replacement reserve report fy 2017 swygert s … landing/swygerts landing... · provided by the...

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REPLACEMENT RESERVE REPORT FY 2017 SWYGERT’S LANDING HOMEOWNERS ASSOCIATION

Community Management by:

IMC CHARLESTON

Carly Price, Property Manager

545 Parkwood Estates Drive Charleston, SC 29407

843-297-8590 [email protected]

Consultant:

2661 Riva Road, Suite 1023 Annapolis, MD 21401

410.268.0479 800.850.2835

MillerDodson.com

http://www.millerdodson.com/�

INTENTIONALLY LEFT BLANK

REPLACEMENT RESERVE REPORT

SWYGERT’S LANDING HOMEOWNERS ASSOCIATION

JOHNS ISLAND CHARLESTON, SOUTH CAROLINA

Description. Swygert’s Landing is a single family subdivision located on Johns Island in Charleston that will contain (per the property manager) 240 detached dwellings when built-out. Some homes are still being constructed in Swygert’s Landing. The survey examined the common elements of the property, including but not limited to:

• Swimming pool and gravel parking lot • Concrete sidewalks leading to the pool • Three ponds • Open space / Conservation areas • Pool house • Bath house • Pool deck • Street signage • Entry way area lighting and entrance monument

Level of Service. This study has been performed as a Level 1 Full Service Reserve Study as defined under the National Reserve Study Standards that have been adopted by the Community Associations Institute. As such, a complete inventory of components was established for the commonly owned elements of this facility based on information provided by the Community Manager or by quantities that were developed from field measurement or takeoffs from to-scale drawings as performed by the Analyst. The condition of each inventory component was established by the Analyst based on a visual inspection or review of provided historical data with a major repair or replacement cost for each also set. The included fund status and funding plan have been derived from analysis of this inventory.

Section A

Replacement Reserve Analysis

Executive Summary - A1 General Information - A2

Current Funding - A3 Cash Flow Method Funding - A4

Inflation Adjusted Funding - A5 Comments - A6

Section B

Replacement Reserve Inventory

Replacement Reserve Inventory General information - B1

Replacement Reserve Inventory Comments - B2

Schedule of Projected Replacements and Exclusions - B3

Section C

Projected Annual Replacements

Projected Annual Replacements General Information - C1

Calendar of Projected Annual Replacements - C2

Section D

Condition Assessment

Appendix

Accounting Summary - CF1 Component Method - CM1

Overview, Standard Terms, and Definitions

Video Answers to Frequently Asked Questions

To aid in the understanding of this report and its concepts and practices, on our web site, we have developed videos addressing frequently asked topics. In addition, there are posted links covering a variety of subjects under the resources page of our web site at mdareserves.com. Purpose. The purpose of this Replacement Reserve Study is to provide Swygert’s Landing Homeowners Association (hereinafter called the Association) with an inventory of the common community facilities and infrastructure components that require periodic replacement. The Study includes a general view of the condition of these items and an effective financial plan to fund projected periodic replacements. • Inventory of Items Owned by the Association. Section B lists the Projected Replacements of the

commonly owned items that require periodic replacement using funding from Replacement Reserves. The Replacement Reserve Inventory also provides information about excluded items, which are items whose replacements are not scheduled for funding from Replacement Reserves.

• Condition of Items Owned by the Association. Section B includes our estimates of the normal

economic life and the remaining economic life for the projected replacements. Section C provides a year-by-year listing of the projected replacements. Section D provides additional detail for items that are unique or deserving of attention because of their condition or the manner in which they have been treated in this study.

• Financial Plan. The Association has a fiduciary responsibility to protect the appearance, value, and

safety of the property and it is, therefore, essential the Association have a financial plan that provides funding for the projected replacements. In conformance with American Institute of Certified Public Accountant guidelines, Section A, Replacement Reserve Analysis evaluates the current funding of Replacement Reserves as reported by the Association and recommends annual funding of Replacement Reserves by the Cash Flow Method. Section A, Replacement Reserve Analysis includes graphic and tabular presentations of the Association’s current funding and the recommended funding based on the Cash Flow Method. An Executive Summary of these calculations is provided on Page A1. The alternative Component Method of funding is provided in the Appendix.

Basis. The data contained in this Replacement Reserve Study is based upon the following: • The Request for Proposal submitted and executed by the Association. • Miller-Dodson performed a visual evaluation on August 1, 2017 to determine a remaining useful life

and replacement cost for the commonly owned elements of this facility. • This study contains additional recommendations to address inflation for the Cash Flow Method only.

For this recommendation, Miller-Dodson uses the Producers Price Index (PPI), which gauges inflation in manufacturing and construction. Please see page A5 for further details.

Current Funding. This reserve study has been prepared for Fiscal Year 2017 covering the period from January 1, 2017 to December 31, 2017. The Replacement Reserves on deposit as of January 31, 2017 are reported to be $15,008.02. The planned contribution for the fiscal year is $15,000.00. The balance and contribution figures have been supplied by the managing agent and confirmation or audit of these figures is beyond the scope of the study. For the purposes of this study, it is assumed that the annual contribution will be deposited at the end of each month. Acknowledgement. Miller-Dodson Associates would like to acknowledge the assistance and input of the Community Manager, Carly Price, who provided very helpful insight into the current operations of the property. Analyst’s Credentials. B. Emerson Treffer holds a Bachelor’s of Science Degree in Business Administration from the University of Maryland. Mr. Treffer has over forty years of experience in valuing all types of commercial, industrial, residential and special purpose real estate. He qualified as an expert

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http://mdareserves.com/resources/links�

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witness in various Federal, State, and County Courts. Mr. Treffer is a Reserve Analyst for Miller-Dodson Associates. Respectfully submitted,

B. Emerson Treffer Reserve Analyst

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Miller + Dodson Associates, Inc. Replacement Reserve Analysis - Page A1Swygert's Landing August 1, 2017

20638901SWYGERT'17

EXECUTIVE SUMMARY

The Swygert's Landing Replacement Reserve Analysis uses the Cash Flow Method (CFM) tocalculate Replacement Reserve funding for the periodic replacement of the 55 Projected Replacementsidentified in the Replacement Reserve Inventory.

$26,922 RECOMMENDED REPLACEMENT RESERVE FUNDING FOR THE STUDY YEAR, 2017$9.35 Per unit (average), minimum monthly funding of Replacement Reserves

We recommend the Association adopt a Replacement Reserve Funding Plan based on the annual fundingrecommendation above. Inflation adjusted funding for subsequent years is shown on Page A5.

Swygert's Landing reports a Starting Balance of $15,008 and Annual Funding totaling $15,000.Current funding is inadequate to fund the $1,064,891 of Projected Replacements scheduled in the Replacement Reserve Inventory over the 40-year Study Period. See Page A3 for a more detailed evaluation.

#1 - Cumulative Replacement Reserve Funding and Expenditures Graph

*

615,008

$1

,06

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91

1,091,891

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Cash Flow Method - Cumulative Receipts

Current Funding - Cumulative Receipts

Projected Replacements - CumulativeExpenditures


20638901SWYGERT'17

REPLACEMENT RESERVE ANALYSIS - GENERAL INFORMATION

The Swygert's Landing Replacement Reserve Analysis calculations of recommended funding ofReplacement Reserves by the Cash Flow Method and the evaluation of the Current Funding are based upon thesame Study Year, Study Period, Beginning Balance, Replacement Reserve Inventory and Level of Service.

2017 STUDY YEAR

The Association reports that their accounting year begins on January 1, and the Study Year, the first yearevaluated by the Replacement Reserve Analysis, begins on January 1, 2017.

40 Years STUDY PERIOD

The Replacement Reserve Analysis evaluates the funding of Replacement Reserves over a 40-year Study Period.

$15,008 STARTING BALANCE

The Association reports Replacement Reserves on Deposit totaling $15,008 at the start of the Study Year.

Level One LEVEL OF SERVICE

The Replacement Reserve Inventory has been developed in compliance with the National Reserve StudyStandards for a Level One Study, as defined by the Community Associations Institute (CAI).

$1,064,891 REPLACEMENT RESERVE INVENTORY - PROJECTED REPLACEMENTS

The Swygert's Landing Replacement Reserve Inventory identifies 55 items that will require periodicreplacement, that are to be funded from Replacement Reserves. We estimate the cost of these replacements willbe $1,064,891 over the 40-year Study Period. The Projected Replacements are divided into 13 major categoriesstarting on Page B3. Pages B1-B2 provide detailed information on the Replacement Reserve Inventory.

#2 - Annual Expenditures for Projected Replacements Graph This graph shows annual expenditures for Projected Replacements over the 40-year Study Period. The red line shows the average annual expenditureof $26,622. Section C provides a year by year Calender of these expenditures.

40-year Average

$26,622

$0 $0 $0 $0 $0 $1,9

06$0 $0 $0

$57,

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,341

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20638901SWYGERT'17

UPDATING

UPDATING OF THE FUNDING PLANThe Association has a responsibility to review the Funding Plan annually. The review should include a comparisonand evaluation of actual reserve funding with recommended levels shown on Page A4 and A5. The Projected Replacements listed on Page C2 should be compared with any replacements accomplished and funded from Replacement Reserves. Discrepancies should be evaluated and if necessary, the Reserve Study should be updatedor a new study commissioned. We recommend annual increases in replacement reserve funding to account for the impact of inflation. Inflation Adjusted Funding is discussed on Page A5.

UPDATING OF THE REPLACEMENT RESERVE STUDYAt a minimum, the Replacement Reserve Study should be professionally updated every three to five years or aftercompletion of a major replacement project. Updating should also be considered if during the annual review of the Funding Plan, discrepancies are noted between projected and actual reserve funding or replacement costs. Updatingmay also be necessary if there is a meaningful discrepancy between the actual inflation rate and the inflation rate used for the Inflation Adjusted Funding of Replacement Reserves on Page A5.

ANNUAL EXPENDITURES AND CURRENT FUNDINGThe annual expenditures that comprise the $1,064,891 of Projected Expenditures over the 40-year Study Period andthe impact of the Association continuing to fund Replacement Reserves at the current level are detailed in Table 3.

#3 - Table of Annual Expenditures and Current Funding Data - Years 1 through 40Year 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

Starting Balance $15,008Projected Replacements ($1,906) ($57,496)

Annual Deposit $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000

End of Year Balance $30,008 $45,008 $60,008 $75,008 $90,008 $103,102 $118,102 $133,102 $148,102 $105,605

Cumulative Expenditures ($1,906) ($1,906) ($1,906) ($1,906) ($59,403)Cumulative Receipts $30,008 $45,008 $60,008 $75,008 $90,008 $105,008 $120,008 $135,008 $150,008 $165,008

Year 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036Projected Replacements ($1,906) ($42,160) ($1,906) ($234,341)

Annual Deposit $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000

End of Year Balance $120,605 $133,699 $148,699 $163,699 $136,539 $151,539 $166,539 $179,633 $194,633 ($24,709)

Cumulative Expenditures ($59,403) ($61,309) ($61,309) ($61,309) ($103,469) ($103,469) ($103,469) ($105,376) ($105,376) ($339,717)Cumulative Receipts $180,008 $195,008 $210,008 $225,008 $240,008 $255,008 $270,008 $285,008 $300,008 $315,008

Year 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046Projected Replacements ($1,906) ($26,215) ($180,192)

Annual Deposit $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000

End of Year Balance ($9,709) $5,291 $20,291 $33,385 $22,170 $37,170 $52,170 $67,170 $82,170 ($83,023)



Annual Deposit $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000

End of Year Balance ($68,023) ($53,023) ($38,023) ($23,023) ($8,023) $5,071 $20,071 $35,071 ($230,541) ($449,883)

Cumulative Expenditures ($548,031) ($548,031) ($548,031) ($548,031) ($548,031) ($549,937) ($549,937) ($549,937) ($830,549) ($1,064,891)Cumulative Receipts $480,008 $495,008 $510,008 $525,008 $540,008 $555,008 $570,008 $585,008 $600,008 $615,008

EVALUATION OF CURRENT FUNDINGThe evaluation of Current Funding (Starting Balance of $15,008 & annual funding of $15,000), is done in today'sdollars with no adjustments for inflation or interest earned on Replacement Reserves. The evaluation assumesReplacement Reserves will only be used for the 55 Projected Replacements identified in the Replacement ReserveInventory and that the Association will continue Annual Funding of $15,000 throughout the 40-year Study Period.

Annual Funding of $15,000 is approximately 56 percent of the $26,922 recommended Annual Funding calculatedby the Cash Flow Method for 2017, the Study Year.Evaluation of the 55 Projected Replacements calculates an average annual expenditure over the next 40 yearsof $26,622. Annual funding of $15,000 is 56 percent of the average annual expenditure.Our calculations identify funding shortfalls in 10 years of the Study Period with the initial shortfall in 2036. Thelargest shortfall, $-449,883, occurs in 2056. All shortfalls can be seen and evaluated in Table 3 above.

