Reserve Analysis Report

Transcription

1 Reserve Analysis Report Sample HOA 2663 S Oakland St Los Angeles, CA Level I Study with Site Inspection Fiscal Year End: 11/30/2016 Phone: Fax: brian@mccafferyreserveconsulting.com

2 Section Sections of This Report 1 Preface Written description of a reserve study and the figures in the report Includes glossary, preparer qualifications, and calculation description 2-7 Executive Summary 2-8 Percent Funded Summarizes key findings of the report. Includes development description and lists the projected balance and percent funded. Summarizes the funding plans Includes category breakdown pie chart Describes percent funded calculation and funding levels Includes current percent funded chart and 30 year percent funded projection chart Year Projections Includes 30 year projection charts for annual expenses and reserve balance projections for each of the 3 funding plans 2-10 Category Significance Includes category percentage column charts for fully funded balance and annual depreciation 2-11 Theoretical 30 Year Funding Plan Lists details of each of the 3 funding plans (current, recommended, and threshold) over the next 30 years Charts of the figures in this table are located in the 30 year projections 2-12 Future Percent Funded Includes table and chart of percent funded for various levels of funding over the next 15 years 3 Component Summary & Component Significance Lists all components included in the study in table form Shows Depreciation and Fully Funded Balance Significance including quick glance graph These figures are the basis for all other calculations in the study 4 Annual Expenses by Component Lists all projected expenses for each component over the next 30 years in table form 5 Component Details Lists details of each individual component Includes notes and pictures of selected components if site inspection was conducted

3 Preface A reserve study is a detailed report that assists common interest developments (CID) in planning for long-term common area repair and replacement expenses. These common areas differ for every development. They can include streets, roofs, recreational facilities and many other items. A reserve study estimates the costs of common area repairs and replacements over a 30 year period. Each component is given a useful life, remaining life, and estimated cost. A reserve study then calculates the funds necessary to cover these expenses by creating funding plans. The Big Picture - What are the significant figures to look at in the report? The Component List What are our reserve components and when will they need maintenance Every reserve study must start with a list of the components. The component summary contains the list of all the components, their useful and remaining lives, and their estimated costs. These numbers are the building blocks for most of the figures in the study. Percent Funded - What is our current financial standing Probably the most important number in a reserve study is percent funded. It s almost like a credit score for an association. It tells them the current strength of their reserve fund. Over 70% = Well Funded Between 30-70% = Fairly Funded Below 30% = Poorly Funded The lower your percent funded the higher the risk of a special assessment. A low percent funded also increases the likelihood of deferred maintenance which can cause declining property values. Funding Plans - How much do we need to save for the future The next important part of the study is the theoretical 30 year funding plans. The study contains 3 funding plans. It projects what the percent funded will be over the next 30 years if the CID follows each of these plans. Current Funding Plan This plan is based on what the association is currently contributing to its reserve fund. This information is supplied by the board or management Recommend Funding Plan This is McCaffery s recommendation, if a CID follows the recommended plan they should end up well funded and near the 100% funded level. 5% Threshold Funding Plan - The threshold funding plan is a 30 year cash flow plan that calculates the minimum amount a CID should contribute so their reserve balance won t fall below 5% funded and cause the need for a special assessment. The percent funded will at some point fall into poorly funded levels but will never drop below 5%. If a CID has a funding plan that is below this threshold plan they should also plan on a future special assessment and/or a deferred maintenance. (Following this plan does carry higher risk of a special assessment if a component fails early or costs more than expected) 1-1

4 Why Should a Reserve Study be performed? Certain states, such as California, require that reserve studies be completed and updated annually and that the board of directors inform owners of the reserve status with their annual budget. In addition, the board of directors of a common interest development (CID) has a legal and fiduciary duty to maintain the community in a good state of repair. Property Values are directly affected by the level of maintenance and upkeep of the common area components. Reserve studies create a maintenance plan, which keeps a development in good condition, therefore increasing property appreciation and value. The amount of funds in the reserve account also greatly affects property values. Reserve studies inform CID s how much they should have in their reserve account, which eliminates costly special assessments. Over time each member of a CID should contribute their fair share to the reserve account so when expenses arise the required funds are available. Reserve Studies help board members fulfill their fiduciary duty and also help avoid litigation against CID board members. Where do Component Repair/Replacement Cost Estimates Come From? The most accurate cost source is actual bids from contractors or to look at contracts from when the repair/replacement was last performed. In most cases bids or contracts are not available so unit costs for similar work done in the same local area are used. In addition, it is helpful to talk to local vendors who have knowledge of the work and can help with a cost estimate. A third source is to use construction cost estimators such as RS Means. Many times the entire quantity of a component will not need to be replaced or repaired all at once. An example of this is concrete sidewalks. All sidewalks should never have to be replaced, but some sections may experience cracking. In this case an allowance can be created for their partial replacement. The cost source number for each component is provided in the component summary and details. An explanation of each follows: 1. Local Historical Cost Cost based on bids for similar work done in same area. 2. McCaffery Estimate Estimate or Allowance made by McCaffery Staff Member. 3. Board/Manager Direction Cost estimate provided by board member or property manager. 4. Bid/Contract Bid came from actual bid or contract. 5. Cost Manual Cost came from estimating manual. 6. Previous Study Cost came from previous reserve study. 1-2

