Update No Site-Visit Reserve Study

Transcription

1 Update No Site-Visit Reserve Study Crystal Lakes Road & Recreation Red Feather Lakes, CO Report #: For Period Beginning: June 1, 2016 Expires: May 31, 2017 Date Prepared: November 5, 2016

2 Hello, and welcome to your Reserve Study! W e don t want you to be surprised. This Report is designed to help you anticipate, and prepare for, the major common area expenses your association will face. Inside you will find: 1) The Reserve Component List (the Scope and Schedule of your Reserve projects) telling you what your association is Reserving for, what condition they are in now, and what they ll cost to replace. 2) An Evaluation of your current Reserve Fund Size and Strength (Percent Funded). This tells you your financial starting point, revealing your risk of deferred maintenance and special assessments. 3) A Recommended Multi-Year Reserve Funding Plan, answering the question What do we do now? More Questions? Visit our website at or call us at: 303/ Association Reserves Colorado, LLC

3 Table of Contents 3- Minute Executive Summary... i Reserve Study Summary... i Reserve Component List Table 1... ii Introduction, Objectives, and Methodology... 1 Which Physical Assets are Funded by Reserves?...2 How do we establish Useful Life and Remaining Useful Life estimates?...2 How do we establish Current Repair/Replacement Cost Estimates?...2 How much Reserves are enough?...3 How much should we contribute?...4 What is our Recommended Funding Goal?...4 Projected Expenses... 5 Expense Graph Figure Reserve Fund Status & Recommended Funding Plan... 6 Funding Plan Graph Figure Cash Flow Graph Figure % Funded Graph Figure Table Descriptions... 8 Reserve Component List Detail Table Contribution & Fund Breakdown Table Component Significance Table Year Reserve Plan Summary Table Year Reserve Plan Year by Year Detail Table Accuracy, Limitations, and Disclosures Terms and Definitions Component Details... Appendix Association Reserves Colorado, LLC

4 3- Minute Executive Summary Association: Crystal Lakes Road & Recreation #: Location: Red Feather Lakes, CO # of Units: 1604 Report Period: June 1, 2016 through May 31, 2017 Findings/Recommendations as-of 6/1/2016: Projected Starting Reserve Balance:... $572,560 Current Fully Funded Reserve Balance:... $1,094,879 Average Reserve Deficit Per Unit:... $326 Recommended 2016/2017 Annual Full Funding Contributions:... $251,409 Alternate Minimum Contributions to keep Reserves above $0:... $195,000 Recommended 2016/2017 Special Assessment for Reserves:... $0 Most Recent Budgeted Reserve Contribution Rate:... $251,409 Economic Assumptions: Net Annual After Tax Interest Earnings Accruing to Reserves % Annual Inflation Rate % This is an Update No-Site-Visit Reserve Study, based on a prior Report prepared by Association Reserves for your 2015/2016 Fiscal Year. No site inspection was performed as part of this Reserve Study, which was prepared by a credentialed Reserve Specialist (RS). Your Reserve Fund is currently 52% Funded. This means the association s special assessment & deferred maintenance risk is currently medium. The objective of your multi-year Funding Plan is to fund your Reserves to a level where you will enjoy a low risk of such Reserve cash flow problems. Based on this starting point, your anticipated future expenses, our recommendation is maintain your Reserve contributions in order to be within the 70% to 100% level as noted above. 100% Full and 70% contribution rates are designed to achieve these funding objectives by the end of our 30-year report scope. No assets appropriate for Reserve designation were excluded. Association Reserves Colorado, LLC i

5 Table 1: Executive Summary Useful Rem. Current Life Useful Cost # Component (yrs) Life (yrs) Estimate Sites & Grounds 2105 Trailer Pad Storage - Repair 30 5 $7, Concrete Pads/Walk - Repair/Replace $18, Lakes/Ponds/Streams - Maintain 5 4 $45, Mailboxes Sheds - Refurbish $6, Mailbox Pedestals - Allowance 2 1 $1, Entrance Sign - Refurbish/Replace 10 7 $11, Greenbelt - Mitigate 1 0 $41, Tami Bridge - Replace $325, Fuel Tank - Replace $40,000 Grounds Equipment 2194 Big Tex Trailer - Replace $5, Dump Truck - Replace 25 0 $74, ATV - Replace 10 3 $10, Dodge Truck - Replace (16') 8 7 $43, Ford Truck - Replace (10') 8 2 $43, Ford Truck - Replace (12') 8 4 $43, Ford Truck - Replace (15') 8 7 $43, Snow Plow Blades - Replace 2 0 $14, Backhoe - Replace $65, Cat Loader - Replace $101, Motor Grader - Replace $150, Roller/Compactor - Replace $79, Skid Steer - Replace $56, Water Tanker - Replace 25 4 $85,000 Building Exteriors 2325 Deck - Resurface/Replace 25 8 $48, Wood Trim/Siding - Repaint/Repair 5 3 $16, Shop Shingle Roof - Replace 25 8 $12, WC/BC Roof - Replace $98, Shop Metal Roof - Replace 25 8 $32, Shop - Refurbish 30 0 $42,000 Building Interiors 2401 Interior Surfaces - Paint 10 0 $12, Basecamp Flooring - Replace 10 0 $16, Wapiti Center Flooring - Replace 10 0 $16, Basecamp Furniture - Replace 10 8 $20, Wapiti Center Furniture - Replace 10 9 $13, Wapiti Office Furniture - Replace 10 0 $6, Basecamp Bathrooms- Refurbish 12 1 $11, Wapiti Bathrooms - Refurbish 12 4 $9, Basecamp - Refurbish 10 8 $18, Wapiti Center - Refurbish 10 9 $36, Downstairs Wapiti Center - Remodel 10 0 $8,500 Association Reserves Colorado, LLC ii

6 Table 1: Executive Summary Useful Rem. Current Life Useful Cost # Component (yrs) Life (yrs) Estimate 2434 Office/Audio Equip - Replace 5 0 $7, Basecamp Kitchen/Apps. - Refurbish $30,000 Mechanical 2540 Base Station Equipment - Replace 10 9 $5, Warning Signs - Replace 10 3 $61, Instant Water Heater - Replace 10 9 $5, Boilers - Replace 15 0 $12, Total Funded Components Note 1: a Useful Life of N/A means a one-time expense, not expected to repeat. Note 2: Yellow highlighted line items are expected to require attention in the initial year, green highlighted items are expected to occur within the first five years. Association Reserves Colorado, LLC iii

7 Assoc Introduction A Reserve Study is the art and science of anticipating, and preparing for, an association s major common area repair and replacement expenses. Partially art, because in this field we are making projections about the future. Partially science, because our work is a combination of research and welldefined computations, following consistent National Reserve Study Standard principles. The foundation of this and every Reserve Study is your Reserve Component List (what you are reserving for). This is because the Reserve Component List defines the scope and schedule of all your anticipated upcoming Reserve projects. Based on that List and your starting balance, we calculate the association s Reserve Fund Strength (reported in terms of Percent Funded ). Then we compute a Reserve Funding Plan to provide for the Reserve needs of the association. These form the three results of your Reserve Study. Reserve contributions are not for the future. Reserve contributions are designed to offset the ongoing, daily deterioration of your Reserve assets. Done well, a stable, budgeted Reserve Funding Plan will collect sufficient funds from the owners who enjoyed the use of those assets, so the association is financially prepared for the irregular expenditures scattered through future years when those projects eventually require replacement. Methodology For this Update No-Site-Visit Reserve Study, we started with a review of your prior Reserve Study, then looked into recent Reserve expenditures, evaluated how expenditures are handled (ongoing maintenance vs Reserves), and researched any well-established association precedents. We updated and adjusted your Reserve Component List on the basis of time elapsed since the last Reserve Study and interviews with association representatives. Association Reserves Colorado, LLC 1