In summary, Current Funding as reported by the Association and shown above, does not provide adequate funding forthe $1,064,891 of Projected Replacements scheduled in the Replacement Reserve Inventory over the Study Period.


20638901SWYGERT'17

CASH FLOW METHOD FUNDING

$26,922 RECOMMENDED REPLACEMENT RESERVE FUNDING FOR 2017$9.35 Per unit (average), minimum monthly funding of Replacement Reserves

Recommended Replacement Reserve Funding has been calculated using the Cash Flow Method (also called the Straight Line or Threshold Method). This method calculates a constant annual funding between peaks in cumulative expenditures, while maintaining a Minimum Balance (threshold) in the Peak Years.

Peak Years. The First Peak Year occurs in 2056 with Replacement Reserves on Deposit dropping to theReserves on Deposit dropping to the Minimum Balance after the completion of $1,064,891 of Projected ReplacementRecommended annual funding of $26,922 remains constant throughout the entire 40-year Study Period.

Minimum Balance. The calculations assume a Minimum Balance of $27,000 in Replacement Reserves. Thisis approx. 12 months of average expenditures based on the $26,622, 40-year average annual expenditure.

Cash Flow Method Study Period. Cash Flow Method calculates funding for $1,064,891 of expendituresover the 40-year Study Period. It does not include funding for any projects beyond 2056 and in 2056, the end of year balance will always be the Minimum Balance.

#4 - Cash Flow Method - Graph of Cumulative Receipts and Expenditures - Years 1 through 40

#5 - Cash Flow Method - Table of Receipts & Expenditures - Years 1 through 40Year 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

Starting Balance $15,008 Projected Replacements ($1,906) ($57,496)

Annual Deposit $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922


Cumulative Expenditures $1,906 $1,906 $1,906 $1,906 $59,403Cumulative Receipts $41,930 $68,852 $95,774 $122,696 $149,618 $176,540 $203,463 $230,385 $257,307 $284,229

Year 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036Projected Replacements ($1,906) ($42,160) ($1,906) ($234,341)

Annual Deposit $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922




Annual Deposit $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922



Year 2047 2048 2049 2050 2051 2052 2053 2054 2055 1st Peak - 2056Projected Replacements ($1,906) ($280,612) ($234,341)

Annual Deposit $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922 $26,922


Cumulative Expenditures ($548,031) ($548,031) ($548,031) ($548,031) ($548,031) ($549,937) ($549,937) ($549,937) ($830,549) ($1,064,891)Cumulative Receipts $849,592 $876,514 $903,436 $930,358 $957,280 $984,203 $1,011,125 $1,038,047 $1,064,969 $1,091,891

$1,0

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Cash Flow Method - Cumulative Receipts Cash Flow Method - Year End Balance Cumulative Expenditures Peak Year


20638901SWYGERT'17

INFLATION ADJUSTED FUNDING

The Cash Flow Method calculations on Page A4 have been done in today's dollars with no adjustment for inflation. At Miller + Dodson, we belive that long-term inflation forecasting is effective at demonstrating the power of compounding,not at calculating appropriate funding levels for Replacement Reserves. We have developed this proprietary model to estimate the short-term impact of inflation on Replacement Reserve funding.

$26,922 2017 - CASH FLOW METHOD RECOMMENDED FUNDING #6 - Inflation Adjusted Funding

The 2017 Study Year calculations have been made using current replacement costs(see Page B2), modified by the Analyst for any project specific conditions.

$27,576 2018 - INFLATION ADJUSTED FUNDINGA new analysis calculates 2018 funding based on three assumptions; Replacement Reserves on Deposit totaling $41,930 on January 1, 2018. No Expenditures from Replacement Reserves in 2017.

Construction Cost Inflation of 2.30 percent in 2017.The $27,576 inflation adjusted funding in 2018 is a 2.43 percent increase over thenon-inflation adjusted 2018 funding of $26,922.


Construction Cost Inflation of 2.30 percent in 2018.The $28,261 inflation adjusted funding in 2019 is a 4.97 percent increase over thenon-inflation adjusted 2019 funding of $26,922.


Construction Cost Inflation of 2.30 percent in 2019.The $29,008 inflation adjusted funding in 2020 is a 7.75 percent increase over thenon-inflation adjusted funding of $26,922.

YEAR FIVE & BEYONDThe inflation adjusted funding calculations outlined above are not intended to be a substitute for periodic evaluation of common elements by an experienced Reserve Analyst. Industry Standards, lender requirements, and many state and local statutes require a Replacement Reserve Study be professionally updated every 3 to 5 years.

INFLATION ADJUSTMENTPrior to approving a budget based upon the 2018, 2019 and 2020 inflation adjusted funding calculations above,the 2.30 percent base rate of inflation used in our calculations should be compared to rates published by the Bureauof Labor Statistics. If there is a significant discrepancy (over 1 percent), contact Miller Dodson + Associates prior to using the Inflation Adjusted Funding.

INTEREST ON RESERVESThe recommended funding calculations do not account for interest earned on Replacement Reserves.In 2017, based on a 1.00 percent interest rate, we estimate the Association may earn $285 on an average balanceof $28,469, $557 on an average balance of $55,718 in 2018, and $836 on $83,637 in 2019. The Association may elect to attribute 100 percent of the earned interest to Reserves, resulting in a reduction in the 2017 funding from $26,922 to $26,637 (a 1.06 percent reduction), $27,576 to $27,019 in 2018 (a 2.02 percentreduction), and $28,261 to $27,425 in 2019 (a 2.96 percent reduction).

$26,

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Cash FlowMethodFunding

InflationAdjustedFunding


20638901SWYGERT'17

REPLACEMENT RESERVE STUDY - SUPPLEMENTAL COMMENTS

Swygert's Landing has 240 units. The type of property is a homeowners association.

The Cash Flow Method calculates the minimum annual funding necessary to prevent Replacement Reserves fromdropping below the Minimum Balance. Failure to fund at least the recommended levels may result in funding not being available for the Projected Replacements listed in the Replacement Reserve Inventory.

The accuracy of the Replacement Reserve Analysis is dependent upon expenditures from Replacement Reservesbeing made ONLY for the 55 Projected Replacements specifically listed in the Replacement Reserve Inventory.The inclusion/exclusion of items from the Replacement Reserve Inventory is discussed on Page B1.

Miller + Dodson Associates, Inc. Replacement Reserve Inventory - Page B1Swygert's Landing August 1, 2017

20638901SWYGERT'17

REPLACEMENT RESERVE INVENTORYGENERAL INFORMATION

Swygert's Landing - Replacement Reserve Inventory identifies 141 items. Two types of items areidentified, Projected Replacements and Excluded Items:

PROJECTED REPLACEMENTS. 55 of the items are Projected Replacements and the periodicreplacements of these items are scheduled for funding from Replacement Reserves. The Projected Replacementshave an estimated one-time replacement cost of $663,865. Replacements totaling $1,064,891 are scheduledin the Replacement Reserve Inventory over the 40-year Study Period.

Projected Replacements are the replacement of commonly-owned physical assets that require periodic replacement and whose replacement is to be funded from Replacement Reserves.

EXCLUDED ITEMS. 86 of the items are Excluded Items, and expenditures for these items are NOTscheduled for funding from Replacement Reserves. The accuracy of the calculations made in the ReplacementReserve Analysis is dependent on expenditures NOT being made for Excluded Items. The Excluded Itemsare listed in the Replacement Reserve Inventory to identify specific items and categories of items thatare not to be funded from Replacement Reserves. There are multiple categories of items that are typicallyexcluded from funding by Replacement Reserves, including but not limited to:

Tax Code. The United States Tax Code grants very favorable tax status to Replacement Reserves, conditionedon expenditures being made within certain guidelines. These guidelines typically exclude maintenanceactivities, minor repairs and capital improvements.

Value. Items with a replacement cost of less that $1,000 and/or a normal economic life of less than 3 years are typically excluded from funding from Replacement Reserves. This exclusion should reflect Associationpolicy on the administration of Replacement Reserves. If the Association has selected an alternative level,it will be noted in the Replacement Reserve Inventory - General Comments on Page B2.

Long-lived Items. Items that when properly maintained, can be assumed to have a life equal to the propertyas a whole, are typically excluded from the Replacement Reserve Inventory.

Unit improvements. Items owned by a single unit and where the items serve a single unit are generallyassumed to be the responsibility of that unit, not the Association.

Other non-common improvements. Items owned by the local government, public and private utility companies, the United States Postal Service, Master Associations, state and local highway authorities, etc., may beinstalled on property that is owned by the Association. These types of items are generally not the responsibility of the Association and are excluded from the Replacement Reserve Inventory.

The rationale for the exclusion of an item from funding by Replacement Reserves is discussed in more detail inthe 'Comments' sections of the Section B - Replacement Reserve Inventory.

CATEGORIES. The 141 items included in the Swygert's Landing Replacement Reserve Inventoryare divided into 13 major categories. Each category is printed on a separate page, Pages B3 to B14.

LEVEL OF SERVICE. This Replacement Reserve Inventory has been developed in compliance with the standardsestablished for a Level One Study - Full Service, as defined by the National Reserve StudyStandards, established in 1998 by Community Associations Institute, which states:

A Level I - Full Service Reserve Study includes the computation of complete component inventoryinformation regarding commonly owned components provided by the Association, quantities derived from field measurements and/or quantity takeoffs from to-scale engineering drawings thatmay be made available. The condition of all components is ascertained from a visual inspectionof each component by the analyst. The remaining economic life and the value of the componentsare provided based on these observations and the funding status and funding plan are then derived from analysis of this data.


20638901SWYGERT'17

REPLACEMENT RESERVE INVENTORY - GENERAL INFORMATION (cont'd)

INVENTORY DATA. Each of the 55 Projected Replacements listed in the Replacement Reserve Inventoryincludes the following data:

Item Number. The Item Number is assigned sequentially and is intended for identification purposes only.

Item Description. We have identified each item included in the Inventory. Additional information may beincluded in the Comments section at the bottom of each page of the Inventory.

Units. We have used standard abbreviations to identify the number of units including SF-square feet, LF-lineal feet, SY-square yard, LS-lump sum, EA-each, and PR-pair. Non-standard abbreviations are noted in the Comments section at the bottom of the page.

Number of Units. The methods used to develop the quantities are discussed in "Level of Service" above.

Unit Replacement Cost. We use four sources to develop the unit cost data shown in the Inventory; actualreplacement cost data provided by the client, information provided by local contractors and suppliers,industry standard estimating manuals, and a cost database we have developed based upon our detailedinterviews with contractors and service providers who are specialists in their respective lines of work.

Normal Economic Life (Yrs). The number of years that a new and properly installed item should beexpected to remain in service.

Remaining Economic Life (Yrs). The estimated number of years before an item will need to be replaced. In "normal" conditions, this could be calculated by subtracting the age of the item from the Normal Economic Life of the item, but only rarely do physical assets age "normally". Some itemsmay have longer or shorter lives depending on many factors such as environment, initial quality of the item, maintenance, etc.

Total Replacement Cost. This is calculated by multiplying the Unit Replacement Cost by the Number of Units.

Each of the 86 Excluded Items includes the Item Description, Units, and Number of Units. Many of theExcluded Items are listed as a 'Lump Sum' with a quantity of 1. For the Excluded Items, this indicates thatall of the items identified by the 'Item Description' are excluded from funding by Replacement Reserves.

REVIEW OF EXPENDITURES. This Replacement Reserve Study should be reviewed by an accounting professional representing the Association prior to implementation.

PARTIAL FUNDING. Items may have been included in the Replacement Reserve Inventory at less than 100 percent of their full quantity and/or replacement cost. This is done on items that will never be replacedin their entirety, but which may require periodic replacements over an extended period of time. The assumptions that provide the basis for any partial funding are noted in the Comments section.

REMAINING ECONOMIC LIFE GREATER THAN 40 YEARS. The calculations do not include funding for initialreplacements beyond 40 years. These replacements are included in this Study for tracking and evaluation. Theyshould be included for funding in future Studies, when they enter the 40-year window.


