once you feel the report is an accurate tool to work from, use it to help establish your budget for
the upcoming fiscal year. The Reserve allocation makes up a significant portion of the total
monthly dues and this report should help you determine the correct amount of money to go into
the Reserve fund. Additionally, the Reserve Study should act as a guide to obtain proposals in
advance of pending normal maintenance and replacement projects. This will give you an
opportunity to shop around for the best price available.
The Reserve Study should be readily available for Real Estate agents, brokerage firms, and
lending institutions for potential future homeowners. As the importance of Reserves becomes
more of a household term, people are requesting homeowners associations to reveal the strength
of the Reserve fund prior to purchasing a condominium or townhome.
How often do we update or review “it”?
Unfortunately, there is a misconception that these reports are good for an extended period of time
since the report has projections for the next 30 years. Just like any major line item in the budget,
the Reserve Analysis should be reviewed each year before the budget is established. Invariably,
some assumptions have to be made during the compilation of this analysis. Anticipated events
may not materialize and unpredictable circumstances could occur. Aging rates and
repair/replacement costs will vary from causes that are unforeseen. Earned interest rates may
vary from year to year. These variations could alter the content of the Reserve Analysis.
Therefore, this analysis should be reviewed annually, and a property observation should be
conducted at least once every three years.
Is it the law to have a Reserve Study conducted?
The Government requires reserve analyses in approximately 20 states. The State of Colorado
currently requires all associations to adopt a Reserve policy, but does not currently enforce a
Reserve Study is completed. Despite enacting this current law, the chances are also very good
the documents of the association require the association to have a Reserve fund established.
This may not mean a Reserve Analysis is required, but how are you going to know there are
enough funds in the account if you don’t have the proper information? Hypothetically, some
associations look at the Reserve fund and think $50,000 is a lot of money and they are in good
shape. What they don’t know is the roof will need to be replaced within 5 years, and the cost of
the roof is going to exceed $75,000. So while $50,000 sounds like a lot of money, in reality it
won’t even cover the cost of a roof, let alone all the other amenities the association is responsible
to maintain.
2
What makes an asset a “Reserve” item versus an “Operating” item?
A “Reserve” asset is an item that is the responsibility of the association to maintain, has a limited
Useful Life, predictable Remaining Useful Life expectancies, typically occurs on a cyclical basis
that exceeds 1 year, and costs above a minimum threshold cost. An “operating” expense is
typically a fixed expense that occurs on an annual basis. For instance, minor repairs to a roof for
damage caused by high winds or other weather elements would be considered an “operating”
expense. However, if the entire roof needs to be replaced because it has reached the end of its
life expectancy, then the replacement would be considered a Reserve expense.
The GREY area of “maintenance” items that are often seen in a Reserve Study –
One of the most popular questions revolves around major “maintenance” items, such as painting
the buildings or seal coating the asphalt. You may hear from your accountant that since painting
or seal coating is not replacing a “capital” item, then it cannot be considered a Reserve issue.
However, it is the opinion of several major Reserve Study providers that these items are
considered to be major expenses that occur on a cyclical basis. Therefore, it makes it very
difficult to ignore a major expense that meets the criteria to be considered a Reserve component.
Once explained in this context, many accountants tend to agree and will include any expenses,
such as these examples, as a Reserve component.
The Property Observation –
The Property Observation was conducted following a review of the documents that were
established by the developer identifying all common area assets. In some cases, the Board of
Directors at some point may have revised the documents. In either case, the most current set of
documents was reviewed prior to inspecting the property. In addition, common area assets may
have been reported to Aspen Reserve Specialties by the client, or by other parties.
Estimated life expectancies and life cycles are based upon conditions that were readily
accessible and visible at the time of the observation. We did not destroy any landscape work,
building walls, or perform any methods of intrusive investigation during the observation. In these
cases, information may have been obtained by contacting the contractor or vendor that has
worked on the property.
The Reserve Fund Analysis –
We projected the starting balance from taking the most recent balance statement, adding
expected Reserve contributions for the rest of the year, and subtracting any pending projects for
the rest of the year. We compared this number to the ideal Reserve Balance and arrived at the
Percent funded level. Measures of strength are as follows:
0% - 30% Funded – Is considered to be a “weak” financial position. Associations that fall
into this category are subject to Special Assessments and deferred maintenance, which could
lead to lower property values. If the association is in this position, actions should be taken to
improve the financial strength of the Reserve Fund.
31% - 69% Funded – The majority of associations are considered to be in this “fair”
financial position. While this doesn’t represent financial strength and stability, the likelihood of
Special Assessments and deferred maintenance is diminished. Effort should be taken to continue
strengthening the financial position of the Reserve fund.
70% - 99% Funded – This indicates financial strength of a Reserve fund and every
attempt to maintain this level should be a goal of the association.
100% Funded – This is the ideal amount of Reserve funding. This means that the
association has the exact amount of funds in the Reserve account that should be at any given
time.
3
Summary of Sixth Avenue West TH #2 Assoc.Projected Starting Balance as of April 1, 2012 Ideal Reserve Balance as of April 1, 2012 Percent Funded as of April 1, 2012 Recommended Reserve Allocation (per month) Minimum Reserve Allocation (per month) Recommended Special Assessment (2012) -
Assoc. ID # - 04027
$194,918
$539,054
36%
$8,400
$8,250
$0
This report is an update to an existing Reserve Study that was prepared for the association 8
years ago for the 2004/05 fiscal period. An observation of the property’s common area elements
took place on February 29, 2012 to verify the information from this previous report. In addition, we
obtained information by contacting local vendors and contractors, as well as communicating with
the property representative. To the best of our knowledge, the conclusions and suggestions of
this report are considered reliable and accurate insofar as the information obtained from these
sources.
This property contains 102 townhome units within 14 different buildings ranging in size from 6 to 8
units each. These buildings are approximately 38 years old, and certain major components are
nearing the end of their life expectancy. Common area responsibilities include building exterior
surfaces, private streets/parking areas, and landscaped grounds. Recently completed Reserve
projects include repairing some concrete surfaces (although more repairs are needed), and
replacement of a couple irrigation clocks. Please refer to pages 11 - 12 of the Financial Analysis
for a detailed listing of when projects are scheduled to be addressed.
In comparing the projected balance of $194,918 versus the ideal Reserve Balance of $539,054,
we find the association Reserve fund to be in a less than average financial position
(approximately 36% funded of ideal) at this time. While the association has followed our
recommendation set back in 2004, frequent report updates were not completed in order to update
replacement costs and replacement cycles. Replacement costs of several major components
(roofing and asphalt) more than doubled since 2004 as a result of unpredictable outside forces
(oil crisis). Associations in this position are typically susceptible to Special Assessments or
deferred maintenance, which can lead to lower property values. However, as long as our
recommendation is followed, additional Special Assessments can be avoided. It was reported the
members will be Assessed an amount that will be the difference between the total cost of the
asphalt work and $150,000 that will be coming out of the Reserve account in 2013. In addition,
the current budgeted Reserve allocation is less than adequate in funding the Reserve fund to
address future projects. Therefore, we suggest increasing the Reserve contribution to $8,400 per
month (representing an increase of $43.61 per unit), followed by nominal annual increases of
2.25% - 3.00% thereafter to help offset the effects of inflation. By following the recommendation,
the plan will maintain the Reserve account in a positive manner, while gradually increasing to a
fully funded position within the thirty-year period.
