clarity from complexity · sample for california final table of contents section report page...

Sample for California

Published - January 16, 2020

Prepared for the 2021 Fiscal Year

P. O. Box 60125 / Sacramento, California 95860Phone (916) 393-0600 Fax (916) 393-0610 Toll Free (877) 708-0600

[email protected] / www.BrowningRG.com

Browning Reserve Group

Full Study

Final

RESERVE STUDY

© B&O Reserve Software 2020

Clarity from Complexity

5608

Version 1/16/2020 12:57:48 PM

1/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO

Sample for CaliforniaFinal

Table of Contents

Section Report Page

Section I: Summary of Association Reserves 1

Section II: 30 Year Expense Forecast 5Detailed

Section III: 30 Year Reserve Funding Plan 7Cash Flow Method {c}

Section III-a: 30 Year Reserve Funding Plan 8Cash Flow Method - Ending Balances Chart

Section IV: 30 Year Reserve Funding Plan 9Fully Funded Balance and % Funded

Section IV-a: 30 Year Reserve Funding Plan 10Cash Flow Method - Percent Funded Chart

Section V: Reserve Fund Balance Forecast 11Component Method

Section VI: Component Listing 13Included Components

Section VII: Tabular Component Listing 20Included Components

Section VII-a: Expenditures by Year 21- Next 9 Years

Section IX: Directory of Reserve Study

Contractors22

Section X: Auditor Notes 23

Section X-a: Supplementary Information for

Auditor25Component Method

Section XI: Glossary 26Reserve Study Terms

TOC - i

5608

Version 1/16/2020 12:57:48 PM

1/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Sample for CaliforniaFinal

Member Distribution Materials

The following Reserve Study sections, located at the end of the report, should be provided to each member.

Section Report

California: Member Summary 30

Assessment and Reserve Funding

Disclosure Summary32[Civil Code §5570]


TOC - ii

5608

Version 1/16/2020 12:57:48 PM

1/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO





Full Study

Final

Section I

Reserve Study Summary

A Reserve Study was conducted of Sample for California (the "Association"). A Full Study includes an on-site review upon where the following tasks are performed:

⦁ development of a reserve component inventory;

⦁ condition assessment based upon on-site visual observation;

⦁ life and valuation estimates;

⦁ fund status;

⦁ and a funding plan.

Sample for California is a Planned Development with a total of 76 Lots.

Physical Inspection

Browning Reserve Group ("BRG") conducted a physical inspection of the Association. The inspection encompassed those major components that the Association is required to maintain. For this study components are determined to be major components if:

1. As of the date of the study, they have a remaining useful life of less than 30 years, and a value greater than $1,000.

2. Such additional components, if any, determined by the Board of Directors.

During the inspection, BRG utilized the services of our own construction cost estimator. In addition, independent contractors were retained to render opinions on selected components as indicated in Section VI, Included Component Listing.

Supplemental information to the physical inspection may have been obtained from the following sources:

1. Project plans where available.

2. Maintenance records of the reserve components where available.

3. Association board members, management and staff.

Summary of Reserves

For the first year of the Reserve Study, the reserve contribution is based upon the existing budget unless otherwise noted in “Section III, Reserve Funding Plan.” In addition BRG relied on the Association to provide an accurate Beginning Reserve Balance.

P. O. Box 60125 / Sacramento, California 95860Phone (916) 393-0600 Fax (916) 393-0610 Toll Free (877) 708-0600

[email protected] / www.BrowningRG.com

5608

Version 1/16/2020 12:57:48 PM © B&O Reserve Software 2020

1/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO

Reserve Study - Full Study

Sample for California2

The status of the Association's reserves, as reflected in the following Reserve Study, is as follows:

1. The Expenditure Forecast of the following Reserve Study identifies the major components which the Association is obligated to repair, replace, restore or maintain, as determined in accordance with the criteria specified above, and specifies for each such component:

a. Its current estimated replacement cost;

b. Its estimated useful life; and

c. Its estimated remaining useful life.

2. It is estimated that the total cash reserves necessary to repair, replace, restore or maintain such major components (in the aggregate) during and at the end of their first remaining useful life is $1,119,938.

⦁ [For purposes of this calculation, “necessary” is defined as the Fully

Funded Balance (FFB) (Component Current Cost X Effective Age / Useful Life, including a provision for interest and inflation in future years.)]

3. The current amount of accumulated cash reserves actually set aside to repair, replace, restore, or maintain such major components as of the fiscal year ending December 31, 2021 is estimated to be $1,119,782, constituting 100.0% of the total expenditures anticipated for all such major components through their first end of useful life replacement.

4. Based upon the schedule of annual reserve contributions necessary to defray the cost of repairing, replacing, restoring or maintaining such major components in the years such expenditures are estimated to be required, it is estimated that annual reserve contributions in the initial amount of $92,922 [$101.89 per Lot per month (average)] for the fiscal year ending December 31, 2021 (the first full fiscal year following first distribution of this report) will be necessary in order to meet all such reserve expenditures when they are projected to come due.

Funding Assessment

Based on the 30 year cash flow projection, the Association's reserves appear adequately funded as the reserve fund ending balances remain positive throughout the replacement of all major components during the next 30 years.

California statute imposes no reserve funding level requirements nor does it address funding level adequacy, and although one or more of the reserve fund percentages expressed in this report may be less than one hundred percent, those percentages do not necessarily indicate that the Association's reserves are inadequately funded.

Percent Funded Status

Based on paragraphs 1 - 3 above, the Association is 100.0% funded. The following scale can be used as a measure to determine the Association’s financial picture whereas the lower the percentage, the higher the likelihood of the Association requiring a special assessment, or other large increases to the reserve contribution in the future.

Percent Funded

30% 100%----------- Strong -------------------------------- Fair ------------------------------------ Poor --------------- 70%



Methodology

The above recommended reserve contribution for the next fiscal year (and future fiscal years as outlined in Section III, Reserve Fund Balance Forecast) was developed using the Cash Flow method. This is a method of developing a reserve funding plan where the 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.

Funding Goals

The funding goal employed for Sample for California is

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 "Fully Funding."