20638901SWYGERT'17

SITE COMPONENTSPROJECTED REPLACEMENTS

UNIT NORMAL REMAININGITEM ITEM NUMBER REPLACEMENT ECONOMIC ECONOMIC REPLACEMENT

# DESCRIPTION UNIT OF UNITS COST ($) LIFE (YRS) LIFE (YRS) COST ($)

1 Gravel Parking Lot sf 2,956 $1.45 10 9 2 $4,2862 Wooden Wheel Stops- Parking Lot ls 16 $55.00 10 9 2 $8803 Concrete flatwork (6%) sf 179 $10.65 6 5 2 $1,906

5

4 Pool- Metal Gates ea 2 $430.00 39 38 2 $8605 Fence, 5' aluminum w/ 3 rails & pickets ft 548 $37.00 39 38 2 $20,276

5

6 Trash Corral Gates ea 2 $485.00 25 24 2 $9707 Concrete trash corral pad sf 170 $11.65 30 29 2 $1,9818 Wooden Fence sf 240 $19.25 25 24 2 $4,620

5

9 Palm Trees ea 9 $650.00 15 14 2 $5,85010 Irrigation System w Manifold ls 1 $8,500.00 15 14 2 $8,500

5

11 Storm Water Management Allowance ls 1 $25,000.00 10 9 2 $25,00012 Pond 1- 84,441 sf / 1.94 Ac Ac 2 $30,000.00 20 19 2 $58,20013 Pond 1- 83,275 sf / 1,91 Ac Ac 2 $30,000.00 20 19 2 $57,30014 Pond 3- 57,584 sf/ 1.32 Acres Ac 1 $30,000.00 20 19 2 $39,60015 Palm Trees ea 8 $650.00 15 14 2 $5,200

5

16 Irrigation System w Manifold ls 1 $8,500.00 15 14 2 $8,5005

5

5

SITE COMPONENTS - Replacement Costs - Subtotal $243,929

SITE COMPONENTSCOMMENTS

We have assumed that the Association will replace the asphalt pavement by the installation of a 2 inch thick overlay. The pavement will need to be milled prior to the installation of the overlay. Milling and the cost of minor repairs (5 to 10 percent of the total area) to the base materials and bearing soils beneath the pavement are included in the cost shown above.


20638901SWYGERT'17

SITE COMPONENTS (cont.)PROJECTED REPLACEMENTS



17 Walking Trail ls 1 $2,800.00 20 19 2 $2,8005

18 Entrance monument, painted metal sign sf 255 $65.00 25 24 2 $16,57519 Masonry Monuments with light/ glass ea 9 $450.00 25 24 2 $4,05020 Pressure Treated Wooden Posts/caps ea 3 $175.00 20 19 2 $525

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5

5

5

5

5

5

5

5

5

5

5

5

5

5

5

5

SITE COMPONENTS (cont.) - Replacement Costs - Subtotal $23,950

SITE COMPONENTS (cont.)COMMENTS


20638901SWYGERT'17

BUILDING EXTERIORSPROJECTED REPLACEMENTS



21 BH-Roofing, Steel standing Seam sf 75 $13.00 39 38 2 $97522 PH-Roofing, Steel standing Seam sf 85 $13.00 39 38 2 $1,105

5

23 BH-Gutters & Downsouts-Aluminium ft 75 $7.00 30 29 2 $52524 PH-Gutters & Downspouts-Aluminium ft 85 $7.00 30 29 2 $595

5

25 PH-Exterior, Cedar Shake sf 604 $14.30 39 38 2 $8,63726 BH-Exterior, Cedar Shake sf 794 $14.30 39 38 2 $11,354

5

27 PH-Entry Door ea 4 $700.00 20 19 2 $2,80028 BH-Entry Door ea 5 $700.00 20 19 2 $3,500

5

29 PH- Wooden, Square Columns ls 1 $5,500.00 30 29 2 $5,50030 BH-Woow\den, Square Columns ls 1 $5,500.00 30 29 2 $5,500

5

31 Bath House- Bath Room Fixture ls 1 $3,000.00 20 19 2 $3,0005

4

4

4

4

4

5

5

BUILDING EXTERIORS - Replacement Costs - Subtotal $43,491

BUILDING EXTERIORSCOMMENTS


20638901SWYGERT'17

RECREATIONPROJECTED REPLACEMENTS



32 Swimming pool structure sf 2,793 $85.00 39 38 2 $237,40533 Swimming pool, whitecoat sf 2,793 $5.85 10 9 2 $16,33934 Swimming pool waterline tile (2x2) ft 252 $10.35 10 9 2 $2,60835 Pool deck, concrete sf 5,740 $10.85 30 29 2 $62,27936 Pool deck, sealer sf 5,740 $0.20 10 9 2 $1,14837 Pool pump. 1.5 HP ea 1 $2,250.00 10 9 2 $2,25038 Pool pump, 5 HP ea 1 $4,685.00 15 14 2 $4,68539 Pool Filters, Sand ea 2 $3,290.00 20 19 2 $6,58040 Pool ladder ea 1 $690.00 20 19 2 $69041 Safety rail ea 2 $450.00 20 19 2 $90042 Salt Chlorine Generator ea 1 $750.00 10 9 2 $750

5

5

5

5

5

5

5

5

5

5

5

5

5

RECREATION - Replacement Costs - Subtotal $335,634

RECREATIONCOMMENTS

We have assumed that the project to replace the pool deck will include the replacement of the plumbing and electrical systems installed beneath the pavement.


20638901SWYGERT'17

RECREATION (cont.)PROJECTED REPLACEMENTS



43 Pool Furniture, Lounge ea 9 $155.00 10 9 2 $1,39544 Pool Furniture, Chair ea 12 $145.00 10 9 2 $1,74045 Pool Furniture, Rocking Chair ea 2 $175.00 10 9 2 $35046 Pool Furniture, Picnic Beach ea 1 $1,000.00 15 14 2 $1,00047 Small Bench ea 2 $880.00 15 14 2 $1,76048 Pool Furniture, Circular Table ea 3 $250.00 10 9 2 $75049 Bike Rack ea 2 $575.00 30 29 2 $1,150

5

50 Water Fountain ea 2 $650.00 15 14 2 $1,3005

51 Dog waste station ea 2 $475.00 20 19 2 $95052 Security System with 3 Cameras ea 1 $975.00 15 14 2 $975

5

53 Pool Swipe Keys System, Button Exit ea 2 $1,570.00 15 14 2 $3,1405

54 Security System with 3 cameras ea 1 $1,250.00 15 14 2 $1,25055 Bike Rack- Metal ea 2 $550.00 30 29 2 $1,100

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5

5

5

5

5

5

RECREATION (cont.) - Replacement Costs - Subtotal $16,860

RECREATION (cont.)COMMENTS


20638901SWYGERT'17

VALUATION EXCLUSIONSEXCLUDED ITEMS



Site lighting fixtures ls 1 3 EXCLUDEDProperty identification signage ls 1 3 EXCLUDEDMiscellaneous signage ls 1 3 EXCLUDEDMailboxes ls 1 3 EXCLUDEDFire extinguisher cabinet ls 1 3 EXCLUDEDSprinkler head ls 1 3 EXCLUDEDEmergency lighting, exit light, etc. ls 1 3 EXCLUDEDSignage ls 1 3 EXCLUDEDInterior doors ls 1 3 EXCLUDEDWindow unit ls 1 3 EXCLUDEDElectric heaters ls 1 3 EXCLUDEDPool- Vaccum head with wheels ea 1 3 EXCLUDEDUnderwater Light ea 1 3 EXCLUDEDPool Rule Sign ea 1 3 EXCLUDED911 Emergency Phone ea 1 3 EXCLUDEDNo Lifeguard on Duty Sign ea 1 3 EXCLUDEDShallow Water- No Diving Sign ea 1 3 EXCLUDEDEmergency Cut-Off Switch Sign ea 1 3 EXCLUDEDHand Skimmer ea 1 3 EXCLUDEDTrash can & receptacle ea 1 3 EXCLUDEDFoot Wash ea 1 3 EXCLUDEDBulletin Board ea 1 3 EXCLUDED

5

5

VALUATION EXCLUSIONSCOMMENTS

Valuation Exclusions. For ease of administration of the Replacement Reserves and to reflect accurately how Replacement Reserves are administered, items with a dollar value less than $1,000.00 have not been scheduled for funding from Replacement Reserves. Examples of items excluded from funding by Replacement Reserves by this standard are listed above.

The list above exemplifies exclusions by the cited standard(s) and is not intended to be comprehensive.


20638901SWYGERT'17

VALUATION EXCLUSIONSEXCLUDED ITEMS



Shepards Hook ea 1 3 EXCLUDEDLife Saving Ring ea 1 3 EXCLUDEDPool Brush & Net ea 1 3 EXCLUDEDBulletin Board ea 1 3 EXCLUDEDPool - Wall Brush ea 1 3 EXCLUDEDPool- Vacuum Hose es 1 3 EXCLUDEDPool-Water Test Set ea 1 3 EXCLUDEDPool- Float Rope/Safey Rope/Float ea 1 3 EXCLUDED

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5

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VALUATION EXCLUSIONSCOMMENTS

Valuation Exclusions. For ease of administration of the Replacement Reserves and to reflect accurately how Replacement Reserves are administered, items with a dollar value less than $1,000.00 have not been scheduled for funding from Replacement Reserves. Examples of items excluded from funding by Replacement Reserves by this standard are listed above.


20638901SWYGERT'17

UNIT IMPROVEMENTS EXCLUSIONSEXCLUDED ITEMS



Domestic water pipes serving one unit ls 1 3 EXCLUDEDSanitary sewers serving one unit ls 1 3 EXCLUDEDElectrical wiring serving one unit ls 1 3 EXCLUDEDCable TV service serving one unit ls 1 3 EXCLUDEDTelephone service serving one unit ls 1 3 EXCLUDEDGas service serving one unit ls 1 3 EXCLUDED

5

Driveway on an individual lot ls 1 3 EXCLUDEDApron on an individual lot ls 1 3 EXCLUDEDSidewalk on an individual lot ls 1 3 EXCLUDEDStairs on an individual lot ls 1 3 EXCLUDEDCurb & gutter on an individual lot ls 1 3 EXCLUDEDRetaining wall on an individual lot ls 1 3 EXCLUDEDFence on an individual lot ls 1 3 EXCLUDED

5

5

Unit exterior ls 1 3 EXCLUDEDUnit windows ls 1 3 EXCLUDEDUnit doors ls 1 3 EXCLUDEDUnit skylights ls 1 3 EXCLUDEDUnit deck, patio, and/or balcony ls 1 3 EXCLUDEDUnit mailbox ls 1 3 EXCLUDEDUnit interior ls 1 3 EXCLUDEDUnit HVAC system ls 1 3 EXCLUDED

UNIT IMPROVEMENTS EXCLUSIONSCOMMENTS

Unit improvement Exclusions. We understand that the elements of the project that relate to a single unit are the responsibility of that unit owner. Examples of items excluded from funding by Replacement Reserves by this standard arelisted above.



20638901SWYGERT'17

UTILITY EXCLUSIONSEXCLUDED ITEMS



Primary electric feeds ls 1 3 EXCLUDEDElectric transformers ls 1 3 EXCLUDEDCable TV systems and structures ls 1 3 EXCLUDEDTelephone cables and structures ls 1 3 EXCLUDEDSite lighting ls 1 3 EXCLUDEDGas mains and meters ls 1 3 EXCLUDEDWater mains and meters ls 1 3 EXCLUDEDSanitary sewers ls 1 3 EXCLUDED

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UTILITY EXCLUSIONSCOMMENTS

Utility Exclusions. Many improvements owned by utility companies are on property owned by the Association. We have assumed that repair, maintenance, and replacements of these components will be done at the expense of the appropriate utility company. Examples of items excluded from funding Replacement Reserves by this standard are listed above.



20638901SWYGERT'17

GOVERNMENT EXCLUSIONSEXCLUDED ITEMS



Government, roadways & parking ls 1 3 EXCLUDEDGovernment, sidewalks & curbs ls 1 3 EXCLUDEDGovernment, lighting ls 1 3 EXCLUDEDGovernment, stormwater mgmt. ls 1 3 EXCLUDEDGovernment, ponds ls 1 3 EXCLUDED

5

Government, mailboxes ls 1 3 EXCLUDEDGovernment Inspections ls 1 3 EXCLUDEDGoverment Permits ls 1 3 EXCLUDEDGovernment Fees ls 1 3 EXCLUDEDBonding ls 1 3 EXCLUDED

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GOVERNMENT EXCLUSIONSCOMMENTS

Government Exclusions. We have assumed that some of the improvements installed on property owned by the Association will be maintained by the state, county, or local government, or other association or other responsible entity. Examples of items excluded from funding by Replacement Reserves by this standard are listed above.

Excluded right-of-ways, including LIST ROADS, and adjacent properties.



20638901SWYGERT'17

IRRIGATION SYSTEM EXCLUSIONSEXCLUDED ITEMS



Subsurface irrigation pipe ls 1 3 EXCLUDEDSubsurface irrigation valve ls 1 3 EXCLUDEDSubsurface irrigation control wiring ls 1 3 EXCLUDED

5

Irrigation control system ls 1 3 EXCLUDEDIrrigation system electrical service ls 1 3 EXCLUDEDIrrigation system enclosures ls 1 3 EXCLUDED

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IRRIGATION SYSTEM EXCLUSIONSCOMMENTS

Irrigation System Exclusions. We have assumed that the maintenance, repair, and periodic replacement of the components of the extensive irrigation systems at the property will not be funded from Replacement Reserves. These systems should be inspected each spring when the systems are brought on line and each fall when they are winterized. Repairs/replacements should be made in conjunction with these inspections.


