c/o Palm Springs Management Group P O Box 2242 • Palm Springs, CA 92263-2242

Toll Free Tel: 855-919-9191 • Fax: 760-406-5905

Rose Garden Homeowners Association

August 6, 2018

Dear Rose Garden Homeowner:

The Rose Garden Board of Directors approved its 2018-19 fiscal budget that commences on October 1, 2018 with the monthly assessment rate increasing $4.00 to $399.00. In accordance with the requirements of California Civil Code Section 5300 (b) (4), the Board of Directors does not anticipate the need to levy a special assessment in order to cover the Association’s general operating expenses.

The budget includes, the same as last year, a one-time Special Assessment of $237.00 payable December 1, 2018 to bolster the Association’s Reserve Fund. The Special Assessment will be subject to a 10% late fee if not received by December 31, 2018. A reminder of this special assessment will be mailed to you with the balloting material in early November. There will also be a separate coupon in the payment coupon booklet that will be sent to shortly.

This base monthly assessment rate is the first increase in 4 years. This is being done as costs have both increased and decreased during this period, but the increases have slightly outweighed the decreases.

Utilities in total have decreased by $7,400 in total. We have improved electric efficiencies enough to offset rate increases and decreased total natural gas costs with solar installations combined with a beneficial commercial gas rate structure that commenced at the same time. While we have been able to reduce irrigation water usage by 25% since 2013, the water costs have increased 30% during this period resulting in a net total cost increase. This year the cable contract also resulted in a reduced cost and will have a full year’s benefit this coming fiscal year. As you will recall, last year that cable savings was then added to the monthly reserve fund contribution.

This year the Board has also added a security patrol three times every evening at a cost of $8.22 per unit, per month.

c/o Palm Springs Management Group P O Box 2242 • Palm Springs, CA 92263-2242

Toll Free Tel: 855-919-9191 • Fax: 760-406-5905

If you are not enrolled in our auto payment plan or ACH, you will be receiving a new coupon payment booklet in early September to use starting with your October payment. If you are enrolled in the auto pay plan, your payment will automatically be adjusted. Unless you instruct us otherwise, your auto payment in December will include the special assessment.

The assessment rate per month per unit can be summarized as follows: Per Month Per Unit Operating Expenses $ 281.40 Cable, Incl Fees, Taxes, & Est Rate Adjmt 38.60 Reserve Fund Contribution 79.00 Total Assm’t Per Month Per Unit $ 399.00

This budget package consists of this letter and the following items of supporting data and notes:

Operating Budget Reserve Study Worksheet Summary and Notes FHA Disclosure VA Disclosure Right to Obtain Minutes Draft of Annual Meeting Minutes Collection Policy Notice Assessments and Foreclosure Alternative Dispute Resolution Notification (ADR) Annual Insurance Notice Requirement Notice of Fines and Related Actions Approval of Physical Changes to the Separate Interests

Your Board of Directors

Rose Garden Homeowners AssociationFiscal Year 2018-2019 Budget

9 Months Projected Current FY APPROVED VarianceCurrent YTD Current Year Budget BUDGET Fav/(Unfav)

Income

4000 ꞏ Member Assessments 519,030.00$ 692,040$ 692,040$ 699,048$ 7,008$

4110 ꞏ Special Assessments 34,602.00 34,602 34,602 34,602 -

4200 ꞏ Late Fee Income 1,233.05 1,600 400 840 (760) 4450 ꞏ Miscellaneous Income - - - - -

Total Income 554,865.05 728,242 727,042 734,490 6,248

Expenses

5000 ꞏ Administrative

5010 ꞏ Management 26,671.00 35,557 35,487 36,852 (1,295)

5040 ꞏ Office Supplies 324.40 480 420 480 -

5050 ꞏ Postage and Delivery 424.11 900 840 900 -

5060 ꞏ Printing and Reproduction 660.44 1,350 1,200 1,356 (6)

5070 ꞏ Meetings 450.00 450 600 600 (150)

5080 ꞏ Bank Fees - - - - -

5090 ꞏ Audit/Reserve Study Fees 3,900.00 3,900 2,300 3,900 -

5110 ꞏ Insurance 29,556.88 39,421 41,000 40,464 (1,043)

5170 ꞏ Legal & Professional Fees 5,985.52 7,800 6,000 6,000 1,800

5191 ꞏ Licenses & Permits 2,156.52 2,655 2,400 2,700 (45)

5210 ꞏ Miscellaneous 1,769.65 2,000 1,800 1,800 200 6690 ꞏ Filing Fees 10.00 10 10 45 (35)

Total 5000 ꞏ Administrative 71,908.52 94,523 92,057 95,097 (574)

6000 ꞏ Utilities

6010 ꞏ Electric 9,699.47 12,870 13,230 13,380 (510)

6020 ꞏ Gas 13,116.58 14,400 16,800 14,880 (480)

6030 ꞏ Cable TV & Internet 55,920.40 72,327 61,320 67,620 4,707 6050 ꞏ Water & Sewer 40,252.16 62,000 54,000 63,000 (1,000)

Total 6000 ꞏ Utilities 118,988.61 161,597 145,350 158,880 2,717

7000 ꞏ Landscape

7010 ꞏ Landscape Contractor 133,938.00 178,584 178,584 178,584 -

7030 ꞏ Landscape Materials 13,688.22 18,800 25,000 23,500 (4,700)

7050 ꞏ Landscape Sp Projects - - 22,000 - - 7090 ꞏ Irrigation Repairs 6,814.28 8,000 14,400 9,000 (1,000)

Total 7000 ꞏ Landscape 154,440.50 205,384 239,984 211,084 (5,700)

8000 ꞏ Pools & Spas

8020 ꞏ Contract Pool Service 6,525.00 8,700 8,700 8,700 - 8025 ꞏ Pool Equip Repair/Maint 10,655.63 13,850 6,000 8,400 5,450

Total 8000 ꞏ Pool Expenses 17,180.63 22,550 14,700 17,100 5,450

Rose Garden Homeowners AssociationFiscal Year 2018-2019 Budget

9 Months Projected Current FY APPROVED VarianceCurrent YTD Current Year Budget BUDGET Fav/(Unfav)

9000 ꞏ Common Area Maintenance

9100 ꞏ Maintenance Labor 2,876.49 4,000 14,400 6,000 (2,000)

9200 ꞏ Maintenance Material 5,798.83 8,800 6,600 10,000 (1,200)

9300 ꞏ Lighting Maintenance 13,234.17 16,000 4,800 12,000 4,000

9320 ꞏ Sewer & Roadway Maint - - - - -

9320 ꞏ Security Patrol 4,800.00 8,400 1,200 14,400 (6,000)

9350 ꞏ Pest Control 7,314.50 8,726 6,600 7,200 1,526

9360 ꞏ Janitorial Services 5,585.00 7,260 6,900 7,260 - 9380 ꞏ Roof Maintenance 15,680.00 18,000 20,400 20,400 (2,400)

Total Common Area Maintenance 55,288.99 71,186 60,900 77,260 (6,074)

Other Expenses

4500 ꞏ Bad Debt Expense - - 800 1,200 (1,200) 9900 ꞏ Reserve Allocation 138,408.00 173,010 173,010 173,010 -

Total Other Expenses 138,408.00 173,010 173,810 174,210 (1,200)

Total Operating Expenses 556,215.25 728,250 726,801 733,631 (5,381)

Net Operating Surplus/(Deficit) (1,350.20)$ (8)$ 241$ 859$ (11,629)$

Reserve Fund Income9850 ꞏ Interest Inc 108.24 170 84 240 70

9990 ꞏ Income Taxes - - - - -

Net RG HOA Surplus/(Deficit) (1,241.96)$ 162$ 325$ 1,099$ (11,559)$

Operating Expenses 556,215 728,250 726,801 733,631 Less: Special Assmts (34,602) (34,602) (34,602) (34,602)

521,613 693,648 692,199 699,029 Increase

Cost per Unit/Month 396.97$ 395.92$ 395.09$ 398.99$ 1.01%(0.92)$ (3.99)$

Report Date 7/10/18 Version 2 44

Reserve Summary (As required by California Civil Code Section 5565)

ROSE GARDEN HOMEOWNERS ASSOCIATION SCT Reserve Consultants, Inc. is pleased to provide this Level II Reserve Study (Site Visit Update Report). In order to comply with the California Civil Code, specifically the Davis-Stirling Common Interest Development Act, Section 5565, we are providing the following information to the Homeowners within ROSE GARDEN HOMEOWNERS ASSOCIATION.

The following study has been prepared with several assumed factors taken into account: a 3.00% inflation rate; a 1.00% return on investment (interest earned); taxes on interest earned is paid for through the operating fund; an estimated remaining life of each reserve component; and an estimated current replacement cost of each reserve component.

As of September 30, 2018, the estimated ending reserve fund balance is $363,500 and the estimated current replacement cost is $2,065,726 for the portfolio of reserve components. The projected future replacement cost of the portfolio is $2,764,411, calculated at an annually compounded inflation rate of 3.00%. The Association’s level of funding which is based upon the estimated ending reserve fund balance divided by the reserve components’ fully funded amount is 27.55%. This is referred to as Percent Funded. The Association would be 100.00% funded if there were $1,319,585.00 in the reserve fund.

The current deficiency (or surplus if the number is in parenthesis) in reserve funding expressed on a per unit basis is $6,548.53. This is calculated by subtracting the ending balance ($363,500) from the 100% funded figure ($1,319,585.00), then divided by the number of ownership interests (146). There is currently no requirement to be fully funded.