Limitations

The intention of the Reserve Study is to forecast the Association's ability to repair or replace major components as they wear out in future years. The Reserve Study is not an engineering report, and no destructive testing was performed. The costs outlined in the study are for budgetary and planning purposes only, and actual bid costs would depend upon the defined scope of work at the time repairs are made. Also, any latent defects are excluded from this report.

Statutory Disclosures

Compliance

The Reserve Study was conducted pursuant to Sections 5300 and 5550 of the California Civil Code.

Open Meeting

California Civil Code Section 5560 says (in part):

The (Reserve Funding) plan shall be adopted by the board of directors at an open meeting before the membership of the association as described in Article 2 (commencing with Section 4900) of Chapter 6. If the board of directors determines that an assessment increase is necessary to fund the reserve funding plan, any increase shall be approved in a separate action of the board that is consistent with the procedure described in Section 5605.

Supplemental Disclosures

General:

BRG has no other involvement(s) with the Association which could result in actual or perceived conflicts of interest.



Personnel Credentials:

BRG is a licensed general building contractor in California, #768851, and the owner, Robert W Browning, holds the Reserve Specialist designation, #46 from the Community Associations Institute.

Completeness:

BRG has found no material issues which, if not disclosed, would cause a distortion of the Association's situation.

Reliance on Client Data:

Information provided by the official representative of the Association regarding financial, physical, quantity, or historical issues will be deemed reliable by BRG.

Scope:

This Reserve Study is a reflection of information provided to BRG and assembled for the Association's use, not for the purpose of performing an audit, quality/forensic analysis, health and safety inspection, or background checks of historical records.

Reserve Balance:

The actual beginning reserve fund balance in this Reserve Study is based upon information provided and was not audited.

Reserve Projects:

Information provided about reserve projects will be considered reliable. Any on-site inspection should not be considered a project audit, quality inspection, or health and safety review.



Section II

30 Year Expense Forecast - DetailedFinal


Reserve Component 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034Remaining

Life

Useful /

Cost

Replacement

Current

Paving01000 -

100 - Asphalt: Sealing 36,100 sf Streets & Parking

5,957 5 0 6,739 7,6255,957

200 - Asphalt: Ongoing Repairs 36,100 sf Streets & Parking (2%)

2,527 5 0 2,859 3,2352,527

300 - Asphalt: Overlay w/ Interlayer 36,100 sf Streets & Parking

75,810 25 10 97,043

8,483 9,598 107,903Total 01000 - Paving 84,293

Concrete02000 -

200 - Sidewalks, Curbs & Gutters 88,160 sf Street Side (0.5%)

4,849 5 5 5,486 6,207

5,486 6,207Total 02000 - Concrete 4,849

Painting: Exterior03000 -

120 - Surface Restoration 182,400 sf [76] Homes

273,600 10 4 302,003 386,590

350 - Touch-Up 76 Homes

36,100 10 9 45,084

500 - Light Poles 21 Street Lights

3,150 5 4 3,477 3,934 4,451

305,480 49,018 391,041Total 03000 - Painting: Exterior 312,850

Roofing05000 -

440 - Pitched: Dimensional Composition 1,520 Squares- [76] Homes

1,026,000 25 9 1,281,333

700 - Gutters / Downspouts 18,240 lf [76] Homes

164,160 25 9 205,013

1,486,347Total 05000 - Roofing 1,190,160

Lakes / Ponds18500 -

200 - Bulkhead 3,850 lf Concrete (3%)

8,663 10 0 11,0898,663

240 - Fountain Otterbine

8,930 8 0 10,8808,930

17,593 10,880 11,089Total 18500 - Lakes / Ponds 17,593

Lighting20000 -

200 - Street Lights 21 Street Lights

79,800 45 29

Total 20000 - Lighting 79,800

26,076 0 0 0 305,480 15,084 0 0 10,880 1,535,365 125,198 0 0 0 391,041Total Expenditures Inflated @ 2.50%

1,689,545Total Current Replacement Cost

2020 to 2034© B&O Reserve Software 2020 55608

Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO

Reserve Component 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049


30 Year Expense Forecast - Detailed

Final


Paving01000 -


9,760 11,0438,627


4,141 4,6853,660


12,287 13,901 15,728Total 01000 - Paving

Concrete02000 -


7,945 8,9897,023

7,023 7,945 8,989Total 02000 - Concrete



494,867


57,711 73,875


5,036 5,697 6,446

62,747 500,565 80,321Total 03000 - Painting: Exterior

Roofing05000 -



Total 05000 - Roofing



14,195


13,257 16,152

13,257 14,195 16,152Total 18500 - Lakes / Ponds

Lighting20000 -


163,303

163,303Total 20000 - Lighting

19,309 13,257 0 0 62,747 36,041 0 0 0 516,717 24,717 0 0 0 243,625Total Expenditures Inflated @ 2.50%

2035 to 2049© B&O Reserve Software 2020 65608

Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Section III

30 Year Reserve Funding Plan Cash Flow MethodFinal


2020 2021 2022 2023 2024 2025 2026 2027 20292028

904,987 1,000,682 1,119,782 1,244,118 1,373,875 1,199,945 1,318,116 1,456,998 1,742,0001,601,894Beginning Balance

26,076 0 0 0 305,480 15,084 0 0 1,535,36510,880Inflated Expenditures @ 2.5%

90,744 92,922 95,152 97,436 99,774 102,169 104,621 107,132 112,336109,703Reserve Contribution

99.50 101.89 104.33 106.84 109.40 112.03 114.72 117.47 123.18120.29Lots/month @ 76

2.4% 2.4% 2.4% 2.4% 2.4% 2.4% 2.4% 2.4%2.4%Percentage Increase

17,500 0 0 0 0 0 0 0 00Special Assessments / Other

23,527 26,179 29,184 32,321 31,776 31,087 34,261 37,764 25,76241,283Interest Pre Tax @ 2.50%

1,000,682 1,119,782 1,244,118 1,373,875 1,199,945 1,318,116 1,456,998 1,601,894 344,7331,742,000Ending Balance