20638901SWYGERT'17

LONG-LIFE EXCLUSIONSEXCLUDED ITEMS



Miscellaneous culverts ls 1 3 EXCLUDED5

Exterior brick veneer ls 1 3 EXCLUDEDExterior stone veneer ls 1 3 EXCLUDED

5

Building foundation(s) ls 1 3 EXCLUDEDConcrete floor slabs (interior) ls 1 3 EXCLUDEDWall, floor, & roof structure ls 1 3 EXCLUDED

5

Fire protection/security systems ls 1 3 EXCLUDED5

Electrical wiring ls 1 3 EXCLUDEDWater piping at common facilities ls 1 3 EXCLUDEDWaste piping at common facilities ls 1 3 EXCLUDEDGas services at common facilities ls 1 3 EXCLUDED

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LONG-LIFE EXCLUSIONSCOMMENTS

Long Life Exclusions. Components that when properly maintained, can be assumed to have a life equal to the property asa whole, are normally excluded from the Replacement Reserve Inventory. Examples of items excluded from funding by Replacement Reserves by this standard are listed above.

Exterior masonry is generally assumed to have an unlimited economic life but periodic repointing is required and we have included this for funding in the Replacement Reserve Inventory.


Miller + Dodson Associates, Inc. Projected Annual Replacements - Page C1Swygert's Landing August 1, 2017

20638901SWYGERT'17

PROJECTED ANNUAL REPLACEMENTSGENERAL INFORMATION

CALENDAR OF ANNUAL REPLACEMENTS. The 55 Projected Replacements in the Swygert's LandingReplacement Reserve Inventory whose replacement is scheduled to be funded from Replacement Reserves are broken down on a year-by-year basis, beginning on Page C2.

REPLACEMENT RESERVE ANALYSIS AND INVENTORYPOLICIES, PROCEDURES, AND ADMINISTRATION

REVISIONS. Revisions will be made to the Replacement Reserve Analysis and Replacement Reserve Inventoryin accordance with the written instructions of the Board of Directors. No additional charge is incurred for the first revision, if requested in writing within three months of the date of the Replacement Reserve Study. It is ourpolicy to provide revisions in electronic (Adobe PDF) format only.

TAX CODE. The United States Tax Code grants favorable tax status to a common interest development (CID)meeting certain guidelines for their Replacement Reserve. If a CID files their taxes as a 'Corporation' onForm 1120 (IRC Section 277), these guidelines typically require maintenance activities, partial replacements, minor replacements, capital improvements, and one-time only replacements to be excluded from Reserves.A CID cannot co-mingle planning for maintenance activities with capital replacement activities in the Reserves(Revenue Ruling 75-370). Funds for maintenance activities and capital replacements activities must be held inseparate accounts. If a CID files taxes as an "Exempt Homeowners Association" using Form 1120H (IRCSection 528), the CID does not have to segregate these activities. However, because the CID may elect tochange their method of filing from year to year within the Study Period, we advise using the more restrictiveapproach. We further recommend that the CID consult with their Accountant and consider creating separateand independent accounts and reserves for large maintenance items, such as painting.

CONFLICT OF INTEREST. Neither Miller - Dodson Associates nor the Reserve Analyst has any prior or existingrelationship with this Association which would represent a real or perceived conflict of interest.

RELIANCE ON DATA PROVIDED BY THE CLIENT. Information provided by an official representative of theAssociation regarding financial, physical conditions, quality, or historical issues is deemed reliable.

INTENT. This Replacement Reserve Study is a reflection of the information provided by the Association and the visual evaluations of the Analyst. It has been prepared for the sole use of the Association and is not for thepurpose of performing an audit, quality/forensic analyses, or background checks of historical records.

PREVIOUS REPLACEMENTS. Information provided to Miller - Dodson Associates regarding prior replacementsis considered to be accurate and reliable. Our visual evaluation is not a project audit or quality inspection.

EXPERIENCE WITH FUTURE REPLACEMENTS. The Calendar of Annual Projected Replacements, listsreplacements we have projected to occur over the next thirty years, begins on Page C2. Actual experience inreplacing the items may differ significantly from the cost estimates and time frames shown because of conditionsbeyond our control. These differences may be caused by maintenance practices, inflation, variations in pricingand market conditions, future technological developments, regulatory actions, acts of God, and luck. Someitems may function normally during our visual evaluation and then fail without notice.

REVIEW OF THE REPLACEMENT RESERVE STUDY. For this study to be effective, it should be reviewed by the Swygert's Landing Board of Directors, those responsible for the management of the itemsincluded in the Replacement Reserve Inventory, and the accounting professionals employed by the Association.


20638901SWYGERT'17

PROJECTED REPLACEMENTS - YEARS 1 TO 3

Item 2017 - STUDY YEAR $ Item 2018 - YEAR 2 $ Item 2019 - YEAR 3 $

No Scheduled Replacements No Scheduled Replacements No Scheduled Replacements


20638901SWYGERT'17


Item 2020 - YEAR 4 $ Item 2021 - YEAR 5 $ Item 2022 - YEAR 6 $

3 Concrete flatwork (6%) $1,906

No Scheduled Replacements No Scheduled Replacements Total Scheduled Replacements $1,906


20638901SWYGERT'17





20638901SWYGERT'17


Item 2026 - YEAR 10 $ Item 2027 - YEAR 11 $ Item 2028 - YEAR 12 $ 1 Gravel Parking Lot $4,286 3 Concrete flatwork (6%) $1,9062 Wooden Wheel Stops- Park $880

11 Storm Water Management A $25,00033 Swimming pool, whitecoat $16,33934 Swimming pool waterline tile $2,60836 Pool deck, sealer $1,14837 Pool pump. 1.5 HP $2,25042 Salt Chlorine Generator $75043 Pool Furniture, Lounge $1,39544 Pool Furniture, Chair $1,74045 Pool Furniture, Rocking Cha $35048 Pool Furniture, Circular Tabl $750

Total Scheduled Replacements $57,496 No Scheduled Replacements Total Scheduled Replacements $1,906


20638901SWYGERT'17



9 Palm Trees $5,85010 Irrigation System w Manifold $8,50015 Palm Trees $5,20016 Irrigation System w Manifold $8,50038 Pool pump, 5 HP $4,68546 Pool Furniture, Picnic Beach $1,00047 Small Bench $1,76050 Water Fountain $1,30052 Security System with 3 Cam $97553 Pool Swipe Keys System, Bu $3,14054 Security System with 3 came $1,250



20638901SWYGERT'17






20638901SWYGERT'17


Item 2035 - YEAR 19 $ Item 2036 - YEAR 20 $ Item 2037 - YEAR 21 $ 1 Gravel Parking Lot $4,2862 Wooden Wheel Stops- Park $880

11 Storm Water Management A $25,00012 Pond 1- 84,441 sf / 1.94 Ac $58,20013 Pond 1- 83,275 sf / 1,91 Ac $57,30014 Pond 3- 57,584 sf/ 1.32 Acre $39,60017 Walking Trail $2,80020 Pressure Treated Wooden P $52527 PH-Entry Door $2,80028 BH-Entry Door $3,50031 Bath House- Bath Room Fix $3,00033 Swimming pool, whitecoat $16,33934 Swimming pool waterline tile $2,60836 Pool deck, sealer $1,14837 Pool pump. 1.5 HP $2,25039 Pool Filters, Sand $6,58040 Pool ladder $69041 Safety rail $90042 Salt Chlorine Generator $75043 Pool Furniture, Lounge $1,39544 Pool Furniture, Chair $1,74045 Pool Furniture, Rocking Cha $35048 Pool Furniture, Circular Tabl $75051 Dog waste station $950

No Scheduled Replacements Total Scheduled Replacements $234,341 No Scheduled Replacements


20638901SWYGERT'17






20638901SWYGERT'17


Item 2041 - YEAR 25 $ Item 2042 - YEAR 26 $ Item 2043 - YEAR 27 $ 6 Trash Corral Gates $9708 Wooden Fence $4,620

18 Entrance monument, painted $16,57519 Masonry Monuments with lig $4,050

Total Scheduled Replacements $26,215 No Scheduled Replacements No Scheduled Replacements


20638901SWYGERT'17



1 Gravel Parking Lot $4,2862 Wooden Wheel Stops- Park $8803 Concrete flatwork (6%) $1,9067 Concrete trash corral pad $1,9819 Palm Trees $5,85010 Irrigation System w Manifold $8,50011 Storm Water Management A $25,00015 Palm Trees $5,20016 Irrigation System w Manifold $8,50023 BH-Gutters & Downsouts-Al $52524 PH-Gutters & Downspouts-A $59529 PH- Wooden, Square Colum $5,50030 BH-Woow\den, Square Colu $5,50033 Swimming pool, whitecoat $16,33934 Swimming pool waterline tile $2,60835 Pool deck, concrete $62,27936 Pool deck, sealer $1,14837 Pool pump. 1.5 HP $2,25038 Pool pump, 5 HP $4,68542 Salt Chlorine Generator $75043 Pool Furniture, Lounge $1,39544 Pool Furniture, Chair $1,74045 Pool Furniture, Rocking Cha $35046 Pool Furniture, Picnic Beach $1,00047 Small Bench $1,76048 Pool Furniture, Circular Tabl $75049 Bike Rack $1,15050 Water Fountain $1,30052 Security System with 3 Cam $97553 Pool Swipe Keys System, Bu $3,14054 Security System with 3 came $1,25055 Bike Rack- Metal $1,100



20638901SWYGERT'17





20638901SWYGERT'17



4 Pool- Metal Gates $8605 Fence, 5' aluminum w/ 3 rail $20,27621 BH-Roofing, Steel standing S $97522 PH-Roofing, Steel standing S $1,10525 PH-Exterior, Cedar Shake $8,63726 BH-Exterior, Cedar Shake $11,35432 Swimming pool structure $237,405



20638901SWYGERT'17


Item 2056 - YEAR 40 $ Item 2057 (beyond Study Period) $ Item 2058 (beyond Study Period) $ 1 Gravel Parking Lot $4,286 3 Concrete flatwork (6%) $1,9062 Wooden Wheel Stops- Park $880

11 Storm Water Management A $25,00012 Pond 1- 84,441 sf / 1.94 Ac $58,20013 Pond 1- 83,275 sf / 1,91 Ac $57,30014 Pond 3- 57,584 sf/ 1.32 Acre $39,60017 Walking Trail $2,80020 Pressure Treated Wooden P $52527 PH-Entry Door $2,80028 BH-Entry Door $3,50031 Bath House- Bath Room Fix $3,00033 Swimming pool, whitecoat $16,33934 Swimming pool waterline tile $2,60836 Pool deck, sealer $1,14837 Pool pump. 1.5 HP $2,25039 Pool Filters, Sand $6,58040 Pool ladder $69041 Safety rail $90042 Salt Chlorine Generator $75043 Pool Furniture, Lounge $1,39544 Pool Furniture, Chair $1,74045 Pool Furniture, Rocking Cha $35048 Pool Furniture, Circular Tabl $75051 Dog waste station $950

Total Scheduled Replacements $234,341 No Scheduled Replacements Total Scheduled Replacements $1,906

Intentionally Left Blank

Miller - Dodson Associates, Inc. Condition Assessment - Page 1 Swygert’s Landing August 1, 2017

CONDITION ASSESSMENT General Comments. Miller - Dodson Associates conducted a Reserve Study inspection on August 1, 2017 at Swygert’s Landing. This subdivision is in generally average to good condition on the day of the inspection. It is noted that the development is located in Flood Zone X, FEMA Map #455412048oJ, dated 11/17/2004. A review of the Replacement Reserve Inventory will show that we are anticipating most of the components achieving their normal economic lives. It is noted that the streets, sidewalks, street lights, curb and gutters, street signs, sewer pumping station, and storm drainage systems are excluded per the property manager. The bath house located at the swimming pool was locked at the time of inspection. Per the property manager, the bath house was not constructed to meet the county flood guidelines and the community has applied for a variance in order to utilize this facility. Currently there are two portable bathrooms located on site with an outside facility for washing. The bath house has been included in this study based on verbal information from the property manager with the assumption that variance will be granted on an “as built” basis. It is noted that the community has an extraordinary high expense for landscape maintenance as the developer created twenty-four small open space / green area rectangular parcels of land between some the of adjoining homes. In addition, there are large open space areas and treed areas and conservation areas that require maintenance. Only a small portion of the walking trail near the pond (next to the entrance to the development) has been improved with railroad ties and mulch and gravel. The balance of the trail is just areas of cleared brush and cleared under-growth. The area within the railroad ties has a wood chip surface and is somewhat displaced and should be replenished. It is noted that the landscaping cost is considered to be a normal operating expense item and is not considered a capital expense; thus, it is excluded from the reserve study. The following comments pertain to the larger, more significant components in the Replacement Reserve Inventory and to those items that are unique or deserving of attention because of their condition or the manner in which they have been treated in the Replacement Reserve Analysis or Inventory. GENERAL CONDITION STATEMENTS Excellent. 100% to 90% of Normal Economic Life expected, with no appreciable wear or defects. Good. 90% to 60% of Normal Economic Life expected, minor wear or cosmetic defects found. Normal maintenance should be expected. If performed properly, normal maintenance may increase the useful life of a component. Otherwise, the component is wearing normally. Fair. 60% to 30% of Normal Economic Life expected, moderate wear with defects found. Repair actions should be taken to extend the life of the component or to correct repairable defects and distress. Otherwise, the component is wearing normally. Marginal. 30% to 10% of Normal Economic Life expected, with moderate to significant wear or distress found. Repair actions are expected to be cost effective for localized issues, but normal wear and use are evident. The component is reaching the end of the Normal Economic Life. Poor. 10% to 0% of Normal Economic Life expected, with significant distress and wear. Left unattended, additional damage to underlying structures is likely to occur. Further maintenance is unlikely to be cost effective.