8 Assoc Which Physical Assets are Funded by Reserves? There is a national-standard four-part test to determine which expenses should appear in your Reserve Component List. First, it must be a common area maintenance responsibility. Second, the component must have a limited life. Third, the remaining life must be predictable (or it by definition is a surprise which cannot be accurately anticipated). Fourth, the component must be above a minimum threshold cost (often between.5% and 1% of an association s total budget). This limits Reserve Components to major, predictable expenses. Within this framework, it is inappropriate to include lifetime components, unpredictable expenses (such as damage due to fire, flood, or earthquake), and expenses more appropriately handled from the Operational Budget or as an insured loss. How do we establish Useful Life and Remaining Useful Life estimates? 1) Visual Inspection (observed wear and age) 2) Association Reserves database of experience 3) Client History (install dates & previous life cycle information) 4) Vendor Evaluation and Recommendation How do we establish Current Repair/Replacement Cost Estimates? In this order 1) Actual client cost history, or current proposals 2) Comparison to Association Reserves database of work done at similar associations 3) Vendor Recommendations 4) Reliable National Industry cost estimating guidebooks Association Reserves Colorado, LLC 2

9 Assoc How much Reserves are enough? Reserve adequacy is not measured in cash terms. Reserve adequacy is found when the amount of current Reserve cash is compared to Reserve component deterioration (the needs of the association). Having enough means the association can execute its projects in a timely manner with existing Reserve funds. Not having enough typically creates deferred maintenance or special assessments. Adequacy is measured in a two-step process: 1) Calculate the value of deterioration at the association (called Fully Funded Balance, or FFB). 2) Compare that to the Reserve Fund Balance, and express as a percentage. Each year, the value of deterioration at the association changes. When there is more deterioration (as components approach the time they need to be replaced), there should be more cash to offset that deterioration and prepare for the expenditure. Conversely, the value of deterioration shrinks after projects are accomplished. The value of deterioration (the FFB) changes each year, and is a moving but predictable target. There is high risk of special assessments and deferred maintenance when the Percent Funded is weak, below 30%. Approximately 30% of all associations are in this high risk range. While the 100% point is Ideal (indicating Reserve cash is equal to the value of deterioration), a Reserve Fund in the 70% -130% range is considered strong (low risk of special assessment). Measuring your Reserves by Percent Funded tells how well prepared your association is for upcoming Reserve expenses. New buyers should be very aware of this important disclosure! Association Reserves Colorado, LLC 3

10 Assoc How much should we contribute? According to National Reserve Study Standards, there are four Funding Principles to balance in developing your Reserve Funding Plan. Our first objective is to design a plan that provides you with sufficient cash to perform your Reserve projects on time. Second, a stable contribution is desirable because it keeps these naturally irregular expenses from unsettling the budget. Reserve contributions that are evenly distributed over current and future owners enable each owner to pay their fair share of the association s Reserve expenses over the years. And finally, we develop a plan that is fiscally responsible and safe for Boardmembers to recommend to their association. Remember, it is the Board s job to provide for the ongoing care of the common areas. Boardmembers invite liability exposure when Reserve contributions are inadequate to offset ongoing common area deterioration. What is our Recommended Funding Goal? Maintaining the Reserve Fund at a level equal to the value of deterioration is called Full Funding (100% Funded). As each asset ages and becomes used up, the Reserve Fund grows proportionally. This is simple, responsible, and our recommendation. Evidence shows that associations in the % range enjoy a low risk of special assessments or deferred maintenance. Allowing the Reserves to fall close to zero, but not below zero, is called Baseline Funding. Doing so allows the Reserve Fund to drop into the 0-30% range, where there is a high risk of special assessments & deferred maintenance. Since Baseline Funding still provides for the timely execution of all Reserve projects, and only the margin of safety is different, Baseline Funding contributions average only 10% - 15% less than Full Funding contributions. Threshold Funding is the title of all other Cash or Percent Funded objectives between Baseline Funding and Full Funding. Association Reserves Colorado, LLC 4

11 Assoc Projected Expenses While this Reserve Study looks forward 30 years, we have no expectation that all these expenses will all take place as anticipated. This Reserve Study needs to be updated annually because we expect the timing of these expenses to shift and the size of these expenses to change. We do feel more certain of the timing and cost of near-term expenses than expenses many years away. Your first five years of projected Reserve expenses total $817,957. Adding the next five years, your first ten years of projected Reserve expenses are $1,569,559. Please be aware of your near-term expenses, which we are able to project more accurately than the more distant projections. The figure below summarizes the projected future expenses at your association as defined by your Reserve Component List. A summary of these expenses are shown in Table 5, while details of the projects that make up these expenses are shown in Table 6. Annual Reserve Expenses $800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $ Years Figure 1 Association Reserves Colorado, LLC 5

12 Assoc Reserve Fund Status The starting point for our financial analysis is your Reserve Fund balance, projected to be $572,560 as-of the start of your Fiscal Year on June 1, As of June 1, 2016, your Fully Funded Balance is computed to be $1,094,879 (see Table 3). This figure represents the deteriorated value of your common area components. Comparing your Reserve Balance to your Fully Funded Balance indicates your Reserves are 52% Funded. Across the country, approx 6% of associations in this range experience special assessments or deferred maintenance. Recommended Funding Plan Based on your current Percent Funded and your near-term and long-term Reserve needs, we are recommending budgeted contributions of $251,409/year this Fiscal Year. The overall 30-yr plan, in perspective, is shown below. This same information is shown numerically in both Table 5 and Table 6. Annual Reserve Funding Recommended Alternate (Minimum) Current Budget $350,000 $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $ Years Figure 2 Association Reserves Colorado, LLC 6

13 Assoc The following chart shows your Reserve balance under our recommended Full Funding Plan, an alternate Baseline Funding Plan, and at your current budgeted contribution rate, compared to your always-changing Fully Funded Balance target. $3,000, Yr Cash Flow Target Fully Funded Balance Recommended Funding Plan Alternate (Minimum) Current Budget $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $ Years Figure 3 This figure shows this same information, plotted on a Percent Funded scale. 140% Percent Funded Recommended Funding Plan Alternate (Minimum) Funding Plan Current Budget 120% 100% 80% 60% 40% 20% 0% Years Figure 4 Association Reserves Colorado, LLC 7