Excess funds transfer from operating to reserve.1)

2030 2031 2032 2033 2034 2035 2036 2037 20392038

344,733 343,058 470,900 604,680 744,612 494,985 618,431 754,096 1,072,233909,649Beginning Balance

125,198 0 0 0 391,041 19,309 13,257 0 62,7470Inflated Expenditures @ 2.5%


126.13 129.16 132.13 135.17 138.28 141.46 144.71 148.04 154.93151.44Lots/month @ 76

2.4% 2.4% 2.3% 2.3% 2.3% 2.3% 2.3% 2.3% 2.3%2.3%Percentage Increase

0 0 0 0 0 0 0 0 00Special Assessments / Other

8,491 10,049 13,279 16,658 15,304 13,746 16,945 20,540 27,78824,468Interest Pre Tax @ 2.50%

343,058 470,900 604,680 744,612 494,985 618,431 754,096 909,649 1,178,5681,072,233Ending Balance

2040 2041 2042 2043 2044 2045 2046 2047 20492048

1,178,568 1,317,891 1,500,556 1,691,231 1,890,195 1,574,561 1,752,872 1,964,439 2,415,3322,185,153Beginning Balance

36,041 0 0 0 516,717 24,717 0 0 243,6250Inflated Expenditures @ 2.5%


158.49 162.14 165.87 169.68 173.58 177.58 181.66 185.84 194.49190.11Lots/month @ 76



30,820 34,796 39,405 44,215 42,775 41,079 45,893 51,230 59,55556,796Interest Pre Tax @ 2.50%

1,317,891 1,500,556 1,691,231 1,890,195 1,574,561 1,752,872 1,964,439 2,185,153 2,408,6342,415,332Ending Balance