Our original analysis of the cash flow for this association indicated future inadequate funding if there were no annual increases to the Reserves. It is our understanding the Board of Directors will allocate a total of $11,534 per month starting in 2019 ($79.00 per unit per month for each of the 146 ownership interests) towards the reserve fund. To offset the future cash shortfall we recommend and have included an increase of 3.75% starting in 2020 for 29 years. The increase is scheduled to take effect in the year 2020. This report includes a special assessment of $34,602 for VARIOUS PROJECTS in 2019 for 1 year. The Board of Directors may change the amount; however, it will impact the level of funding on reserves. These numbers, by themselves, are not a clear indicator of financial strength and could indicate underfunding, overfunding, or adequate funding.

The following table represents additionally required information pursuant to the Davis-Stirling Common Interest Development Act, Section 5565.

Fiscal Year: October 1, 2018 through September 30, 2019

Category

Estimated Remaining

Useful Lives

Estimated Current

Replacement Cost

Fund Balance on Sep 30, 2018

Estimated Reserve

Allocation

Estimated Special

Assessment Allocation

Estimated Interest

Asphalt & Concrete 0 to 1 $335,894 $226,030 $86,064.37 $21,516.09 $236.51Buildings, Roof 0 to 41 $1,315,820 $107,155 $40,801.02 $10,200.25 $112.12Contingency 0 to 0 $6,900 $5,061 $1,926.95 $481.74 $5.30Electrical/Lights 21 to 21 $6,000 $169 $64.42 $16.10 $0.18Fence/Gates/Walls 5 to 28 $73,530 $1,845 $702.49 $175.62 $1.93Mailboxes 4 to 4 $12,410 $595 $226.51 $56.63 $0.62Paint 0 to 8 $165,649 $8,394 $3,196.04 $799.01 $8.78Pool Cabanas 0 to 10 $12,764 $6,904 $2,628.76 $657.19 $7.22Pool Furniture 3 to 18 $25,315 $531 $202.06 $50.51 $0.56Pools & Spas 0 to 20 $87,970 $5,620 $2,139.75 $534.94 $5.88Tennis Courts 1 to 8 $18,474 $1,009 $384.06 $96.01 $1.06Utilities 2 to 2 $5,000 $188 $71.58 $17.89 $0.20

Totals: $2,065,726 $363,500 $138,408 $34,602 $380

The complete reserve study is available by request from the Association.

SCT Reserve Consultants, Inc. 5

Assessment and Reserve Funding Disclosure Summary For the Fiscal Year Ending September 30, 2019

(As illustrated by California Civil Code Section 5570(a))

(1) The regular assessment per ownership interest is $395.00 per month, of which approximately $79.00 is allocated to reserves per month.

Note: If assessments vary by the size or type of ownership interest, the assessment applicable to this ownership interest may be found on the following page of the attached summary. NOT APPLICABLE

(2) Additional regular or special assessments that have already been scheduled to be imposed or charged, regardless of the purpose, if they have been approved by the board and/or members: SEE ANSWER BELOW TO QUESTION #4 WHICH SUGGESTS THERE WILL BE INCREASES IN REGULAR ASSESSMENTS FOR RESERVE FUNDING.

Date assessment will be due: Amount per ownership interest

per year: Purpose of the assessment:

Fiscal Year 2019, terms to be determined $240.00 Various Projects

Note: If assessments vary by the size or type of ownership interest, the assessment applicable to this ownership interest may be found on the following page of the attached summary. NOT APPLICABLE

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

Yes __X__ No __X__

Yes, if the Association follows the recommended future reserve contribution increases as outlined in the reserve study and disclosed in the table of question (4) with consideration to the note below*.

No, if the Association does not follow the recommended future reserve contribution increases as outlined in the reserve study and disclosed in the table of question (4) with consideration to the note below*. *Note: The information contained within the reserve study includes estimates of replacement value and life expectancies of the components and includes assumptions regarding future events based on information provided by and supplied to the Association’s Board of Directors and/or management. Some assumptions inevitably will not materialize and unanticipated events and circumstances may occur subsequent to the data of this disclosure summary. Therefore, the actual replacement cost and remaining life may vary from the reserve study and the variation may be significant. Additionally, inflation and other economic events may impact the reserve study, particularly over a thirty (30) year period of time which could impact the accuracy of the reserve study and the funds available to meet the association’s obligation for repair and/or replacement of major components during the next thirty (30) years. Furthermore, the occurrence of vandalism, severe weather conditions, earthquakes, floods or other acts of God cannot be accounted for and are excluded when assessing life expectancy of the components. The reserve study only includes items that the Association has a clear and express responsibility to maintain, pursuant to the Association’s CC&Rs.

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

Approximate date assessment(s) will be due: Amount per ownership interest per month:

3.75% starting in 2020 for 29 years (Current amount) X (the increases)

(5) All major components are included in the reserve study and are included in its calculations.

(6) Based on the method of calculation in paragraph (4) of subdivision (b) of Section 5550, the estimated amount required in the reserve fund at the end of the current fiscal year is $995,898.65, as of September 30, 2019, based in whole or in part on the last reserve study or update prepared by SCT RESERVE CONSULTANTS, INC. The projected reserve fund cash balance at the end of the current fiscal year is $82,952.35, resulting in reserves being 8.33% percent funded at this date. If an alternate, but generally accepted, method of calculation is also used, the required amount is $453,938. (See explanation below).

Explanation: Cash Flow Methodology - a method of developing a reserve funding plan where contributions to the reserve fund are designed to offset the variable annual expenditures from the reserve fund. Different reserve funding plans are tested against the anticipated schedule of reserve expenses until the desired funding goal is achieved.

SCT Reserve Consultants, Inc. 6

Assessment and Reserve Funding Disclosure Summary For the Fiscal Year Ending September 30, 2019

(As illustrated by California Civil Code Section 5570(a)) (continued)

7) See below: 30-Year Reserve Funding Plan Table…Based on the method of calculation in paragraph (4) of subdivision (b) of Section 5550 of the Civil Code, the estimated amount required in the reserve fund at the end of each of the next five budget years is $(see “100% Funded” column below), and the projected reserve fund cash balance in each of those years, taking into account only assessments already approved and other known revenues, is $(see “Cash Flow Balance with Funding Plan” column below), leaving the reserve at (see “Percent Funded” column below) percent funding. If the reserve funding plan approved by the association is implemented, the projected reserve fund cash balance in each of those years will be $(see “Cash Flow Balance with Funding Plan” column below), leaving the reserve at (see “Percent Funded” column below) percent funding. Note: The financial representations set forth in this summary are based on the best estimates of the preparer at that time. The estimates are subject to change. At the time this summary was prepared, the assumed long-term before-tax interest rate earned on reserve funds was 1.00% per year, and the assumed long-term inflation rate to be applied to major component repair and replacement costs was 3.00% per year.

30-Year Reserve Funding Plan Table

Expenditures

100%Funded

Cash Flow (Balance with Funding Plan)

Percent Funded(EOY)

Contribution,Interest,

Spec Assess

ContributionUnit/M onth

Contribution% Change

Components,Taxes,

Deferred Exp

2018 $1,319,585 $363,500 27.55%2019 $995,899 $82,952 8.33% $173,390 $79.00 $453,938 2020 $949,333 $43,840 4.62% $143,664 $81.96 3.75% $182,777 2021 $942,762 $46,235 4.90% $149,054 $85.04 3.75% $146,659 2022 $958,448 $73,375 7.66% $154,743 $88.22 3.75% $127,603 2023 $951,985 $76,245 8.01% $160,548 $91.53 3.75% $157,678 2024 $956,085 $90,723 9.49% $166,631 $94.97 3.75% $152,152 2025 $990,535 $141,656 14.30% $173,228 $98.53 3.75% $122,295 2026 $1,014,828 $181,739 17.91% $180,066 $102.22 3.75% $139,984 2027 $965,583 $127,971 13.25% $186,305 $106.06 3.75% $240,073 2028 $1,050,042 $244,644 23.30% $194,282 $110.03 3.75% $77,608 2029 $1,139,679 $378,854 33.24% $202,806 $114.16 3.75% $68,596 2030 $1,227,648 $510,968 41.62% $211,587 $118.44 3.75% $79,474 2031 $1,305,960 $633,064 48.48% $220,552 $122.88 3.75% $98,456 2032 $1,363,802 $729,968 53.52% $229,564 $127.49 3.75% $132,660 2033 $1,419,445 $831,763 58.60% $238,912 $132.27 3.75% $137,116 2034 $1,440,869 $879,440 61.04% $248,059 $137.23 3.75% $200,383 2035 $1,477,849 $946,220 64.03% $257,691 $142.38 3.75% $190,911 2036 $1,510,186 $1,011,864 67.00% $267,656 $147.72 3.75% $202,011 2037 $1,499,393 $1,005,048 67.03% $277,279 $153.25 3.75% $284,094 2038 $1,549,345 $1,097,432 70.83% $288,180 $159.00 3.75% $195,796 2039 $1,351,034 $842,587 62.37% $296,187 $164.96 3.75% $551,032 2040 $1,392,030 $904,218 64.96% $307,457 $171.15 3.75% $245,826 2041 $1,456,151 $1,009,323 69.31% $319,678 $177.57 3.75% $214,573 2042 $1,364,099 $767,702 56.28% $329,031 $184.23 3.75% $570,653 2043 $1,503,885 $995,287 66.18% $343,149 $191.14 3.75% $115,564 2044 $1,625,387 $1,226,714 75.47% $357,950 $198.30 3.75% $126,523 2045 $1,671,679 $1,319,901 78.96% $371,904 $205.74 3.75% $278,717 2046 $1,771,874 $1,513,784 85.43% $387,247 $213.45 3.75% $193,363 2047 $1,850,034 $1,676,180 90.60% $402,836 $221.46 3.75% $240,440 2048 $2,052,755 $2,055,472 100.13% $421,003 $229.76 3.75% $41,711

$7,660,639 $5,968,66830-Year Sum:

Year

End of Year Revenue

Fiscal Year: October 01, 2018 - September 30, 2019

ROSE GARDEN HOMEOWNERS ASSOCIATION SCT Reserve Consultants, Inc. Job No. 2018-013-01 L2 Page 7 of 28

Report Date 7/10/18 Version 2

Summary In accordance with our proposal, 2018-013, SCT Reserve Consultants, Inc. is pleased to provide this

Level II Reserve Study Site Visit Update Report for ROSE GARDEN HOMEOWNERS

ASSOCIATION. Our study was performed in accordance with the Davis-Stirling Common Interest

Development Act, specifically §5550, of the California Civil Code. This report included a site inspection

on April 5, 2018. This townhome common interest development (CID) is located at 1100 South Tiffany

Circle, Palm Springs, CA 92262. We are using an inception date for the components of October 1, 1979.