5 Glossary of Terms: Contingency An allowance for miscellaneous components, unpredictable expenses and/or costs that were higher than expected. (5% of total current cost unless directed otherwise) Current Budgeted Reserve Assessment Amount currently being deposited into reserve account. Provided by Property Manager or Board Member. Depreciation This Year Amount that should be saved for component during current year. Provided for each component and summed for all components. If the association is 100% funded this is the amount they should contribute to the reserve fund annually. =(Total Current Cost / Normal Useful Life) Depreciation Percent A components percentage of the total depreciation of all components. =(Component Depreciation/Total Depreciation of all components) Fully Funded Balance The total depreciation over the life of the component. In other words, the amount that should have been saved during the life of the component. Provided for each component and summed for all components =((Useful Life Remaining Life) * Depreciation This Year) Full Funded Balance Percent A component s percentage of the total fully funded balance of all components. =(Component FFB/Total FFB of all Components) Monthly Contribution The amount that should be allocated to each component using the recommended funding plan. =((Component Depreciation/Total Depreciation)*Recommended Monthly Funding) Life Remaining Percent The percentage of life that a component has remaining =(Remaining Live/Useful Life) Normal Useful Life Typical useable life for a component. Percent Funded The percentage of the fully funded balance that the CID has in reserve fund. (Projected Balance/ Fully Funded Balance) Projected Balance Projected balance at fiscal year end with current funding plan. Calculated using current reserve balance, remaining contributions to reserves before year-end, and planned expenses before year-end. Supplied by board or management. Recommended Reserve Contribution Recommended amount that the CID should allocate into reserves to offset future expenses. 1-3

6 Remaining Life Expected remaining useable life of component. (0 year remaining life means the component will be serviced in the upcoming fiscal year) Replacement Year Year that component is projected to be replaced or repaired. Total Cost Total cost to replace or repair component in today s dollars. =(Quantity x Unit Cost) Total Future Cost - Current cost adjusted to future cost taking into account inflation and replacement year. =(Current Cost * (1+ inflation rate)^(replacement Year-Present Year)) Threshold Reserve Contribution Reserve contribution that should be allocated into reserves to keep reserve balance above a minimum amount during the next 30 years. (Minimum amount is 5% funded unless otherwise noted) Under Funded Amount association is short of fully funded balance; also known as a deficit. =(Fully Funded Balance Projected Balance) Unit Cost Cost per Unit. Unit of Measure Unit used to measure component. (Explanations shown below) SF Square Feet SY Square Yard LF Linear Feet Each Per Single Unit Lump Sum - Total cost for component Allowance Allowance for component repair or replacement Contract Cost obtained from actual contract or bid Useful Life Time in years component is expected to last. What Procedures were used for calculation and establishment of reserves? In this study the fully funded reserve balance for a component at a given time was computed using the component method. Using the component method the fully funded reserve balance equals the current cost of replacement or repair multiplied by the number of years the component has been in service divided by the useful life of the component. For example if the cost of a boiler is $10,000, the useful life is 10 years and the remaining life is 3 years. The recommended reserve balance would be: $10,000 x ((10-3)/10) = $7,

7 Preparer Qualifications Brian McCaffery, President and founder of McCaffery Reserve Consulting, earned his Bachelor of Science Degree in Architectural Engineering from the University of Colorado in Boulder. His degree program included coursework in Building Exterior, Lighting, Electrical Systems, Heating Ventilating and Air Conditioning, Concrete and Steel Design, Civil Engineering, Structural Engineering, and Estimating. He has worked in the Building Construction/Architectural Engineering industry for 11 years and has been performing reserve studies for the past 9 years. During his professional career, Brian has worked for multiple companies that perform reserve studies. He has performed over 3,000 reserve studies throughout the state of California and the United States. Brian is a certified Reserve Specialist, designated by the Community Associations Institute (CAI). The Reserve Specialist designation is awarded to experienced, qualified reserve specialists, who through years of specialized experience, can help ensure that your community association prepares its reserve budget as accurately as possible. Brian also has a permit to perform reserve studies in the state of Nevada (Reserve study permit #9). McCaffery understands that most homeowners, board members, and property managers can have a difficult time understanding all the numbers in a reserve study. That is why we make it a priority to make our report easy for anyone to understand. The layout of this report is set up with graphs, explanations and figures to make it easy to follow. If you read though the full report you should have a good understanding of the numbers and calculations. We strive to make sure our studies are second to none in the industry. The important figures are summarized in the executive summary and the supporting graphs and figures give a full explanation of how the findings were derived. Further descriptions are provided in the descriptions section. For more useful information on reserve studies please visit: For a quick video that highlights the main sections please see: Or scan QR code below with a smart phone 1-5

8 One Page Description of how we come up with the Numbers in this Report The numbers in this report start with the components listed in the component summary. 1. Every component is given a useful life, remaining life, and an estimated cost We will use a boiler as an example. This boiler is expected to last 10 years and has been in use for 7 years. The estimated cost is $10,000. Component Useful Life Remaining Life Cost Boiler 10 3 $10, The fully funded balance is calculated Fully Funded Balance = (Useful life-remaining Life)/Useful Life * Cost (10-3)/10 * $10,000 = $7,000 The fully funded balance is then summed for all components and this is the total fully funded balance for the development. 3. Fully Funded Balance is then compared to the actual projected year-end balance that the development has saved for reserves This is called the percent funded. For our example let s say the development had $5,000 saved for their boiler. Their percent funded would be: Percent Funded = Projected Year End Reserve Balance/Fully Funded Balance $5,000/$7,000 = 71% 4. Next expenses are projected for each component for the next 30 years using the useful and remaining lives This information is shown in the annual expenses by component section. Inflation is included in these figures. 5. Using the projected expenses for the next 30 years the funding plans are created Funding plans are created so that the development has enough money to offset their projected expenses for the next 30 years. We try to create funding plans that have a uniform contribution over a 30 year period with a slight increase over time for inflation. 1-6