© B&O Reserve Software 2020 75608

Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Section III-a

30 Year Reserve Funding Plan Cash Flow Method - Ending BalancesFinal


$0

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

$3,000,000

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

2034

2035

2036

2037

2038

2039

2040

2041

2042

2043

2044

2045

2046

2047

2048

2049

Years

Fu

nd

Bala

nce


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Section IV

30 Year Reserve Funding Plan Including Fully Funded Balance and % FundedFinal


Year

Beginning

Balance

Fully Funded

Balance

Percent

Funded

Reserve

Contribution

Special Assessments

& Other Contributions Interest

Ending

Balance@ 2.50%

Inflated

Expenditures

2020 904,987 1,030,846 97.1% 26,076 90,744 7,500 23,527 1,000,682

2021 1,000,682 1,119,938 100.0% 0 92,922 0 26,179 1,119,782

2022 1,119,782 1,241,086 100.2% 0 95,152 0 29,184 1,244,118

2023 1,244,118 1,367,592 100.5% 0 97,436 0 32,321 1,373,875

2024 1,373,875 1,499,647 80.0% 305,480 99,774 0 31,776 1,199,945

2025 1,199,945 1,324,333 99.5% 15,084 102,169 0 31,087 1,318,116

2026 1,318,116 1,444,799 100.8% 0 104,621 0 34,261 1,456,998

2027 1,456,998 1,586,310 101.0% 0 107,132 0 37,764 1,601,894

2028 1,601,894 1,733,992 100.5% 10,880 109,703 0 41,283 1,742,000

2029 1,742,000 1,876,915 18.4% 1,535,365 112,336 0 25,762 344,733

2030 344,733 463,583 74.0% 125,198 115,032 0 8,491 343,058

2031 343,058 463,175 101.7% 0 117,793 0 10,049 470,900

2032 470,900 593,994 101.8% 0 120,502 0 13,279 604,680

2033 604,680 731,064 101.9% 0 123,274 0 16,658 744,612

2034 744,612 874,617 56.6% 391,041 126,109 0 15,304 494,985

2035 494,985 624,073 99.1% 19,309 129,010 0 13,746 618,431

2036 618,431 751,501 100.3% 13,257 131,977 0 16,945 754,096

2037 754,096 891,609 102.0% 0 135,012 0 20,540 909,649

2038 909,649 1,052,180 101.9% 0 138,117 0 24,468 1,072,233

2039 1,072,233 1,220,223 96.6% 62,747 141,294 0 27,788 1,178,568

2040 1,178,568 1,331,694 99.0% 36,041 144,544 0 30,820 1,317,891

2041 1,317,891 1,476,958 101.6% 0 147,869 0 34,796 1,500,556

2042 1,500,556 1,666,518 101.5% 0 151,270 0 39,405 1,691,231

2043 1,691,231 1,864,634 101.4% 0 154,749 0 44,215 1,890,195

2044 1,890,195 2,071,613 76.0% 516,717 158,308 0 42,775 1,574,561

2045 1,574,561 1,758,141 99.7% 24,717 161,949 0 41,079 1,752,872

2046 1,752,872 1,945,242 101.0% 0 165,674 0 45,893 1,964,439

2047 1,964,439 2,166,567 100.9% 0 169,485 0 51,230 2,185,153

2048 2,185,153 2,397,742 100.7% 0 173,383 0 56,796 2,415,332

2049 2,415,332 2,639,123 91.3% 243,625 177,371 0 59,555 2,408,634

95608

Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO



Section IV-a

30 Year Reserve Funding Plan Cash Flow Method - Percent FundedFinal


0

10

20

30

40

50

60

70

80

90

100

110

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

2034

2035

2036

2037

2038

2039

2040

2041

2042

2043

2044

2045

2046

2047

2048

2049

Years

Perc

en

t Fu

nd

ed


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Section V

Reserve Fund Balance Forecast Component MethodFinal


Reserve ComponentCurrent

Repl. Cost

Useful

Life

Remaining

Life

Estimated

Future

Replacement

Costs

Per

Year

% Per Year

Straight Line

2021

2021 Fully

Funded

Balance

2020 Fully

Funded

Balance

Line Item

Contribution

based on

Cash Flow Method

01000 - Paving

5,957 1,191 1.11% 1,0355,957 1,221100 - Asphalt: Sealing

36,100 sf Streets & Parking5 0 5,957

2,527 505 0.47% 4392,527 518200 - Asphalt: Ongoing Repairs

36,100 sf Streets & Parking (2%)5 0 2,527

97,043 3,882 3.63% 3,37275,810 49,731300 - Asphalt: Overlay w/ Interlayer

36,100 sf Streets & Parking25 10 45,486

Sub-total [01000 - Paving] 105,527 5,578 5.22% 4,84684,293 51,47053,970

02000 - Concrete

5,486 914 0.85% 7944,849 994200 - Sidewalks, Curbs & Gutters

88,160 sf Street Side (0.5%)5 5 808

03000 - Painting: Exterior

302,003 30,200 28.23% 26,236273,600 196,308120 - Surface Restoration

182,400 sf [76] Homes10 4 164,160

45,084 4,508 4.21% 3,91736,100 7,401350 - Touch-Up

76 Homes10 9 3,610

3,477 695 0.65% 6043,150 1,292500 - Light Poles

21 Street Lights5 4 630

Sub-total [03000 - Painting: Exterior] 350,564 35,404 33.10% 30,757312,850 205,000168,400

05000 - Roofing

1,281,333 51,253 47.92% 44,5261,026,000 715,122440 - Pitched: Dimensional Composition

1,520 Squares- [76] Homes25 9 656,640

205,013 8,201 7.67% 7,124164,160 114,420700 - Gutters / Downspouts

18,240 lf [76] Homes25 9 105,062

Sub-total [05000 - Roofing] 1,486,347 59,454 55.58% 51,6501,190,160 829,542761,702

18500 - Lakes / Ponds

8,663 866 0.81% 7538,663 888200 - Bulkhead

3,850 lf Concrete (3%)10 0 8,663

8,930 1,116 1.04% 9708,930 1,144240 - Fountain

Otterbine8 0 8,930

Sub-total [18500 - Lakes / Ponds] 17,593 1,983 1.85% 1,72217,593 2,03217,593


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO

Reserve ComponentCurrent

Repl. Cost

Useful

Life

Remaining

Life

Estimated

Future

Replacement

Costs

Per

Year

% Per Year

Straight Line

2021

2021 Fully

Funded

Balance

2020 Fully

Funded

Balance

Line Item

Contribution

based onCash Flow Method


Reserve Fund Balance Forecast Component Method

Final


20000 - Lighting

163,303 3,629 3.39% 3,15379,800 30,900200 - Street Lights

21 Street Lights45 29 28,373

Totals 2,128,819 106,962 1,119,938 100.00% 92,9221,689,545

[A] [B]

99.99%Percent Funded

[EndBal]

[B]

1,030,846

97.07%

[EndBal]

[A]


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Section VI

Component Listing Included ComponentsFinal


Paving01000 -

100 - Asphalt: Sealing

36,100 sf Streets & Parking 36,100 Square Feet

$0.165

5

Quantity Unit of Measure

% Included

Useful Life Remaining Life

100.00% $5,957Total Cost/Study

Cost /SqFt

0

Replacement Year 2020 $5,956Future CostSummary

This is to prepare the surface and apply a single coat asphalt emulsion product. If a second coat is desired the cost is generally 10% to 20% higher.

2020- $5,957 was expended to seal coat by Blackrock Paving, Inc.2015- $4,120 was expended to seal coat by Blackrock Paving, Inc.2014- Seal coat appeared worn and near replacement. 2010- $3,975 was expended to seal coat by Biondi Paving.2005- $3,133 was expended to seal coat by Blackrock Paving, Inc.2004- Asphalt placed in service.

Costing provided by Blackrock Paving, Inc.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Component Listing Included Components

Final


Paving01000 -

200 - Asphalt: Ongoing Repairs

36,100 sf Streets & Parking (2%) 36,100 Square Feet

$3.50 $126,350

5


% Included



Cost /SqFt Qty * $/SqFt

0


This is for miscellaneous repairs including crackfill, skin patching and minor dig out & fill. Cracks 1/4" or wider should be filled when observed.

2020- $2,527 was expended to crack fill and R&R entry area by Blackrock Paving, Inc.2015- $1,889 was expended to crack fill and patch 3 areas by Blackrock Paving, Inc.2014- 3 small failure areas were observed near the community entry. Unfilled cracks were observed throughout. 2010- $1,926 was expended for crack fill and patch.2004- Asphalt placed in service.

300 - Asphalt: Overlay w/ Interlayer

36,100 sf Streets & Parking 36,100 Square Feet

$2.10

25


% Included



Cost /SqFt

10


This is to apply a geotextile interlayer to the existing asphalt surface and overlay with a minimum of 1.5" of new hot mix asphalt. Generally this includes edge grinding and utility box extensions.

2004- Asphalt placed in service.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO



Final


Concrete02000 -

200 - Sidewalks, Curbs & Gutters

88,160 sf Street Side (0.5%) 88,160 Square Feet

$11.00 $969,760

5


% Included


.50% $4,849Total Cost/Study

Cost /SqFt Qty * $/SqFt

5


This is to repair, replace or grind concrete sidewalks, curbs and gutters to remove vertical displacements and to maintain functionality. The concrete useful life exceeds the scope of this study, so this component provides for repair only. Concrete repairs should be performed in conjunction with pavement work when feasible.

2014- Minor cracks were observed, but no elevation shifts were noted.2004- Sidewalks placed in service.


120 - Surface Restoration

182,400 sf [76] Homes 182,400 Square Feet

$1.50

10


% Included



Cost /SqFt

4


This is to prepare, power wash, sand, scrape, caulk, and paint with a 100% premium acrylic paint. Mid-cycle touchup is provided for within another component.

2014- $208,792 total was expended to paint all home stucco, wood trim and attached metal by MasterCraft Painting, Inc.2004- Home construction completed.

Costing provided by MasterCraft Painting, Inc.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO



Final



350 - Touch-Up

76 Homes 76 Lot

$475

10


% Included



Cost /Lt

9


This is to prepare and touchup wood trim and attached metal surfaces including railings, gutters and entry trellises. Full home painting is provided for within another component.