This study is for October 1, 2018 through September 30, 2019, the Association’s fiscal year.

In general, reserve funds are funds set aside from collected association fees paid by owners of a common

interest development. These funds earn interest and are disbursed when deemed necessary by the Board of

Directors. The purpose of a reserve study is to determine how much money should exist in a reserve fund

at a given point in time or to project required future contributions and expenditure amounts so that

sufficient reserve funds are available when needed. Our reserve study is generated using proprietary SCT

software and a combination of local industry standards and national average replacement costs.

A 30-year “Cash Flow and Percent Funded Projection” analysis and “Graph” are produced to verify and

define the relationship of the Cash Flow (annual beginning balance) with respect to the 100% funded

amount. Ideally, the Cash Flow line of the graph should run parallel to and below the “Percent Funded”

line of the graph, see funding goals.

The following study has been prepared with several assumed factors taken into account: 3.00% inflation

rate; a 1.00% return on investment (interest earned); taxes on interest earned is paid for through the

operating fund; an estimated remaining life of each reserve component; and an estimated current

replacement cost of each reserve component.

A contingency fund of 5.0% has been established to pay for incidental and miscellaneous reserve

expenditures. Otherwise, any component that has a life cycle (full life) of less than two years should be

budgeted and paid for through normal operating or property maintenance funds and is not included as part

of this study.

The current deficiency (or surplus if the number is in parenthesis) in reserve funding expressed on a

per unit basis is $6,548.53. This is calculated by subtracting the ending balance ($363,500) from the

100% funded figure ($1,319,585.00), then divided by the number of ownership interests (146). There is

currently no requirement to be fully funded.

The Davis-Stirling Common Interest Development Act requires the disclosure of the current reserve fund

balance divided by the current replacement cost (this is not Percent Funded). As of October 1, 2018, the

estimated reserve fund balance is $363,500 and the estimated current replacement cost is $2,065,726 of

the portfolio of reserve components. The projected future replacement cost of the portfolio is $2,764,411,

calculated at an annually compounded inflation rate of 3.00%. Currently, this factor for ROSE GARDEN

HOMEOWNERS ASSOCIATION is 17.60%.

ROSE GARDEN HOMEOWNERS ASSOCIATION SCT Reserve Consultants, Inc. Job No. 2018-013-01 L2 Page 8 of 28

Report Date 7/10/18 Version 2

Summary (continued)

The Association’s level of funding for the fiscal year (October 1, 2018 through September 30, 2019)

which is based upon the final estimated reserve fund balance divided by the reserve components’ fully

funded amount is 8.33%, and is referred to as Percent Funded. The Association would be 100.00%

funded if there were $995,898.65 in the reserve fund.

Our original analysis of the cash flow for this association indicated future inadequate funding (see the

graph, the “square box and/or pink line”). This line represents the cash flow if there were no annual

increases to the Reserves. It is our understanding the Board of Directors will allocate a total of $11,534

per month starting in 2019 ($79.00 per unit per month for each of the 146 ownership interests) towards

the reserve fund. To offset the future cash shortfall we recommend and have included an increase of

3.75% starting in 2020 for 29 years. The increase is scheduled to take effect in the year 2020. This

report includes a special assessment of $34,602 for VARIOUS PROJECTS in 2019 for 1 year. The

Board of Directors may raise or lower this amount, however, it will impact the level of funding on

reserves. These numbers, by themselves, are not a clear indicator of financial strength and could indicate

underfunding, overfunding, or adequate funding.

Sincerely,

Michael C. Graves, R.S. #00039

SCT Reserve Consultants, Inc.

Civil Code section 5300 now requires this disclosure: Certification by the Federal Housing Administration (FHA) may provide benefits to members of an association, including an improvement in an owner's ability to refinance a mortgage or obtain secondary financing and an increase in the pool of potential buyers of the separate interest. This common interest development [is/is not (circle one)] a condominium project. The association of this common interest development [is/is not (circle one)] certified by the Federal Housing Administration. For the latest updates on certification, check this website: https://entp.hud.gov/idapp/html/condlook.cfm

VA: "Certification by the federal Department of Veterans Affairs may provide benefits to members of an association, including an improvement in an owner's ability to refinance a mortgage or obtain secondary financing and an increase in the pool of potential buyers of the separate interest. This common interest development [is/is not (circle one)] a condominium project. The association of this common interest development [is/is not (circle one)] certified by the federal Department of Veterans Affairs."

ROSE GARDEN HOMEOWNERS ASSOCIATION

RIGHT TO OBTAIN MINUTES UNDER CIVIL CODE §1363.05(e) Minutes of meetings of the board of directors, draft minutes marked to indicate it is a draft or a summary of minutes must be made available to any member upon request within 30 days of the meeting. Minutes for Rose Garden Homeowners Association are available by contacting the management company at: Palm Springs Management Group LLC P O Box 2242 Palm Springs, CA 92263-2242 Tel: 760-325-9503 Fax: 760-406-5905 Email: Phil@PalmSpringsMgmt.com You can also obtain meeting minutes, agendas and other forms at the Association’s website: www.psrosegarden.com.

1

Rose Garden Homeowners Association

ANNUAL HOMEOWNERS MEETING MINUTES LOCATION: Mizell Center 480 S Sunrise Way, Palm Springs, CA 92262 DATE: December 9, 2017 BOARD MEMBERS PRESENT: Hugh Gaspar

David Carden Earl Rose

Kate Rice Richard Morales

MEMBERS PRESENT: 82 Homeowners by ballot proxy with 42 present in person Phil Allen of Palm Springs Management

CALL TO ORDER The meeting was called to order at 1:08 p.m. by the President. INTRODUCTION OF BOARD MEMBERS AND PROPERTY MANAGERS The Board members and management introduced themselves. The various committee members present were also introduced. PRESIDENT’S REPORT David Carden thanked the community vendors for their work. The holiday Progressive party is tomorrow and all residents are encouraged to attend. BOARD SEATS ELECTION Phil Allen with Palm Springs Management Group, Clyde Doctor, and Dale Koch were appointed inspectors of election. 82 ballots were handed in to be counted. OPEN FORUM – Topics Raised

• A several homeowners commented on the hedge height either being too high harming security or too low for privacy.

• A homeowner stated that trees need to be trimmed smaller • A homeowner stated that security in general needs to be improved • A homeowner asked if there could be a standard for motion lights in backyards • A homeowner commented on the excess street parking in the community and

could we institute printed permits to display inside a vehicle • A homeowner asked about replacements for trees removed

2

APPROVAL OF MINUTES By motion properly made by Earl Rose and seconded by Hugh Gaspar the annual minutes of the December 10, 2016 annual meeting were approved by voice vote of those in attendance. TREASURER’S REPORT Earl Rose reviewed the unaudited financial reports for the fiscal year ended September 30, 2017. For the fiscal year ended September 30, 2017, the Rose Garden had an operating fund surplus of $1,625 versus a budgeted surplus of $213. Reserve interest was $81 for the year. Last year, we had a $23,934 surplus. Administrative Expenses in total were $7,963 less than budgeted due primarily to few legal costs and lower insurance premiums. Utilities were $14,760 greater than budgeted primarily due to greater water usage and a rate increase during the fiscal year. The rate per 100 cubic feet of water is 14% higher than the prior fiscal year’s cost and our water use was up 13% versus the last fiscal year. The combination of higher rates and higher usage bumped up our costs by 21% over the prior year. Landscape Maintenance was $4,455 more than budgeted primarily due to the $17,114 expenditure for the hedge rehab and the Baristo corridor rehab. Pools and Spa Expenses were $2,370 over target as we incurred a number of repairs throughout the year. The Common Area Maintenance Expenses were $14,322 below budget. Overages were camera inspections of a number of units’ sewer lines at a cost of $3,750 as well as lighting repairs are also higher this year. Roof maintenance was $16,959 under budget for this line item which has helped offset the overages. Fall roof inspections and maintenance would have absorbed most of the roof expense benefit but this could not be scheduled before September 30th this year. Operating cash at September 30 was $104,883. Reserve funds increased to $184,329. Reserve Expenditures year-to-date amounted to $53,505, to replace the roof on one pod over the winter, new lounges for the east pool, 2 new drinking fountains and 2 tennis court windscreens. Assessments and fines receivable totaled $1,227 while prepaid assessments increased to $27,984 as a number of homeowners prepaid the November 1st special assessment. ************************************************************************************************* Kassinger has NO delinquent accounts.