SITE COMPONENTS Entry Monument and Signage. The Association maintains an entry monument along Brownswood Road to Swygert’s Landing and seven detached monuments with internal lighting surrounded by glass on all sides on the top. The monument is made of masonry construction covered with stucco. The monuments are in good condition, with no open masonry joints observed and no observed loose and broken masonry units. The monument lettering is metal and is considered a long life item, and is therefore excluded from this study. We recommend repointing and replacement of defective areas of the masonry as needed. The Association may want to consider applying a coat of Siloxane or other appropriate breathable sealant to mitigate water penetration and further degradation of the masonry work. For additional information, please see the appropriate links on our web site at http://mdareserves.com/resources/links/building-exterior.

Entrance monument to Swygert’s Landing

Individual lighted monuments along main entrance

http://mdareserves.com/resources/links/building-exterior�


Asphalt Pavement, Concrete Sidewalks (along street), Curbs & Gutters, Street Signs, and Sewer Pumping Station. The Association is not responsible for any of the above mentioned items as they are the responsibility of the county per the property manager.

Typical street view Typical street view

Concrete Flatwork. The concrete flatwork in this community is limited to the sidewalk leading to the pool, the 2 handicapped parking spaces at the pool, the concrete aprons leading to the gravel parking lot, and trash corral concrete pad. The overall condition of the concrete flatwork is good with no observed areas of defects. The Association should periodically inspect the sidewalks for the following types of defects and complete the repairs as needed:

• Cracking. There are a number of sections of the concrete flatwork that have cracked.

• Heaving/Settlement. Sections of the concrete flatwork have heaved or settled relative to their adjacent sections, creating trip hazards.

• Scaling and Flaking. Several sections of the concrete flatwork are scaling and flaking. Scaling and

flaking are the loss of the surface mortar in concrete, typically caused by water freezing within the concrete. Once started, scaling and flaking can be expected to continue to grow as a result of exposure of the concrete to freeze-thaw cycles.

• Tree Root Damage. There are locations where roots from trees planted near the concrete walks

have pushed the concrete, causing cracks and heaving. Repair of these areas will require removal of the asphalt and the tree roots.

• The expansion joint material is not present in many of the joints between the concrete sidewalks and

curbs. The expansion material that fills these joints is installed to allow movement and to serve as a gasket to prevent water from entering the pavement. If these joints are left open, soil will wash away underneath the pavement and will cause settlement of both the curb and gutter and the sidewalk. Additionally, water that is allowed to collect behind the curb and gutter will open up the joint between the asphalt and gutter pan, which will deteriorate the edges of the asphalt. The expansion joint material should be replaced with an impregnated homasote approximately every five years as a normal maintenance procedure.

The standards we used for recommending replacement are as follows:

1. Trip hazard, 0.5 inch height difference. 2. Severe cracking. 3. Severe spalling. 4. Uneven riser heights on steps. 5. Steps with risers in excess of 8.25 inches.


Because it is highly unlikely that all of the community’s concrete components will fail and require replacement in the period of the study, we have programmed funds for the replacement of 60 percent of the inventory and spread those funds over a 60-year timeframe to reflect the incremental nature of this work. This approach assumes a failure rate of one percent per year.

Concrete sidewalk and concrete entry apron at pool

Gravel Parking Lot at Pool. The Association is responsible for the gravel parking lot at the pool. The parking lot has two concrete handicapped parking spaces and two concrete entry aprons which adjoin the street. In general, the Association’s gravel parking area is in average condition. There are wooden vehicular stops located in the parking lot. The gravel drive is designed with a stabilized sub-grade to support a 75,000 pound fire truck.

Gravel parking lot

Walking Trails. The Association is responsible for the walking trails. Only a small section of the walking trail is improved with railroad ties and mulch and gravel. The balance of the walking trails is clear cut paths through the underbrush and around trees. That portion of the trail that has the railroad tie needs to be mulched for better footing.

Improved walking trail


Unimproved walking trail cut through underbrush and open space walking area

Storm Water Ponds. The community is served by three storm water ponds. The pond near the front entrance contains 84,441± square feet. The second pond near the pool contains 83,275± square feet while the third pond located near Seger Street contains 57,554± square feet. The total acreage for the ponds is 5.17± acres.

Storm Water Management Ponds

Ponds will accumulate silt and over time lose the ability to store storm water at design levels, which could result in overflows and minor local flooding. In addition, water quality can be negatively affected by increased siltation and debris accumulation. Accordingly, ponds require periodic dredging. Estimates of cost and the frequency of dredging ponds are a function of many variables, including the volume of the pond, the siltation rate, the nature of the material being removed, the method of removal, and the haul distance to a site that will accept the spoil material. Most of this information is unknown and must be assumed for the purpose of reserve study planning. The siltation rate and cost of periodic dredging are speculative, varying greatly depending on local conditions. As a rule of thumb, dredging should be performed when approximately one-third of the volume of the pond has been filled with silt. In the absence of accurate information about the original depth of the pond and the local siltation rate, we have assumed that it will be necessary to remove one cubic yard of material over a third of the pond area periodically as noted in the inventory. We have assumed that the material being removed is free of heavy metals and hydrocarbons, and that it will be accepted as fill at a local landfill. A more accurate prediction of cost and cycles will require a hydrologic analysis and testing, which is beyond the scope of our study. As a supplement to traditional dredging methods, hydro-raking can prolong the interval between dredging. Because of the significant cost of this work, it is recommended that the Association undertake studies to refine the assumptions of this study.


Based on our understanding, we recommend the following:

• Periodically remove accumulated debris and vegetation growing in the ponds. • Survey the ponds to establish the current profile of the bottom. After five years of operation, have the

pond re-surveyed to establish new depths to determine the local siltation rate. This will establish the frequency required for periodic dredging.

• Periodically sample and test for contaminants. • Consult with local contractors to determine the cost of removing and disposing of the spoil, once its

nature is known. Firms that specialize in this work can be typically found by internet searching “Lake and Pond, Construction and Maintenance” for your state or area of the country. Some states provide short lists of companies that specialize in this type of work. Please note that the periodic removal of overgrown vegetation from the pond is considered a maintenance activity and has not been reserved for or included in this study. Storm water structures must be maintained over time so that they may perform their two major functions - storm water storage and storm water quality improvement. A well-planned maintenance program is the best way to ensure that these structures will continue to perform their water quality and quantity functions.

The following information outlines the general maintenance considerations for storm-water management structures. Storm-water management structures will require routine and non-routine maintenance. Routine maintenance such as visual inspections, vegetation management, and the regular removal of debris and litter provides a variety of benefits such as reducing the chance of clogging outlet structures, trash racks, risers, and other facility components. It is important to note that while general maintenance tasks are suggested, actual maintenance needs are very site specific. Below is a lists component of a general maintenance program.

Routine Non-Routine • Visual Inspection Bank Stabilization • Vegetation Management Sediment Removal • Debris/Litter Control Outlet Structure Maintenance / Replacement • Maintaining Undisturbed Areas Around Infiltration Trenches/Basins (routine) • Maintenance of Mechanical Components (dependent on age of structure; non-routine)

Ponds should be inspected once a year, addressing the items listed below.

MINIMUM INSPECTION CHECKLIST FOR PONDS.

• Obstructions of the inlet or outlet devices by trash and debris • Excessive erosion or sedimentation in the basin • Cracking or settling of the dam • Low spots in the bottom of a dry pond • Deterioration of pipes • Condition of the emergency spillway • Stability of the side-slopes • Upstream and downstream channel conditions • Signs of vandalism

Vegetation Management. Grass is usually used around and in storage ponds to prevent erosion and to filter sediment. The grass near the pond should not be over-fertilized, or the excessive nutrients will be washed into the pond and contribute to the growth of algae. Grass should be cut no shorter than 6-8 inches. Please note that the periodic removal of overgrown vegetation from the pond is considered a maintenance activity and has not been reserved for or included in this study.


Sediment Removal. One of the main purposes of a storm-water management pond is to remove sediment from storm water. As water flows through the pond, sediment will accumulate and eventually will need to be removed. Storm-water management structures vary in design and shape. Therefore, there is no general rule for the frequency of sediment removal. Upstream conditions such as land use, type of land cover (vegetated vs. paved), and soil types are important factors in determining how rapidly sediment will accumulate in a pond. Sediment removal is usually the single largest cost of maintaining a storm-water management structure. Owners are responsible for maintaining the facility and should plan ahead, setting aside the necessary funds to pay for sediment removal. The best solution to sediment removal is to designate an on-site area or a site adjacent to the facility where the sediment can be disposed. This area will need to be located outside of the floodplain. If such a disposal area is not available, the sediment will need to be transported and disposed of off-site. Transportation costs and disposal fees can greatly increase the cost of sediment removal. Once the sediment is removed, the bottom of the basin and any disturbed areas will need to be stabilized and re-vegetated, or the structure will quickly clog and require sediment removal again. We have provided funds for the minor dredging of the detention pond and clearing of the swales, creek area, and drainage lines. Because of the significance of the cost of this work in establishing the correct reserve contribution, it is recommended that the Association undertake studies to refine the information and replace the assumptions we have had to make with more factual information as a basis for the estimates. Storm Water Drainage System. We included only the underground piping portions of the storm water system (leading to the ponds) in the reserve analysis. No engineering drawings were available to accurately determine distances, sizes of lines and materials used for underground components of the system. Accordingly, we have provided an estimate of the approximate replacement cost based on our experience with other communities of similar size and our external inspection of the visible components when on site. Inspection of the underground lines and structures is beyond the scope of this study.

Storm water management pond and drain


RECREATIONAL FACILITIES Swimming Pool. The community operates an outdoor pool with a wading area (zero entry) within the pool. The pool is of concrete construction. The pool was operational at the time of inspection and is reported to be in good condition. The pool has a swim ladder and hand rails. In addition the pool has two water pumps and two filters. Listed below are the major components of the pool facilities:

Swimming pool

Zero entry pool area Pool depth - 1’ to 4’

• Pool Shell. The shell for the swimming pool is in good condition.

• Pool Deck. The pool has a concrete deck. The overall condition of the deck is good with no observed tripping hazards.

• Pool Deck Coating. The concrete pool deck is coated with an elastomeric coating. The coating is in good condition. We have assumed a service life for the coating of ten years.

• Whitecoat. The pool whitecoat is in good condition. We have assumed a service life of eight to ten years for the pool whitecoat.

• Waterline Tile. The waterline tile is in good condition. We have assumed that the waterline tile will be replaced or restored when the pool is whitecoated.

• Coping. The pool is edged with tile coping. The coping is in good condition.

• Two Pumps and Filter System (two filters). The high rate sand filter system and pumps are is in good operating condition.

• Pool Fence. The swimming pool is enclosed by a metal fence that is in good condition.


Water filters and pump

Pool house Bath house

Pool house with pumps and filters Bath house

Note: Bath house pool variance is mounted on the exterior doors. No interior inspection of the bath house was permitted as the doors were pad locked. This report assumes the county will allow a variance and as such allow the community to utilize the bath house.


Variance sign at bath house doors

Pool Landscaping and Irrigation Manifold. The Association is responsible for the landscaping for the pool grounds, which includes the grass and palm trees. There is a water manifold located near the street that uses public water for irrigation.