2019- $35,220 was expended to touchup paint by MasterCraft Painting, Inc.2009- $31,029 total was expended to touchup paint by MasterCraft Painting, Inc.2004- Home construction completed.

Costing provided by MasterCraft Painting, Inc.

500 - Light Poles

21 Street Lights 21 Items

$150

5


% Included



Cost /Itm

4


This is to prepare and paint the light standards.

2019- $3,073 was expended to paint light standards.2014- $2,081 was expended to paint light standards.2011- Light standards need paint.2004- Lights placed in service.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO



Final


Roofing05000 -

440 - Pitched: Dimensional Composition

1,520 Squares- [76] Homes 1,520 Squares

$675

25


% Included


100.00% $1,026,000Total Cost/Study

Cost /Sqrs

9

Replacement Year 2029 $1,281,333Future CostSummary

This is to reroof with a dimensional composition roofing product. Composition roofs should be regularly inspected and repaired as indicated to ensure maximum life.

2020- Roofs were evaluated by client's roofing contractor who reported that roofs are aging well and anticipates 9 years remaining life.2004- Roofs placed in service.

700 - Gutters / Downspouts

18,240 lf [76] Homes 18,240 Linear Feet

$9.00

25


% Included



Cost /l.f.

9


This is to replace the gutters and downspouts.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO



Final



200 - Bulkhead

3,850 lf Concrete (3%) 3,850 Linear Feet

$90.00 $346,500

10


% Included



Cost /l.f. Qty * $/l.f.

0


This is to repair and replace the concrete lake bulkhead. The concrete useful life exceeds the scope of this study, so this component provides for repair only.

2020- $8,663 was expended to repair two failed sections. No other repairs are anticipated in the near term.2014- No bulkhead or lake issues were reported per Lake Restoration Engineering Inc's compressive evaluation.2004- Lake construction completed.

240 - Fountain

Otterbine 1 Items

$8,930

8


% Included



Cost /Itm

0


This is to repair or replace fountain components including controller, ground fault circuit interrupter (GFCI), submerged power line, pump, nozzle, and anchor line.

2020- $8,930 was expended for miscellaneous repairs and pump motor rebuild.2012- $5,621 was expended to replace power line and rebuild fountain pump and motor.2004- Fountain placed in service.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO



Final


Lighting20000 -

200 - Street Lights

21 Street Lights 21 Items

$3,800

45


% Included



Cost /Itm

29


This is to replace the street lights. Light standard painting is provided for within another component. Lamp replacement is from operating.

2016- Motor vehicle insurance paid to replace one street light.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Section VII

Component Tabular Listing Final


Included Components

Current

Replacement Cost

Useful

Life

Remaining

Life Quantity

Cost/

U of MComponent LocationTreatment

Paving01000 -

100 - Asphalt: Sealing 36,100 $.17/SqFt5$5,957 0 Streets & Parking

200 - Asphalt: Ongoing Repairs 36,100 $3.50/SqFt5$2,527 0 (2%) Streets & Parking

300 - Asphalt: Overlay w/ Interlayer 36,100 $2.10/SqFt25$75,810 10 Streets & Parking

Concrete02000 -

200 - Sidewalks, Curbs & Gutters 88,160 $11.00/SqFt5$4,849 5 (0.5%) Street Side


120 - Surface Restoration 182,400 $1.50/SqFt10$273,600 4 [76] Homes

350 - Touch-Up 76 $475/Lt10$36,100 9 Homes

500 - Light Poles 21 $150/Itm5$3,150 4 Street Lights

Roofing05000 -

440 - Pitched: Dimensional Composition

1,520 $675/Sqrs25$1,026,000 9 [76] Homes

700 - Gutters / Downspouts 18,240 $9.00/l.f.25$164,160 9 [76] Homes


200 - Bulkhead 3,850 $90.00/l.f.10$8,663 0 (3%) Concrete

240 - Fountain 1 $8,930/Itm8$8,930 0 Otterbine

Lighting20000 -

200 - Street Lights 21 $3,800/Itm45$79,800 29 Street Lights


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Section VII-a

Expenditures by Year - Next 9 YearsFinal


Reserve Component

Life

Useful Replacement Cost

Current Forecast

Inflated Cost @ 2.50%

2020Paving01000 -


5,9565


2,5275

8,483Total 01000 - Paving: 8,483



8,66310 8,662


8,9308

17,592Total 18500 - Lakes / Ponds: 17,593

26,07526,076Total 2020:

2024Painting: Exterior03000 -


273,60010 302,003


3,1505 3,477

305,480276,750Total 2024:

2025Paving01000 -


5,9565 6,739


2,5275 2,859

9,598Total 01000 - Paving: 8,483

Concrete02000 -


4,8495 5,486

15,08413,332Total 2025:

2028Lakes / Ponds18500 -


8,9308 10,880

10,8808,930Total 2028:


Version 1/16/2020 12:57:48 PM

1/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Section IX

Directory of Reserve Study Contractors Final


Blackrock Paving, Inc.

P.O. Box 322 Rocklin , CA 95677 Phone: (916) 368-6076 License #: 696040

Paving01000 -

100 - Asphalt: Sealing Streets & Parking

MasterCraft Painting, Inc.

11354 Amaigum Way Orangevale , CA 95662

Phone: (916) 635-5000 License #: 571247


120 - Surface Restoration [76] Homes

350 - Touch-Up Homes


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Section X

Notes to the Auditor

Final


This report is intended to assist the auditor while preparing the audit, review or compilation of Sample for California’s (the "Association") financial documents.

Browning Reserve Group ("BRG") prepared a reserve study for the Association during the 2020 fiscal year. This was done to help determine the Association's reserve contribution for the next fiscal year (2021) and future fiscal years. In addition, BRG prepared the proper statutory disclosures for distribution to the Association members.

This Reserve Study is a Full Study. A Full Study includes an on-site review upon where the following tasks are performed:

⦁ development of a reserve component inventory;

⦁ condition assessment based upon on-site visual observation;

⦁ life and valuation estimates;

⦁ fund status;

⦁ and a funding plan. Please note, in order to complete these study tasks, one or more

visits were conducted by BRG to Sample for California.