14 Assoc Table Descriptions The tabular information in this Report is broken down into six tables. Table 1 is a summary of your Reserve Components (your Reserve Component List), the information found in Table 2. Table 2 is your Reserve Component List, which forms the foundation of this Reserve Study. This table represents the information from which all other tables are derived. Table 3 shows the calculation of your Fully Funded Balance, the measure of your current Reserve component deterioration. For each component, the Fully Funded Balance is the fraction of life used up multiplied by its estimated Current Replacement Cost. Table 4 shows the significance of each component to Reserve needs of the association, helping you see which components have more (or less) influence than others on your total Reserve contribution rate. The deterioration cost/yr of each component is calculated by dividing the estimated Current Replacement Cost by Useful Life, then that component s percentage of the total is displayed. Table 5: This table provides a one-page 30-year summary of the cash flowing into and out of the Reserve Fund, with a display of the Fully Funded Balance, Percent Funded, and special assessment risk for each year. Table 6: This table shows the cash flow detail for the next 30 years. This table makes it possible to see which components are projected to require repair or replacement each year, and the size of those individual expenses. Association Reserves Colorado, LLC 8

15 Table 2: Reserve Component List Detail Rem. Useful Useful [ --- Current Cost Estimate --- ] # Component Quantity Life Life Best Case Worst Case Sites & Grounds 2105 Trailer Pad Storage - Repair ~ (100) Spaces, (4) Gates 30 5 $7,000 $8, Concrete Pads/Walk - Repair/Replace Numerous GSF $18,000 $19, Lakes/Ponds/Streams - Maintain (6) Ponds/Lakes 5 4 $40,000 $50, Mailboxes Sheds - Refurbish (3) Sheds $5,000 $8, Mailbox Pedestals - Allowance ~ (26) CBUs 2 1 $1,400 $1, Entrance Sign - Refurbish/Replace (2) Large Wood Signs 10 7 $8,200 $14, Greenbelt - Mitigate ~ 563 Acres 1 0 $31,000 $51, Tami Bridge - Replace ~ (18 x 30) $300,000 $350, Fuel Tank - Replace (1) Tank $38,000 $42,000 Grounds Equipment 2194 Big Tex Trailer - Replace (1) Trailer $5,000 $6, Dump Truck - Replace (1) Ford L900 Dump Truck 25 0 $63,000 $85, ATV - Replace (1) ATV 10 3 $8,200 $12, Dodge Truck - Replace (16') (1) 2016 Dodge Truck 8 7 $41,000 $45, Ford Truck - Replace (10') (1) 2010 Ford F $41,000 $45, Ford Truck - Replace (12') (1) 2012 Ford F $41,000 $45, Ford Truck - Replace (15') (1) Ford F $41,000 $45, Snow Plow Blades - Replace ~ (7) Pieces 2 0 $12,000 $16, Backhoe - Replace (1) 2000 Backhoe $60,000 $70, Cat Loader - Replace (1) Cat $95,000 $108, Motor Grader - Replace Cat 143 H $120,000 $180, Roller/Compactor - Replace (1) Cat CS 433C $69,000 $90, Skid Steer - Replace (1) Cat 272C $51,000 $61, Water Tanker - Replace (1) Ford L70 Water Tanker 25 4 $74,000 $96,000 Building Exteriors 2325 Deck - Resurface/Replace ~ 3,500 GSF 25 8 $40,000 $57, Wood Trim/Siding - Repaint/Repair ~ 9,000 GSF 5 3 $13,000 $20, Shop Shingle Roof - Replace ~ 1,700 GSF 25 8 $10,000 $14, WC/BC Roof - Replace ~ 14,000 GSF $86,000 $110, Shop Metal Roof - Replace ~ 2,300 GSF 25 8 $26,000 $38, Shop - Refurbish (1) Building 30 0 $38,000 $46,000 Building Interiors 2401 Interior Surfaces - Paint ~ 3,200 GSF 10 0 $10,000 $14, Basecamp Flooring - Replace ~ 180 GSY 10 0 $15,000 $17, Wapiti Center Flooring - Replace ~ 93 GSY 10 0 $15,000 $17, Basecamp Furniture - Replace ~ (53) Pieces 10 8 $18,000 $22, Wapiti Center Furniture - Replace ~ (62) Pieces 10 9 $10,000 $16, Wapiti Office Furniture - Replace ~ (62) Pieces 10 0 $5,000 $8, Basecamp Bathrooms- Refurbish (2) Bathrooms 12 1 $10,000 $12, Wapiti Bathrooms - Refurbish (2) Bathrooms 12 4 $8,200 $10, Basecamp - Refurbish Numerous GSF 10 8 $16,000 $20,000 Association Reserves Colorado, LLC 9

16 Table 2: Reserve Component List Detail Rem. Useful Useful [ --- Current Cost Estimate --- ] # Component Quantity Life Life Best Case Worst Case 2432 Wapiti Center - Refurbish Numerous GSF 10 9 $35,000 $37, Downstairs Wapiti Center - Remodel (2) Offices 10 0 $8,000 $9, Office/Audio Equip - Replace ~ (15) Pieces 5 0 $6,100 $9, Basecamp Kitchen/Apps. - Refurbish (1) Kitchen $28,000 $32,000 Mechanical 2540 Base Station Equipment - Replace Equipment 10 9 $4,000 $6, Warning Signs - Replace ~ (6) Stations/Sirens 10 3 $51,000 $71, Instant Water Heater - Replace (1) Tank 10 9 $4,500 $5, Boilers - Replace (2) Burnham Boilers 15 0 $10,000 $14, Total Funded Components Association Reserves Colorado, LLC 10

17 Table 3: Fully Funded Balance Current Fully Cost Effective Useful Funded # Component Estimate X Age / Life = Balance Sites & Grounds 2105 Trailer Pad Storage - Repair $7,500 X 25 / 30 = $6, Concrete Pads/Walk - Repair/Replace $18,600 X 1 / 12 = $1, Lakes/Ponds/Streams - Maintain $45,000 X 1 / 5 = $9, Mailboxes Sheds - Refurbish $6,500 X 11 / 25 = $2, Mailbox Pedestals - Allowance $1,600 X 1 / 2 = $ Entrance Sign - Refurbish/Replace $11,100 X 3 / 10 = $3, Greenbelt - Mitigate $41,000 X 1 / 1 = $41, Tami Bridge - Replace $325,000 X 57 / 70 = $264, Fuel Tank - Replace $40,000 X 1 / 20 = $2,000 Grounds Equipment 2194 Big Tex Trailer - Replace $5,650 X 1 / 25 = $ Dump Truck - Replace $74,000 X 25 / 25 = $74, ATV - Replace $10,100 X 7 / 10 = $7, Dodge Truck - Replace (16') $43,000 X 1 / 8 = $5, Ford Truck - Replace (10') $43,000 X 6 / 8 = $32, Ford Truck - Replace (12') $43,000 X 4 / 8 = $21, Ford Truck - Replace (15') $43,000 X 1 / 8 = $5, Snow Plow Blades - Replace $14,000 X 2 / 2 = $14, Backhoe - Replace $65,000 X 17 / 30 = $36, Cat Loader - Replace $101,500 X 11 / 30 = $37, Motor Grader - Replace $150,000 X 18 / 30 = $90, Roller/Compactor - Replace $79,500 X 18 / 30 = $47, Skid Steer - Replace $56,000 X 9 / 30 = $16, Water Tanker - Replace $85,000 X 21 / 25 = $71,400 Building Exteriors 2325 Deck - Resurface/Replace $48,500 X 17 / 25 = $32, Wood Trim/Siding - Repaint/Repair $16,500 X 2 / 5 = $6, Shop Shingle Roof - Replace $12,000 X 17 / 25 = $8, WC/BC Roof - Replace $98,000 X 10 / 25 = $39, Shop Metal Roof - Replace $32,000 X 17 / 25 = $21, Shop - Refurbish $42,000 X 30 / 30 = $42,000 Building Interiors 2401 Interior Surfaces - Paint $12,000 X 10 / 10 = $12, Basecamp Flooring - Replace $16,000 X 10 / 10 = $16, Wapiti Center Flooring - Replace $16,000 X 10 / 10 = $16, Basecamp Furniture - Replace $20,000 X 2 / 10 = $4, Wapiti Center Furniture - Replace $13,000 X 1 / 10 = $1, Wapiti Office Furniture - Replace $6,500 X 10 / 10 = $6, Basecamp Bathrooms- Refurbish $11,000 X 11 / 12 = $10, Wapiti Bathrooms - Refurbish $9,100 X 8 / 12 = $6, Basecamp - Refurbish $18,000 X 2 / 10 = $3,600 Association Reserves Colorado, LLC 11