3

By motion properly made by Kate Rice and seconded by David Carden, the financial report was approved by voice vote. IRS REVENUE RULING WHEREAS, the Rose Garden Homeowners Association, is a mutual benefit California corporation duly organized and existing under the laws of the State of California; and, WHEREAS, the Association files a form 1120H annual tax return, THEREFORE, upon motion duly made David Carden and seconded by Earl Rose and carried by voice vote, IT IS HEREBY RESOLVED that in compliance with IRS Revenue Ruling 70-604, the excess income (if any) for the fiscal year ending September 30, 2017 will be applied to any assessments or expenditures in the following fiscal years beginning October 1, 2017. BARISTO NEIGHBORHOOD ORGANIZATION David Carden reported that the Baristo Neighborhood Organization has a number or projects in process including a number of boutique hotels in the west end of the neighborhood and the temporary College of the Desert west campus across Baristo from the Rose Garden. David met with officials of the college and the city engineer to request lighting and crosswalks at the intersection of E Baristo and S Hermosa. The city stated that those items are not required for colleges versus grade schools. David is partitioning the city to do so anyway. A number of residents also expressed concerns about student overflow parking in the Rose Garden. EAST SIDE LAND LEASE EXTENSION David Carden reported that we have obtained signatures from 70% of the owners of one plot and 90% of those on the second plot that constitute the land lease. The BIA wants us to make one more try to obtain those remaining owners’ approval. Then the BIA will most likely then sign off on the extension on behalf of those uncommitted owners. David is hopeful the lease extension will be finalized in 2018. OPEN FORUM

• No comments ELECTION RESULTS

Kate Rice 76 Votes Earl Rose 83 Votes Susan Windham 78 Votes

Kate Rice, Earl Rose and Susan Windham are all elected to two year terms as members of the Board of Directors ADJOURNMENT There being no further business at this time, and upon motion duly made, seconded and carried, the meeting was adjourned at 2:16 P.M.

4

Recorded by Philip Allen, Palm Springs Management Group, LLC. Attested by: ________________________ _________________

Susan Windham - Secretary Date

COLLECTION POLICY FOR

DELINQUENT ASSESSMENTS

•

ROSE GARDEN

HOMEOWNERS ASSOCIATION

*amended ______, 2015

IF THIS DOCUMENT CONTAINS ANY RESTRICTION BASED ON RACE,COLOR, RELIGION, SEX, GENDER, GENDER IDENTITY, GENDEREXPRESSION, SEXUAL ORIENTATION, FAMILIAL STATUS, MARITALSTATUS, DISABILITY, GENETIC INFORMATION, NATIONAL ORIGIN,SOURCE OF INCOME AS DEFINED IN SUBDIVISION (p) OF SECTION12955, OR ANCESTRY, THAT RESTRICTION VIOLATES STATE ANDFEDERAL FAIR HOUSING LAWS AND IS VOID, AND MAY BEREMOVED PURSUANT TO SECTION 12956.2 OF THE GOVERNMENTCODE. LAWFUL RESTRICTIONS UNDER STATE AND FEDERAL LAWON THE AGE OF OCCUPANTS IN SENIOR HOUSING OR HOUSING FOROLDER PERSONS SHALL NOT BE CONSTRUED AS RESTRICTIONSBASED ON FAMILIAL STATUS.

ASSESSMENT COLLECTION AND FULL PAY POLICY FOR ALL ASSESSMENTS

1. DUE DATES: All Regular Assessments shall be due and payable, in advance, in equalmonthly installments, on the first day of each month. Special Assessments and EnforcementAssessments and Balcony Surface Cost Center Assessments shall be due and payable on the duedate specified by the Board in the notice imposing the assessment or in the ballot presenting thespecial assessment to the members for approval. In no event shall a Special Assessment,Enforcement Assessment or Balcony Surface Cost Center Assessment be due and payable earlierthan thirty (30) days after it is imposed.

2. PAYMENT RECEIPTS / OVERNIGHT PAYMENT LOCATION: Owners can request areceipt from the Association which shall indicate the date of payment and the person who receivedit. Any request for a receipt of payment must be submitted directly to the Association's businessaddress (separately from any actual payment). Overnight payment of assessments may besent/delivered to the following address:

ROSE GARDEN HOMEOWNERS ASSOCIATIONc/o PALM SPRINGS MANAGEMENT GROUP932 ALEJO VISTAPALM SPRINGS, CA 92262

3. APPLICATION: Payments received on delinquent assessments shall be applied to theOwner's account as follows: payment shall be applied to the principal owed first. Payments onprincipal shall be applied to the Owner's account by the "balance forward payment" method, i.e.,in reverse order so that the oldest arrearages of the principal are retired first. Only after theprincipal owed is paid in full shall such payments be applied to interest, late charges, collectionexpenses, administration fees, attorneys' fees, or any other amount due to the Association whichresult in continued delinquencies.

4. LATE CHARGE: All assessments shall be delinquent if not paid within 15 days after theybecome due and will result in the imposition of a late charge of ten percent (10%) of the delinquentassessment or ten ($10.00), whichever is greater. Furthermore, the Association shall be entitledto recover any reasonable collections costs, including attorneys' fees, that the Association thenincurs in its efforts to collect the delinquent sums.

5. INTEREST: If an assessment payment is not paid within thirty (30) days of its originaldue date, interest may be imposed on all sums due, including the delinquent assessment, collectioncosts, and late charges, at an annual percentage rate of 12%.

6. SECONDARY ADDRESS: Upon receipt of a written request by an Owner identifying asecondary address for the purposes of assessment collection notices, the Association shall sendadditional copies of any collection notices required by this Collection Policy to the secondary addressprovided. The Owner’s notice of a secondary address must be in writing and mailed to theAssociation in a manner that shall indicate that the Association has received it. The Associationshall only send notices to the indicated secondary address at the point in time the Associationreceives the written request.

1 COLLECTION POLICY S:\85-210\ColPolicy\UpdatedCollectionPolicy.121914.wpd

7. PAY OR LIEN LETTER: If an assessment payment from the Owner is not paid withinthirty (30) days after its original due date (for example, if an Owner fails to pay an assessmentwhich was due on June 1 and the failure to pay continues through July 1, then the June assessmentwould not have been paid within 30 days after its original due date), a notice of delinquency (Payor Lien Letter) shall be sent to the Owner by regular first-class mail and certified mail, return receiptrequested. The Pay or Lien Letter shall provide at least 30 days' written notice to a delinquentOwner prior to recording an Assessment Lien and further provide an itemized statement of thecharges owed, including a breakdown of: (a) the principal amount owed; (b) any late charges withthe method of calculation used to determine such charges; (c) any attorneys' fees incurred; and(d) a description of collection practices, including the right of the association to the reasonable costsof collection. A copy of the Association's collection policy shall be attached to the Pay or LienLetter.

8. INTERNAL DISPUTE RESOLUTION PROCESS*: The Association shall offer to meet andconfer with a delinquent owner to resolve any dispute related to the total amount due from thedelinquent Owner to the Association and/or the Association’s Collection Policy (“Meet and ConferOffer”). The Association’s Meet and Confer Offer shall either be placed within the Association’s Payor Lien Letter or in a separate written communication to the delinquent Owner. An Owner whowishes to accept the Meet and Confer Offer must do so by submitting his/her/its written requestto facilitate the meet and confer with the Association, which written request must be received bythe Association within twenty (20) days of the date of the Meet and Confer Offer. The Associationshall designate a prompt date and time for the meet and confer, at a location that shall either bethe Association’s principal office or another convenient location as designated by the Association. The Association shall designate a Board officer, along with it’s CID Manager to participate in themeet and confer with the delinquent Owner. Prior to recording a lien for delinquent assessments,the Association shall participate in any meet and confer so accepted by the delinquent Owner,provided, however, that the Owner’s acceptance of the Association’s Meet and Confer Offer is madewithin twenty (20) days of the date of the Meet and Confer Offer. 9. SHOW CAUSE HEARING: Additionally, a delinquent Owner may be given a written notice(either in the Pay or Lien Letter or in a separate written document, as determined by the Board ofDirectors) of a hearing before the Board of Directors, wherein the Owner shall be invited to showgood cause why (a) the Owner's voting privileges; and/or (b) the Owner's privileges for use of thecommon area/recreational facilities; and /or (c) the Owner's bulk cable television and internetprivileges (hereinafter collectively "Membership Privileges") should not be suspended for non-payment of the delinquent assessment(s) ("Show Cause Hearing").

The notice and hearing procedures shall be in accordance with the following:

a. Written notice shall be mailed to the Owner not less than ten (10) days prior to thedate of such hearing by first class or certified mail at Owner's last known address as shown on theAssociation's records. The notice shall set forth the amount of delinquency owed by the Owner andthe time, date and place on which the hearing shall be held;

* Pursuant to a 1994 California decision, Park Place Estates Homeowners Association, Inc. v. Naber (1994) 29Cal.App. 4th 427, the appellate court held that homeowners have an independent obligation to pay monthlyassessments and do not have a right to set off or withhold payments of assessments.

2 COLLECTION POLICY S:\85-210\ColPolicy\UpdatedCollectionPolicy.121914.wpd

b. The Board of Directors shall provide an opportunity for the Owner to be heard, orallyor in writing, at the Show Cause Hearing prior to making any determination on the suspension ofany Membership Privileges;

c. In the event good cause is not shown and the Owner's account has not been broughtcurrent, then the Board may suspend any of the Owner's Membership Privileges. Cable televisionand internet services shall be reinstated upon the Owner’s account being brought current and uponpayment to the Association of a reinstatement assessment in an amount equal to what theAssociation is charged by the cable/internet company to facilitate reinstatement of cable/internetservice. The Board shall hold the hearing in Executive Session; provided, however, if the Board isrequested by a Member to have his/her matter be heard in an open Board meeting, then the mattermust be heard in an open Board meeting, and not in Executive Session.

d. After the Show Cause Hearing, the Board of Directors shall provide within fifteen (15)days written notice to the Owner of the suspension of any Membership Privileges.