Pool landscaping Water manifold

Fencing. The Association maintains an inventory of metal fencing (five feet in height) along all of the sides of the pool that is in good condition. There are also two metal gates equipped with electronic swipe pads and push button exiting. The metal fence and key pads are in good condition. Protection from string machine damage during lawn maintenance can extend the useful life of some fence types. Protection from this type of damage is typically provided by applying herbicides around post bases or installing protective sheathing. Fencing systems have a large number of configurations and finishes that can usually be repaired as a maintenance activity by replacing individual components as they become damaged or weathered. This type of fence can last 20 to 25 years if properly maintained. For more information on fencing, visit our website link to the American Fence Association.

Exterior metal fence with gate

http://mdareserves.com/resources/links/site-components�


Trash Corrals. The community has one trash corral located near the pool with two wooden gates. The trash corrals include a concrete pad and an enclosure that is constructed from wood fencing. The overall condition of the trash corral is good.

This Condition Assessment is based upon our visual survey of the property. The sole purpose of the visual survey was an evaluation of the common elements of the property to ascertain the remaining useful life and the replacement costs of these common elements. Our evaluation assumed that all components met building code requirements in force at the time of construction. Our visual survey was conducted with care by experienced persons, but no warranty or guarantee is expressed or implied.

End of Condition Assessment

Intentionally Left Blank

Miller + Dodson Associates, Inc. Cash Flow Method Accounting Summary - Page CF1Swygert's Landing August 1, 2017

20638901SWYGERT'17

CASH FLOW METHOD ACCOUNTING SUMMARYThis Swygert's Landing - Cash Flow Method Accounting Summary is an attachment to theSwygert's Landing - Replacement Reserve Study dated August 1, 2017 and is for use byaccounting and reserve professionals experienced in Association funding and accounting principles.This Summary consists of four reports, the 2017, 2018, and 2019 Cash Flow Method Category FundingReports (3) and a Three-Year Replacement Funding Report.

CASH FLOW METHOD CATEGORY FUNDING REPORT, 2017, 2018, and 2019. Each of the 55 ProjectedReplacements listed in the Swygert's Landing Replacement Reserve Inventory has beenassigned to one of 5 categories. The following information is summarized by category in each report:

Normal Economic Life and Remaining Economic Life of the Projected Replacements.

Cost of all Scheduled Replacements in each category.

Replacement Reserves on Deposit allocated to the category at the beginning and end of the report period.

Cost of Projected Replacements in the report period.

Recommended Replacement Reserve Funding allocated to the category during the report period as calculated by the Cash Flow Method.

THREE-YEAR REPLACEMENT FUNDING REPORT. This report details the allocation of the $15,008Beginning Balance (at the start of the Study Year) and the $80,766 of additional Replacement ReserveFunding in 2017 through 2019 (as calculated in the Replacement Reserve Analysis) to each of the 55Projected Replacements listed in the Replacement Reserve Inventory. These allocations have been made using Chronological Allocation, a method developed by Miller Dodson Associates, Inc., and discussed below.The calculated data includes:

Identification and estimated cost of each Projected Replacement scheduled in years 2017 through 2019.

Allocation of the $15,008 Beginning Balance to the Projected Replacements by Chronological Allocation.

Allocation of the $80,766 of additional Replacement Reserve Funding recommended in the Replacement Reserve Analysis in years 2017 through 2019, by Chronological Allocation.

CHRONOLOGICAL ALLOCATION. Chronological Allocation assigns Replacement Reserves to ProjectedReplacements on a "first come, first serve" basis in keeping with the basic philosophy of the Cash Flow Method.The Chronological Allocation methodology is outlined below.

The first step is the allocation of the $15,008 Beginning Balance to the Projected Replacements in theStudy Year. Remaining unallocated funds are next allocated to the Projected Replacements in subsequentyears in chronological order until the total of Projected Replacements in the next year is greater than the unallocated funds. Projected Replacements in this year are partially funded with each replacementreceiving percentage funding. The percentage of funding is calculated by dividing the unallocated funds by the total of Projected Replacements in the partially funded year.

At Swygert's Landing the Beginning Balance funds all Scheduled Replacements inthe Study Year through 2025 and provides partial funding (23%) of replacements scheduled in 2026.

The next step is the allocation of the $26,922 of 2017 Cash Flow Method Reserve Funding calculatedin the Replacement Reserve Analysis. These funds are first allocated to fund the partially fundedProjected Replacements and then to subsequent years in chronological order as outlined above.

At Swygert's Landing the Beginning Balance and the 2017 Replacement ReserveFunding, funds replacements through 2025 and partial funds (69.6%) replacements in 2026.

Allocations of the 2018 and 2019 Reserve Funding are done using the same methodology.

The Three-Year Replacement Funding Report details component by component allocations made by Chronological Allocation.


20638901SWYGERT'17

2017 - CASH FLOW METHOD CATEGORY FUNDING REPORT

Each of the 55 Projected Replacements included in the Swygert's Landing Replacement ReserveInventory has been assigned to one of the 5 categories listed in TABLE CF1 below. This calculated data is asummary of data provided in the Three-Year Replacement Funding Report and Replacement Reserve Inventory.The accuracy of this data is dependent upon many factors including the following critical financial data:

A Beginning Balance of $15,008 as of the first day of the Study Year, January 1, 2017.

Total reserve funding (including the Beginning Balance) of $41,930 in the Study Year.

No expenditures from Replacement Reserves other than those specifically listed in theReplacement Reserve Inventory.

If any of these critical factors are inaccurate, do not use the data and please contact Miller Dodson Associatesto arrange for an update of the Replacement Reserve Study.

2017 - CASH FLOW METHOD CATEGORY FUNDING - TABLE CF1NORMAL REMAINING ESTIMATED 2017 2017 2017 2017

ECONOMIC ECONOMIC REPLACEMENT BEGINNING RESERVE PROJECTED END OF YEARCATEGORY LIFE LIFE COST BALANCE FUNDING REPLACEMENTS BALANCE

SITE COMPONENTS 6 to 39 years 5 to 38 years $243,929 $8,780 $14,125 $22,905

SITE COMPONENTS (cont.) 20 to 25 years 19 to 24 years $23,950

BUILDING EXTERIORS 20 to 60 years 0 to 38 years $43,491

RECREATION 10 to 39 years 9 to 38 years $335,634 $5,263 $10,814 $16,077

RECREATION (cont.) 10 to 30 years 9 to 29 years $16,860 $965 $1,983 $2,948


20638901SWYGERT'17



Replacement Reserves on Deposit totaling $41,930 on January 1, 2018.

Total reserve funding (including the Beginning Balance) of $68,852 from 2017 through 2018.









RECREATION (cont.) 10 to 30 years 8 to 28 years $16,860 $2,948 $2,973 $5,921


20638901SWYGERT'17




Total Replacement Reserve funding (including the Beginning Balance) of $95,774 from 2017 to 2019.











20638901SWYGERT'17

CASH FLOW METHOD - THREE-YEAR REPLACEMENT FUNDING REPORT

TABLE CF4 below details the allocation of the $15,008 Beginning Balance, as reported by the Association andthe $80,766 of Replacement Reserve Funding calculated by the Cash Flow Method from 2017 to 2019, to the 55Projected Replacements listed in the Replacement Reserve Inventory. These allocations have been made byChronological Allocation, a method developed by Miller Dodson Associates, Inc., and outlined on Page CF1.The accuracy of the allocations is dependent upon many factors including the following critical financial data:






If any of these critical factors are inaccurate, do not use the data and please contact Miller DodsonAssociates, Inc., to arrange for an update of the Replacement Reserve Study.

CASH FLOW METHOD - THREE-YEAR REPLACEMENT FUNDING - TABLE CF4Description of Estimated Allocation 2017 2017 2017 2018 2018 2018 2019 2019 2019

Item Projected Replacement of Beginning Reserve Projected End of Year Reserve Projected End of Year Reserve Projected End of Year# Replacement Costs Balance Funding Replacements Balance Funding Replacements Balance Funding Replacements Balance

SITE COMPONENTS

1 Gravel Parking Lot 4,286 977 2,007 2,984 1,303 4,286 4,2862 Wooden Wheel Stops- Parking Lot 880 201 412 613 267 880 8803 Concrete flatwork (6%) 1,906 1,906 1,906 1,906 3,813 3,8134 Pool- Metal Gates 8605 Fence, 5' aluminum w/ 3 rails & picket 20,2766 Trash Corral Gates 9707 Concrete trash corral pad 1,9818 Wooden Fence 4,6209 Palm Trees 5,850 1,047 1,047 3,736 4,782

10 Irrigation System w Manifold 8,500 1,521 1,521 5,428 6,94911 Storm Water Management Allowance 25,000 5,697 11,706 17,403 7,597 25,000 25,00012 Pond 1- 84,441 sf / 1.94 Ac 58,20013 Pond 1- 83,275 sf / 1,91 Ac 57,30014 Pond 3- 57,584 sf/ 1.32 Acres 39,60015 Palm Trees 5,200 930 930 3,321 4,25116 Irrigation System w Manifold 8,500 1,521 1,521 5,428 6,949

SITE COMPONENTS (cont.)

17 Walking Trail 2,80018 Entrance monument, painted metal sign 16,57519 Masonry Monuments with light/ glass 4,05020 Pressure Treated Wooden Posts/caps 525

BUILDING EXTERIORS

21 BH-Roofing, Steel standing Seam 97522 PH-Roofing, Steel standing Seam 1,10523 BH-Gutters & Downsouts-Aluminium 52524 PH-Gutters & Downspouts-Aluminium 59525 PH-Exterior, Cedar Shake 8,63726 BH-Exterior, Cedar Shake 11,35427 PH-Entry Door 2,80028 BH-Entry Door 3,50029 PH- Wooden, Square Columns 5,50030 BH-Woow\den, Square Columns 5,50031 Bath House- Bath Room Fixture 3,000

RECREATION

32 Swimming pool structure 237,40533 Swimming pool, whitecoat 16,339 3,723 7,651 11,374 4,965 16,339 16,33934 Swimming pool waterline tile (2x2) 2,608 594 1,221 1,816 793 2,608 2,60835 Pool deck, concrete 62,27936 Pool deck, sealer 1,148 262 538 799 349 1,148 1,148


20638901SWYGERT'17

CASH FLOW METHOD - THREE-YEAR REPLACEMENT FUNDING - TABLE CF4 cont'dDescription of Estimated Allocation 2017 2017 2017 2018 2018 2018 2019 2019 2019


37 Pool pump. 1.5 HP 2,250 513 1,054 1,566 684 2,250 2,25038 Pool pump, 5 HP 4,685 838 838 2,992 3,83039 Pool Filters, Sand 6,58040 Pool ladder 69041 Safety rail 90042 Salt Chlorine Generator 750 171 351 522 228 750 750

RECREATION (cont.)

43 Pool Furniture, Lounge 1,395 318 653 971 424 1,395 1,39544 Pool Furniture, Chair 1,740 396 815 1,211 529 1,740 1,74045 Pool Furniture, Rocking Chair 350 80 164 244 106 350 35046 Pool Furniture, Picnic Beach 1,000 179 179 639 81747 Small Bench 1,760 315 315 1,124 1,43948 Pool Furniture, Circular Table 750 171 351 522 228 750 75049 Bike Rack 1,15050 Water Fountain 1,300 233 233 830 1,06351 Dog waste station 95052 Security System with 3 Cameras 975 174 174 623 79753 Pool Swipe Keys System, Button Exit 3,140 562 562 2,005 2,56754 Security System with 3 cameras 1,250 224 224 798 1,02255 Bike Rack- Metal 1,100

Miller + Dodson Associates, Inc. Component Method - Page CM1Swygert's Landing August 1, 2017

20638901SWYGERT'17

COMPONENT METHOD

$28,585COMPONENT METHOD RECOMMENDED ANNUAL FUNDING OF REPLACEMENT RESERVES IN THE STUDY YEAR, 2017.$9.93 Per unit (average), recommended monthly funding of Replacement Reserves

General. The Component Method (also referred to as the Full Funded Method) is a very conservativemathematical model developed by HUD in the early 1980s. Each of the 55 Projected Replacements listed in theReplacement Reserve Inventory is treated as a separate account. The Beginning Balance is allocated to each of theindividual accounts, as is all subsequent funding of Replacement Reserves. These funds are "locked" in these individual accounts and are not available to fund other Projected Replacements. The calculation of Recommended Annual Funding of Replacement Reserves is a multi-step process outlined in more detail on Page CM2.