18 Table 3: Fully Funded Balance Current Fully Cost Effective Useful Funded # Component Estimate X Age / Life = Balance 2432 Wapiti Center - Refurbish $36,000 X 1 / 10 = $3, Downstairs Wapiti Center - Remodel $8,500 X 10 / 10 = $8, Office/Audio Equip - Replace $7,650 X 5 / 5 = $7, Basecamp Kitchen/Apps. - Refurbish $30,000 X 1 / 15 = $2,000 Mechanical 2540 Base Station Equipment - Replace $5,000 X 1 / 10 = $ Warning Signs - Replace $61,000 X 7 / 10 = $42, Instant Water Heater - Replace $5,000 X 1 / 10 = $ Boilers - Replace $12,000 X 15 / 15 = $12,000 $1,094,879 Association Reserves Colorado, LLC 12

19 Table 4: Component Significance Current Useful Cost Deterioration Deterioration # Component Life Estimate Cost/yr Significance Sites & Grounds 2105 Trailer Pad Storage - Repair 30 $7,500 $ % 2107 Concrete Pads/Walk - Repair/Replace 12 $18,600 $1, % 2163 Lakes/Ponds/Streams - Maintain 5 $45,000 $9, % 2164 Mailboxes Sheds - Refurbish 25 $6,500 $ % 2165 Mailbox Pedestals - Allowance 2 $1,600 $ % 2167 Entrance Sign - Refurbish/Replace 10 $11,100 $1, % 2183 Greenbelt - Mitigate 1 $41,000 $41, % 2191 Tami Bridge - Replace 70 $325,000 $4, % 2193 Fuel Tank - Replace 20 $40,000 $2, % Grounds Equipment 2194 Big Tex Trailer - Replace 25 $5,650 $ % 2194 Dump Truck - Replace 25 $74,000 $2, % 2196 ATV - Replace 10 $10,100 $1, % 2197 Dodge Truck - Replace (16') 8 $43,000 $5, % 2197 Ford Truck - Replace (10') 8 $43,000 $5, % 2197 Ford Truck - Replace (12') 8 $43,000 $5, % 2197 Ford Truck - Replace (15') 8 $43,000 $5, % 2198 Snow Plow Blades - Replace 2 $14,000 $7, % 2199 Backhoe - Replace 30 $65,000 $2, % 2199 Cat Loader - Replace 30 $101,500 $3, % 2199 Motor Grader - Replace 30 $150,000 $5, % 2199 Roller/Compactor - Replace 30 $79,500 $2, % 2199 Skid Steer - Replace 30 $56,000 $1, % 2199 Water Tanker - Replace 25 $85,000 $3, % Building Exteriors 2325 Deck - Resurface/Replace 25 $48,500 $1, % 2355 Wood Trim/Siding - Repaint/Repair 5 $16,500 $3, % 2379 Shop Shingle Roof - Replace 25 $12,000 $ % 2379 WC/BC Roof - Replace 25 $98,000 $3, % 2383 Shop Metal Roof - Replace 25 $32,000 $1, % 2398 Shop - Refurbish 30 $42,000 $1, % Building Interiors 2401 Interior Surfaces - Paint 10 $12,000 $1, % 2410 Basecamp Flooring - Replace 10 $16,000 $1, % 2411 Wapiti Center Flooring - Replace 10 $16,000 $1, % 2428 Basecamp Furniture - Replace 10 $20,000 $2, % 2429 Wapiti Center Furniture - Replace 10 $13,000 $1, % 2429 Wapiti Office Furniture - Replace 10 $6,500 $ % 2430 Basecamp Bathrooms- Refurbish 12 $11,000 $ % 2431 Wapiti Bathrooms - Refurbish 12 $9,100 $ % 2432 Basecamp - Refurbish 10 $18,000 $1, % Association Reserves Colorado, LLC 13

20 Table 4: Component Significance Current Useful Cost Deterioration Deterioration # Component Life Estimate Cost/yr Significance 2432 Wapiti Center - Refurbish 10 $36,000 $3, % 2433 Downstairs Wapiti Center - Remodel 10 $8,500 $ % 2434 Office/Audio Equip - Replace 5 $7,650 $1, % 2435 Basecamp Kitchen/Apps. - Refurbish 15 $30,000 $2, % Mechanical 2540 Base Station Equipment - Replace 10 $5,000 $ % 2543 Warning Signs - Replace 10 $61,000 $6, % 2567 Instant Water Heater - Replace 10 $5,000 $ % 2571 Boilers - Replace 15 $12,000 $ % 46 Total Funded Components $151, % Association Reserves Colorado, LLC 14

21 Table 5: 30-Year Reserve Plan Summary Fiscal Year Start: 06/01/16 Interest: 1.0% Inflation: 3.0% Reserve Fund Strength Calculations (All values as of Fiscal Year Start Date) Projected Reserve Balance Changes Starting Fully Special Loans or Reserve Funded Percent Assmt Reserve Special Interest Reserve Year Balance Balance Funded Risk Contribs. Assmts Income Expenses 2016 $572,560 $1,094, % Med $251,409 $0 $5,761 $249, $580,080 $1,026, % Med $253,923 $0 $6,826 $55, $785,620 $1,161, % Med $256,462 $0 $8,658 $103, $946,773 $1,255, % Low $259,027 $0 $10,098 $142, $1,073,624 $1,317, % Low $261,617 $0 $10,759 $266, $1,079,143 $1,258, % Low $264,233 $0 $11,832 $66, $1,288,260 $1,408, % Low $266,876 $0 $13,952 $65, $1,503,415 $1,569, % Low $269,544 $0 $15,594 $171, $1,616,741 $1,631, % Low $272,240 $0 $16,324 $255, $1,649,417 $1,615, % Low $274,962 $0 $16,990 $191, $1,750,090 $1,670, % Low $277,712 $0 $17,865 $221, $1,824,391 $1,703, % Low $280,489 $0 $19,311 $84, $2,039,476 $1,883, % Low $283,294 $0 $19,566 $466, $1,875,399 $1,681, % Low $286,127 $0 $16,359 $780, $1,397,800 $1,158, % Low $288,988 $0 $14,457 $206, $1,494,776 $1,217, % Low $291,878 $0 $14,555 $383, $1,417,560 $1,102, % Low $294,797 $0 $15,205 $102, $1,624,700 $1,280, % Low $297,745 $0 $17,371 $88, $1,851,059 $1,485, % Low $300,722 $0 $18,802 $259, $1,910,962 $1,528, % Low $303,729 $0 $18,186 $505, $1,727,692 $1,328, % Low $306,767 $0 $17,403 $297, $1,754,486 $1,344, % Low $309,834 $0 $18,260 $183, $1,899,156 $1,486, % Low $312,933 $0 $20,121 $105, $2,126,824 $1,722, % Low $316,062 $0 $20,626 $463, $2,000,114 $1,605, % Low $319,223 $0 $20,618 $214, $2,125,190 $1,750, % Low $322,415 $0 $21,547 $283, $2,185,968 $1,838, % Low $325,639 $0 $22,534 $211, $2,322,795 $2,013, % Low $328,895 $0 $24,388 $119, $2,556,795 $2,297, % Low $332,184 $0 $25,497 $369, $2,544,747 $2,343, % Low $335,506 $0 $24,153 $616,478 Association Reserves Colorado, LLC 15