9 Executive Summary Sample HOA This is a Homeowners Association with 93 Condominium Units. The common area components include: asphalt, pool, and building exterior. A Full Study with an on-site inspection was performed on May 4th, 2016 Number of Units 93 Year Built 1987 Fiscal Year End November 30, % Percent Funded 100% 84.3% Poor Fair Well Reserve Fund Balance November 30, 2016 Fully Funded Reserve Balance $ 938,099 Projected Balance $ 791,058 Under Funded (Deficiency in Reserve Funding) $ 147,041 Deficiency in Reserve Funding Per Unit $ 1, Percent Funded 84.3% Funding Plans Annually Monthly Per Unit Monthly Depreciation of Components in 2016 $ 77,300 $ 6,442 $ Budgeted Reserve Contribution 2016 $ 67,200 $ 5,600 $ % Threshold Reserve Contribution for 2017 $ 62,400 $ 5,200 $ Recommended Reserve Contribution for 2017 $ 85,800 $ 7,150 $ Funding Plans $100,000 $90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $- $77,300 Depreciation of Components in 2016 $67,200 Budgeted Reserve Contribution 2016 $62,400 5% Threshold Reserve Contribution for 2017 $85,800 Recommended Reserve Contribution for

10 Percent Funded Percent Funded is probably the most important number in a reserve study Your current percent funded is: Year End Balance $ 791,058 = 84% Fully Funded Balance $ 938,099 Above 70% = Well Funded Between 30% and 70% = Fairly Funded Below 30% = Poorly Funded The higher your percent funded, the lower the risk of special assessments and deferred maintenance. Current Percent Funded $1,000,000 $800,000 $600,000 $400,000 $200,000 $- Well Funded > 70% Fairly Funded 30% - 70% Poorly Funded < 30% 100% Funded Actual $791,058 If you follow one of the 3 funding plans in this reserve study this is what your percent funded may look like over the next 30 years. Anytime the Current line drops below 0% a special assessment is likely. Annually Monthly Per Unit Monthly Current Reserve Contribution 2015 $ 67,200 $ 5,600 $ % Threshold Reserve Contribution for 2017 $ 62,400 $ 5,200 $ Recommended Reserve Contribution for 2017 $ 85,800 $ 7,150 $ % Percent Funded 30 Year Projection Belwo 30% Poor 30-70% Fair Above 70% Well Current Recommended Threshold 100% 80% 60% 40% 20% 0% 2-8

11 30 Year Projections Reserve expenses will vary from year to year. A reserve study predicts these expenses and offsets them by creating a uniform funding plan that increases slightly over time to keep up with inflation. $600,000 Projected Annual Expenses $500,000 $400,000 $300,000 $200,000 $100,000 $- The black 100% funded line shows the ideal balance over the next 30 years. It increases over time due to inflation and depreciation of your components. The 100% funded line will drop after years with large expenses. The recommend funding plan will keep you well funded. The threshold plan will approach $0 dollars, following this plan has a higher risk of special assessments or deferred maintenance. $2,500,000 $2,000,000 $1,500, Year Reserve Balance Projection 100% Fully Funded Current Recommended Threshold $1,000,000 $500,000 $

12 Category Significance This chart breaks down the total fully funded balance for each category Roofing Fully Funded Balance $ 497,166 = 53% Total Fully Funded Balance $ 938,099 Fully Funded Balance 60% 53% 50% 40% 30% 20% 10% 8% 12% 2% 11% 3% 5% 1% 5% 0% This chart breaks down the total annual depreciation for each category Roofing Annual Depreciation $ 20,882 = 27% Total Annual Depreciation $ 77,300 This chart may differ from the chart above because it does not account for remaining life Depreciation This Year 30% 27% 25% 23% 20% 15% 11% 12% 10% 10% 5% 3% 5% 3% 5% 0%