Component Method - Cumulative Receipts and Expenditures Graph

$548,031

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Component Method - Cumulative Receipts Component Method - Year End Balance Projected Replacements - Cumulative Expenditures

Miller + Dodson Associates, Inc. Component Method - Page CM2Swygert's Landing August 1, 2017

20638901SWYGERT'17

COMPONENT METHOD (cont'd)

Current Funding Objective. A Current Funding Objective is calculated for each of the Projected Replacementslisted in the Replacement Reserve Inventory. Replacement Cost is divided by the Normal Economic Life todetermine the nominal annual contribution. The Remaining Economic Life is then subtracted from theNormal Economic Life to calculate the number of years that the nominal annual contribution should havebeen made. The two values are then multiplied to determine the Current Funding Objective. This is repeated for each of the 55 Projected Replacements. The total, $0, is the Current Funding Objective.

Funding Percentage. The Funding Percentage is calculated by dividing the Beginning Balance ($15,008)by the Current Funding Objective. In this case the Reserves are fully funded.

Allocation of the Beginning Balance. The Beginning Balance is divided among the 55 Projected Replacementsin the Replacement Reserve Inventory. The Current Funding Objective for each Projected Replacement ismultiplied by the Funding Percentage and these funds are then "locked" into the account of each item.

Annual Funding. The Recommended Annual Funding of Replacement Reserves is then calculated for eachProjected Replacement. The funds allocated to the account of the Projected Replacement are subtracted from the Replacement Cost. The result is then divided by the number of years until replacement, and the result is the annual funding for each of the Projected Replacements. The sum of these is $28,585, the Component MethodRecommended Annual Funding of Replacement Reserves in the Study Year (2017).

Adjustment to the Component Method for interest and inflation. The calculations in the Replacement ReserveAnalysis do not account for interest earned on Replacement Reserves, inflation, or a constant annual increase in Annual Funding of Replacement Reserves. The Component Method is a very conservative method and if the Analysis is updated regularly, adequate funding will be maintained without the need for adjustments.

Component Method Data - Years 1 through 30Year 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

Beginning balance $15,008 Recommended annual funding $28,585 $28,585 $28,585 $28,585 $28,585 $28,585 $28,585 $28,585 $28,585 $28,585

Interest on reservesExpenditures $1,906 $57,496

Year end balance $43,593 $72,178 $100,763 $129,348 $157,933 $184,612 $213,197 $241,782 $270,367 $241,456Cumulative Expenditures $1,906 $1,906 $1,906 $1,906 $59,403

Cumulative Receipts $43,593 $72,178 $100,763 $129,348 $157,933 $186,518 $215,103 $243,688 $272,274 $300,859

Year 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036Recommended annual funding $28,585 $28,585 $28,585 $28,585 $28,585 $28,585 $28,585 $28,585 $28,585 $28,585

Interest on reservesExpenditures $1,906 $42,160 $1,906 $234,341

Year end balance $270,041 $296,720 $325,305 $353,890 $340,315 $368,900 $397,485 $424,164 $452,749 $246,992Cumulative Expenditures $59,403 $61,309 $61,309 $61,309 $103,469 $103,469 $103,469 $105,376 $105,376 $339,717


Year 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046Recommended annual funding $28,585 $28,585 $28,585 $28,585 $28,585 $28,585 $28,585 $28,585 $28,585 $28,585

Interest on reservesExpenditures $1,906 $26,215 $180,192

Year end balance $275,577 $304,162 $332,747 $359,426 $361,796 $390,381 $418,966 $447,551 $476,136 $324,529Cumulative Expenditures $339,717 $339,717 $339,717 $341,623 $367,838 $367,838 $367,838 $367,838 $367,838 $548,031


Miller + Dodson Associates, Inc. Component Method Accounting Summary - Page CM3Swygert's Landing August 1, 2017

20638901SWYGERT'17

COMPONENT METHOD ACCOUNTING SUMMARYThis Swygert's Landing - Component Method Accounting Summary is an attachment to theSwygert's Landing - Replacement Reserve Study dated August 1, 2017 and is for use byaccounting and reserve professionals experienced in Association funding and accounting principles.This Summary consists of four reports, the 2017, 2018, and 2019 Component Method Category FundingReports (3) and a Three-Year Replacement Funding Report.

COMPONENT METHOD CATEGORY FUNDING REPORT, 2017, 2018, and 2019. Each of the 55 ProjectedReplacements listed in the Swygert's Landing Replacement Reserve Inventory has beenassigned to one of 5 categories. The following information is summarized by category in each report:

Normal Economic Life and Remaining Economic Life of the Projected Replacements.

Cost of all Scheduled Replacements in each category.

Replacement Reserves on Deposit allocated to the category at the beginning and end of the report period.

Cost of Projected Replacements in the report period.

Recommended Replacement Reserve Funding allocated to the category during the report period as calculated by the Component Method.

THREE-YEAR REPLACEMENT FUNDING REPORT. This report details the allocation of the $15,008Beginning Balance (at the start of the Study Year) and the $85,755 of additional Replacement Reservefunding from 2017 to 2019 (as calculated in the Replacement Reserve Analysis) to each of the 55Projected Replacements listed in the Replacement Reserve Inventory. These allocations have been madeusing the Component Method as outlined in the Replacement Reserve Analysis.The calculated data includes:

Identification and estimated cost of each Projected Replacement schedule in years 2017 through 2019.

Allocation of the $15,008 Beginning Balance to the Projected Replacements by the Component Method.

Allocation of the $85,755 of additional Replacement Reserve Funding recommended in the Replacement Reserve Analysis in years 2017 through 2019, by the Component Method.


20638901SWYGERT'17

2017 - COMPONENT METHOD CATEGORY FUNDING REPORT

Each of the 55 Projected Replacements included in the Swygert's Landing Replacement ReserveInventory has been assigned to one of the 5 categories listed in TABLE CM1 below. This calculated data is asummary of data provided in the Three-Year Replacement Funding Report and Replacement Reserve Inventory.The accuracy of this data is dependent upon many factors including the following critical financial data:

A Beginning Balance of $15,008 as of the first day of the Study Year, January 1, 2017.

Total reserve funding (including the Beginning Balance) of $43,593 in the Study Year.



2017 - COMPONENT METHOD CATEGORY FUNDING - TABLE CM1NORMAL REMAINING ESTIMATED 2017 2017 2017 2017


5 to 38 yearsSITE COMPONENTS 6 to 39 years 5 to 38 years $243,929 $13,791 $13,791

SITE COMPONENTS (cont.) 20 to 25 years 19 to 24 years $23,950 $991 $991

BUILDING EXTERIORS 20 to 60 years 0 to 38 years $43,491 $1,435 $1,435

RECREATION 10 to 39 years 9 to 38 years $335,634 $11,194 $11,194

RECREATION (cont.) 10 to 30 years 9 to 29 years $16,860 $1,174 $1,174


20638901SWYGERT'17




Total reserve funding (including the Beginning Balance) of $72,178 from 2017 through 2018.






SITE COMPONENTS (cont.) 20 to 25 years 18 to 23 years $23,950 $991 $991 $1,983

BUILDING EXTERIORS 20 to 60 years 18 to 37 years $43,491 $1,435 $1,435 $2,870




20638901SWYGERT'17










SITE COMPONENTS (cont.) 20 to 25 years 17 to 22 years $23,950 $1,983 $991 $2,974

BUILDING EXTERIORS 20 to 60 years 17 to 36 years $43,491 $2,870 $1,435 $4,305




20638901SWYGERT'17

COMPONENT METHOD - THREE-YEAR REPLACEMENT FUNDING REPORT

TABLE CM4 below details the allocation of the $15,008 Beginning Balance, as reported by the Association and the$85,755 of Replacement Reserve Funding calculated by the Cash Flow Method from 2017 to 2019, to the 55Projected Replacements listed in the Replacement Reserve Inventory. These allocations have been made byChronological Allocation, a method developed by Miller Dodson Associates, Inc., and outlined on Page CF1.The accuracy of the allocations is dependent upon many factors including the following critical financial data:






If any of these critical factors are inaccurate, do not use the data and please contact Miller DodsonAssociates, Inc., to arrange for an update of the Replacement Reserve Study.

COMPONENT METHOD - THREE-YEAR REPLACEMENT FUNDING - TABLE CM4Description of Estimated Allocation 2017 2017 2017 2018 2018 2018 2019 2019 2019


SITE COMPONENTS

1 Gravel Parking Lot 4,286 429 429 429 857 429 1,2862 Wooden Wheel Stops- Parking Lot 880 88 88 88 176 88 2643 Concrete flatwork (6%) 1,906 318 318 318 635 318 9534 Pool- Metal Gates 860 22 22 22 44 22 665 Fence, 5' aluminum w/ 3 rails & picket 20,276 520 520 520 1,040 520 1,5606 Trash Corral Gates 970 39 39 39 78 39 1167 Concrete trash corral pad 1,981 66 66 66 132 66 1988 Wooden Fence 4,620 185 185 185 370 185 5549 Palm Trees 5,850 390 390 390 780 390 1,170

10 Irrigation System w Manifold 8,500 567 567 567 1,133 567 1,70011 Storm Water Management Allowance 25,000 2,500 2,500 2,500 5,000 2,500 7,50012 Pond 1- 84,441 sf / 1.94 Ac 58,200 2,910 2,910 2,910 5,820 2,910 8,73013 Pond 1- 83,275 sf / 1,91 Ac 57,300 2,865 2,865 2,865 5,730 2,865 8,59514 Pond 3- 57,584 sf/ 1.32 Acres 39,600 1,980 1,980 1,980 3,960 1,980 5,94015 Palm Trees 5,200 347 347 347 693 347 1,04016 Irrigation System w Manifold 8,500 567 567 567 1,133 567 1,700

SITE COMPONENTS (cont.)

17 Walking Trail 2,800 140 140 140 280 140 42018 Entrance monument, painted metal sign 16,575 663 663 663 1,326 663 1,98919 Masonry Monuments with light/ glass 4,050 162 162 162 324 162 48620 Pressure Treated Wooden Posts/caps 525 26 26 26 53 26 79

BUILDING EXTERIORS

21 BH-Roofing, Steel standing Seam 975 25 25 25 50 25 7522 PH-Roofing, Steel standing Seam 1,105 28 28 28 57 28 8523 BH-Gutters & Downsouts-Aluminium 525 18 18 18 35 18 5324 PH-Gutters & Downspouts-Aluminium 595 20 20 20 40 20 6025 PH-Exterior, Cedar Shake 8,637 221 221 221 443 221 66426 BH-Exterior, Cedar Shake 11,354 291 291 291 582 291 87327 PH-Entry Door 2,800 140 140 140 280 140 42028 BH-Entry Door 3,500 175 175 175 350 175 52529 PH- Wooden, Square Columns 5,500 183 183 183 367 183 55030 BH-Woow\den, Square Columns 5,500 183 183 183 367 183 55031 Bath House- Bath Room Fixture 3,000 150 150 150 300 150 450

RECREATION

32 Swimming pool structure 237,405 6,087 6,087 6,087 12,175 6,087 18,26233 Swimming pool, whitecoat 16,339 1,634 1,634 1,634 3,268 1,634 4,90234 Swimming pool waterline tile (2x2) 2,608 261 261 261 522 261 78235 Pool deck, concrete 62,279 2,076 2,076 2,076 4,152 2,076 6,22836 Pool deck, sealer 1,148 115 115 115 230 115 344


20638901SWYGERT'17

COMPONENT METHOD - THREE-YEAR REPLACEMENT FUNDING - TABLE CM4 cont'dDescription of Estimated Allocation 2017 2017 2017 2018 2018 2018 2019 2019 2019


37 Pool pump. 1.5 HP 2,250 225 225 225 450 225 67538 Pool pump, 5 HP 4,685 312 312 312 625 312 93739 Pool Filters, Sand 6,580 329 329 329 658 329 98740 Pool ladder 690 35 35 35 69 35 10441 Safety rail 900 45 45 45 90 45 13542 Salt Chlorine Generator 750 75 75 75 150 75 225

RECREATION (cont.)