22 Table 6: 30-Year Income/Expense Detail (yrs 0 through 4) Fiscal Year Starting Reserve Balance $572,560 $580,080 $785,620 $946,773 $1,073,624 Annual Reserve Contribution $251,409 $253,923 $256,462 $259,027 $261,617 Recommended Special Assessments $0 $0 $0 $0 $0 Interest Earnings $5,761 $6,826 $8,658 $10,098 $10,759 Total Income $829,730 $840,828 $1,050,741 $1,215,897 $1,346,001 # Component Sites & Grounds 2105 Trailer Pad Storage - Repair $0 $0 $0 $0 $ Concrete Pads/Walk - Repair/Replace $0 $0 $0 $0 $ Lakes/Ponds/Streams - Maintain $0 $0 $0 $0 $50, Mailboxes Sheds - Refurbish $0 $0 $0 $0 $ Mailbox Pedestals - Allowance $0 $1,648 $0 $1,748 $ Entrance Sign - Refurbish/Replace $0 $0 $0 $0 $ Greenbelt - Mitigate $41,000 $42,230 $43,497 $44,802 $46, Tami Bridge - Replace $0 $0 $0 $0 $ Fuel Tank - Replace $0 $0 $0 $0 $0 Grounds Equipment 2194 Big Tex Trailer - Replace $0 $0 $0 $0 $ Dump Truck - Replace $74,000 $0 $0 $0 $ ATV - Replace $0 $0 $0 $11,037 $ Dodge Truck - Replace (16') $0 $0 $0 $0 $ Ford Truck - Replace (10') $0 $0 $45,619 $0 $ Ford Truck - Replace (12') $0 $0 $0 $0 $48, Ford Truck - Replace (15') $0 $0 $0 $0 $ Snow Plow Blades - Replace $14,000 $0 $14,853 $0 $15, Backhoe - Replace $0 $0 $0 $0 $ Cat Loader - Replace $0 $0 $0 $0 $ Motor Grader - Replace $0 $0 $0 $0 $ Roller/Compactor - Replace $0 $0 $0 $0 $ Skid Steer - Replace $0 $0 $0 $0 $ Water Tanker - Replace $0 $0 $0 $0 $95,668 Building Exteriors 2325 Deck - Resurface/Replace $0 $0 $0 $0 $ Wood Trim/Siding - Repaint/Repair $0 $0 $0 $18,030 $ Shop Shingle Roof - Replace $0 $0 $0 $0 $ WC/BC Roof - Replace $0 $0 $0 $0 $ Shop Metal Roof - Replace $0 $0 $0 $0 $ Shop - Refurbish $42,000 $0 $0 $0 $0 Building Interiors 2401 Interior Surfaces - Paint $12,000 $0 $0 $0 $ Basecamp Flooring - Replace $16,000 $0 $0 $0 $ Wapiti Center Flooring - Replace $16,000 $0 $0 $0 $0 Association Reserves Colorado, LLC 16

23 Table 6: 30-Year Income/Expense Detail (yrs 0 through 4) Fiscal Year Basecamp Furniture - Replace $0 $0 $0 $0 $ Wapiti Center Furniture - Replace $0 $0 $0 $0 $ Wapiti Office Furniture - Replace $6,500 $0 $0 $0 $ Basecamp Bathrooms- Refurbish $0 $11,330 $0 $0 $ Wapiti Bathrooms - Refurbish $0 $0 $0 $0 $10, Basecamp - Refurbish $0 $0 $0 $0 $ Wapiti Center - Refurbish $0 $0 $0 $0 $ Downstairs Wapiti Center - Remodel $8,500 $0 $0 $0 $ Office/Audio Equip - Replace $7,650 $0 $0 $0 $ Basecamp Kitchen/Apps. - Refurbish $0 $0 $0 $0 $0 Mechanical 2540 Base Station Equipment - Replace $0 $0 $0 $0 $ Warning Signs - Replace $0 $0 $0 $66,656 $ Instant Water Heater - Replace $0 $0 $0 $0 $ Boilers - Replace $12,000 $0 $0 $0 $0 Total Expenses $249,650 $55,208 $103,968 $142,273 $266,858 Ending Reserve Balance: $580,080 $785,620 $946,773 $1,073,624 $1,079,143 Association Reserves Colorado, LLC 17

24 Table 6: 30-Year Income/Expense Detail (yrs 5 through 9) Fiscal Year Starting Reserve Balance $1,079,143 $1,288,260 $1,503,415 $1,616,741 $1,649,417 Annual Reserve Contribution $264,233 $266,876 $269,544 $272,240 $274,962 Recommended Special Assessments $0 $0 $0 $0 $0 Interest Earnings $11,832 $13,952 $15,594 $16,324 $16,990 Total Income $1,355,208 $1,569,088 $1,788,554 $1,905,304 $1,941,369 # Component Sites & Grounds 2105 Trailer Pad Storage - Repair $8,695 $0 $0 $0 $ Concrete Pads/Walk - Repair/Replace $0 $0 $0 $0 $ Lakes/Ponds/Streams - Maintain $0 $0 $0 $0 $58, Mailboxes Sheds - Refurbish $0 $0 $0 $0 $ Mailbox Pedestals - Allowance $1,855 $0 $1,968 $0 $2, Entrance Sign - Refurbish/Replace $0 $0 $13,652 $0 $ Greenbelt - Mitigate $47,530 $48,956 $50,425 $51,938 $53, Tami Bridge - Replace $0 $0 $0 $0 $ Fuel Tank - Replace $0 $0 $0 $0 $0 Grounds Equipment 2194 Big Tex Trailer - Replace $0 $0 $0 $0 $ Dump Truck - Replace $0 $0 $0 $0 $ ATV - Replace $0 $0 $0 $0 $ Dodge Truck - Replace (16') $0 $0 $52,885 $0 $ Ford Truck - Replace (10') $0 $0 $0 $0 $ Ford Truck - Replace (12') $0 $0 $0 $0 $ Ford Truck - Replace (15') $0 $0 $52,885 $0 $ Snow Plow Blades - Replace $0 $16,717 $0 $17,735 $ Backhoe - Replace $0 $0 $0 $0 $ Cat Loader - Replace $0 $0 $0 $0 $ Motor Grader - Replace $0 $0 $0 $0 $ Roller/Compactor - Replace $0 $0 $0 $0 $ Skid Steer - Replace $0 $0 $0 $0 $ Water Tanker - Replace $0 $0 $0 $0 $0 Building Exteriors 2325 Deck - Resurface/Replace $0 $0 $0 $61,438 $ Wood Trim/Siding - Repaint/Repair $0 $0 $0 $20,902 $ Shop Shingle Roof - Replace $0 $0 $0 $15,201 $ WC/BC Roof - Replace $0 $0 $0 $0 $ Shop Metal Roof - Replace $0 $0 $0 $40,537 $ Shop - Refurbish $0 $0 $0 $0 $0 Building Interiors 2401 Interior Surfaces - Paint $0 $0 $0 $0 $ Basecamp Flooring - Replace $0 $0 $0 $0 $ Wapiti Center Flooring - Replace $0 $0 $0 $0 $0 Association Reserves Colorado, LLC 18