13 Theoretical 30 Year Funding Plans Before Tax Interest Rate 1.5% Sample HOA Annual Inflation Rate 3.0% Above 70% = Well Funded Between 30% and 70% = Fairly Funded Below 30% = Poorly Funded Annual Funding Increase 3.0% (Low Risk of Special Assessment) (Higher Risk of Special Assessment) Year Annual Fully Funded Current Funding Plan Recommended Funding Plan 5% Threshold Funding Plan End Expenses Balance Contribution Balance % Funded Contribution Balance % Funded Contribution Balance % Funded 2016 $ - $ 938,099 $ 67,200 $ 791,058 84% $ - $ 791,058 84% $ - $ 791,058 84% 2017 $ 23,360 $ 1,020,597 $ 69,216 $ 848,780 83% $ 85,800 $ 865,364 85% $ 62,400 $ 841,964 82% 2018 $ 84,939 $ 1,041,361 $ 71,292 $ 847,865 81% $ 88,374 $ 881,779 85% $ 64,272 $ 833,926 80% 2019 $ 8,355 $ 1,148,034 $ 73,431 $ 925,660 81% $ 91,025 $ 977,677 85% $ 66,200 $ 904,281 79% 2020 $ 77,256 $ 1,185,925 $ 75,634 $ 937,923 79% $ 93,756 $ 1,008,842 85% $ 68,186 $ 908,775 77% 2021 $ 164,279 $ 1,133,447 $ 77,903 $ 865,616 76% $ 96,569 $ 956,264 84% $ 70,232 $ 828,360 73% 2022 $ 170,529 $ 1,075,323 $ 80,240 $ 788,311 73% $ 99,466 $ 899,545 84% $ 72,339 $ 742,594 69% 2023 $ 192,332 $ 994,645 $ 82,648 $ 690,451 69% $ 102,450 $ 823,155 83% $ 74,509 $ 635,910 64% 2024 $ 21,984 $ 1,098,630 $ 85,127 $ 763,951 70% $ 105,523 $ 919,042 84% $ 76,744 $ 700,209 64% 2025 $ 491,456 $ 700,938 $ 87,681 $ 371,635 53% $ 108,689 $ 550,060 78% $ 79,046 $ 298,302 43% 2026 $ 32,228 $ 790,996 $ 90,311 $ 435,293 55% $ 111,950 $ 638,033 81% $ 81,418 $ 351,967 44% 2027 $ 411,776 $ 476,392 $ 93,021 $ 123,067 26% $ 115,308 $ 351,135 74% $ 83,860 $ 29,331 6% 2028 $ 81,372 $ 512,891 $ 95,811 $ 139,352 27% $ 118,767 $ 393,797 77% $ 86,376 $ 34,775 7% 2029 $ 67,774 $ 568,498 $ 98,685 $ 172,354 30% $ 122,330 $ 454,261 80% $ 88,967 $ 56,490 10% 2030 $ 54,923 $ 643,077 $ 101,646 $ 221,662 34% $ 126,000 $ 532,152 83% $ 91,637 $ 94,051 15% 2031 $ - $ 782,800 $ 104,695 $ 329,682 42% $ 129,780 $ 669,915 86% $ 94,386 $ 189,847 24% 2032 $ 115,601 $ 805,305 $ 107,836 $ 326,863 41% $ 133,674 $ 698,036 87% $ 97,217 $ 174,311 22% 2033 $ 241,244 $ 696,324 $ 111,071 $ 201,593 29% $ 137,684 $ 604,947 87% $ 100,134 $ 35,816 5% 2034 $ 13,016 $ 834,735 $ 114,404 $ 306,005 37% $ 141,814 $ 742,819 89% $ 103,138 $ 126,475 15% 2035 $ 61,628 $ 928,673 $ 117,836 $ 366,802 39% $ 146,069 $ 838,402 90% $ 106,232 $ 172,976 19% 2036 $ 17,149 $ 1,077,598 $ 121,371 $ 476,526 44% $ 150,451 $ 984,279 91% $ 109,419 $ 267,840 25% 2037 $ 72,533 $ 1,175,282 $ 125,012 $ 536,152 46% $ 154,964 $ 1,081,475 92% $ 112,701 $ 312,025 27% 2038 $ 131,458 $ 1,216,484 $ 128,762 $ 541,499 45% $ 159,613 $ 1,125,852 93% $ 116,082 $ 301,330 25% 2039 $ 48,621 $ 1,352,953 $ 132,625 $ 633,625 47% $ 164,402 $ 1,258,521 93% $ 119,565 $ 376,794 28% 2040 $ 78,943 $ 1,465,299 $ 136,604 $ 700,790 48% $ 169,334 $ 1,367,789 93% $ 123,152 $ 426,654 29% 2041 $ 80,621 $ 1,583,916 $ 140,702 $ 771,383 49% $ 174,414 $ 1,482,099 94% $ 126,846 $ 479,280 30% 2042 $ 64,907 $ 1,727,941 $ 144,923 $ 862,969 50% $ 179,646 $ 1,619,069 94% $ 130,652 $ 552,214 32% 2043 $ 266,069 $ 1,663,730 $ 149,271 $ 759,115 46% $ 185,036 $ 1,562,321 94% $ 134,571 $ 428,999 26% 2044 $ 68,804 $ 1,816,087 $ 153,749 $ 855,446 47% $ 190,587 $ 1,707,538 94% $ 138,608 $ 505,238 28% 2045 $ 69,690 $ 1,977,362 $ 158,361 $ 956,949 48% $ 196,304 $ 1,859,765 94% $ 142,767 $ 585,893 30% 2046 $ 319,315 $ 1,878,972 $ 163,112 $ 815,100 43% $ 202,193 $ 1,770,540 94% $ 147,050 $ 422,416 22% Note: All future projections are theoretical. The estimated lives and costs of components will likely change over time depending on factors such as inflation rates and levels of maintenance. Reserve analysis should be performed annually to account for these factors

14 Future Percent Funded This table and chart shows where your percent funded will be over the next 15 years starting with different levels of funding. Keep in mind all figures assume a 3% annual increase in funding to keep up with inflation. Above 70% = Well Funded Between 30% and 70% = Fairly Funded Below 30% = Poorly Funded (Low Risk of Special Assessment) (Higher Risk of Special Assessment) Reserve Funding Plan Contribution Percent Funded % Recommended $ 94,380 84% 86% 86% 88% 88% 89% 89% 90% 91% 92% 94% 98% 102% 102% 101% Recommended $ 85,800 84% 85% 85% 85% 85% 84% 84% 83% 84% 78% 81% 74% 77% 80% 83% 90% Recommended $ 77,220 84% 84% 83% 83% 82% 80% 78% 76% 76% 65% 67% 49% 51% 54% 58% 80% Recommended $ 68,640 84% 83% 81% 80% 79% 76% 73% 69% 69% 52% 54% 24% 25% 29% 33% 70% Recommended $ 60,060 84% 82% 80% 78% 76% 72% 68% 62% 62% 39% 41% -1% 0% 3% 8% 60% Recommended $ 51,480 84% 81% 78% 76% 73% 68% 62% 55% 54% 26% 28% -25% -26% -22% -16% 120% 100% 80% 60% 40% 20% 0% % -40% $94,380 $85,800 $77,220 $68,640 $60,060 $51,480 Note: All future projections are theoretical. The estimated lives and costs of components will likely change over time depending on factors such as inflation rates and levels of maintenance. Reserve analysis should be performed annually to account for these factors