43 Pool Furniture, Lounge 1,395 140 140 140 279 140 41944 Pool Furniture, Chair 1,740 174 174 174 348 174 52245 Pool Furniture, Rocking Chair 350 35 35 35 70 35 10546 Pool Furniture, Picnic Beach 1,000 67 67 67 133 67 20047 Small Bench 1,760 117 117 117 235 117 35248 Pool Furniture, Circular Table 750 75 75 75 150 75 22549 Bike Rack 1,150 38 38 38 77 38 11550 Water Fountain 1,300 87 87 87 173 87 26051 Dog waste station 950 48 48 48 95 48 14352 Security System with 3 Cameras 975 65 65 65 130 65 19553 Pool Swipe Keys System, Button Exit 3,140 209 209 209 419 209 62854 Security System with 3 cameras 1,250 83 83 83 167 83 25055 Bike Rack- Metal 1,100 37 37 37 73 37 110

Miller - Dodson Associates, Inc. Page 1 Overview, Standard Terms, and Definitions August 1, 2017

1. COMMON INTEREST DEVELOPMENTS - AN OVERVIEW Over the past 40 years, the responsibility for community facilities and infrastructure around many of our homes has shifted from the local government to Community Associations. Thirty years ago, a typical new town house abutted a public street on the front and a public alley on the rear. Open space was provided by a nearby public park and recreational facilities were purchased ala carte from privately owned country clubs, swim clubs, tennis clubs, and gymnasiums. Today, 60% of all new residential construction, i.e. townhouses, single-family homes, condominiums, and cooperatives, is in Common Interest Developments (CID). In a CID, a homeowner is bound to a Community Association that owns, maintains, and is responsible for periodic replacements of various components that may include the roads, curbs, sidewalks, playgrounds, streetlights, recreational facilities, and other community facilities and infrastructure. The growth of Community Associations has been explosive. In 1965, there were only 500 Community Associations in the United States. According to the 1990 U.S. Census, there were 130,000 Community Associations. Community Associations Institute (CAI), a national trade association, estimates there were more than 200,000 Community Associations in the year 2000, and that the number of Community Associations will continue to multiply. The shift of responsibility for billions of dollars of community facilities and infrastructure from the local government and private sector to Community Associations has generated new and unanticipated problems. Although Community Associations have succeeded in solving many short-term problems, many Associations have failed to properly plan for the tremendous expenses of replacing community facilities and infrastructure components. When inadequate replacement reserve funding results in less than timely replacements of failing components, home owners are exposed to the burden of special assessments, major increases in Association fees, and a decline in property values. 2. REPLACEMENT RESERVE STUDY The purpose of a Replacement Reserve Study is to provide the Association with an inventory of the common community facilities and infrastructure components that require periodic replacement, a general view of the condition of these components, and an effective financial plan to fund projected periodic replacements. The Replacement Reserve Study consists of the following: • Replacement Reserve Study Introduction. The introduction provides a description of the property, reviews the intent of

the Replacement Reserve Study, and lists documents and site evaluations upon which the Replacement Reserve Study is based.

• Section A Replacement Reserve Analysis. Many components owned by the Association have a limited life and require

periodic replacement. Therefore, it is essential the Association have a financial plan that provides funding for the timely replacement of these components in order to protect the safety, appearance, and value of the community. In conformance with American Institute of Certified Public Accountant guidelines, a Replacement Reserve Analysis evaluates the current funding of Replacement Reserves as reported by the Association and recommends annual funding of Replacement Reserves by two generally accepted accounting methods; the Cash Flow Method and the Component Method. Miller - Dodson provides a replacement reserve recommendation based on the Cash Flow Method in Section A, and the Component Method in the Appendix of the report.

• Section B Replacement Reserve Inventory. The Replacement Reserve Inventory lists the commonly owned

components within the community that require periodic replacement using funding from Replacement Reserves. The Replacement Reserve Inventory also provides information about components excluded from the Replacement Reserve Inventory whose replacement is not scheduled for funding from Replacement Reserves.

Replacement Reserve Inventory includes estimates of the normal economic life and the remaining economic life for

those components whose replacement is scheduled for funding from Replacement Reserves. • Section C Projected Annual Replacements. The Calendar of Projected Annual Replacements provides a year-by-year

listing of the Projected Replacements based on the data in the Replacement Reserve Inventory. • Section D Condition Assessment. Several of the items listed in the Replacement Reserve Inventory are discussed in

more detail. The Condition Assessment includes a narrative and photographs that document conditions at the property observed during our visual evaluation.

• The Appendix is provided as an attachment to the Replacement Reserve Study. Additional attachments may include

supplemental photographs to document conditions at the property and additional information specific to the property cited in the Conditions Assessment (i.e. Consumer Product Safety Commission, Handbook for Public Playground Safety, information on segmental retaining walls, manufacturer recommendations for asphalt shingles or siding, etc.). The Appendix also includes the Accounting Summary for the Cash Flow Method and the Component Method.


3. METHODS OF ANALYSIS The Replacement Reserve industry generally recognizes two different methods of accounting for Replacement Reserve Analysis. Due to the difference in accounting methodologies, these methods lead to different calculated values for the Minimum Annual Contribution to the Reserves. The results of both methods are presented in this report. The Association should obtain the advice of its accounting professional as to which method is more appropriate for the Association. The two methods are: • Cash Flow Method. The Cash Flow Method is sometimes referred to as the "Pooling Method." It calculates the

minimum constant annual contribution to reserves (Minimum Annual Deposit) required to meet projected expenditures without allowing total reserves on hand to fall below the specified minimum level in any year.

First, the Minimum Recommended Reserve Level to be Held on Account is determined based on the age, condition,

and replacement cost of the individual components. The mathematical model then allocates the estimated replacement costs to the future years in which they are projected to occur. Based on these expenditures, it then calculates the minimum constant yearly contribution (Minimum Annual Deposit) to the reserves necessary to keep the reserve balance at the end of each year above the Minimum Recommended Reserve Level to be Held on Account. The Cash Flow Analysis assumes that the Association will have authority to use all of the reserves on hand for replacements as the need occurs. This method usually results in a Minimum Annual Deposit that is less than that arrived at by the Component Method.

• Component Method. This method is a time tested mathematical model developed by HUD in the early 1980s, but has

been generally relegated to a few States that require it by law. For the vast majority of Miller - Dodson’s clients, this method is not used.

The Component Method treats each item in the replacement schedule as an individual line item budget. Generally,

the Minimum Annual Contribution to Reserves is higher when calculated by the Component Method. The mathematical model for this method works as follows:

First, the total Current Objective is calculated, which is the reserve amount that would have accumulated had all of the

items on the schedule been funded from initial construction at their current replacement costs. Next, the Reserves Currently on Deposit (as reported by the Association) are distributed to the components in the schedule in proportion to the Current Objective. The Minimum Annual Deposit for each component is equal to the Estimated Replacement Cost, minus the Reserves on Hand, divided by the years of life remaining.

4. REPLACEMENT RESERVE STUDY DATA • Identification of Reserve Components. The Reserve Analyst has only two methods of identifying Reserve

Components; (1) information provided by the Association and (2) observations made at the site. It is important that the Reserve Analyst be provided with all available information detailing the components owned by the Association. It is our policy to request such information prior to bidding on a project and to meet with the individuals responsible for maintaining the community after acceptance of our proposal. After completion of the Study, the Study should be reviewed by the Board of Directors, individuals responsible for maintaining the community, and the Association’s accounting professionals. We are dependent upon the Association for correct information, documentation, and drawings.

• Unit Costs. Unit costs are developed using nationally published standards and estimating guides and are adjusted by

state or region. In some instances, recent data received in the course of our work is used to modify these figures. Contractor proposals or actual cost experience may be available as part of the Association records. This is useful

information, which should be incorporated into your report. Please bring any such available data to our attention, preferably before the report is commenced.

• Replacement vs. Repair and Maintenance. A Replacement Reserve Study addresses the required funding for Capital

Replacement Expenditures. This should not be confused with operational costs or cost of repairs or maintenance. 5. DEFINITIONS Adjusted Cash Flow Analysis. Cash flow analysis adjusted to take into account annual cost increases due to inflation and interest earned on invested reserves. In this method, the annual contribution is assumed to grow annually at the inflation rate. Annual Deposit if Reserves Were Fully Funded. Shown on the Summary Sheet A1 in the Component Method summary,


this would be the amount of the Annual Deposit needed if the Reserves Currently on Deposit were equal to the Total Current Objective. Cash Flow Analysis. See Cash Flow Method, above. Component Analysis. See Component Method, above. Contingency. An allowance for unexpected requirements. Roughly the same as the Minimum Recommended Reserve Level to be Held on Account used in the Cash Flow Method of analysis. Critical Year. In the Cash Flow Method, a year in which the reserves on hand are projected to fall to the established minimum level. See Minimum Recommended Reserve Level to be Held on Account. Current Objective. This is the reserve amount that would have accumulated had the item been funded from initial construction at its current replacement cost. It is equal to the estimated replacement cost divided by the estimated economic life, times the number of years expended (the difference between the Estimated Economic Life and the Estimated Life Left). The Total Current Objective can be thought of as the amount of reserves the Association should now have on hand based on the sum of all of the Current Objectives. Cyclic Replacement Item. A component item that typically begins to fail after an initial period (Estimated Initial Replacement), but which will be replaced in increments over a number of years (the Estimated Replacement Cycle). The Reserve Analysis program divides the number of years in the Estimated Replacement Cycle into five equal increments. It then allocates the Estimated Replacement Cost equally over those five increments. (As distinguished from Normal Replacement Items, see below) Estimated Economic Life. Used in the Normal Replacement Schedules. This represents the industry average number of years that a new item should be expected to last until it has to be replaced. This figure is sometimes modified by climate, region, or original construction conditions. Estimated Economic Life Left. Used in the Normal Replacement Schedules. Number of years until the item is expected to need replacement. Normally, this number would be considered to be the difference between the Estimated Economic Life and the age of the item. However, this number must be modified to reflect maintenance practice, climate, original construction and quality, or other conditions. For the purpose of this report, this number is determined by the Reserve Analyst based on the present condition of the item relative to the actual age. Estimated Initial Replacement. For a Cyclic Replacement Item (see above), the number of years until the replacement cycle is expected to begin. Estimated Replacement Cycle. For a Cyclic Replacement Item, the number of years over which the remainder of the component's replacement occurs. Minimum Annual Deposit. Shown on the Summary Sheet A1. The calculated requirement for annual contribution to reserves as calculated by the Cash Flow Method (see above). Minimum Deposit in the Study Year. Shown on the Summary Sheet A1. The calculated requirement for contribution to reserves in the study year as calculated by the Component Method (see above). Minimum Recommended Reserve Level to be Held on Account. Shown on the Summary Sheet A1, this number is used in the Cash Flow Method only. This is the prescribed level below which the reserves will not be allowed to fall in any year. This amount is determined based on the age, condition, and replacement cost of the individual components. This number is normally given as a percentage of the total Estimated Replacement Cost of all reserve components. Normal Replacement Item. A component of the property that, after an expected economic life, is replaced in its entirety. (As distinguished from Cyclic Replacement Items, see above.) Normal Replacement Schedules. The list of Normal Replacement Items by category or location. These items appear on pages designated. Number of Years of the Study. The numbers of years into the future for which expenditures are projected and reserve levels calculated. This number should be large enough to include the projected replacement of every item on the schedule, at least once. This study covers a 40-year period.


One Time Deposit Required to Fully Fund Reserves. Shown on the Summary Sheet A1 in the Component Method summary, this is the difference between the Total Current Objective and the Reserves Currently on Deposit. Reserves Currently on Deposit. Shown on the Summary Sheet A1, this is the amount of accumulated reserves as reported by the Association in the current year. Reserves on Hand. Shown in the Cyclic Replacement and Normal Replacement Schedules, this is the amount of reserves allocated to each component item in the Cyclic or Normal Replacement schedules. This figure is based on the ratio of Reserves Currently on Deposit divided by the total Current Objective. Replacement Reserve Study. An analysis of all of the components of the common property of the Association for which a need for replacement should be anticipated within the economic life of the property as a whole. The analysis involves estimation for each component of its estimated Replacement Cost, Estimated Economic Life, and Estimated Life Left. The objective of the study is to calculate a recommended annual contribution to the Association's Replacement Reserve Fund. Total Replacement Cost. Shown on the Summary Sheet A1, this is total of the Estimated Replacement Costs for all items on the schedule if they were to be replaced once. Unit Replacement Cost. Estimated replacement cost for a single unit of a given item on the schedule. Unit (of Measure). Non-standard abbreviations are defined on the page of the Replacement Reserve Inventory where the item appears. The following standard abbreviations are used in this report: EA: each FT: feet LS: lump sum PR: pair SF: square feet SY: square yard

Miller - Dodson Associates, Inc. Page 5 Video Answers to Frequently Asked Questions

What is a Reserve Study? Who are we?

What kind of property uses a Reserve Study? Who are our clients?

Who conducts a Reserve Study? Reserve Specialist (RS) what does this mean?

When should a Reserve Study be updated? What are the different types of Reserve Studies?

What is in a Reserve Study and what is out? Improvement vs Component, is there a difference?

What is my role as a Community Manager? Will the report help me explain Reserves to my clients?

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Miller - Dodson Associates, Inc. Page 6 Video Answers to Frequently Asked Questions

What is my role as a Board Member? Will a Reserve Study meet my community’s needs?

Community dues, how can a Reserve Study help? Will a study help keep my property competitive?

How do I read the report? Will I have a say in what the report contains?

Where do the numbers come from? Cumulative expenditures and funding, what?

How are interest and inflation addressed? What should we look at when considering inflation?

A community needs more help, where do we go? What is a Strategic Funding Plan?

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