For BRG reserve studies, the year in which the study is being conducted, is the first year of the study. For example, this study is being prepared during 2020 and is the Association’s first year in the study. This enables BRG to use a starting point which ties to the last audited financial statement, December 31, 2019. You will notice in Section III, Reserve Fund Balance Forecast, a Beginning Reserve Balance of $904,987 is being used which ties to the last completed audit or review of the Association’s financial statements. BRG then re-builds the first year of the study, in this case 2020, and estimates an ending reserve fund balance. Again, see Section III and the 2020 ending reserve balance estimate of $1,000,682.

“Re-building” the first year of the study as mentioned above simply means using the 2020 adopted budget for the 2020 reserve contribution. Finally, the 2020 reserve expenses both actual and projected are estimated.

We find by using the above method a more accurate reserve study is possible because the beginning reserve fund balance ties directly to the Association’s audited financial statement or, in the absence of an audit or review, the year end balance sheet. There is no need to rely on others for determining mid year reserve balances or estimating current year ending reserve balances. This approach forces all involved, to look at the current year’s reserve fund activities so a more accurate ending reserve fund balance can be estimated.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Notes to the Auditor

Final


With respect to the reserve component Percent Funded values on the next page(s), here are the calculations:

FFB = Year Cost X Year Effective Age / Useful Life

% Funded = Year Estimated Ending Reserve Balance / Year FFB

Please see Section V - Reserve Fund Balance Forecast.



Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Schedule of Supplementary Information for Auditor Component Method

Final


Current Repl. Cost

UsefulLife

RemainingLife

2021 Line ItemContribution

based onCash Flow Method

2021 Fully Funded BalanceReserve Component

2020 Fully Funded Balance

01000 - Paving


5,957 5 0 1,0351,2215,957


2,527 5 0 4395182,527


75,810 25 10 3,37249,73145,486

02000 - Concrete


4,849 5 5 794994808

03000 - Painting: Exterior


273,600 10 4 26,236196,308164,160


36,100 10 9 3,9177,4013,610


3,150 5 4 6041,292630

05000 - Roofing


1,026,000 25 9 44,526715,122656,640


164,160 25 9 7,124114,420105,062

18500 - Lakes / Ponds


8,663 10 0 7538888,663


8,930 8 0 9701,1448,930

20000 - Lighting


79,800 45 29 3,15330,90028,373

Totals 1,119,938 92,9221,689,545

[B]


[EndBal]

[B]

1,030,846

[A]

97.07%

[EndBal]

[A]


Version 1/16/2020 12:57:48 PM

01/16/2020 December 31


Section XI

Glossary

Final


of Reserve Study Terms

Terms & Definitions CAI

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 representative(s) of the association or cooperative.

COMPONENT METHOD: A method of developing a Reserve Funding Plan where the total

contribution is based on the sum of contributions for individual components. See “Cash Flow Method.

COMPONENT: The 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) predictable Remaining Useful Life expectancies, 4) above a minimum threshold cost, and 5) as required by local codes.

CONDITION ASSESSMENT: The task of evaluating the current condition of the

component based on observed or reported characteristics.

CURRENT REPLACEMENT COST: See “Replacement Cost."

DEFICIT: An actual (or projected) Reserve Balance less than the Fully Funded Balance.

The opposite would be a Surplus.

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 a 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 a Reserve Study.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


Glossaryof Reserve Study Terms

Final


FULLY FUNDED BALANCE (FFB): Total Accrued Depreciation. 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, then summed together for an association total. Two formulae can be utilized, depending on the provider’s sensitivity to interest and inflation effects. Note: Both yield identical results when interest and inflation are equivalent.

FFB = Current Cost X Effective Age / Useful Life

or

FFB = (Current Cost X Effective Age / Useful Life) + [(Current Cost X Effective Age / Useful Life) / (1 + Interest Rate) ^ Remaining Life] -[(Current Cost X Effective Age / Useful Life) / (1 + Inflation Rate) ^ Remaining Life]

FULLY FUNDED: 100% Funded. When the actual (or projected) Reserve balance is equal

to the Fully Funded Balance.

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 cash balance above zero.

Full Funding: Setting a Reserve funding goal of attaining and maintaining Reserves at or near 100% funded.

Statutory Funding: Establishing a Reserve funding goal of setting aside the specific minimum amount of Reserves required by local statues.

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 “Fully Funding."

FUNDING PLAN: An association’s 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 Fully Funded 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.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO



Final


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 “zero” 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 that the

association has identified for use to defray the future repair or replacement of those major components which the association is obligated to maintain. Also known as Reserves, Reserve Accounts and Cash Reserves. Based upon information provided and not audited.

RESERVE PROVIDER: An individual that prepares Reserve Studies.

RESERVE STUDY: A budget planning tool which 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.

RESPONSIBLE CHARGE: A reserve specialist in responsible charge of a reserve study

shall render regular and effective supervision to those individuals performing services which directly and materially affect the quality and competence rendered by the reserve specialist. A reserve specialist shall maintain such records as are reasonably necessary to establish that the reserve specialist exercised regular and effective supervision of a reserve study of which he was in responsible charge. A reserve specialist engaged in any of the following acts or practices shall be deemed not to have rendered the regular and effective supervision required herein:

1. The regular and continuous absence from principal office premises from which professional services are rendered; except for performance of field work or presence in a field office maintained exclusively for a specific project;

2. The failure to personally inspect or review the work of subordinates where necessary and appropriate;

3. The rendering of a limited, cursory or perfunctory review of plans or projects in lieu of an appropriate detailed review;

4. The failure to personally be available on a reasonable basis or with adequate advance notice for consultation and inspection where circumstances require personal availability.

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 greater than the Fully Funded

Balance. See “Deficit.”

USEFUL LIFE (UL): Total Useful Life or Depreciable Life. The estimated time, in years,

that a reserve component can be expected to serve its intended function if properly constructed in its present application or installation.