15 11/30/2016 Component Summary Sample HOA Category Approx. Unit of Useful Remaining Unit Total Cost Component Quantity Measure Life Life Cost Cost Source Roofing Tile Underlayment & Repairs SF 35 8 $ 5.00 $ 350,000 1 Tile Underlayment & Repairs SF $ 5.00 $ 300,000 1 Roof Repairs/Flashings/Vents 1 Allowance $ 25,000 $ 25,000 1 Gutters & Downspouts 2300 LF 25 5 $ 7.00 $ 16,100 1 $ 691,100 Painting Stucco 93 Each 10 6 $ 750 $ 69,750 1 Wood Trim/Garages 93 Each 5 1 $ 325 $ 30,225 1 Wood Trim Repairs 1 Allowance 5 1 $ 15,000 $ 15,000 1 Metal Pole Lights 44 Each 4 0 $ $ 5,060 1 Stucco Walls Exterior SF 10 6 $ 0.60 $ 8,400 1 $ 128,435 Asphalt Slurry Seal & Repair SF 4 0 $ 0.17 $ 11,900 1 Overlay & Replace SF 25 4 $ 1.70 $ 119,000 1 Concrete Repairs 1 Allowance 10 5 $ 6,000 $ 6,000 1 $ 136,900 Fencing/Rails Vinyl Patio Fencing 360 LF $ $ 14,400 1 Wood Patio Fencing 90 LF 20 1 $ $ 2,340 1 Wood Patio Fencing 30 LF $ $ Metal Pool Fencing 400 LF 25 6 $ $ 17,600 1 Wall Repairs 1 Allowance 10 5 $ 5,000 $ 5,000 1 $ 40,120 Pool & Spa Area Pool Resurface/Tile 1 Each 12 1 $ 15,000 $ 15,000 1 Pool Heater 1 Each 10 9 $ 4,000 $ 4,000 1 Pool Filter 1 Each 10 1 $ 1,200 $ 1,200 1 Pool Pump/Motor 2 Each 7 1 $ 1,000 $ 2,000 1 Spa Resurface/Tile 1 Each 8 7 $ 5,000 $ 5,000 1 Spa Heater 1 Each 10 8 $ 3,500 $ 3,500 1 Spa Filter 1 Each 10 1 $ 1,200 $ 1,200 1 Spa Pump/Motor 2 Each 7 6 $ 1,200 $ 2,400 1 Pool Wood Trellis Replace 1500 SF 30 5 $ $ 21,000 1 Pool Wood Trellis Paint 1500 SF 6 3 $ 2.00 $ 3,000 1 Lounge Chairs 14 Each 7 1 $ 450 $ 6,300 1 Table & Chair Sets 3 Each 7 1 $ 1,400 $ 4,200 1 Deck Caulk 1 Allowance 4 0 $ 5,000 $ 5,000 1 Restroom & Shower Remodel 1 Allowance 20 3 $ 20,000 $ 20,000 1 Water Heater 1 Each 10 0 $ 1,400 $ 1,400 1 Pool Deck Replacement 4400 SF 35 5 $ 8.00 $ 35,200 1 $ 130,400 Landscaping Irrigation System Upgrade 1 Allowance 15 3 $ 15,000 $ 15,000 1 Landscape Replacements 1 Allowance 10 3 $ 15,000 $ 15,000 1 Tree Remove/Replace 1 Allowance 3 1 $ 5,000 $ 5,000 1 Tree Trimming Included in Operating Budget 3 $ 35,000 Lighting Pole Lights 44 Each 25 5 $ 1,450 $ 63,800 1 $ 63,800 Miscellaneous Mailboxes 93 Each $ 120 $ 11,160 1 Termite Treatment 3 Buildings 3 3 $ 5,900 $ 17,700 1 Utility Doors & Hardware 35 Each 5 2 $ 225 $ 7,875 1 $ 36,735 Contingency 5% 1 TOTALS $ 1,262,490 Notes: Any other items not listed are included in operating budget

16 11/30/2016 Component Significance Category Component Roofing Tile Underlayment & Repairs Tile Underlayment & Repairs Roof Repairs/Flashings/Vents Gutters & Downspouts Painting Stucco Wood Trim/Garages Wood Trim Repairs Metal Pole Lights Stucco Walls Exterior Asphalt Slurry Seal & Repair Overlay & Replace Concrete Repairs Fencing/Rails Vinyl Patio Fencing Wood Patio Fencing Wood Patio Fencing Metal Pool Fencing Wall Repairs Pool & Spa Area Pool Resurface/Tile Pool Heater Pool Filter Pool Pump/Motor Spa Resurface/Tile Spa Heater Spa Filter Spa Pump/Motor Pool Wood Trellis Replace Pool Wood Trellis Paint Lounge Chairs Table & Chair Sets Deck Caulk Restroom & Shower Remodel Water Heater Pool Deck Replacement Landscaping Irrigation System Upgrade Landscape Replacements Tree Remove/Replace Tree Trimming Lighting Pole Lights Miscellaneous Mailboxes Termite Treatment Utility Doors & Hardware Contingency 5% Fully Funded Balance Depreciation This Year Monthly $ Amount % Quick Glance Graph $ Amount % Quick Glance Graph Contribution $ 270, % $ 10, % $ $ 214, % $ 8, % $ $ % $ 1, % $ $ 12, % $ % $ $ 497, % $ 20, % $ 1, $ 27, % $ 6, % $ $ 24, % $ 6, % $ $ 12, % $ 3, % $ $ 5, % $ 1, % $ $ 3, % $ % $ $ 72, % $ 18, % $ 1, $ 11, % $ 2, % $ $ 99, % $ 4, % $ $ 3, % $ % $ $ 114, % $ 8, % $ $ 2, % $ % $ $ 2, % $ % $ $ % $ % $ 3.61 $ 13, % $ % $ $ 2, % $ % $ $ 21, % $ 1, % $ $ 13, % $ 1, % $ $ % $ % $ $ 1, % $ % $ $ 1, % $ % $ $ % $ % $ $ % $ % $ $ 1, % $ % $ $ % $ % $ $ 17, % $ % $ $ 1, % $ % $ $ 5, % $ % $ $ 3, % $ % $ $ 5, % $ 1, % $ $ 17, % $ 1, % $ $ 1, % $ % $ $ 30, % $ 1, % $ $ 101, % $ 9, % $ $ 12, % $ 1, % $ $ 10, % $ 1, % $ $ 3, % $ 1, % $ % $ 25, % $ 4, % $ $ 51, % $ 2, % $ $ 51, % $ 2, % $ $ 5, % $ % $ $ % $ 5, % $ $ 4, % $ 1, % $ $ 9, % $ 8, % $ $ 44, % $ 3, % $ $ 938, % 100% $ 77, % 100% $ 7,