10. ASSESSMENT LIEN:

a. If the delinquent Owner does not bring his/her account current within the deadlineset forth in the Pay or Lien Letter, the Board of Directors shall approve the recordation of anassessment lien against the delinquent Owner’s property. The Board’s decision to record theassessment lien shall be by a majority vote of a quorum of the Board members at an open Boardmeeting. The Board’s action should refer to the unit/parcel/account number of the property thatis delinquent, rather than the name of the owner. The Assessment Lien shall be recorded in theCounty Recorder's Office itemizing all sums that are then delinquent, including the delinquentassessment(s), then current monthly assessment amount which will also accrue and be a part ofthe lien, interest, late charges, collection costs and reasonable attorneys' fees. Recording thisnotice creates a lien, which is subject to foreclosure, against the delinquent Owner's property.

b. At the same time, the Association shall advise the Association's collectionagent/bank that it should accept no further monies from this delinquent Owner untilthe assessment lien has been paid in full. Owners shall not send any assessment paymentsto the Association once the matter has been turned over to the Attorney for collection; suchpayments shall only be accepted by the law firm. Any payments delivered to the collection agentshall be forwarded to the attorney's office; the attorney shall then release the lien if payment in fullwas made by the delinquent Owner. A charge of up to $425.00 for attorneys' fees shall be chargedto the Owner at this stage (pursuant to Civil Code § 1366.3(a) 5650(a)).

11. PRE-FORECLOSURE ACTIONS:

a. No earlier than thirty (30) days after the Notice of Assessment lien has beenrecorded, the Association shall make a written pre-foreclosure offer to meet and confer with thedelinquent Owner, consistent with the process identified in paragraph 8 herein (except that thetimeline for the delinquent Owner to accept a meet and confer would be thirty (30) days from thedate of the Owner’s receipt of this pre-foreclosure offer) or alternative dispute resolution consistentwith Civil Code §1369.50 5925, et. seq. (“IDR/ADR Offer”). Owner shall have thirty (30) days fromthe date of the IDR/ADR Offer to decide whether or not Owner wishes to pursue dispute resolutionor a particular type of alternative dispute resolution (except that binding arbitration is not availableto any delinquent Owner if the Association intends to initiate a judicial foreclosure).

3 COLLECTION POLICY S:\85-210\ColPolicy\UpdatedCollectionPolicy.121914.wpd

b. Prior to initiating foreclosure, the Board of Directors must, in executive session,approve the decision to proceed with foreclosure by a majority vote of a quorum of the Board ofDirectors. The Board shall record the Board’s executive session decision in the minutes of the nextmeeting of the Board open to the members by referencing the lot/parcel number of the propertythat is delinquent.

c. The Board of Directors shall not proceed with any form of foreclosure unless anduntil the amount of delinquent assessments (exclusive of any accelerated assessments, latecharges, fees, costs of collection, attorney’s fees or interest) equals or exceeds One Thousand EightHundred Dollars ($1,800.00) or the assessments have been delinquent for more than twelve (12)months (“Threshold”). Once the Threshold has been met and all other requirements identifiedabove have been completed, the Board may proceed with foreclosure of the assessment lienpursuant to the Association's governing documents and Civil Code §1367 5700. The procedureused shall be a private foreclosure, pursuant to Civil Code § 2924, et seq. and Civil Code §13675700. The foreclosure action shall include:

i. A Notice of Default and Election to Sell shall be recorded at theCounty Recorder's Office and a ninety-day reinstatement period shall begin.

ii. A Title Report shall be obtained from a title company at a cost ofapproximately $350.00 and this shall also be charged to the delinquent Owner.

iii. Furthermore, an additional $300.00 attorneys' fees and costs shall be chargedat this stage.

12. If the Association determines that the property is over-encumbered, or otherwise makes adetermination that a lawsuit is appropriate, the Association shall file a personal lawsuit against thedelinquent Owner to recover all delinquent assessments owing to the Association. If a lawsuit isnecessary to collect the delinquent assessments from the Owner, all expenses, costs and attorneys'fees in connection with said lawsuit, including but not limited to pre- and post- judgment costs forfiling fees, personal service, witness fees, interest, execution of judgment and/or writ fees shall berecovered from the Owner defendant.

13. If the delinquency is still not cured ninety (90) days after the Notice of Default and Electionto Sell was recorded, the attorney shall proceed to record and publish the Notice of Trustee'sSale. This Notice must also be published three (3) times during a three-week period and postedin a public place. At this final stage, there shall be additional publication costs, as well as attorneys'fees of $125.00. If a non-judicial foreclosure sale is completed by the Association against thedelinquent Owner’s property, the Owner shall have the right to redeem the property for a periodof time up to and including ninety (90) days after the date of the Trustee’s Sale.

14. When a delinquent Owner has paid in full all delinquent assessments and charges, theattorney shall prepare a Release of Lien which shall be recorded in the County Recorder's Office ofRiverside County, California within 21 days of receipt of the sums necessary to satisfy thedelinquent amount and mail a copy of the lien release to the Owner of the residential unit.

4 COLLECTION POLICY S:\85-210\ColPolicy\UpdatedCollectionPolicy.121914.wpd

15. PAYMENT PLAN STANDARDS: The Association hereby establishes the following paymentplan standards:

a. Payment Within 60 Days: If an Owner can bring himself/herself/itself currentwithin sixty (60) days, inclusive of assessments which accrue within the sixty (60) days of thepayment plan, the Association will forbear filing an Assessment Lien and the Owner will not incurthe Assessment Lien costs if the payment plan is strictly followed. The payment plan shall includean administrative cost. By agreeing to the 60 day payment plan, the Owner further agrees that ifhe/she/it fails to make any of the payments identified in the payment plan, the Association shallhave the right to file an Assessment Lien without recommencing the pre-lien or Pay or Lien Noticeprocess.

b. Payment Exceeding 60 Days: In light of the length of time of this payment plan,payment plans exceeding sixty (60) days shall require that the Association record its AssessmentLien to establish itself as a secured creditor. The payment plan shall also include an administrativecost. All costs related to the recordation of the Assessment Lien shall be part of this payment plan. The payment plan would require payment of all delinquent assessments amortized over the lengthof the payment plan, along with all assessments which will accrue during the payment plan. TheAssociation shall further require that the Owner sign a Forbearance Agreement which identifieshis/her/its obligations of repayment consistent with the payment plan and further provides that ifthere is a default under the payment plan, the Association can proceed with the collection processas particularly identified within the Forbearance Agreement. Payment plans under thisparagraph 15.b should normally not exceed six (6) months.

16. REQUEST FOR PAYMENT PLAN: An Owner may submit a written request to theAssociation for a payment plan consistent with either paragraph 15.a or 15.b above. An Owner canalso submit a written request to meet with the Board to identify which payment plan the Ownerchooses, as identified in paragraph 15. above. The Board is required to meet with the Owner inexecutive session within 45 days of the postmark of the request for the meeting, if the request ismailed within fifteen days of the date of the postmark of the Pay or Lien Notice. If there is noregularly scheduled board meeting within the 45 day timeline, the Board has designated theAssessment Dispute Resolution Committee to meet with the Owner.

17. PARTIAL PAYMENTS: Owners may make partial payments without a written paymentplan; provided, however, that any such partial payment shall:

a. not stop any collection action; b. not invalidate any assessment lien already filed; c. not stop an already existing non-judicial foreclosure action; d. not obviate the obligation to pay all collection fees and costs inclusive of late

charges, interest, management fees/bookkeeping fees, title charges, lien fees and costs, trustee’sfees and / or attorney’s fees; and

e. further require (due to the additional bookkeeping and other administrative expensesincurred with a partial payment) that any Owner who submits a partial payment (without anapproved payment plan) will incur an administrative expense of $45.00 for each partial paymenttendered and received by, or on behalf of, the Association.

5 COLLECTION POLICY S:\85-210\ColPolicy\UpdatedCollectionPolicy.121914.wpd

1

ROSE GARDEN HOMEOWNERS ASSOCIATION

"NOTICE ASSESSMENTS AND FORECLOSURE

This notice outlines some of the rights and responsibilities of owners of property in common interest developments and the associations that manage them. Please refer to the sections of the Civil Code indicated for further information. A portion of the information in this notice applies only to liens recorded on or after January 1, 2003. You may wish to consult a lawyer if you dispute an assessment.