The above terms and definitions are from the Community Associations Institute (CAI) national standards.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO



Final


Terms & Definitions BRG

Browning Reserve Group reserve studies use several terms that are unique to our reports. Our specialized systems have been developed to offer flexibility in many areas of our reporting. Please see below for definitions of abbreviations and symbols used in many of our reserve studies.

NR-1 (LIMITED RECURRENCE, 1 TIME): This signifies a major reserve component

recurs for only a fixed number of cycles. Most often used to display a cost in a specific year only, NR-1 signifies the component only occurs one time. An NR-2 means the component will display for two cycles and so on. This makes it easy to enter one-time costs that pop up from time to time, or to display a cost that may be unique at one replacement date only.

SE-2 (SPREAD EVENLY OVER 2 YEARS): This signifies the major component, when

replaced is spread evenly over 2 or more years. For example if a component will be replaced in year 8 of the study, and there is a SE-2, then the component will be replaced over 2 years, year 8 and year 9. Although the component is split over 2 or more years, each subsequent year will increase by the study’s inflation factor. An SE-3 signifies the component is split over three years and so on.

NSE-2 (SPREAD NON-EVENLY OVER 2 YEARS): Similar to above, but the spread is not

equal in each year. The spread is entered at a different amount for each year in the spread. The total of the spread will always equal 100% of the total replacement cost, excluding inflation.

% (PERCENT TO INCLUDE): This signifies that the component is being replaced at less

than 100 percent of its replacement cost or quantity. Perhaps a component is replaced partially at each replacement year. Another example would be to do a small portion of the work at each replacement year. Oftentimes wood fencing is replaced over several cycles, and the study will display a percentage of the fence at each replacement cycle.

DELAYED START (REMAINING LIFE GREATER THAN USEFUL): In many instances a

component's replacement cycle may not begin immediately, so the replacement cycle start is delayed. Delay is accomplished by setting the remaining life greater than the useful life.

ZERO REMAINING LIFE: Zero remaining life signifies that the component is replaced in

the year which the study is prepared. All replacements are reflected in their replacement year, and the year in which the study is prepared is no different than any other year.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


RESERVE STUDY

Member Distribution Materials

Final



Full Study

Clarity from Complexity

Section Report Page

California: Member Summary 1

Assessment and Reserve Funding Disclosure Summary

3[Civil Code §5570]


5608

Version 1/16/2020 12:57:48 PM

1/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO

www.BrowningRG.com



Professionally managed by

ABC Management(916) 555-1234

January 16, 2020


California Member Summary Final


This is a summary of the Reserve Study that has been performed for Sample for California, (the "Association"). This study was conducted in compliance with California Civil Code Sections 5300, 5550 and 5560 and is being provided to you, as a member of the Association, as required under these statutes. A full copy is available (through the Association) for review by members of the Association.

The intention of the Reserve Study is to forecast the Association's ability to repair or replace major components as they wear out in future years. This is done utilizing the "Cash Flow Method." This is a method of developing a reserve funding plan where the contributions to the reserve fund are designed to offset the variable annual expenditures from the reserve fund.

Browning Reserve Group prepared this Full Study for the January 1, 2021 - December 31, 2021 fiscal year.

Sample for California is a Planned Development with a total of 76 Lots.

The Reserve Study is not an engineering report, and no destructive testing was performed. The costs outlined in the study are for budgetary and planning purposes only, and actual bid costs would depend upon the defined scope of work at the time repairs are made. Also, any latent defects are excluded from this report.

Funding Assessment

Based on the 30 year cash flow projection, the Association's reserves appear adequately funded as the reserve fund ending balances remain positive throughout the replacement of all major components during the next 30 years.

California statute imposes no reserve funding level requirements nor does it address funding level adequacy, and although one or more of the reserve fund percentages expressed in this report may be less than one hundred percent, those percentages do not necessarily indicate that the Association's reserves are inadequately funded.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO

RemainingLife

UsefulLife

Current Replacement

CostReserve Component

2021Fully

Funded Balance

2021Line Item

Contributionbased on

Cash Flow Method

2020Fully

Funded Balance


California Member Summary

Final


51,470 4,84601000 - Paving 84,293 5-25 0-10 53,970

994 79402000 - Concrete 4,849 5-5 5-5 808

205,000 30,75703000 - Painting: Exterior 312,850 5-10 4-9 168,400

829,542 51,65005000 - Roofing 1,190,160 25-25 9-9 761,702

2,032 1,72218500 - Lakes / Ponds 17,593 8-10 0-0 17,593

30,900 3,15320000 - Lighting 79,800 45-45 29-29 28,373

Totals $1,119,938


$92,922$1,689,545

$1,119,782Estimated Ending Balance $101.89/Lot/month @ 76

$1,030,846

97.1%

$1,000,682


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO


California Assessment and Reserve Funding Disclosure For the Fiscal Year Ending 2021

Final

January 16, 2020

(1) The regular assessment per ownership interest is $311.75 per month for the fiscal year beginning January 1, 2021.

Note: If assessments vary by the size or type of ownership interest, the assessment applicable to this ownership interest may be found on page ___ of the attached summary.

(2) Additional regular or special assessments that have already been scheduled to be imposed or charged, regardless of the purpose, if they have been approved by the board and/or members:

Date

assessment will be due:

Amount per ownership interest per month or year (if assessments

are variable, see note immediately below):Purpose of the assessment:

N/A $0.00 N/A

Total: $0.00

Note: If assessments vary by the size or type of ownership interest, the assessment applicable to this ownership interest may be found on page ___ of the attached report.

(3) Based upon the most recent reserve study and other information available to the board of directors, will currently projected reserve account balances be sufficient at the end of each year to meet the association's obligation for repair and/or replacement of major components during the next 30 years?

Yes X No

This disclosure has been prepared by Browning Reserve Group and has been reviewed and approved by the association's board of directors based upon the best information available to the association at the time of its preparation. The accuracy of this information over the next 30 years will be dependent upon circumstances which are impossible to predict with specificity, and will require future action to adjust assessments over the period in accordance with the current projections and future developments.