17 Roofing Annual Expenses by Component Tile Underlayment & Repairs $ - $ - $ - $ - $ - $ - $ - $ - $ 443,370 $ - Tile Underlayment & Repairs $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Roof Repairs/Flashings/Vents $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Gutters & Downspouts $ - $ - $ - $ - $ - $ 18,664 $ - $ - $ - $ - Painting Stucco $ - $ - $ - $ - $ - $ - $ 83,285 $ - $ - $ - Wood Trim/Garages $ - $ 31,132 $ - $ - $ - $ - $ 36,090 $ - $ - $ - Wood Trim Repairs $ - $ 15,450 $ - $ - $ - $ - $ 17,911 $ - $ - $ - Metal Pole Lights $ 5,060 $ - $ - $ - $ 5,695 $ - $ - $ - $ 6,410 $ - Stucco Walls Exterior $ - $ - $ - $ - $ - $ - $ 10,030 $ - $ - $ - Asphalt Slurry Seal & Repair $ 11,900 $ - $ - $ - $ 13,394 $ - $ - $ - $ 15,075 $ - Overlay & Replace $ - $ - $ - $ - $ 133,936 $ - $ - $ - $ - $ - Concrete Repairs $ - $ - $ - $ - $ - $ 6,956 $ - $ - $ - $ - Fencing/Rails Vinyl Patio Fencing $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Wood Patio Fencing $ - $ 2,410 $ - $ - $ - $ - $ - $ - $ - $ - Wood Patio Fencing $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Metal Pool Fencing $ - $ - $ - $ - $ - $ - $ 21,015 $ - $ - $ - Wall Repairs $ - $ - $ - $ - $ - $ 5,796 $ - $ - $ - $

18 Annual Expenses by Component Pool & Spa Area Pool Resurface/Tile $ - $ 15,450 $ - $ - $ - $ - $ - $ - $ - $ - Pool Heater $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 5,219 Pool Filter $ - $ 1,236 $ - $ - $ - $ - $ - $ - $ - $ - Pool Pump/Motor $ - $ 2,060 $ - $ - $ - $ - $ - $ - $ 2,534 $ - Spa Resurface/Tile $ - $ - $ - $ - $ - $ - $ - $ 6,149 $ - $ - Spa Heater $ - $ - $ - $ - $ - $ - $ - $ - $ 4,434 $ - Spa Filter $ - $ 1,236 $ - $ - $ - $ - $ - $ - $ - $ - Spa Pump/Motor $ - $ - $ - $ - $ - $ - $ 2,866 $ - $ - $ - Pool Wood Trellis Replace $ - $ - $ - $ - $ - $ 24,345 $ - $ - $ - $ - Pool Wood Trellis Paint $ - $ - $ - $ 3,278 $ - $ - $ - $ - $ - $ 3,914 Lounge Chairs $ - $ 6,489 $ - $ - $ - $ - $ - $ - $ 7,981 $ - Table & Chair Sets $ - $ 4,326 $ - $ - $ - $ - $ - $ - $ 5,320 $ - Deck Caulk $ 5,000 $ - $ - $ - $ 5,628 $ - $ - $ - $ 6,334 $ - Restroom & Shower Remodel $ - $ - $ - $ 21,855 $ - $ - $ - $ - $ - $ - Water Heater $ 1,400 $ - $ - $ - $ - $ - $ - $ - $ - $ - Pool Deck Replacement $ - $ - $ - $ - $ - $ 40,806 $ - $ - $ - $ - Landscaping Irrigation System Upgrade $ - $ - $ - $ 16,391 $ - $ - $ - $ - $ - $ - Landscape Replacements $ - $ - $ - $ 16,391 $ - $ - $ - $ - $ - $ - Tree Remove/Replace $ - $ 5,150 $ - $ - $ 5,628 $ - $ - $ 6,149 $ - $ - Tree Trimming $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Lighting Pole Lights $ - $ - $ - $ - $ - $ 73,962 $ - $ - $ - $ - Miscellaneous Mailboxes $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Termite Treatment $ - $ - $ - $ 19,341 $ - $ - $ 21,135 $ - $ - $ 23,094 Utility Doors & Hardware $ - $ - $ 8,355 $ - $ - $ - $ - $ 9,685 $ - $ - Totals $ - $ 23,360 $ 84,939 $ 8,355 $ 77,256 $ 164,279 $ 170,529 $ 192,332 $ 21,984 $ 491,456 $ 32,