25 Table 6: 30-Year Income/Expense Detail (yrs 5 through 9) Fiscal Year Basecamp Furniture - Replace $0 $0 $0 $25,335 $ Wapiti Center Furniture - Replace $0 $0 $0 $0 $16, Wapiti Office Furniture - Replace $0 $0 $0 $0 $ Basecamp Bathrooms- Refurbish $0 $0 $0 $0 $ Wapiti Bathrooms - Refurbish $0 $0 $0 $0 $ Basecamp - Refurbish $0 $0 $0 $22,802 $ Wapiti Center - Refurbish $0 $0 $0 $0 $46, Downstairs Wapiti Center - Remodel $0 $0 $0 $0 $ Office/Audio Equip - Replace $8,868 $0 $0 $0 $ Basecamp Kitchen/Apps. - Refurbish $0 $0 $0 $0 $0 Mechanical 2540 Base Station Equipment - Replace $0 $0 $0 $0 $6, Warning Signs - Replace $0 $0 $0 $0 $ Instant Water Heater - Replace $0 $0 $0 $0 $6, Boilers - Replace $0 $0 $0 $0 $0 Total Expenses $66,948 $65,673 $171,813 $255,888 $191,280 Ending Reserve Balance: $1,288,260 $1,503,415 $1,616,741 $1,649,417 $1,750,090 Association Reserves Colorado, LLC 19

26 Table 6: 30-Year Income/Expense Detail (yrs 10 through 14) Fiscal Year Starting Reserve Balance $1,750,090 $1,824,391 $2,039,476 $1,875,399 $1,397,800 Annual Reserve Contribution $277,712 $280,489 $283,294 $286,127 $288,988 Recommended Special Assessments $0 $0 $0 $0 $0 Interest Earnings $17,865 $19,311 $19,566 $16,359 $14,457 Total Income $2,045,666 $2,124,191 $2,342,336 $2,177,885 $1,701,245 # Component Sites & Grounds 2105 Trailer Pad Storage - Repair $0 $0 $0 $0 $ Concrete Pads/Walk - Repair/Replace $0 $25,747 $0 $0 $ Lakes/Ponds/Streams - Maintain $0 $0 $0 $0 $68, Mailboxes Sheds - Refurbish $0 $0 $0 $0 $9, Mailbox Pedestals - Allowance $0 $2,215 $0 $2,350 $ Entrance Sign - Refurbish/Replace $0 $0 $0 $0 $ Greenbelt - Mitigate $55,101 $56,754 $58,456 $60,210 $62, Tami Bridge - Replace $0 $0 $0 $477,273 $ Fuel Tank - Replace $0 $0 $0 $0 $0 Grounds Equipment 2194 Big Tex Trailer - Replace $0 $0 $0 $0 $ Dump Truck - Replace $0 $0 $0 $0 $ ATV - Replace $0 $0 $0 $14,832 $ Dodge Truck - Replace (16') $0 $0 $0 $0 $ Ford Truck - Replace (10') $57,788 $0 $0 $0 $ Ford Truck - Replace (12') $0 $0 $61,308 $0 $ Ford Truck - Replace (15') $0 $0 $0 $0 $ Snow Plow Blades - Replace $18,815 $0 $19,961 $0 $21, Backhoe - Replace $0 $0 $0 $95,455 $ Cat Loader - Replace $0 $0 $0 $0 $ Motor Grader - Replace $0 $0 $213,864 $0 $ Roller/Compactor - Replace $0 $0 $113,348 $0 $ Skid Steer - Replace $0 $0 $0 $0 $ Water Tanker - Replace $0 $0 $0 $0 $0 Building Exteriors 2325 Deck - Resurface/Replace $0 $0 $0 $0 $ Wood Trim/Siding - Repaint/Repair $0 $0 $0 $24,231 $ Shop Shingle Roof - Replace $0 $0 $0 $0 $ WC/BC Roof - Replace $0 $0 $0 $0 $ Shop Metal Roof - Replace $0 $0 $0 $0 $ Shop - Refurbish $0 $0 $0 $0 $0 Building Interiors 2401 Interior Surfaces - Paint $16,127 $0 $0 $0 $ Basecamp Flooring - Replace $21,503 $0 $0 $0 $ Wapiti Center Flooring - Replace $21,503 $0 $0 $0 $0 Association Reserves Colorado, LLC 20

27 Table 6: 30-Year Income/Expense Detail (yrs 10 through 14) Fiscal Year Basecamp Furniture - Replace $0 $0 $0 $0 $ Wapiti Center Furniture - Replace $0 $0 $0 $0 $ Wapiti Office Furniture - Replace $8,735 $0 $0 $0 $ Basecamp Bathrooms- Refurbish $0 $0 $0 $16,154 $ Wapiti Bathrooms - Refurbish $0 $0 $0 $0 $ Basecamp - Refurbish $0 $0 $0 $0 $ Wapiti Center - Refurbish $0 $0 $0 $0 $ Downstairs Wapiti Center - Remodel $11,423 $0 $0 $0 $ Office/Audio Equip - Replace $10,281 $0 $0 $0 $ Basecamp Kitchen/Apps. - Refurbish $0 $0 $0 $0 $45,378 Mechanical 2540 Base Station Equipment - Replace $0 $0 $0 $0 $ Warning Signs - Replace $0 $0 $0 $89,581 $ Instant Water Heater - Replace $0 $0 $0 $0 $ Boilers - Replace $0 $0 $0 $0 $0 Total Expenses $221,276 $84,715 $466,937 $780,085 $206,468 Ending Reserve Balance: $1,824,391 $2,039,476 $1,875,399 $1,397,800 $1,494,776 Association Reserves Colorado, LLC 21