(4) If the answer to (3) is no, what additional assessments or other contributions to reserves would be necessary to ensure that sufficient reserve funds will be available each year during the next 30 years that have not yet been approved by the board or the members

Approximate date assessment will be due: Amount per ownership interest per month or year:

N/A N/A

(5) All major components are included in the reserve study and are included in its calculations. See next page §5300(b)(4), for any major component exclusions.

(6) Based on the method of calculation in paragraph (4) of the subdivision (b) of section 5570, the estimated amount required in the reserve fund at the end of the current fiscal year is $1,030,846, based in whole or in part on the last reserve study or update prepared by Browning Reserve Group as of January, 2020. The projected reserve fund cash balance at the end of the current fiscal year is $1,000,682 resulting in reserves being 97% percent funded at this date. Civil code section 5570 does not require the board to fund reserves in accordance with this calculation.

An alternate and generally accepted method of calculation has been utilized to determine future reserve contribution amounts. The reserve contribution for the next fiscal year has been determined using the Cash Flow method of calculation (see section III, Reserve Fund Balance Forecast). This is a method of developing a reserve funding plan where the contributions to the reserve fund are designated 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.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.202


California Assessment and Reserve Funding Disclosure For the Fiscal Year Ending 2021

Final

(7) Based on the method of calculation in paragraph (4) of subdivision (b) of section 5570 of the Civil Code, the estimated amount required in the reserve fund at the end of each of the next five budget years is presented in column (b) 'Fully Funded Balance' in the table immediately below; and the projected reserve fund cash balance in each of those years, taking into account only assessments already approved and other known revenues, is presented in column (c) 'Reserve Ending Balance'; leaving the reserve at percent funding as presented in column (d) 'Percent Funded' in each of the respective years.

FiscalYear(a)

Fully FundedBalance

(b)

PercentFunded

(d)

ReserveEnding Balance

(c)

2021 $1,119,938 $1,119,782 100.0%

2022 $1,241,086 $1,244,118 100.2%

2023 $1,367,592 $1,373,875 100.5%

2024 $1,499,647 $1,199,945 80.0%

2025 $1,324,333 $1,318,116 99.5%

If the reserve funding plan approved by the association is implemented, the projected fund cash balance in each of those years will be the amounts presented in column (c) 'Reserve Ending Balance' in the table immediately above, leaving the reserve at percent funding as presented in column (d) 'Percent Funded' in each of the respective years.

NOTE: The financial representations set forth in this summary are based on the best estimates of the preparer at that time. The estimates are subject to change. At the time this summary was prepared, 2.50% per year was the assumed long-term inflation rate, and 2.50% per year was the assumed long-term interest rate.

Additional Disclosures

§5565(d) The current deficiency in reserve funding as of December 31, 2021 is $2 per ownership

interest (average).

This is calculated as the current estimate of the amount of cash reserves necessary as of the end of the fiscal year for which the study is prepared, less, the amount of accumulated cash reserves actually (Projected to be) set aside to repair, replace, restore, or maintain the major components.

Deficiency = 2021 Fully Funded Balance - 2021 Reserve Ending BalanceOwnership Interest Quantity

§5300(b)(4) The current board of directors of the association has not deferred or determined to not

undertake repairs or replacements over the next 30 years.

M ajor Component: Justification for Deferral:

N/A N/A

§5300(b)(5) The board of directors as of the date of the study does not anticipate the levy of a

special assessment for the repair, replacement, or restoration of the major components.


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.202


Section III

30 Year Reserve Funding Plan Cash Flow MethodFinal


2020 2021 2022 2023 2024 2025 2026 2027 20292028

904,987 1,000,682 1,119,782 1,244,118 1,373,875 1,199,945 1,318,116 1,456,998 1,742,0001,601,894Beginning Balance

26,076 0 0 0 305,480 15,084 0 0 1,535,36510,880Inflated Expenditures @ 2.5%


99.50 101.89 104.33 106.84 109.40 112.03 114.72 117.47 123.18120.29Lots/month @ 76

2.4% 2.4% 2.4% 2.4% 2.4% 2.4% 2.4% 2.4%2.4%Percentage Increase

17,500 0 0 0 0 0 0 0 00Special Assessments / Other

23,527 26,179 29,184 32,321 31,776 31,087 34,261 37,764 25,76241,283Interest Pre Tax @ 2.50%

1,000,682 1,119,782 1,244,118 1,373,875 1,199,945 1,318,116 1,456,998 1,601,894 344,7331,742,000Ending Balance

Excess funds transfer from operating to reserve.1)

2030 2031 2032 2033 2034 2035 2036 2037 20392038

344,733 343,058 470,900 604,680 744,612 494,985 618,431 754,096 1,072,233909,649Beginning Balance

125,198 0 0 0 391,041 19,309 13,257 0 62,7470Inflated Expenditures @ 2.5%


126.13 129.16 132.13 135.17 138.28 141.46 144.71 148.04 154.93151.44Lots/month @ 76



8,491 10,049 13,279 16,658 15,304 13,746 16,945 20,540 27,78824,468Interest Pre Tax @ 2.50%

343,058 470,900 604,680 744,612 494,985 618,431 754,096 909,649 1,178,5681,072,233Ending Balance

2040 2041 2042 2043 2044 2045 2046 2047 20492048

1,178,568 1,317,891 1,500,556 1,691,231 1,890,195 1,574,561 1,752,872 1,964,439 2,415,3322,185,153Beginning Balance

36,041 0 0 0 516,717 24,717 0 0 243,6250Inflated Expenditures @ 2.5%


158.49 162.14 165.87 169.68 173.58 177.58 181.66 185.84 194.49190.11Lots/month @ 76



30,820 34,796 39,405 44,215 42,775 41,079 45,893 51,230 59,55556,796Interest Pre Tax @ 2.50%

1,317,891 1,500,556 1,691,231 1,890,195 1,574,561 1,752,872 1,964,439 2,185,153 2,408,6342,415,332Ending Balance


Version 1/16/2020 12:57:48 PM

01/16/2020 v5.0;4953c.12.2021 Full.4.MM.RB.TO

clarity from complexity · sample for california final table of contents section report page...

Documents