In the percent Funded graph, you will see that we have also suggested a minimum Reserve
contribution of $8,250 per month. If the Reserve contribution falls below this rate, then the
Reserve fund will fall into a situation where Special Assessments, deferred maintenance, and
lower property values are possible at some point in the future. The minimum Reserve allocation
follows the “threshold” theory of Reserve funding where the ”percent funded” status is not allowed
to dip below 30% funded at any point during the thirty-year period. This was provided for one
purpose only, to show the association how small the difference is between the two scenarios and
how it would not make financial sense to contribute less money (less than $1.50 per unit per
month in this case) to the Reserve fund to only stay above a certain threshold. As you can see,
the difference between the two scenarios is considered to be extremely minimal, and based on
the risk, we strongly suggest the recommended Reserve Allocation is followed.
4
Component Inventory for Sixth Avenue West TH #2
Comp #:
104
Client Reference #
4027
Carport Roofs/Supports - Replace
Observations:
The evidence of minor surface rusting along the edges of the carports still exist today and the conditions have not
changed significantly since our last property inspection in 2004. All carports appear to be structurally intact at this time.
We did observe a few support poles that have been recently installed. A few corners and edges were also damaged
from large trucks running into them. These structures are assumed to be original and in good to fair condition for the age
of the community. This type of material has an extended life expectancy and there is no anticipation for complete
replacement. Treat repairs on an as needed basis with general operating dues at this time.
Location:
Carports
Quantity:
Approx. 41,000 GSF
Life Expectancy:
N/A Remaining Life:
Best Cost:
$0
Worst Cost:
$0
General Notes:
Unit #61 through 75 - 2840 GSF
Unit #14740 through 14758 - 2520 GSF
Unit #14676 through 14690 - 3360 GSF
Unit #1 through 11 - 2520 GSF
Unit #15 through 25 - 2520 GSF
Unit #29 through 43 - 2940 GSF
Unit #14665 through 14675 - 2460 GSF
Unit #14711 through 14735 - 3360 GSF
Unit #161 through 175 - 2940 GSF
Unit #211 through 225 - 3360 GSF
Unit #251 through 265 - 3360 GSF
Unit #301 through 311 - 2520 GSF
Unit #14710 through 14734 - 3360 GSF
Unit #45 through 59 - 2940 GSF
Source of Information:
Page 1 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
105
Client Reference #
4027
Comp Shingle Roof - Replace (B)
Observations:
At the time of this property observation, we observed several areas where there was evidence of wind damage and
missing shingles. It was reported that numerous repairs have been completed to these wind damaged areas, nut no
complete replacement. In closely inspecting one of the shingles on the ground, there was some granule loss due to
typical aging. While this roof material may have a rating of 30-years from the manufacturer, the average life expectancy
for this type of roof in this environment ranges from 15 - 18 years due to the harsh elements. Factors that decrease the
life expectancy includes hail storms, freeze/thaw cycles, intense heat, dryness, and heavy winds. We split the
replacement in 2 phases to spread out the expense and help budgeting.
Location:
Mansards and rooftops
Quantity:
Approx. 753 squares
Life Expectancy:
18
Remaining Life: 7
$244,725
$325/square; Estimate to remove and replace
Best Cost:
Worst Cost:
$263,550
$350/square; Higher estimate for more labor costs
Source of Information: Research with contractor
General Notes:
Mailbox kiosks - 1 square total
Unit #61 through 75 - 107 squares
Unit #14740 through 14758 - 95 squares
Unit #14676 through 14690 - 120 squares
Unit #1 through 11 - 93 squares
Unit #15 through 25 - 93 squares
Unit #29 through 43 - 107 squares
Unit #14665 through 14675 - 93 squares
Unit #14711 through 14735 - 120 squares
Unit #161 through 175 - 109 squares
Unit #211 through 225 - 124 squares
Unit #251 through 265 - 124 squares
Unit #301 through 311 - 93 squares
Unit #14710 through 14734 - 120 squares
Unit #45 through 59 - 107 squares
Page 2 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
105
Client Reference #
4027
Comp Shingle Roof - Replace (A)
Observations:
At the time of this property observation, we observed several areas where there was evidence of wind damage and
missing shingles. It was reported that numerous repairs have been completed to these wind damaged areas, nut no
complete replacement. In closely inspecting one of the shingles on the ground, there was some granule loss due to
typical aging. While this roof material may have a rating of 30-years from the manufacturer, the average life expectancy
for this type of roof in this environment ranges from 15 - 18 years due to the harsh elements. Factors that decrease the
life expectancy includes hail storms, freeze/thaw cycles, intense heat, dryness, and heavy winds. We split the
replacement in 2 phases to spread out the expense and help budgeting.
Location:
Mansards and rooftops
Quantity:
Approx. 753 squares
Life Expectancy:
18
Remaining Life: 6
$244,725
$325/square; Estimate to remove and replace
Best Cost:
Worst Cost:
$263,550
$350/square; Higher estimate for more labor costs
Source of Information: Research with contractor
General Notes:
Mailbox kiosks - 1 square total
Unit #61 through 75 - 107 squares
Unit #14740 through 14758 - 95 squares
Unit #14676 through 14690 - 120 squares
Unit #1 through 11 - 93 squares
Unit #15 through 25 - 93 squares
Unit #29 through 43 - 107 squares
Unit #14665 through 14675 - 93 squares
Unit #14711 through 14735 - 120 squares
Unit #161 through 175 - 109 squares
Unit #211 through 225 - 124 squares
Unit #251 through 265 - 124 squares
Unit #301 through 311 - 93 squares
Unit #14710 through 14734 - 120 squares
Unit #45 through 59 - 107 squares
Page 3 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
120
Client Reference #
4027
Raingutters/Downspouts - Replace (partial)
Observations:
Majority of lines appeared to be in fair condition with only a few damaged lines and downspout extensions. It also
appears as though some areas have been repaired or replaced recently (new lines on building 7 - units 15 - 25). Any
minor repairs, such as to downspout extensions, should be handled as an operating issue, not reserves. No other
unusual conditions were observed with the gutters or downspouts. Typically, raingutters and downspouts are replaced at
the same time as roof materials. Therefore, Reserve to replace every 18 years. Remaining life is also based on current
overall condition.
Location:
Perimeter of roofs
Quantity:
Approx. 6,220 LF
Life Expectancy:
9
Remaining Life: 6
$16,350
$5.25/LF; Estimate to replace 50% every 9 years
Best Cost:
Worst Cost:
$18,650
$6.00/LF: Higher estimate for larger lines
General Notes:
Unit #61 through 75 - 430 LF
Unit #14740 through 14758 - 390 LF
Unit #14676 through 14690 - 520 LF
Unit #1 through 11 - 360 LF
Unit #15 through 25 - 380 LF
Unit #29 through 43 - 430 LF
Unit #14665 through 14675 - 400 LF
Unit #14711 through 14735 - 520 LF
Unit #161 through 175 - 410 LF
Unit #211 through 225 - 580 LF
Unit #251 through 265 - 500 LF
Unit #301 through 311 - 350 LF
Unit #14710 through 14734 - 520 LF
Unit #45 through 59 - 430 LF
Source of Information: Cost database
Page 4 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
209
Client Reference #
4027
Wood Fencing - Restain
Observations:
All fencing is weathered with exposed surfaces throughout. It does not appear the majority of the fences have ever been
stained or painted to protect the materials against warping and splitting. As long as the fence remains unprotected (not
sealed), Reserve funding is not required for this component. If association decides to stain the new fence in the future,
then Reserve funding can be added in future Reserve Study updates.
Location:
Units, trash enclosures
Quantity:
Approx. 3,000 LF
Life Expectancy:
N/A Remaining Life:
Best Cost:
$0
Worst Cost:
$0
Source of Information:
General Notes:
Unit #61 through 75 - 169 LF
Unit #14740 through 14758 - 193 LF
Unit #14676 through 14690 - 250 LF
Unit #1 through 11 - 275 LF
Unit #15 through 25 - 150 LF
Unit #29 through 43 - 215 LF
Unit #14665 through 14675 - 175 LF
Unit #14711 through 14735 - 210 LF
Unit #161 through 175 - 175 LF
Unit #211 through 225 - 195 LF
Unit #251 through 265 - 195 LF
Unit #301 through 311 - 150 LF
Unit #14710 through 14734 - 210 LF
Unit #45 through 59 - 220 LF
Trash enclosures - 220 LF
(6) 30 LF each
(1) 40 LF each
NOTE Fences that have been damaged by wind (blown over) include
14675 and 211.