28 Table 6: 30-Year Income/Expense Detail (yrs 15 through 19) Fiscal Year Starting Reserve Balance $1,494,776 $1,417,560 $1,624,700 $1,851,059 $1,910,962 Annual Reserve Contribution $291,878 $294,797 $297,745 $300,722 $303,729 Recommended Special Assessments $0 $0 $0 $0 $0 Interest Earnings $14,555 $15,205 $17,371 $18,802 $18,186 Total Income $1,801,210 $1,727,562 $1,939,817 $2,170,583 $2,232,877 # Component Sites & Grounds 2105 Trailer Pad Storage - Repair $0 $0 $0 $0 $ Concrete Pads/Walk - Repair/Replace $0 $0 $0 $0 $ Lakes/Ponds/Streams - Maintain $0 $0 $0 $0 $78, Mailboxes Sheds - Refurbish $0 $0 $0 $0 $ Mailbox Pedestals - Allowance $2,493 $0 $2,645 $0 $2, Entrance Sign - Refurbish/Replace $0 $0 $18,347 $0 $ Greenbelt - Mitigate $63,877 $65,793 $67,767 $69,800 $71, Tami Bridge - Replace $0 $0 $0 $0 $ Fuel Tank - Replace $0 $0 $0 $0 $70,140 Grounds Equipment 2194 Big Tex Trailer - Replace $0 $0 $0 $0 $ Dump Truck - Replace $0 $0 $0 $0 $ ATV - Replace $0 $0 $0 $0 $ Dodge Truck - Replace (16') $66,993 $0 $0 $0 $ Ford Truck - Replace (10') $0 $0 $0 $73,205 $ Ford Truck - Replace (12') $0 $0 $0 $0 $ Ford Truck - Replace (15') $66,993 $0 $0 $0 $ Snow Plow Blades - Replace $0 $22,466 $0 $23,834 $ Backhoe - Replace $0 $0 $0 $0 $ Cat Loader - Replace $0 $0 $0 $0 $177, Motor Grader - Replace $0 $0 $0 $0 $ Roller/Compactor - Replace $0 $0 $0 $0 $ Skid Steer - Replace $0 $0 $0 $0 $ Water Tanker - Replace $0 $0 $0 $0 $0 Building Exteriors 2325 Deck - Resurface/Replace $0 $0 $0 $0 $ Wood Trim/Siding - Repaint/Repair $0 $0 $0 $28,090 $ Shop Shingle Roof - Replace $0 $0 $0 $0 $ WC/BC Roof - Replace $152,681 $0 $0 $0 $ Shop Metal Roof - Replace $0 $0 $0 $0 $ Shop - Refurbish $0 $0 $0 $0 $0 Building Interiors 2401 Interior Surfaces - Paint $0 $0 $0 $0 $ Basecamp Flooring - Replace $0 $0 $0 $0 $ Wapiti Center Flooring - Replace $0 $0 $0 $0 $0 Association Reserves Colorado, LLC 22

29 Table 6: 30-Year Income/Expense Detail (yrs 15 through 19) Fiscal Year Basecamp Furniture - Replace $0 $0 $0 $34,049 $ Wapiti Center Furniture - Replace $0 $0 $0 $0 $22, Wapiti Office Furniture - Replace $0 $0 $0 $0 $ Basecamp Bathrooms- Refurbish $0 $0 $0 $0 $ Wapiti Bathrooms - Refurbish $0 $14,603 $0 $0 $ Basecamp - Refurbish $0 $0 $0 $30,644 $ Wapiti Center - Refurbish $0 $0 $0 $0 $63, Downstairs Wapiti Center - Remodel $0 $0 $0 $0 $ Office/Audio Equip - Replace $11,918 $0 $0 $0 $ Basecamp Kitchen/Apps. - Refurbish $0 $0 $0 $0 $0 Mechanical 2540 Base Station Equipment - Replace $0 $0 $0 $0 $8, Warning Signs - Replace $0 $0 $0 $0 $ Instant Water Heater - Replace $0 $0 $0 $0 $8, Boilers - Replace $18,696 $0 $0 $0 $0 Total Expenses $383,649 $102,862 $88,758 $259,621 $505,185 Ending Reserve Balance: $1,417,560 $1,624,700 $1,851,059 $1,910,962 $1,727,692 Association Reserves Colorado, LLC 23

30 Table 6: 30-Year Income/Expense Detail (yrs 20 through 24) Fiscal Year Starting Reserve Balance $1,727,692 $1,754,486 $1,899,156 $2,126,824 $2,000,114 Annual Reserve Contribution $306,767 $309,834 $312,933 $316,062 $319,223 Recommended Special Assessments $0 $0 $0 $0 $0 Interest Earnings $17,403 $18,260 $20,121 $20,626 $20,618 Total Income $2,051,862 $2,082,581 $2,232,210 $2,463,512 $2,339,955 # Component Sites & Grounds 2105 Trailer Pad Storage - Repair $0 $0 $0 $0 $ Concrete Pads/Walk - Repair/Replace $0 $0 $0 $36,709 $ Lakes/Ponds/Streams - Maintain $0 $0 $0 $0 $91, Mailboxes Sheds - Refurbish $0 $0 $0 $0 $ Mailbox Pedestals - Allowance $0 $2,976 $0 $3,158 $ Entrance Sign - Refurbish/Replace $0 $0 $0 $0 $ Greenbelt - Mitigate $74,051 $76,272 $78,560 $80,917 $83, Tami Bridge - Replace $0 $0 $0 $0 $ Fuel Tank - Replace $0 $0 $0 $0 $0 Grounds Equipment 2194 Big Tex Trailer - Replace $0 $0 $0 $0 $11, Dump Truck - Replace $0 $0 $0 $0 $ ATV - Replace $0 $0 $0 $19,933 $ Dodge Truck - Replace (16') $0 $0 $0 $84,864 $ Ford Truck - Replace (10') $0 $0 $0 $0 $ Ford Truck - Replace (12') $77,663 $0 $0 $0 $ Ford Truck - Replace (15') $0 $0 $0 $84,864 $ Snow Plow Blades - Replace $25,286 $0 $26,825 $0 $28, Backhoe - Replace $0 $0 $0 $0 $ Cat Loader - Replace $0 $0 $0 $0 $ Motor Grader - Replace $0 $0 $0 $0 $ Roller/Compactor - Replace $0 $0 $0 $0 $ Skid Steer - Replace $0 $104,176 $0 $0 $ Water Tanker - Replace $0 $0 $0 $0 $0 Building Exteriors 2325 Deck - Resurface/Replace $0 $0 $0 $0 $ Wood Trim/Siding - Repaint/Repair $0 $0 $0 $32,564 $ Shop Shingle Roof - Replace $0 $0 $0 $0 $ WC/BC Roof - Replace $0 $0 $0 $0 $ Shop Metal Roof - Replace $0 $0 $0 $0 $ Shop - Refurbish $0 $0 $0 $0 $0 Building Interiors 2401 Interior Surfaces - Paint $21,673 $0 $0 $0 $ Basecamp Flooring - Replace $28,898 $0 $0 $0 $ Wapiti Center Flooring - Replace $28,898 $0 $0 $0 $0 Association Reserves Colorado, LLC 24

31 Table 6: 30-Year Income/Expense Detail (yrs 20 through 24) Fiscal Year Basecamp Furniture - Replace $0 $0 $0 $0 $ Wapiti Center Furniture - Replace $0 $0 $0 $0 $ Wapiti Office Furniture - Replace $11,740 $0 $0 $0 $ Basecamp Bathrooms- Refurbish $0 $0 $0 $0 $ Wapiti Bathrooms - Refurbish $0 $0 $0 $0 $ Basecamp - Refurbish $0 $0 $0 $0 $ Wapiti Center - Refurbish $0 $0 $0 $0 $ Downstairs Wapiti Center - Remodel $15,352 $0 $0 $0 $ Office/Audio Equip - Replace $13,817 $0 $0 $0 $ Basecamp Kitchen/Apps. - Refurbish $0 $0 $0 $0 $0 Mechanical 2540 Base Station Equipment - Replace $0 $0 $0 $0 $ Warning Signs - Replace $0 $0 $0 $120,389 $ Instant Water Heater - Replace $0 $0 $0 $0 $ Boilers - Replace $0 $0 $0 $0 $0 Total Expenses $297,376 $183,425 $105,386 $463,398 $214,765 Ending Reserve Balance: $1,754,486 $1,899,156 $2,126,824 $2,000,114 $2,125,190 Association Reserves Colorado, LLC 25