19 Roofing Tile Underlayment & Repair Tile Underlayment & Repair Roof Repairs/Flashings/Ven $ - $ - $ - $ - $ - $ 38,949 $ - $ - $ - $ - $ - Gutters & Downspouts Annual Expenses by Component $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 403,175 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Painting Stucco Wood Trim/Garages Wood Trim Repairs Metal Pole Lights Stucco Walls Exterior $ - $ - $ - $ - $ - $ - $ 111,928 $ - $ - $ - $ - $ - $ 41,838 $ - $ - $ - $ - $ 48,502 $ - $ - $ - $ - $ - $ 20,764 $ - $ - $ - $ - $ 24,071 $ - $ - $ - $ - $ - $ - $ 7,214 $ - $ - $ - $ 8,120 $ - $ - $ - $ 9,139 $ - $ - $ - $ - $ - $ - $ 13,480 $ - $ - $ - $ - Asphalt Slurry Seal & Repair Overlay & Replace Concrete Repairs $ - $ - $ 16,967 $ - $ - $ - $ 19,096 $ - $ - $ - $ 21,493 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 9,348 $ - $ - $ - $ - $ - Fencing/Rails Vinyl Patio Fencing Wood Patio Fencing Wood Patio Fencing Metal Pool Fencing Wall Repairs $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 26,008 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 1,368 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 7,790 $ - $ - $ - $ - $

20 Annual Expenses by Component Pool & Spa Area Pool Resurface/Tile Pool Heater Pool Filter Pool Pump/Motor Spa Resurface/Tile Spa Heater Spa Filter Spa Pump/Motor Pool Wood Trellis Replace Pool Wood Trellis Paint Lounge Chairs Table & Chair Sets Deck Caulk Restroom & Shower Remod $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Water Heater Pool Deck Replacement $ - $ - $ - $ 22,028 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 7,014 $ - $ - $ 1,661 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 3,116 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 7,790 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 5,959 $ - $ - $ - $ 1,661 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 3,524 $ - $ - $ - $ - $ - $ - $ 4,335 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 4,674 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 9,815 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 6,543 $ - $ - $ - $ - $ - $ - $ - $ 7,129 $ - $ - $ - $ 8,024 $ - $ - $ - $ 9,031 $ 1,881 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 2,529 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Landscaping Irrigation System Upgrade Landscape Replacements Tree Remove/Replace Tree Trimming $ - $ - $ - $ - $ - $ - $ - $ - $ 25,536 $ - $ - $ - $ - $ - $ 22,028 $ - $ - $ - $ - $ - $ - $ - $ 6,720 $ - $ - $ 7,343 $ - $ - $ 8,024 $ - $ - $ 8,768 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Lighting Pole Lights $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Miscellaneous Mailboxes Termite Treatment Utility Doors & Hardware $ - $ 15,448 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 25,236 $ - $ - $ 27,576 $ - $ - $ 30,133 $ - $ - $ - $ - $ 11,228 $ - $ - $ - $ - $ 13,016 $ - $ - $ - Totals $ 411,776 $ 81,372 $ 67,774 $ 54,923 $ - $ 115,601 $ 241,244 $ 13,016 $ 61,628 $ 17,149 $ 72,

21 Roofing Tile Underlayment & Repair Tile Underlayment & Repair Roof Repairs/Flashings/Ven $ - $ - $ - $ - $ - $ - $ - $ - $ - Gutters & Downspouts Annual Expenses by Component $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Painting Stucco Wood Trim/Garages Wood Trim Repairs Metal Pole Lights Stucco Walls Exterior $ - $ - $ - $ - $ - $ 150,422 $ - $ - $ - $ 56,227 $ - $ - $ - $ - $ 65,183 $ - $ - $ - $ 27,904 $ - $ - $ - $ - $ 32,349 $ - $ - $ - $ - $ - $ - $ 10,286 $ - $ - $ - $ 11,577 $ - $ - $ - $ - $ - $ - $ 18,115 $ - $ - $ - Asphalt Slurry Seal & Repair Overlay & Replace Concrete Repairs $ - $ - $ - $ 24,190 $ - $ - $ - $ 27,226 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 280,431 $ - $ - $ - $ - $ 12,563 $ - $ - $ - $ - Fencing/Rails Vinyl Patio Fencing Wood Patio Fencing Wood Patio Fencing Metal Pool Fencing Wall Repairs $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 4,353 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 10,469 $ - $ - $ - $

22 Annual Expenses by Component Pool & Spa Area Pool Resurface/Tile Pool Heater Pool Filter Pool Pump/Motor Spa Resurface/Tile Spa Heater Spa Filter Spa Pump/Motor Pool Wood Trellis Replace Pool Wood Trellis Paint Lounge Chairs Table & Chair Sets Deck Caulk Restroom & Shower Remod $ - $ - $ 39,472 $ - $ - $ - $ - $ - $ - Water Heater Pool Deck Replacement $ - $ - $ - $ - $ 31,407 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 9,426 $ 2,232 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 3,832 $ - $ - $ - $ - $ - $ - $ 4,713 $ - $ - $ 9,868 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 8,008 $ - $ 2,232 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 5,331 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 5,581 $ - $ - $ - $ - $ - $ 6,664 $ - $ - $ - $ 12,071 $ - $ - $ - $ - $ - $ - $ 14,846 $ - $ 8,048 $ - $ - $ - $ - $ - $ - $ 9,898 $ - $ - $ - $ 10,164 $ - $ - $ - $ 11,440 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Landscaping Irrigation System Upgrade Landscape Replacements Tree Remove/Replace Tree Trimming $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 29,604 $ - $ - $ - $ - $ - $ - $ - $ 9,581 $ - $ - $ 10,469 $ - $ - $ 11,440 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Lighting Pole Lights $ - $ - $ - $ - $ - $ - $ - $ - $ - Miscellaneous Mailboxes Termite Treatment Utility Doors & Hardware $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 32,927 $ - $ - $ 35,980 $ - $ - $ 39,317 $ - $ - $ - $ 15,089 $ - $ - $ - $ - $ 17,493 $ - $ - Totals $ 131,458 $ 48,621 $ 78,943 $ 80,621 $ 64,907 $ 266,069 $ 68,804 $ 69,690 $ 319,