Page 5 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
301
Client Reference #
4027
Siding Materials - Repair/Repaint
Observations:
We observed some minor fading on the darker (red) colors, especially surfaces that are exposed to the south. The
lighter colored materials are in fair condition with some minor discoloring noted. There were no signs of any peeling paint
or exposed siding. At the time of our site visit, we noticed a contractor repairing the siding around one of the upstairs
recessed window bays. He mentioned several of these areas have been repaired over the past couple years. Due to
overall small area, we suggest repairing any necessary sections at the same time as painting. In this environment, wood
surfaces should be repainted every 4 - 5 years to protect the material from deterioration.
Location:
Ends of buildings, under windows
Quantity:
Approx. 6,150 GSF
Life Expectancy:
5
Remaining Life: 3
$17,850
$175/unit; Allowance to repaint and repair
Best Cost:
Worst Cost:
$25,500
$250/unit; Higher estimate for more prep work
Source of Information: Cost database
General Notes:
Unit #61 through 75 - 415 GSF
Unit #14740 through 14758 - 310 GSF
Unit #14676 through 14690 - 420 GSF
Unit #1 through 11 - 505 GSF
Unit #15 through 25 - 505 GSF
Unit #29 through 43 - 415 GSF
Unit #14665 through 14675 - 505 GSF
Unit #14711 through 14735 - 420 GSF
Unit #161 through 175 - 530 GSF
Unit #211 through 225 - 576 GSF
Unit #251 through 265 - 576 GSF
Unit #301 through 311 - 505 GSF
Unit #14710 through 14734 - 420 GSF
Unit #45 through 59 - 415 GSF
NOTE - The remaining life was extended to 3 years per the
request of the client.
Page 6 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
306
Client Reference #
4027
Brick Siding - Replace
Observations:
Bricks appeared to be attached to the sides of the building well with no loose or missing material noted. Typically, bricks
have an extended life expectancy and complete replacement is unlikely. There are times where minor repairs may
become necessary, but this is unpredictable when and how much would occur. Repairs should be handled as a
maintenance issue on an as needed basis. Reserve funding is not required for this component at this time. If it later
turns out that frequent repairs are necessary, then funding could be added in future Reserve Study updates.
Location:
Lower half of buildings
Quantity:
Approx. 53,225 GSF
Life Expectancy:
N/A Remaining Life:
Best Cost:
$0
Worst Cost:
$0
Source of Information:
General Notes:
mailbox kiosks - 224 GSF
Unit #61 through 75 - 3620 GSF
Unit #14740 through 14758 - 3260 GSF
Unit #14676 through 14690 - 4720 GSF
Unit #1 through 11 - 3200 GSF
Unit #15 through 25 - 3200 GSF
Unit #29 through 43 - 3620 GSF
Unit #14665 through 14675 - 3200 GSF
Unit #14711 through 14735 - 4720 GSF
Unit #161 through 175 - 3680 GSF
Unit #211 through 225 - 4120 GSF
Unit #251 through 265 - 4120 GSF
Unit #301 through 311 - 3200 GSF
Unit #14710 through 14734 - 4720 GSF
Unit #45 through 59 - 3620 GSF
Page 7 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
401
Client Reference #
4027
Asphalt - Overlay
Observations:
There are numerous potholes and severe cracking throughout the entire community. Repairs can be performed to
extend the life of the surface, but this is only delaying the inevitable that the parking lot has reached the end of its life
expectancy. When the surface is redone, we recommend installing concrete drain pans in strategic areas that will divert
water away from the lot and protect the asphalt from damage due to constant exposure to draining water. The average
life expectancy for asphalt ranges from 20 - 25 years in this environment, depending on the level of maintenance and
amount of traffic on the property. Seal coating is recommended every 3 - 4 years to protect the surface.
Location:
Common area driveways, parking
Quantity:
Approx. 118,975 GSF
Life Expectancy:
21
Remaining Life: 22
General Notes:
The reason the remaining life exceeds the useful life is due to
the replacement project being deferred until 2013. Once the
surface is replaced, the association should plan for future
overlay and major work which should occur about 20 - 25 years
following the project.
$178,500
$1.50/GSF; Est. to rotomill and 2" overlay
Best Cost:
Worst Cost:
$196,300
$1.65/GSF; Higher estimate for local repairs
Source of Information: Cost database
Page 8 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
401
Client Reference #
4027
Asphalt - Remove and Replace
Observations:
In general, the parking lot is in poor condition and it was reported that the entire lot will need to be removed and
replaced. Only a portion of the expense will be taken from the Reserves, as the balance will be funded from separate
means. Therefore, since this is expected to be a one-time expense, we have established the Useful Life at "99" years to
"trick" the program.
Location:
Common area driveways, parking
Quantity:
Approx. 118,975 GSF
Life Expectancy:
99
Remaining Life: 1
General Notes:
Reported from client - "Total exact cost of project is still
unknown. The proposal to homeowners includes approximately
$150,000 out of reserves with the remainder to be paid through
a line of credit secured by a special assessment."
$150,000
Partial amount to remove and replace
Best Cost:
Worst Cost:
$150,000
Higher estimate for local repairs
Source of Information: Estimates received by client
Page 9 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
402
Client Reference #
4027
Asphalt - Seal Coat/crack fill
Observations:
In general, the parking lot is in need of an overlay in the near future. This type of material is subject to heavy wear in this
environment due to snow removal techniques. Snow plows gradually remove small layers of asphalt every time plows
are used. Sand and gravel acts as sand paper to the surface as cars drive over the surface. No matter what kind of
removal is used, the asphalt layers diminish each year. In this environment, it is recommended that a seal coat is applied
every 3 - 4 years, depending on the amount of traffic and the effects of the elements over the years. Industry
professionals recommend seal coating with 12 months of a new application to ensure the surface is properly sealed from
the start.
Location:
Common area driveways, parking
Quantity:
Approx. 118,975 GSF
Life Expectancy:
3
General Notes:
Remaining Life: 1
$11,900
$.10/GSF; Est. for seal coat and stripe
Best Cost:
Worst Cost:
$15,500
$.13/GSF; Higher est. includes repairs/crack fill
Source of Information: Research with local contractor
Page 10 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
601
Client Reference #
4027
Concrete Sidewalks - Repair
Observations:
Conditions vary throughout the community with areas that have been recently repaired (shaving and remove and
replace), to areas that are in poor condition (cracking, settling, spalling, etc.). Due to varying conditions, it is unlikely all
concrete surfaces will fail and need to be replaced at the same time. Therefore, we suggest establishing a Reserve fund
for frequent repairs and replacement to a percentage of the area (10% or 1430 GSF) every 4 years. The remaining life is
based on the fact that several stoops need to be replaced or mud jacked in the near future.