ASSESSMENTS AND FORECLOSURE

Assessments become delinquent 15 days after they are due. The failure to pay association assessments may result in the loss of an owner's property through foreclosure. Foreclosure may occur either as a result of a court action, known as judicial foreclosure or without court action, often referred to as nonjudicial foreclosure. For liens recorded on and after January 1, 2006, an association may not use judicial or nonjudicial foreclosure to enforce that lien if the amount of the delinquent assessments or dues, exclusive of any accelerated assessments, late charges, fees, attorney's fees, interest, and costs of collection, is less than one thousand eight hundred dollars ($1,800). For delinquent assessments or dues in excess of one thousand eight hundred dollars ($1,800) or more than 12 months delinquent, an association may use judicial or nonjudicial foreclosure subject to the conditions set forth in Section 1367.4 of the Civil Code. When using judicial or nonjudicial foreclosure, the association records a lien on the owner's property. The owner's property may be sold to satisfy the lien if the amounts secured by the lien are not paid. (Sections 1366, 1367.1, and 1367.4 of the Civil Code)

In a judicial or nonjudicial foreclosure, the association may recover assessments, reasonable costs of collection, reasonable attorney's fees, late charges, and interest. The association may not use nonjudicial foreclosure to collect fines or penalties, except for costs to repair common areas damaged by a member or a member's guests, if the governing documents provide for this. (Sections 1366 and 1367.1 of the Civil Code)

The association must comply with the requirements of Section 1367.1 of the Civil Code when collecting delinquent assessments. If the association fails to follow these requirements, it may not record a lien on the owner's property until it has satisfied those requirements. Any additional costs that result from satisfying the requirements are the responsibility of the association. (Section 1367.1 of the Civil Code)

At least 30 days prior to recording a lien on an owner's separate interest, the association must provide the owner of record with certain documents by certified mail, including a description of its collection and lien enforcement procedures and the method of calculating the amount. It must also provide an itemized statement of the charges owed by the owner. An owner has a right to review the association's records to verify the debt. (Section 1367.1 of the Civil Code)

2

If a lien is recorded against an owner's property in error, the person who recorded the lien is required to record a lien release within 21 days, and to provide an owner certain documents in this regard. (Section 1367.1 of the Civil Code)

The collection practices of the association may be governed by state and federal laws regarding fair debt collection. Penalties can be imposed for debt collection practices that violate these laws.

PAYMENTS

When an owner makes a payment, he or she may request a receipt, and the association is required to provide it. On the receipt, the association must indicate the date of payment and the person who received it. The association must inform owners of a mailing address for overnight payments. (Section 1367.1 of the Civil Code)

An owner may, but is not obligated to, pay under protest any disputed charge or sum levied by the association, including, but not limited to, an assessment, fine, penalty, late fee, collection cost, or monetary penalty imposed as a disciplinary measure, and by so doing, specifically reserve the right to contest the disputed charge or sum in court or otherwise.

An owner may dispute an assessment debt by submitting a written request for dispute resolution to the association as set forth in Article 5 (commencing with Section 1368.810) of Chapter 4 of Title 6 of Division 2 of the Civil Code. In addition, an association may not initiate a foreclosure without participating in alternative dispute resolution with a neutral third party as set forth in Article 2 (commencing with Section 1369.510) of Chapter 7 of Title 6 of Division 2 of the Civil Code, if so requested by the owner. Binding arbitration shall not be available if the association intends to initiate a judicial foreclosure.

An owner is not liable for charges, interest, and costs of collection, if it is established that the assessment was paid properly on time. (Section 1367.1 of the Civil Code)

MEETINGS AND PAYMENT PLANS

An owner of a separate interest that is not a timeshare may request the association to consider a payment plan to satisfy a delinquent assessment. The association must inform owners of the standards for payment plans, if any exist. (Section 1367.1 of the Civil Code)

The board of directors must meet with an owner who makes a proper written request for a meeting to discuss a payment plan when the owner has received a notice of a delinquent assessment. These payment plans must conform with the payment plan standards of the association, if they exist. (Section 1367.1 of the Civil Code)"

(c) A member of an association may provide written notice by facsimile transmission or United States mail to the association of a secondary address. If a secondary address is provided, the association shall send any and all correspondence and legal notices required pursuant to this article to both the primary and the secondary address.

ROSE GARDEN HOMEOWNERS ASSOCIATION A California Nonprofit Mutual Benefit

Corporation

ENFORCEMENT PROCEDURE

DECEMBER 2013*

* adopted December 14, 2013

IF THIS DOCUMENT CONTAINS ANY RESTRICTION BASED ON RACE, COLOR,RELIGION, SEX, GENDER, GENDER IDENTITY, GENDER EXPRESSION, SEXUALORIENTATION, FAMILIAL STATUS, MARITAL STATUS, DISABILITY, GENETICINFORMATION, NATIONAL ORIGIN, SOURCE OF INCOME AS DEFINED INSUBDIVISION (p) OF SECTION 12955, OR ANCESTRY, THAT RESTRICTIONVIOLATES STATE AND FEDERAL FAIR HOUSING LAWS AND IS VOID, AND MAYBE REMOVED PURSUANT TO SECTION 12956.2 OF THE GOVERNMENT CODE. LAWFUL RESTRICTIONS UNDER STATE AND FEDERAL LAW ON THE AGE OFOCCUPANTS IN SENIOR HOUSING OR HOUSING FOR OLDER PERSONS SHALLNOT BE CONSTRUED AS RESTRICTIONS BASED ON FAMILIAL STATUS.

TABLE OF CONTENTS

Description Page

ENFORCEMENT PROCEDURE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

VIOLATION REPORT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

WARNING NOTICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

NON-ARCHITECTURAL VIOLATION NOTICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

ARCHITECTURAL VIOLATION NOTICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

HEARING NOTICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

EXPEDITED HEARING NOTICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

HOMEOWNER HEARING PROCEDURE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

RULING NOTICE.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

ENFORCEMENT PROCEDURE FLOW CHART. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

S:\85-210\EnfProcedure\EnforcementProcedure.Final.122313.wpd ENFORCEMENT PROCEDURE NOVEMBER 2013

ROSE GARDEN HOMEOWNERS ASSOCIATION ENFORCEMENT PROCEDURE

This document is the Rose Garden Homeowners Association’s (hereafter referred to “Association”)

enforcement process 1 (“Enforcement Procedure”). The entities engaged in enforcing the Association's

Restated Covenants, Conditions and Restrictions CC&Rs (“CC&Rs”), Restated Bylaws (“Bylaws”), Restated

Articles of Incorporation, Restated Rules and Regulations (“Rules”) and Restated Architectural and Landscape

Guidelines (“Architectural Standards”) (hereafter, collectively, Governing Documents) are:

Board of Directors — The Board of Directors is charged with overseeing the enforcement of the

Association's Governing Documents. It has the authority to conduct violation hearings, impose Enforcement

Assessments, including but not limited to fines, cause violations to be remedied, suspend voting rights,

common area privileges, use of the recreational facilities and/or any other privilege of any Member or Person

deriving rights from any Member (“Membership Privileges”), and promulgate Architectural Standards. The

Board of Directors, in its sole discretion, may review any committee decision and thereafter modify any ruling

in the Board's discretion regardless of an appeal from a Member, provided, however, that it gives notice to

the Member and committee within seven (7) business days of the committee's date of its Ruling Notice.

Architectural Committee — The Architectural Committee is charged with primarily reviewing and

making recommendations to the Board of Directors on approval or disapproval of proposed architectural

modifications. The Architectural Committee is also charged with assisting the Board of Directors with the

promulgation of Architectural Guidelines and any amendments thereto.

Landscape Committee — The Landscape Committee is charged with primarily reviewing and making

recommendations to the Board of Directors on approval or disapproval of proposed landscape modifications.

The Landscape Committee is also charged with assisting the Board of Directors with the promulgation of

landscape standards as part of these Architectural Guidelines and any amendments thereto.

For the purposes of this Enforcement Procedure, the following definitions shall apply:

• The term violation shall mean and include any failure to follow and/or observe the Association's

Governing Documents.

• The term recurring violation shall mean any violation of the Association's Governing Documents which

has a definite commencement and cessation, but has occurred more than once. Examples of

recurring violations are: (1) parking on the Association’s private streets in excess of the time allowed,

but moving it and subsequently parking it, but again violating the parking restrictions;(2) violation

of leash rules regarding pets on more than one occasion; and (3) speeding or other motor vehicle

violations on more than one occasion.

• The term continuous violation shall mean any violation of the Association's Governing Documents

which is ongoing and has not ceased for a period of time in excess of seventy-two (72) consecutive

1 The forms attached as exhibits to this Enforcement Procedure are not part of the Enforcement Procedure but are for the

assistance of the community association to provide a format for their consideration. The Association can use any forms it wishes so longas it complies with the Enforcement Procedure process which consists of pages 1 through 5.

1S:\85-210\EnfProcedure\EnforcementProcedure.Final.122313.wpd ENFORCEMENT PROCEDURE NOVEMBER 2013

hours. Examples of continuous violations are: (1) a poorly-maintained Unit or (2) retaining an

improvement on the Owner's Unit in violation of the Architectural Standards. Upon the Owner's

curing the violation, the Board of Directors may, but is not obligated to, waive any portion or all of

the monetary fine imposed for a continuous violation.

The Enforcement Procedure related to any disciplinary action shall be as indicated below. For enforcement

of the Governing Documents related to parking violations unrelated to disciplinary action against the Owner,

such as towing, the enforcement procedure may begin at Step 5.

STEP 1. INITIATION.

• If a Violation Report is completed by a homeowner, a Board member, Association Manager,

Architectural Committee member, Landscape Committee member, or another designated

representative of the Association, the Violation Report will be verified as set forth in Step 2.

STEP 2. VERIFICATION

Verification of a Violation Report for non-architectural violations is accomplished by a review of the

Association's Governing Documents and/or inspection by the Association Manager, Board of Directors,

appropriate committee or other designated Association representative. Verification of a Violation Report for

architectural violations is accomplished by a review of the Association's Governing Documents and/or

inspection by the Architectural Committee. Verification of a Violation Report for landscape violations is

accomplished by a review of the Association's Governing Documents and/or inspection by the Landscape

Committee. Violation shall be defined as an act in direct conflict with the Association's Governing Documents,

and/or local, county or state requirements.

STEP 3. DOCUMENTATION

A. FOR NON-ARCHITECTURAL VIOLATIONS

1. The Board has the following three options for enforcing non-architectural violations:

• A Warning Notice is completed by the Association Manager or his/her designated

representative and forwarded to the violating homeowner (hereinafter Violator). At the discretion of the Board

or Association Manager, this step may be skipped if, based on the seriousness of the violation, more

immediate action is warranted; or

• If the violation persists after the Warning Notice has been issued OR if the Board or

Association Manager determines to proceed directly to a Violation Notice, said Violation Notice is sent to

the Violator, stating a deadline by which to cure the violation; or

• If the violation warrants immediate action, an Expedited Hearing Notice is sent

to the Violator, stating a date, time and place where the Violator may be heard before the Board of Directors.