32 Table 6: 30-Year Income/Expense Detail (yrs 25 through 29) Fiscal Year Starting Reserve Balance $2,125,190 $2,185,968 $2,322,795 $2,556,795 $2,544,747 Annual Reserve Contribution $322,415 $325,639 $328,895 $332,184 $335,506 Recommended Special Assessments $0 $0 $0 $0 $0 Interest Earnings $21,547 $22,534 $24,388 $25,497 $24,153 Total Income $2,469,151 $2,534,141 $2,676,078 $2,914,476 $2,904,407 # Component Sites & Grounds 2105 Trailer Pad Storage - Repair $0 $0 $0 $0 $ Concrete Pads/Walk - Repair/Replace $0 $0 $0 $0 $ Lakes/Ponds/Streams - Maintain $0 $0 $0 $0 $106, Mailboxes Sheds - Refurbish $0 $0 $0 $0 $ Mailbox Pedestals - Allowance $3,350 $0 $3,554 $0 $3, Entrance Sign - Refurbish/Replace $0 $0 $24,656 $0 $ Greenbelt - Mitigate $85,845 $88,420 $91,073 $93,805 $96, Tami Bridge - Replace $0 $0 $0 $0 $ Fuel Tank - Replace $0 $0 $0 $0 $0 Grounds Equipment 2194 Big Tex Trailer - Replace $0 $0 $0 $0 $ Dump Truck - Replace $154,940 $0 $0 $0 $ ATV - Replace $0 $0 $0 $0 $ Dodge Truck - Replace (16') $0 $0 $0 $0 $ Ford Truck - Replace (10') $0 $92,733 $0 $0 $ Ford Truck - Replace (12') $0 $0 $0 $98,381 $ Ford Truck - Replace (15') $0 $0 $0 $0 $ Snow Plow Blades - Replace $0 $30,192 $0 $32,031 $ Backhoe - Replace $0 $0 $0 $0 $ Cat Loader - Replace $0 $0 $0 $0 $ Motor Grader - Replace $0 $0 $0 $0 $ Roller/Compactor - Replace $0 $0 $0 $0 $ Skid Steer - Replace $0 $0 $0 $0 $ Water Tanker - Replace $0 $0 $0 $0 $200,308 Building Exteriors 2325 Deck - Resurface/Replace $0 $0 $0 $0 $ Wood Trim/Siding - Repaint/Repair $0 $0 $0 $37,751 $ Shop Shingle Roof - Replace $0 $0 $0 $0 $ WC/BC Roof - Replace $0 $0 $0 $0 $ Shop Metal Roof - Replace $0 $0 $0 $0 $ Shop - Refurbish $0 $0 $0 $0 $0 Building Interiors 2401 Interior Surfaces - Paint $0 $0 $0 $0 $ Basecamp Flooring - Replace $0 $0 $0 $0 $ Wapiti Center Flooring - Replace $0 $0 $0 $0 $0 Association Reserves Colorado, LLC 26

33 Table 6: 30-Year Income/Expense Detail (yrs 25 through 29) Fiscal Year Basecamp Furniture - Replace $0 $0 $0 $45,759 $ Wapiti Center Furniture - Replace $0 $0 $0 $0 $30, Wapiti Office Furniture - Replace $0 $0 $0 $0 $ Basecamp Bathrooms- Refurbish $23,032 $0 $0 $0 $ Wapiti Bathrooms - Refurbish $0 $0 $0 $20,820 $ Basecamp - Refurbish $0 $0 $0 $41,183 $ Wapiti Center - Refurbish $0 $0 $0 $0 $84, Downstairs Wapiti Center - Remodel $0 $0 $0 $0 $ Office/Audio Equip - Replace $16,017 $0 $0 $0 $ Basecamp Kitchen/Apps. - Refurbish $0 $0 $0 $0 $70,697 Mechanical 2540 Base Station Equipment - Replace $0 $0 $0 $0 $11, Warning Signs - Replace $0 $0 $0 $0 $ Instant Water Heater - Replace $0 $0 $0 $0 $11, Boilers - Replace $0 $0 $0 $0 $0 Total Expenses $283,183 $211,346 $119,283 $369,729 $616,478 Ending Reserve Balance: $2,185,968 $2,322,795 $2,556,795 $2,544,747 $2,287,929 Association Reserves Colorado, LLC 27

34 Assoc Accuracy, Limitations, and Disclosures The reserve study should be reviewed carefully. It may not include all common and limited common element components that will require major maintenance, repair or replacement in future years, and may not include regular contributions to a reserve account for the cost of such maintenance, repair, or replacement. The failure to include a component in a reserve study, or to provide contributions to a reserve account for a component, may, under some circumstances, require you to pay on demand as a special assessment your share of common expenses for the cost of major maintenance, repair or replacement of a reserve component. Because we have no control over future events, we do not expect that all the events we anticipate will occur as planned. We expect that inflationary trends will continue, and we expect Reserve funds to continue to earn interest, so we believe that reasonable estimates for these figures are much more accurate than ignoring these economic realities. We can control measurements, which we attempt to establish within 5% accuracy through a combination of on-site measurements, drawings, and satellite imagery. The starting Reserve Balance and interest rate earned on deposited Reserve funds that you provided to us were considered reliable and were not confirmed independently. We have considered the association s representation of current and historical Reserve projects reliable, and we have considered the representations made by its vendors and suppliers to also be accurate and reliable. Component Useful Life, Remaining Useful Life, and Current Cost estimates assume a stable economic environment and lack of natural disasters. Because the physical condition of your components, the association s Reserve balance, the economic environment, and legislative environment change each year, this Reserve Study is by nature a one-year document. Because a long-term perspective improves the accuracy of near-term planning, this Report projects expenses for the next 30 years. It is our recommendation and that of the Financial Accounting Standards Board (FASB) that your Reserve Study be updated each year as part of the annual budget process. Association Reserves CO, LLC and its employees have no ownership, management, or other business relationships with the client other than this Reserve Study engagement. Bryan Farley R.S., company president, is a credentialed Reserve Specialist (#260). All work done by Association Reserves CO, LLC is performed under his Responsible Charge. There are no material issues to our knowledge that have not been disclosed to the client that would cause a distortion of the association s situation. Component quantities indicated in this Report were developed by Association Reserves unless otherwise noted. No destructive or intrusive testing was performed. This Report and this site inspection were accomplished only for Reserve budget purposes (to help identify and address the normal deterioration of properly built and installed components with predictable life expectancies). The Funding Plan in this Report was developed using the cash-flow methodology to achieve the specified Funding Objective. Association Reserves liability in any matter involving this Reserve Study is limited to our Fee for services rendered. Association Reserves Colorado, LLC 28