Location:
Common area sdiewalks
Quantity:
Approx. 14,300 GSF
Life Expectancy:
4
Remaining Life: 2
$12,150
Allowance to repair 10% of area every 4 years
Best Cost:
Worst Cost:
$13,950
Higher estimate for more repairs
Source of Information: Cost database
General Notes:
Trash enclosures - (6) at 64 GSF ea = 384 GSF
Unit #61-75 - 1125 GSF
Unit #14740-14758 - 620 GSF
Unit #14676 through 14690 - 1200 GSF
Unit #1 through 11 - 820 GSF
Unit #15 through 25 - 900 GSF (new sidewalk leading to unit 17)
Unit #29 through 43 - 940 GSF
Unit #14665 through 14675 - 840 GSF
Unit #14711 through 14735 - 1275 GSF
Unit #161 through 175 - 960 GSF
Unit #211 through 225 - 1030 GSF
Unit #251 through 265 - 1060 GSF
Unit #301 through 311 - 850 GSF
Unit #14710 through 14734 - 1340 GSF
Unit #45 through 59 - 960 GSF
NOTE:
new stoop for unit 57 is already cracking
stoop 61/63 is settled
165/167 stoop has substantial settling
Page 11 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
801
Client Reference #
4027
Monument - Rebuild
Observations:
Monument is structurally stable and in good condition with some of the letters beginning to discolor and fade. There were
a few bricks that has chipped and broken by the "S" in" West". It appears this monument is original, and as a result, it is
our opinion that it was built extremely well and the likelihood of future failure is minimal. The lettering can be replaced as
desired as an operating expense. Based on overall condition and stability of wall, we do not suggest Reserving for
repairs or replacement at this time. If the association would prefer to "update" the monument at some point on the future,
then Reserve funding can be added to future report updates at the request of the client.
Location:
Ellsworth Ave.
Quantity:
Approx. 175 GSF brick, lettering
Life Expectancy:
N/A Remaining Life:
Best Cost:
$0
Worst Cost:
$0
General Notes:
Source of Information:
Page 12 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
802
Client Reference #
4027
Identification Sign - Replace
Observations:
The main wood is weathered with some drying and cracking noted. It appears that a sheet of OSB was attached to the
backside of the sign to stabilize the older wood. While the sign has an aged appearance, it is still legible and functional
as an identification sign. Eventually, the sign will need to be replaced due to deterioration of the wood. When
replacement is required, the cost can vary depending on the type of materials used and overall design. The estimated
replacement cost is for similar design or slight upgrade. If longer lasting materials are used at time of replacement, the
life expectancy can be adjusted in future Reserve Study updates.
Location:
Adjacent to bldg 1
Quantity:
(1) 8 x 3.5' wood sign
Life Expectancy:
25
General Notes:
NOTE - The remaining life was extended to 5 years per the
request of the client.
Remaining Life: 5
$1,750
Estimate to replace with a similar design
Best Cost:
Worst Cost:
$2,000
Higher estimate for different material
Source of Information: Research with contractor
Page 13 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
803
Client Reference #
4027
Mailboxes - Replace
Observations:
Mailboxes are currently installed in a brick structure that was built to house the exact size of the mailbox bank. While
these are still functional, the end of their useful life is approaching and the association should anticipate replacement in
the near future. At the current time, there are CBU's that are of similar size that should fit into the existing space. If not,
then complete renovation of the entire structure is possible. The estimated cost is for replacement of similar size boxes
and minor modifications to the structure.
Location:
Adjeacent to streets
Quantity:
(112) Boxes
Life Expectancy:
20
Remaining Life: 1
General Notes:
By unit #43 (4) 4x4 banks with 1 slot dedicated as an outgoing box.
By unit #175 (4) 4x3 banks with 1 slot dedicated as an outgoing box.
$7,850
$70/box; Estimate to replace
Best Cost:
Worst Cost:
$9,550
$85/box; Higher estimate
Source of Information: Research with manufacturer
Page 14 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
809
Client Reference #
4027
Address Signs - Replace
Observations:
No significant change to appearance since the last property inspection. These are still functional and serve the purpose.
If he association decides to upgrade signs, we suggest using operating funds as the cost is too small for separate
Reserve consideration.
Location:
Entrance to driveways
Quantity:
Approx. (120) Assorted signs
Life Expectancy:
N/A Remaining Life:
Best Cost:
$0
Worst Cost:
$0
General Notes:
5 assorted signs at driveway entrances
(1) each unit for unit number
Source of Information:
Page 15 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
Client Reference #
4027
1002 Ironwork Handrails - Replace
Observations:
Current conditions exhibit some rusting and corrosion that has worn through the metal in various areas. Some of these
areas can pose a danger of cutting someone's hand. As a result, we have established an allowance for periodic repairs
and replacement of the railings to ensure safe conditions at all times. The remaining life is based on overall age and
observed conditions of several rails that need replacement soon.
Location:
Various locations throughout property
Quantity:
Approx. 375 LF
Life Expectancy:
10
Remaining Life: 1
$2,500
Allowance for major repairs/replacement
Best Cost:
Worst Cost:
$3,000
Higher estimate for more repairs
General Notes:
Building 61 through 75 - 56 LF
Building 14740 through 14758 - 10 LF
Unit #14676 through 14690 - 80 LF
Unit #1 through 11 - 38 LF
Unit #15 through 25 - 8 LF
Unit #29 through 43 - 95 LF
Unit #14711 through 14735 - 72 LF
Unit #14710 through 14734 - 16 LF
NOTE - The remaining life was extended by 1 year per the
request of the client.
Source of Information: Cost database
Page 16 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
Client Reference #
4027
1003 Wood Fencing - Replace
Observations:
In general, the fencing conditions range from weathered and deteriorated, to stable and in good condition. In testing
several areas, there were some sections that were pretty stable, but others that appeared the integrity of the post has
been compromised, leading to loose and unstable sections. This was confirmed by several sections that had fallen over
during recent high wind storms. At this time, we suggest the association plan for replacement of the fences in the near
future to provide a safe atmosphere for the community. Due to varying conditions, we have established Reserve funding
to replace about 1/3rd of the fences every 6 years.
Location:
Units, trash enclosures
Quantity:
Approx. 3,000 LF
Life Expectancy:
6
Remaining Life: 0
$25,000
$25/LF; Estimate to replace 1/3rd every 6 years
Best Cost:
Worst Cost:
$30,000
Higher estimate for more repairs
Source of Information: Cost database
General Notes:
Unit #61 through 75 - 169 LF
Unit #14740 through 14758 - 193 LF
Unit #14676 through 14690 - 250 LF
Unit #1 through 11 - 275 LF
Unit #15 through 25 - 150 LF
Unit #29 through 43 - 215 LF
Unit #14665 through 14675 - 175 LF
Unit #14711 through 14735 - 210 LF
Unit #161 through 175 - 175 LF
Unit #211 through 225 - 195 LF
Unit #251 through 265 - 195 LF
Unit #301 through 311 - 150 LF
Unit #14710 through 14734 - 210 LF
Unit #45 through 59 - 220 LF
Trash enclosures - 220 LF
(6) 30 LF each
(1) 40 LF each
NOTE Fences that have been damaged by wind (blown over) include
14675 and 211.
Page 17 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
Client Reference #
4027
1005 Brick Columns/Wall - Replace
Observations:
The wall and columns are very sturdy and in good condition. Some of the bricks were cracked and the concrete caps
were starting to spall, but all columns were intact and stable. Based on the materials used and the condition when
compared to the age of the property, we do not anticipate complete replacement of these columns. Perform minor
repairs on an as needed basis using operating funds.
Location:
North perimeter of property
Quantity:
Approx. 330 GSF
Life Expectancy:
N/A Remaining Life:
Best Cost:
$0
Worst Cost:
$0
General Notes:
Source of Information:
Page 18 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
Client Reference #
4027
1009 Split Rail Fencing - Replace
Observations:
There were typical signs of deterioration for this type fence. Split rail fences tend to have an aged appearance with small
cracks and splintering. The overall area and replacement cost (less than $1000) is too small for Reserve funding. We
suggest repairing or replacing as a maintenance issue.