2. If a Violation Notice is sent and the Violator fails to take the necessary action by the

deadline given, a Hearing Notice will be sent to the Violator, setting forth the date, place and time upon

which the Violator may be heard before the Board of Directors.

2S:\85-210\EnfProcedure\EnforcementProcedure.Final.122313.wpd ENFORCEMENT PROCEDURE NOVEMBER 2013

3. Failure to appear at any hearing, could result in immediate discipline including, but not

limited to, imposition of an Enforcement Assessment, and/or suspension of Membership Privileges.

Association must give at least ten (10) days written notice of the hearing to the Violator before any action

is taken, pursuant to Civil Code §1363 and the Association's Governing Documents.

B. FOR ARCHITECTURAL / LANDSCAPE VIOLATIONS

1. Examples of architectural / landscape violations are:

a. Owner of the property has not submitted the requisite application, related documents

and plans and/or the requisite fees to the Architectural Committee, Landscape Committee or management,

if appropriate, or secured requisite written approval from the Association.

b. Owner of the property has obtained prior approval but has not complied with the

approved final plans and specifications of the proposed work.

c. Owner has failed to maintain his/her/its Unit and/or landscaping areas which Owner

is responsible to maintain.

2. The Board has the following three options for enforcing architectural / landscape violations:

• A Warning Notice is completed by the Association Manager and forwarded to the

violating homeowner (hereinafter Violator). At the discretion of the Board or Association Manager, this step

may be skipped, and the Association may proceed directly to a Violation Notice or an Expedited Hearing

Notice; or

• If the violation persists after the Warning Notice has been issued OR if the Board or

Association Manager determines to proceed directly to a Violation Notice, said Violation Notice is sent to

the Violator, stating a deadline by which to cure the violation; or

• If the violation warrants immediate action, an Expedited Hearing Notice is sent

to the Violator, stating a date, time and place where the Violator may be heard before the Board of Directors.

3. If a Violation Notice is sent and the Violator fails to take the necessary action by the

deadline given, a Hearing Notice will be sent to the violating homeowner, setting forth the date, time, and

place where the Violator may be heard before the Board of Directors.

4. Failure to: (1) appear at any hearing; and/or (2) comply with a written Violation Notice

could result in immediate discipline including, but not limited to, imposition of an Enforcement Assessment

and/or suspension of Membership Privileges. Association must give at least ten (10) days written notice of

the hearing to the Violator before any action is taken, pursuant to Civil Code §1363 and the Association's

Governing Documents.

STEP 4. HOMEOWNER HEARING PROCEDURE

A. Findings of Fact and Recommended Action: The Board of Directors must

make specific findings as it relates to the violation of the Governing Documents, noting them on the

Homeowner Hearing Procedure form and Ruling Notice form with the facts which support its decision.

The decision of the Association and action recommended/taken should also be noted on the Homeowner

Hearing Procedure form. NOTE: If no violation is found, then no remedy is required, and the Association

would then issue a Ruling Notice pursuant to Step 4.C below.

3S:\85-210\EnfProcedure\EnforcementProcedure.Final.122313.wpd ENFORCEMENT PROCEDURE NOVEMBER 2013

B. Remedies of the Board of Directors. If it is determined a violation has taken

place, the Board of Directors may take any or all the following actions:

1. Enforcement Assessment — Even if the violation is not of a continuing nature and

does not lend itself to a self-help remedy, the Board of Directors still has the authority to impose an

Enforcement Assessment for failure to comply with the provisions of the Governing Documents. The Board

of Directors may only impose an Enforcement Assessment after providing notice and hearing to a Violator,

pursuant to the minimum requirements set forth herein. The following Enforcement Assessment structure is

based upon a reasonable determination of the costs (i.e. attorneys' fees, property management fees, etc.)

expended by the Association in performing its functions in enforcing the Governing Documents, as well as

the imposition of appropriate sanctions for violation of said Governing Documents.

The Enforcement Assessment structure is detailed in Paragraph 4.D below.

2. Right and Authority to suspend Membership Privileges for each violation of the

Governing Documents and/or for any period during which the Member is delinquent in the payment of any

assessment, fine or monetary penalty, or as otherwise provided in the Governing Documents.

3. Self-Help Remedy for Continuing Non-Architectural Violations — If the

violation of the Governing Documents continues and can be cured through a self-help remedy, the Board has

the right to demand correction of the continuing violation and a date certain upon which a homeowner must

comply (a reasonable period of time shall be given to the homeowner) via the Notice of Ruling. The Notice

should further indicate that if the homeowner fails to comply within the time provided by the Association, the

Association would bring the homeowner into compliance and charge the cost of same to the homeowner as

an Enforcement Assessment.

4. Self-Help Remedy for Continuing Architectural Violations — If it is determined

a violation has taken place, the Board of Directors shall make findings of fact and request corrective action

(removal, replacement, repair and/or modification) by the Violator. If corrective action is not taken by the

Member and the violation can be cured through a self-help remedy, the Ruling Notice shall further indicate

that if the Member fails to comply within the time provided, the Board of Directors shall bring the Member

into compliance and charge the cost of same to the Member as an Enforcement Assessment. However, any

demand letter which requires the Association to go onto a Members' property to rectify the

violation should be reviewed and sent by Association's counsel. For example, if a homeowner's Unit

is becoming an eyesore for lack of maintenance, the Association can provide written notice to the violating

homeowner that he/she must provide the appropriate maintenance and that he/she is in violation of the

Governing Documents. The Notice would further provide that the owner has a specific (and reasonable)

period of time to correct the deficiency. If the owner fails to correct said deficiency within the specified time

given by the Association, the Association could then proceed with the maintenance and charge the cost to

the homeowner as an Enforcement Assessment.

5. Other Potential Remedies / Sanctions — Notwithstanding anything set forth

herein, the Board of Directors in its discretion shall have the power to require any other applicable remedy

and/or sanction for as long as it deems necessary, provided, however, that said remedy / sanction is in accord

with the Association's Governing Documents and law. If the violation is of such a serious nature that potential

legal action is contemplated, the Association's general counsel should be consulted for determination whether

Internal Dispute Resolution (“IDR”) and/or Alternative Dispute Resolution ("ADR") should be offered to the

Violator (as well as consideration of other potential remedies).

C. Ruling Notice. Regardless what remedy the Board chooses to take, even if no violation

is found, the Association must mail to the Violator a Ruling Notice within fifteen (15) days after the date

of hearing. If it is ruled that an Enforcement Assessment shall be imposed against the Violator, then the

Board must give notice of the ruling to the Violator and request payment of such assessment within thirty

4S:\85-210\EnfProcedure\EnforcementProcedure.Final.122313.wpd ENFORCEMENT PROCEDURE NOVEMBER 2013

(30) days after the Ruling Notice is mailed. This is to be recorded in the Executive Session minutes or regular

minutes, whichever is applicable.

D. Enforcement Assessment Structure. If any Member's failure to comply with the

provisions of the Governing Documents results in the Association's expenditures of monies or incurs costs

related to the action or non-action of a Member, the Association may levy an Enforcement Assessment

against such Member. Additionally, the Association may levy fines as Enforcement Assessments consistent

with Tables 1 and 2 below. The amount of the Enforcement Assessments may be amended from time to time

by the Board of Directors. The present structure of the Association for Enforcement Assessments for violations

of the Governing Documents shall be as follows:

Table 1: Enforcement Assessments for Violation of the Governing Documents

First Violation Costs incurred by the Association, if any, as well as a monetary fine up

to $250.00

Recurring Violation for a

Second Time

Costs incurred by the Association, if any, as well as a monetary fine up

to $500.00

Recurring Violation for a

Third or More Times

Costs incurred by the Association, if any, as well as a monetary fine up

to $750.00 plus possible legal action

Continuous Violation Costs incurred by the Association, if any, as well as a monetary fine up

to $750.00 PLUS an amount up to $40.00 per day from the date of the

first notice of violation until violation is cured.

In addition to the Enforcement Assessments described in Table 1 above, the Board of Directors may levy the

following Enforcement Assessments for architectural application violations, which may be added to any other

Enforcement Assessments.

Table 2: Enforcement Assessments for Architectural Application Violations

Enforcement Assessments for commencing Architectural Improvement without

• Association Approval and/or

• Submitting Application

(even if Improvement is within the Architectural Standards)

Up to $2,500.00

plus legal costs

and any other

remedies

available to the

Association

Enforcement Assessments for failure to follow submitted plans and specifications

and/or make corrections upon notice

Up to $2,500.00

plus legal costs

and any other

remedies

available to the

Association

E. Collection of Enforcement Assessments. Pursuant to the Association's

collection policy and the CC&Rs, if an Enforcement Assessment was levied for failure to comply with the

Governing Documents or for costs incurred by the Association in repair of damage to the Common Areas and

is not paid within thirty (30) days after mailing the Ruling Notice, then the Board may suspend the Owner's

Membership Privileges after notice and hearing as set forth in the Association’s governing documents.