Location:
North perimeter of property
Quantity:
Approx. 100 LF
Life Expectancy:
N/A Remaining Life:
Best Cost:
$0
Worst Cost:
$0
General Notes:
Source of Information:
Page 19 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
Client Reference #
4027
1602 Exterior Wall Mount - Replace
Observations:
Fixtures differ from unit to unit. Therefore, it is assumed these lights are the responsibility of each owner to replace when
necessary. Declarations are unclear as to who is responsible for these lights. Reserve funding is not required for this
component at this time unless the association makes a decision to replace as a whole to maintain a consistent
appearance. If association decides to replace all at the same time, the cost for the replacement will depend on the
quality of the fixture installed. The average cost of a new standard light is usually around $125 per fixture or about
$12,500 for all lights.
Location:
Front doors of each unit
Quantity:
Approx. 100 lights
Life Expectancy:
N/A Remaining Life:
Best Cost:
$0
Worst Cost:
$0
General Notes:
Source of Information:
Page 20 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
Client Reference #
4027
1609 Street Lights - Replace
Observations:
Fixtures were stable and in good condition during inspection. Reported that these fixtures were replaced approximately
18 years ago. The poles are constructed of fiberglass and have a very long life expectancy. Some minor fading and
weathering noted on poles, but not significant enough to be concerned about stability at this time. However, the fixture
heads typically need to be replaced every 30 - 40 years. Unable to observe fixtures in working conditions since
inspection took place during daylight hours.
Location:
Parking lots
Quantity:
(7) 20' poles
Life Expectancy:
35
General Notes:
Remaining Life: 17
$8,400
$1200/fixture; Estimate to replace
Best Cost:
Worst Cost:
$10,500
$1500/fixture; Higher estimate
Source of Information: Cost database
Page 21 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
Client Reference #
4027
1701 Irrigation System - Rebuild
Observations:
According to the contractor, the system is older and in need of major refurbishment. Ideally, the entire system needs to
be replaced, but the cost to replace would be unfeasible at this time. Therefore, we have established a line item for
major repairs every 3 years. We have coordinated this to occur at the same time as groundcover refurbishment (see
component #1801) so the landscaping can be done after the grounds are torn up to replace the lines.
Location:
Landscaped areas
Quantity:
Extensive area
Life Expectancy:
3
Remaining Life: 3
General Notes:
NOTE - It was reported this expense is currently handled as an
operating expense, but will turn into a Reserve issue in the
future. Therefore, the remaining life needs to equal the useful
life in order to prepare for the next time around that an expense
will need to occur for this component.
$15,000
Allowance for major repairs and rebuilding
Best Cost:
Worst Cost:
$20,000
Higher estimate for more labor
Source of Information: Research with contractor
Page 22 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
Client Reference #
4027
1703 Irrigation Timeclocks - Replace
Observations:
Of the 7 clocks that operate the irrigation system, only 2 are less than 2 years old. The others are older and nearing the
end of their life expectancy. The average life expectancy of these clocks ranges from 10 - 12 years in this environment
under normal conditions. Normal conditions do not include failure of clock due to lightning strike or vandalism. Due to
varying ages, we have established a Reserve allowance to replace 3 clocks every 4 years. The remaining life is based
on the fact that the majority of clocks have reached the end of their life expectancy.
Location:
See general notes
Quantity:
(7) Assorted clocks
Life Expectancy:
4
Remaining Life: 4
$3,000
Allowance to replace 3 clocks every 4 years
Best Cost:
Worst Cost:
$3,600
Higher estimate for more efficiency
Source of Information: Cost database
General Notes:
Building 6 (unit 14675) Hunter Pro C, Aug 2010 (7 active stations)
Building 8 (unit 15) Irritrol, Dial 11
Building 3 (unit 211) Irritrol, Dial 7
Building 2 (unit #251) Hunter Pro C, August 2010 (7 active stations)
Building 14 (unit 75) Hunter ICC, 32 station capacity, 14 are active.
Building 5 (unit 14735) Irritrol
Building 9 (unit 14690) Irritrol, Dial 7
NOTE - It was reported this expense is currently handled as an
operating expense, but will turn into a Reserve issue in the
future. Therefore, the remaining life needs to equal the useful
life in order to prepare for the next time around that an expense
will need to occur for this component.
Page 23 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
Client Reference #
4027
1706 Backflow Devices - Replace
Observations:
All devices have been removed and were in storage at time of inspection to prevent theft. Devices can be rebuilt and
repaired when needed as a maintenance issue. It is very seldom that a complete system would need to be replaced due
to normal wear and tear. Replacement would be as a result of freezing conditions if system is not winterized properly or
in a timely manner. No Reserve funding is required due to difficulty of predicting a life expectancy and the fact that
systems can be rebuilt an a minimal cost, as opposed to being replaced.
Location:
Adjacent to some buildings
Quantity:
Approx. 7 devices
Life Expectancy:
N/A Remaining Life:
Best Cost:
$0
Worst Cost:
$0
General Notes:
locations observed:
14690
14675
14375
251
15
Source of Information:
Page 24 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
Client Reference #
4027
1801 Groundcover/Landscaping - Replenish
Observations:
In general, the grounds are dated and should be refurbished to restore a proper appearance for the community. Majority
of the area was in dormancy when we were on site, but there were a few areas that were bare and needed new shrubs.
We suggest establishing Reserve funding for periodic refurbishment of the landscaping to maintain an appropriate
appearance. Despite our recommendation to Reserve for this project, it was reported that the association takes a more
proactive approach to this by treating any renovations on an annual basis using Operating funds to pay for this project.
Therefore, separate Reserve funding is not necessary since it is already included in the Operating budget.
Location:
Common areas
Quantity:
Extensive groundcover
Life Expectancy:
N/A Remaining Life:
Best Cost:
$0
Worst Cost:
$0
General Notes:
Source of Information:
Page 25 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
Client Reference #
4027
1804 Tree - Replacement
Observations:
Trees appeared to be healthy and in good condition at time of inspection. Most trees were in dormancy or just starting to
bloom at time of field observation. It is very difficult to predict a replacement cycle for trees as there are several factors
that will contribute to a tree dying. Factors such as disease, infestation of insects, heavy snow storms, etc. can all
attribute to eventual tree replacement. Since it is difficult to predict when the replacement will be necessary, Reserve
funding is typically not a factor. Therefore, separate Reserve funding is not included for this component.
Location:
Common areas
Quantity:
Numerous sizes and types
Life Expectancy:
N/A Remaining Life:
Best Cost:
$0
Worst Cost:
$0
General Notes:
Source of Information:
Page 26 of 27
Friday, October 05, 2012
Component Inventory for Sixth Avenue West TH #2
Comp #:
Client Reference #
4027
1805 Railroad Ties/Timbers - Replace
Observations:
These landscape timbers and railroad ties do not act as a major retaining wall. These are in poor condition and need to
be rebuilt. These ties are used to separate the landscape rocks from entering the parking lot. Repair or replacement
cost is too small for separate Reserve designation. We suggest treating any repairs on an as needed basis with general
operating funds.