5S:\85-210\EnfProcedure\EnforcementProcedure.Final.122313.wpd ENFORCEMENT PROCEDURE NOVEMBER 2013

ROSE GARDEN H.O.A. RENTAL POLICY RULE RESTATEMENT The changes noted below in bold italics were approved by the Board at their September 16, 2017 open meeting. Prior verbiage is the normal font. 8. Tenants/Leasing

a. All lease/rental agreements for any Unit within the Community shall contain a provision binding the tenant(s) to the terms and conditions contained in the Association’s Governing Documents, including without limitation these Rules, and any amendments thereto, and shall provide that failure to comply with the requirements of the Governing Documents shall constitute default under the lease which may be cured by eviction of the tenant either by the Owner or the Association.

b. At least two (2) days in advance of the move-in date, Owners shall be required to:

i. Notify the Board of Directors c/o the Property Manager of the intent to lease the Unit, including length of the lease, names of the occupants of the rented/leased Unit, relationship to one another, number of occupants, and automobile information included vehicle registration;

ii. Each owner/ lessor shall provide any tenant or lessee w ith a current copy of the governing documents and shall be responsible for compliance by the tenant(s) or lessee w ith all of the provisions of the governing documents during the tenant(s)/ lessee’s occupancy and use of the unit. (Copies may be obtained from the Property Manager for this purpose) Signed receipt by tenant(s) of these documents including the Pool & Spa Common Area Rules, to be provided to the Property Manager w ithin two (2) days of tenant(s) moving into unit.

iii. Notify the Association c/o of the Property manager of the address and telephone number where such Owner can be reached.

c. All leases must be for the entire unit and not merely parts thereof, unless the owner remains

in occupancy. d. Each owner shall be liable to the Association for any damage to the Common Area or to

Association-owned property caused by tenant or tenant’s guests. Failure of any tenant to comply with these Rules may subject the Owner and/or tenant to disciplinary action.

e. No unit may be rented or leased for a period of less than 28 consecutive days, or for

hotel, transient, or timeshare purposes, nor shall an Owner advertise (whether on the internet, printed materials such as newspapers, magazines or otherw ise) for a period of less than 28 consecutive days.

f. All owners shall provide the Property Manager with a copy of the lease signed by both parties no later than two (2) days prior to the move-in date.

g. All leases and rental agreements shall be subject in all respects to the Association’s governing documents and any owner who leases or rents his/ her unit shall be and remain in full compliance w ith City of Palm Springs regulations.

h. In the event a tenant(s) or lessee of a unit fails to comply w ith the provision of the

Association governing documents, the owner of such unit shall be responsible for such violations and shall be subject to all enforcement actions provided in the governing documents.

i. ENFORCEMENT ASSESSMENTS FOR VIOLATION OF THE MINIMUM RENTAL PERIOD

REQUIREMENTS (i.e. LEASING AND/ OR ADVERTISING). a. FIRST VIOLATION: Costs incurred by the Association, if any, as well as a

monetary fine up to $1,000. b. RECURRING VIOLATION FOR A SECOND TIME: Costs incurred by the

Association, if any, as well as a monetary fine up to $2,500. c. RECURRING VIOLATION FOR A THIRD TIME OR MORE: Costs incurred by the

Association, if any, as well as monetary fine up to $5,000, plus possible legal action.

d. CONTINUIOUS VIOLATION: Costs incurred by the Association, if any, as well as a monetary fine up to $5,000, plus up to $40 per day from the date of the first notice of violation until the violation is cured.

e. In conjunction w ith the enforcement assessments, the Board may also suspend common area privileges and voting rights.

ROSE GARDEN HOMEOWNERS ASSOCIATION, INC.

SUMMARY OF THE PROVISIONS OF THE ALTERNATIVE DISPUTE RESOLUTION LEGISLATION ENUMERATED UNDER CIVIL CODE §1354

Pursuant to Civil Code §1354, this letter will notify you of a law which requires owners within the subdivisions, as well as the Association, to participate in some form of Alternative Dispute Resolution ("ADR") prior to initiating litigation to enforce the Association's governing documents. Subject to exceptions specified within Civil Code §1354, an Association and its owner members must offer to submit their dispute to a form of ADR, such as arbitration or mediation, before filing a civil action to enforce the governing documents.

If the form of ADR chosen is arbitration, it may be either binding or non-binding at the option of the parties. The ADR legislation also provides that the failure of either the Association or any owner to offer ADR prior to initiating litigation is a potential basis for having your lawsuit dismissed. Additionally, the ADR litigation further provides that any party's refusal to participate in ADR prior to the filing of a lawsuit may be considered by the court in its determination of the amount of attorney's fees awarded to the prevailing party.

Finally, this statute specifically requires that the Association send a summary of this legislation, which specifically includes the following provision of Civil Code §1354.

Failure by any member of the association to comply with the pre-filing requirement of Section §1354 of the Civil Code may result in the loss of your rights to sue the Association or another member of the Association regarding enforcement of the governing documents.

If you have a dispute with a member or with the Association regarding the enforcement of the governing documents, we strongly suggest that you review the provisions of Civil Code §1354 and consult with an attorney to ascertain your rights and remedies.

SUMMARY – REVIEW AND APPROVAL PROCESS THE BASIC RULE Rose Garden Condominium owners should not start any addition or modification to their unit or adjacent land without first contacting the Architectural or Landscaping Committees to determine whether or not approval by the Association is required. While this document is intended to keep owners informed of the rules regarding owner-initiated projects, these rules may occasionally be amended. Owners should use the most current version of these rules for reference. PROJECTS REQUIRING APPROVAL Some typical exterior modifications requiring approval include, but are not limited to, the following: • Any interior or exterior project impacting Common Area elements of plumbing, electrical systems, etc. and any project that pierces exterior walls or modifies any load-bearing walls • Exterior light fixtures • Patio and courtyard walls • Rain gutter installation • Skylights and solar tubes (replacement and/or new installations) • Windows and exterior window treatments • Patio extensions PROJECTS EXEMPT FROM APPROVAL • Interior decorating or minor repairs • Landscaping within patios or courtyards consistent with the Landscaping Rules APPLICATION AND APPROVAL Upon request the owner/applicant shall be issued an application form specifying the information and assurances, including insurance and liability waiver if required, necessary to obtain approval. The owner/applicant shall be offered the opportunity to consult with Board, Committee or Management members for assistance in completing the application form. Within 30 days of the submission of a properly completed application the Architecture or Landscape Committee shall meet, review the application in accordance with these Rules and Criteria and adopt a recommendation in favor or opposed to the proposal. The Committee may extend the deadline for an additional 30 days if required in order to consult with the owner/applicant to amend the application. The recommendation, including relevant facts and findings, shall be forwarded immediately in writing to the Board of Directors. If the Architectural or Landscape Committee fails to respond to the application within 60 days the owner/applicant may submit the application directly to the Board of Directors. Upon receipt of the application the Board of Directors shall schedule a review of the application at an open meeting, notify the owner/applicant of the date of review and, after review, approve or disapprove of the application within 60 days of the date of receipt. Final approval of an application may be conditioned on the successful completion of a final inspection. Failure of the owner/applicant to bring the project into compliance with the application or other violation of these Rules may result in an abatement proceeding under the Enforcement Procedure. When an Application is approved, work on the project must begin immediately and be completed within a reasonable time which may be specified by the Board.

I. GENERAL LIABILITY INSURANCE

A. Name of insurer:

B. Policy limits: $1,000,000 each occurrence and $2,000,000 aggregate

C. Amount of deductible (if any):

D. Umbrella coverage, if applicable:

E. Umbrella carrier:

F. Policy dates:

II. PROPERTY INSURANCE

A. Name of insurer:

B. Policy limits:

C. Amount of deductible:

D. Policy dates:

III. EARTHQUAKE INSURANCE

A. Name of insurer:

B. Policy limits:

C. Amount of deductible:

D. Policy dates:

IV. FLOOD INSURANCE

A. Name of insurer:

B. Policy limits:

C. Amount of deductible:

D. Policy dates:

V. FIDELITY BOND INSURANCE

A. Name of insurer:

B. Policy limits:

C. Amount of deductible:

D. Policy dates:

Pursuant to Section 5810 of the California Civil Code, if the association receives any notice of nonrenewal

of a policy described in the annual budget report, the association shall immediately notify its members if

replacement coverage will not be in effect by the date the existing coverage will lapse.

Rose Garden Homeowners AssociationINSURANCE SUMMARY DISCLOSURE

Century National Insurance Company

Century National Insurance Company

$5,000,000

N/A

Liberty Mutual Insurance Company

$500,000

11/01/2017-11/01/2018

Pursuant to Section 5300 (b)(9) of the California Civil Code, the Association is providing you with the

following information regarding its insurance policies. Pursuant to Civil Code Section 5300 (a), this

summary is being distributed not less than 30 days nor more than 90 days preceding the beginning of the

Association's fiscal year.

$10,000

N/A

11/01/2017-11/01/2018

$32,640,000

11/01/2017-11/01/2018

LaBarre/Oksnee Insurance LaBarre/Oksnee Insurance LaBarre/Oksnee Insurance LaBarre/Oksnee Insurance

Fireman's Fund Insurance Company

N/A

$1,000

This summary of the association’s policies of insurance provides only certain information, as required

by Section 5300 of the Civil Code, and should not be considered a substitute for the complete policy

terms and conditions contained in the actual policies of insurance. Any association member may, upon

request and provision of reasonable notice, review the association’s insurance policies and, upon

request and payment of reasonable duplication charges, obtain copies of those policies. Although the

association maintains the policies of insurance specified in this summary, the association’s policies of

insurance may not cover your property, including personal property or real property improvements to

or around your dwelling, or personal injuries or other losses that occur within or around your

dwelling. Even if a loss is covered, you may nevertheless be responsible for paying all or a portion of

any deductible that applies. Association members should consult with their individual insurance

broker or agent for appropriate additional coverage.

N/A

N/A

N/A

N/A

N/A

N/A