Location:
Parking lots
Quantity:
Extensive LF
Life Expectancy:
N/A Remaining Life:
Best Cost:
$0
Worst Cost:
$0
General Notes:
200 LF
Source of Information:
Page 27 of 27
Friday, October 05, 2012
Funding Summary For Sixth Avenue West TH #2 Association
Beginning Assumptions
Financial Information Source
# of units
Fiscal Year End
Monthly Dues from 2011 budget
Monthly Reserve Allocation from 2013 Budget
Projected Starting Reserve Balance (as of 4/1/2012)
Ideal Starting Reserve Balance (as of 4/1/2012)
Economic Factors
Current Inflation Rate (Based on Construction Cost Index)
Reported After-Tax Interest Rate
Current Reserve Status
Current Balance as a % of Ideal Balance
Research With Client
102
March 31, 2013
$19,968.00
$3,952.00
$194,918
$539,054
4.00%
2.50%
36%
Recommendations for 2012 Fiscal Year
Monthly Reserve Allocation
Per Unit
Minimum Monthly Reserve Allocation
Per Unit
Primary Annual Increases
# of Years
Secondary Annual Increases
# of Years
Special Assessment
Per Unit
$8,400
$82.35
$8,250
$80 88
$80.88
2.25%
20
3.00%
10
$0
$0
Changes From Prior Year (2011 to 2012)
Increase/Decrease to Reserve Allocation
as Percentage
Per Unit
$4,448
113%
$43.61
1
Percent Funded Graph For Sixth Avenue West TH #2 Association
Percent Funded
Recommended
Monthly Reserve Allocation
from 2013 Budget
Minimum
120%
80%
60%
40%
20%
Year
2
2042
2040
2038
2036
2034
2032
2030
2028
2026
2024
2022
2020
2018
2016
2014
0%
2012
% Level of Funding
Fun
100%
Component Inventory for Sixth Avenue West TH #2
Category
Asset #
Asset Name
UL
RUL
Roofing
104
105
105
120
Carport Roofs/Supports - Replace
Comp Shingle Roof - Replace (B)
Comp Shingle Roof - Replace (A)
Raingutters/Downspouts - Replace (parti
N/A
18
18
9
7
6
6
Painted Surfaces
209
Wood Fencing - Restain
N/A
Siding Materials
301
306
Siding Materials - Repair/Repaint
Brick Siding - Replace
5
N/A
Drive Materials
401
401
402
Asphalt - Overlay
Asphalt - Remove and Replace
Asphalt - Seal Coat/crack fill
Decking
601
Best Cost
Worst Cost
$0
$244,725
$244,725
$16,350
$0
$263,550
$263,550
$18,650
$0
$0
3
$17,850
$0
$25,500
$0
21
99
3
22
1
1
$178,500
$150,000
$11,900
$196,300
$150,000
$15,500
Concrete Sidewalks - Repair
4
2
$12,150
$13,950
Prop. Identification 801
802
803
809
Monument - Rebuild
Identification Sign - Replace
Mailboxes - Replace
Address Signs - Replace
N/A
25
20
N/A
5
1
$0
$1,750
$7,850
$0
$0
$2,000
$9,550
$0
Fencing/Walls
1002
1003
1005
1009
Ironwork Handrails - Replace
Wood Fencing - Replace
Brick Columns/Wall - Replace
Split Rail Fencing - Replace
10
6
N/A
N/A
$2,500
$25,000
$0
$0
$3,000
$30,000
$0
$0
Light Fixtures
1602
1609
Exterior Wall Mount - Replace
Street Lights - Replace
N/A
35
$0
$8,400
$0
$10,500
Irrig. System
1701
1703
1706
Irrigation System - Rebuild
Irrigation Timeclocks - Replace
Backflow Devices - Replace
3
4
N/A
$15,000
$3,000
$0
$20,000
$3,600
$0
Landscaping
1801
1804
1805
Groundcover/Landscaping - Replenish
Tree - Replacement
Railroad Ties/Timbers - Replace
N/A
N/A
N/A
$0
$0
$0
$0
$0
$0
3
1
0
17
3
4
Significant Components For Sixth Avenue West TH #2 Association
ID
105
105
120
301
401
401
402
601
802
803
1002
1003
1609
1701
1703
Asset Name
Comp Shingle Roof - Replace (A)
Comp Shingle Roof - Replace (B)
Raingutters/Downspouts - Replace (partial)
Siding Materials - Repair/Repaint
Asphalt - Overlay
Asphalt - Remove and Replace
Asphalt - Seal Coat/crack fill
Concrete Sidewalks - Repair
Identification Sign - Replace
Mailboxes - Replace
Ironwork Handrails - Replace
Wood Fencing - Replace
Street Lights - Replace
Irrigation System - Rebuild
Irrigation Timeclocks - Replace
UL
18
18
9
5
21
99
3
4
25
20
10
6
35
3
4
RUL
6
7
6
3
22
1
1
2
5
1
1
0
17
3
4
4
Ave Curr
Cost
$254,138
$254,138
$17,500
$21,675
$187,400
$150,000
$13,700
$13,050
$1,875
$8,700
$2,750
$27,500
$9,450
$17,500
$3,300
Significance:
(Curr Cost/UL)
As $
As %
$14,119
22.2110%
$14,119
22.2110%
$1,944
3.0589%
$4,335
6.8196%
$8,924
14.0385%
$0
0.0000%
$4,567
7.1841%
$3,263
5.1324%
$75
0.1180%
$435
0.6843%
$275
0.4326%
$4,583
7.2103%
$270
0.4248%
$5,833
9.1767%
$825
1.2979%
Significant Components Graph For Sixth Avenue West TH #2 Association
105 Comp Shingle Roof - Replace (A)
105 Comp Shingle Roof - Replace (A)
401 Asphalt - Overlay
1701 Irrigation System - Rebuild
All Other
22%
33%
22%
%
14%
9%
Significance:
(Curr Cost/UL)
Asset ID
105
105
401
1701
All Other
Asset Name
UL
RUL
Comp Shingle Roof - Replace (A)
18
Comp Shingle Roof - Replace (A)
18
Asphalt - Overlay
21
Irrigation System - Rebuild
3
See Expanded Table on Page 4 For Additional Breakdown
5
Average
Curr. Cost As $
6
6
22
3
$254,138
$254,138
$187,400
$17,500
$14,119
$14,119
$8,924
$5,833
$20,572
As
%
22%
22%
14%
9%
32%
Yearly Summary For Sixth Avenue West TH #2 Association
Fiscal
Year Start
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
Fully Funded
Balance
$539,054
$599,701
$
,
$503,001
$579,945
$631,677
$713,600
$820,203
$502,815
$243,368
$308 031
$308,031
$388,542
$460,761
$576,561
$625,043
$698,864
$817,796
$904,012
$1,030,880
$1,181,745
$1,194,972
$1,352,034
$1,543,449
$1,687,226
$1,383,570
$1,635,621
$1 635 621
$924,702
$395,355
$556,827
$717,241
$823,558
Starting
Reserve
Balance
$194,918
$274,074
$
,
$200,917
$298,424
$370,468
$471,273
$594,967
$304,232
$74,291
$163 520
$163,520
$267,138
$361,308
$496,539
$564,102
$655,035
$788,097
$886,713
$1,022,618
$1,178,840
$1,197,456
$1,354,292
$1,540,506
$1,676,726
$1,374,181
$1,528,892
$1 528 892
$916,369
$401,163
$564,868
$723,960
$826,608
Percent
Funded
36%
46%
40%
51%
59%
66%
73%
61%
31%
53%
69%
78%
86%
90%
94%
96%
98%
99%
100%
100%
100%
100%
99%
99%
93%
99%
101%
101%
101%
100%
Annual
Reserve
Contribs
$100,800
$103,068
$
,
$105,387
$107,758
$110,183
$112,662
$115,197
$117,789
$120,439
$123 149
$123,149
$125,920
$128,753
$131,650
$134,612
$137,641
$140,738
$143,904
$147,142
$150,453
$153,838
$157,299
$162,018
$166,879
$171,885
$177,042
$177 042
$182,353
$187,824
$193,458
$199,262
$205,240
6
Rec.
Special
Ass'mnt
$0
$0
$
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Interest
Income
$5,856
$5,931
$ ,
$6,235
$8,352
$10,510
$13,313
$11,228
$4,726
$2,969
$5 377
$5,377
$7,847
$10,711
$13,244
$15,223
$18,019
$20,912
$23,841
$27,488
$29,671
$31,862
$36,145
$40,171
$38,095
$36,249
$30,532
$30 532
$16,451
$12,062
$16,093
$19,361
$23,499
Reserve
Expenses
$27,500
$182,156
$
,
$14,115
$44,067
$19,888
$2,281
$417,160
$352,456
$34,180
$24 908
$24,908
$39,597
$4,233
$77,330
$58,902
$22,598
$63,033
$31,841
$18,408
$161,508
$28,864
$7,231
$65,970
$507,518
$53,423
$820,097
$820 097
$714,011
$36,181
$50,459
$115,975
$0
Reserve Contributions For Sixth Avenue West TH #2 Association
Reserve Contributions
Recommended
Current
Minimum
$20,000
$18,000
$16,000
$12,000
$10,000
$8,000
$6,000
$4,000
$2,000
Year
7
2042
2040
2038
2036
2034
2032
2030
2028
2026
2024
2022
2020
2018
2016
2014
$2012
Monthly Cont
Contribution
$14,000
Component Funding Information For Sixth Avenue West TH #2 Association
ID
105
105
120
301
401
401
402
601
802
803
1002
1003
1609
1701
1703
Component Name
Comp Shingle Roof - Replace (A)
Comp Shingle Roof - Replace (B)
Raingutters/Downspouts - Replace (partial)
Siding Materials - Repair/Repaint
Asphalt - Overlay
Asphalt - Remove and Replace
Asphalt - Seal Coat/crack fill
Concrete Sidewalks - Repair
Identification Sign - Replace
Mailboxes - Replace
Ironwork Handrails - Replace
Wood Fencing - Replace
Street Lights - Replace
Irrigation System - Rebuild
Irrigation Timeclocks - Replace
Ave
Current
Cost
Ideal
Future Cost Balance
Current
Fund
Balance
$254,138
$254,138
$17,500
$21,675
$187,400
$150,000
$13,700
$13,050
$1,875
$8,700
$2,750
$27,500
$9,450
$17,500
$3,300
$321,565
$334,428
$22,143
$24,381
$444,123
$0
$14,248
$14,115
$2,281
$9,048
$2,860
$34,796
$18,408
$19,685
$3,861
$0
$0
$0
$0
$0
$148,485
$9,133
$0
$0
$8,265
$1,535
$27,500
$0
$0
$0
8
$169,425
$155,306
$5,833
$8,670
$0
$148,485
$9,133
$6,525
$1,500
$8,265
$2,475
$27,500
$4,860
$0
$0
Monthly
$1,865.72
$1,865.72
$256.95
$572.85
$1,179.24
$0.00
$603.46
$431.12
$9.91
$57.48
$36.34
$605.66
$35.68
$770.85
$109.02
Yearly Cash Flow For Sixth Avenue West TH #2 Association
Year
Starting Balance
Reserve Income
Interest Earnings
p
Special
Assessments
Funds Available
Reserve Expenditures
Ending Balance
2012
$194,918
$100,800
$5,856
$
$0
$301,574
$27,500
$274,074
2013
$274,074
$103,068
$5,931
$
$0
$383,073
$182,156
$200,917
2014
$200,917
$105,387
$6,235
$
$0
$312,539
$14,115
$298,424
2015
$298,424
$107,758
$8,352
$
$0
$414,534
$44,067
$370,468
2016
$370,468
$110,183
$10,510
$
$0
$491,161
$19,888
$471,273
Year
Starting Balance
Reserve Income
Interest Earnings
Special Assessments
Funds Available
Reserve Expenditures
Ending Balance
2017
$471,273
$112,662
$13,313
$0
$597,249
$2,281
$594,967
2018
$594,967
$115,197
$11,228
$0
$721,392
$417,160
$304,232
2019
$304,232
$117,789
$4,726
$0
$426,747
$352,456
$74,291
2020
$74,291
$120,439
$2,969
$0
$197,700
$34,180
$163,520
2021
$163,520
$123,149
$5,377
$0
$292,046
$24,908
$267,138
Year
Starting Balance
Reserve Income
Interest Earnings
Special Assessments
Funds Available
Reserve Expenditures
Ending Balance
2022
$267,138
$125,920
$7,847
$0
$400,904
$39,597
$361,308
2023
$361,308
$128,753
$10,711
$0
$500,772
$4,233
$496,539
2024
$496,539
$131,650
$13,244
$0
$641,432
$77,330
$564,102
2025
$564,102
$134,612
$15,223
$0
$713,937
$58,902
$655,035
2026
$655,035
$137,641
$18,019
$0
$810,695
$22,598
$788,097
Year
Starting Balance
Reserve Income
Interest Earnings
Special Assessments
Funds Available
Reserve Expenditures
Ending Balance
2027
$788,097
$140,738
$20,912
$0
$949,746
$63,033
$886,713
2028
$886,713
$143,904
$23,841
$0
$1,054,458
$31,841
$1,022,618
2029
$1,022,618
$147,142
$27,488
$0
$1,197,248
$18,408
$1,178,840
2030
$1,178,840
$150,453
$29,671
$0
$1,358,964
$161,508
$1,197,456
2031
$1,197,456
$153,838
$31,862
$0
$1,383,156
$28,864
$1,354,292
Year
Starting Balance
Reserve Income
Interest Earnings
Special Assessments
Funds Available
Reserve Expenditures
Ending Balance
2032
$1,354,292
$157,299
$36,145
$0
$1,547,737
$7,231
$1,540,506
2033
$1,540,506
$162,018
$40,171
$0
$1,742,696
$65,970
$1,676,726
2034
$1,676,726
$166,879
$38,095
$0
$1,881,699
$507,518
$1,374,181
2035
$1,374,181
$171,885
$36,249
$0
$1,582,315
$53,423
$1,528,892
2036
$1,528,892
$177,042
$30,532
$0
$1,736,467
$820,097
$916,369
Year
Starting Balance
Reserve Income
Interest Earnings
Special Assessments
Funds Available
Reserve Expenditures
Ending Balance
2037
$916,369
$182,353
$16,451
$0
$1,115,174
$714,011
$401,163
2038
$401,163
$187,824
$12,062
$0
$601,049
$36,181
$564,868
2039
$564,868
$193,458
$16,093
$0
$774,419
$50,459
$723,960
2040
$723,960
$199,262
$19,361
$0
$942,583
$115,975
$826,608
2041
$826,608
$205,240
$23,499
$0
$1,055,347
$0
$1,055,347
9
Yearly Expenditures Graph For Sixth Avenue West TH #2 Association
Reserve Expenditures
$900,000
$800,000
$700,000
$500,000
$400,000
$400 000
$300,000
$200,000
$100,000
Year
10
2042
2040
2038
2036
2034
2032
2030
2028
2026
2024
2022
2020
2018
2016
2014
$2012
Annu
ual Totals
$600,000
Projected Reserve Expenditures For Sixth Avenue West TH #2 Association
Year
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
Asset ID
1003
401
402
803
1002
601
301
1701
402
1703
802
105
120
601
1003
1701
105
402
301
1703
1701
402
601
1002
1003
1701
1703
301
402
601
120
1701
402
1703
1609
301
601
1003
1701
402
1703
803
1002
1701
401
402
601
301
105
120
1003
1701
1703
Asset Name
Wood Fencing - Replace
Asphalt - Remove and Replace
Asphalt - Seal Coat/crack fill
Mailboxes - Replace
Ironwork Handrails - Replace
Concrete Sidewalks - Repair
Siding Materials - Repair/Repaint
Irrigation System - Rebuild
Asphalt - Seal Coat/crack fill
Irrigation Timeclocks - Replace
Identification Sign - Replace
Comp Shingle Roof - Replace (A)
Raingutters/Downspouts - Replace (partial)
Concrete Sidewalks - Repair
Wood Fencing - Replace
Irrigation System - Rebuild
Comp Shingle Roof - Replace (B)
Asphalt - Seal Coat/crack fill
Siding Materials - Repair/Repaint
Irrigation Timeclocks - Replace
Irrigation System - Rebuild
Asphalt - Seal Coat/crack fill
Concrete Sidewalks - Repair
Ironwork Handrails - Replace
Wood Fencing - Replace
Irrigation System - Rebuild
Irrigation Timeclocks - Replace
Siding Materials - Repair/Repaint
Asphalt - Seal Coat/crack fill
Concrete Sidewalks - Repair
Raingutters/Downspouts - Replace (partial)
Irrigation System - Rebuild
Asphalt - Seal Coat/crack fill
Irrigation Timeclocks - Replace
Street Lights - Replace
Siding Materials - Repair/Repaint
Concrete Sidewalks - Repair
Wood Fencing - Replace
Irrigation System - Rebuild
Asphalt - Seal Coat/crack fill
Irrigation Timeclocks - Replace
Mailboxes - Replace
Ironwork Handrails - Replace
Irrigation System - Rebuild
Asphalt - Overlay
Asphalt - Seal Coat/crack fill
Concrete Sidewalks - Repair
Siding Materials - Repair/Repaint
Comp Shingle Roof - Replace (A)
Raingutters/Downspouts - Replace (partial)
Wood Fencing - Replace
Irrigation System - Rebuild
Irrigation Timeclocks - Replace
11
Projected Cost
$27,500
$156,000
$14,248
$9,048
$2,860
$14,115
$24,381
$19,685
$16,027
$3,861
$2,281
$321,565
$22,143
$16,512
$34,796
$22,143
$334,428
$18,028
$29,664
$4,516
$24,908
$20,279
$19,317
$4,233
$44,028
$28,018
$5,283
$36,090
$22,812
$22,598
$31,517
$31,517
$25,660
$6,181
$18,408
$43,910
$26,437
$55,710
$35,452
$28,864
$7,231
$19,825
$6,267
$39,878
$444,123
$32,468
$30,927
$53,423
$651,432
$44,858
$70,491
$44,858
$8,459
Total Per
Annum
$27,500
$182,156
$14,115
$44,067
$19,888
$2,281
$417,160
$352,456
$34,180
$24,908
$39,597
$4,233
$77,330
$58,902
$22,598
$63,033
$31,841
$18,408
$161,508
$28,864
$7,231
$65,970
$507,518
$53,423
$820,097
Year
2037
2038
2039
2040
2041
2042
Asset ID Asset Name
Comp Shingle Roof - Replace (B)
105
Asphalt - Seal Coat/crack fill
402
Concrete Sidewalks - Repair
601
Irrigation System - Rebuild
1701
Siding Materials - Repair/Repaint
301
Asphalt - Seal Coat/crack fill
402
Irrigation Timeclocks - Replace
1703
No Expenditures Projected
Concrete Sidewalks - Repair
601
Identification Sign - Replace
802
Wood Fencing - Replace
1003
Irrigation System - Rebuild
1701
12
Projected
Cost
Total Per
Annum
$677,489
$36,522
$714,011
$36,181
$50,459
$64,997
$41,082
$9,896
$36,181
$50,459
$42,326
$6,081
$89,193
$56,759
$115,975
$0
$194,361
Glossary of Commonly used Words and Phrases (provided by the National
Reserve Study Standards of the Community Associations Institute)
Asset or Component – Individual line items in the Reserve Study, developed or updated in the
Physical Analysis. These elements form the building blocks for the Reserve Study. Components
typically are: 1) Association Responsibility, 2) with limited Useful Life expectancies, 3) have
predictable Remaining Life expectancies, 4) above a minimum threshold cost, and 5) required by
local codes.
Cash Flow Method – A method of developing a Reserve Funding Plan where contributions to the
Reserve fund are designed to offset the variable annual expenditures from the Reserve fund.
Different Reserve Funding Plans are tested against the anticipated schedule of Reserve
expenses until the desired Funding Goal is achieved.
Component Inventory – The task of selecting and quantifying Reserve Components. This task
can be accomplished through on-site visual observations, review of association design and
organizational documents, a review of established association precedents, and discussion with
appropriate association representatives.
Deficit – An actual (or projected) Reserve Balance, which is less than the Fully Funded Balance.
Effective Age – The difference between Useful Life and Remaining Useful Life. Not always
equivalent to chronological age, since some components age irregularly. Used primarily in
computations.
Financial Analysis – The portion of the Reserve Study where current status of the Reserves
(Measured as cash or Percent Funded) and a recommended Reserve contribution rate (Reserve
Funding Plan) are derived, and the projected Reserve income and expense over time is
presented. The Financial Analysis is one of the two parts of the Reserve Study.
Component Full Funding – When the actual (or projected) cumulative Reserve balance for all
components is equal to the Fully Funded Balance.
Fully Fund Balance (aka – Ideal Balance) – An indicator against which Actual (or projected)
Reserve Balance can be compared. The Reserve balance that is in direct proportion to the
fraction of life “used up” of the current Repair or Replacement cost. This number is calculated for
each component, and then summed together for an association total.
FFB = Replacement Cost X Effective Age / Useful Life
Fund Status – The status of the Reserve Fund as compared to an established benchmark, such
as percent funding.
Funding Goals – Independent of methodology utilized, the following represent the basic
categories of Funding Plan Goals.
•
•
•
Baseline Funding: Establishing a Reserve funding goal of keeping the Reserve
Balance above zero.
Component Full Funding: Setting a Reserve funding goal of attaining and
maintaining cumulative Reserves at or near 100% funded.
Threshold Funding: Establishing a Reserve funding goal of keeping the
Reserve balance above a specified dollar or Percent Funded amount. Depending
on the threshold, this may be more or less conservative than the “Component
Fully Funding” method.
1
Funding Plan – An associations plan to provide income to a Reserve fund to offset anticipated
expenditures from that fund.
Funding Principles –
• Sufficient Funds When Required
• Stable Contribution Rate over the Years
• Evenly Distributed Contributions over the Years
• Fiscally Responsible
Life and Valuation Estimates – The task of estimating Useful Life, Remaining Useful Life, and
Repair or Replacement Costs for the Reserve components.
Percent Funded – The ratio, at a particular point of time (typically the beginning of the Fiscal
Year), of the actual (or projected) Reserve Balance to the accrued Fund Balance, expressed as a
percentage.
Physical Analysis – The portion of the Reserve Study where the Component Inventory,
Condition Assessment, and Life and Valuation Estimate tasks are performed. This represents
one of the two parts of the Reserve Study.
Remaining Useful Life (RUL) – Also referred to as “Remaining Life” (RL). The estimated time,
in years, that a reserve component can be expected to continue to serve its intended function.
Projects anticipated to occur in the initial year have “0” Remaining Useful Life.
Replacement Cost – The cost of replacing, repairing, or restoring a Reserve Component to its
original functional condition. The Current Replacement Cost would be the cost to replace, repair,
or restore the component during that particular year.
Reserve Balance – Actual or projected funds as of a particular point in time (typically the
beginning of the fiscal year) that the association has identified for use to defray the future repair
or replacement of those major components in which the association is obligated to maintain. Also
known as Reserves, Reserve Accounts, Cash Reserves. This is based upon information provided
and is not audited.
Reserve Provider – An individual that prepares Reserve Studies. Also known as Aspen
Reserve Specialties.
Reserve Study – A budget-planning tool that identifies the current status of the Reserve fund and
a stable and equitable Funding Plan to offset the anticipated future major common area
expenditures. The Reserve Study consists of two parts: The Physical Analysis and the Financial
Analysis.
Special Assessment – An assessment levied on the members of an association in addition to
regular assessments. Special Assessments are often regulated by governing documents or local
statutes.
Surplus – An actual (or projected) Reserve Balance that is greater that the Fully Funded
Balance.
Useful Life (UL) – Also known as “Life Expectancy”, or “Depreciable Life”. The estimated time,
in years, that a Reserve component can be expected to serve its intended function if properly
constructed and maintained in its present application or installation.
2