23 Component Details Roofing Tile Underlayment & Repairs Approximate Component Quantity Estimated Current Unit Cost $ 5.00 Unit of Measure - SF Estimated Total Current Cost $ 350,000 Normal Useful Life (Years) - 35 Estimated Total Future Cost $ 443,370 Estimated Remaining Useful Life (Years) - 8 Fully Funded Balance $ 270,000 Estimated Replacement Year Depreciation This Year $ 10,000 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 28.78% Life Remainging Percent - 23% 610 Roofing Tile Underlayment & Repairs Approximate Component Quantity Estimated Current Unit Cost $ 5.00 Unit of Measure - SF Estimated Total Current Cost $ 300,000 Normal Useful Life (Years) - 35 Estimated Total Future Cost $ 403,175 Estimated Remaining Useful Life (Years) - 10 Fully Funded Balance $ 214,286 Estimated Replacement Year Depreciation This Year $ 8,571 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 22.84% Life Remainging Percent - 29% Roof repairs were made in We have budgeted to complete this every 15 years going forward

24 Roofing Roof Repairs/Flashings/Vents Approximate Component Quantity - 1 Estimated Current Unit Cost $ 25, Unit of Measure - Allowance Estimated Total Current Cost $ 25,000 Normal Useful Life (Years) - 15 Estimated Total Future Cost $ 38,949 Estimated Remaining Useful Life (Years) - 15 Fully Funded Balance $ - Estimated Replacement Year Depreciation This Year $ 1,667 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.00% Life Remainging Percent - 100% Roof repairs were made in We have budgeted to complete this every 15 years going forward Roofing Gutters & Downspouts Approximate Component Quantity Estimated Current Unit Cost $ 7.00 Unit of Measure - LF Estimated Total Current Cost $ 16,100 Normal Useful Life (Years) - 25 Estimated Total Future Cost $ 18,664 Estimated Remaining Useful Life (Years) - 5 Fully Funded Balance $ 12,880 Estimated Replacement Year Depreciation This Year $ 644 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 1.37% Life Remainging Percent - 20% We spoke with RSO roofing and the informed us they estimate a 5 year remaining life for the gutters

25 Painting Stucco Approximate Component Quantity - 93 Estimated Current Unit Cost $ Unit of Measure - Each Estimated Total Current Cost $ 69,750 Normal Useful Life (Years) - 10 Estimated Total Future Cost $ 83,285 Estimated Remaining Useful Life (Years) - 6 Fully Funded Balance $ 27,900 Estimated Replacement Year Depreciation This Year $ 6,975 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 2.97% Life Remainging Percent - 60% 599 Painting Wood Trim/Garages Approximate Component Quantity - 93 Estimated Current Unit Cost $ Unit of Measure - Each Estimated Total Current Cost $ 30,225 Normal Useful Life (Years) - 5 Estimated Total Future Cost $ 31,132 Estimated Remaining Useful Life (Years) - 1 Fully Funded Balance $ 24,180 Estimated Replacement Year Depreciation This Year $ 6,045 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 2.58% Life Remainging Percent - 20%

26 Painting Wood Trim Repairs Approximate Component Quantity - 1 Estimated Current Unit Cost $ 15, Unit of Measure - Allowance Estimated Total Current Cost $ 15,000 Normal Useful Life (Years) - 5 Estimated Total Future Cost $ 15,450 Estimated Remaining Useful Life (Years) - 1 Fully Funded Balance $ 12,000 Estimated Replacement Year Depreciation This Year $ 3,000 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 1.28% Life Remainging Percent - 20% Painting Metal Pole Lights Approximate Component Quantity - 44 Estimated Current Unit Cost $ Unit of Measure - Each Estimated Total Current Cost $ 5,060 Normal Useful Life (Years) - 4 Estimated Total Future Cost $ 5,060 Estimated Remaining Useful Life (Years) - 0 Fully Funded Balance $ 5,060 Estimated Replacement Year Depreciation This Year $ 1,265 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.54% Life Remainging Percent - 0% Painting Stucco Walls Exterior Approximate Component Quantity Estimated Current Unit Cost $ 0.60 Unit of Measure - SF Estimated Total Current Cost $ 8,400 Normal Useful Life (Years) - 10 Estimated Total Future Cost $ 10,030 Estimated Remaining Useful Life (Years) - 6 Fully Funded Balance $ 3,360 Estimated Replacement Year Depreciation This Year $ 840 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.36% Life Remainging Percent - 60%

27 Asphalt Slurry Seal & Repair Approximate Component Quantity Estimated Current Unit Cost $ 0.17 Unit of Measure - SF Estimated Total Current Cost $ 11,900 Normal Useful Life (Years) - 4 Estimated Total Future Cost $ 11,900 Estimated Remaining Useful Life (Years) - 0 Fully Funded Balance $ 11,900 Estimated Replacement Year Depreciation This Year $ 2,975 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 1.27% Life Remainging Percent - 0% 580 Asphalt Overlay & Replace Approximate Component Quantity Estimated Current Unit Cost $ 1.70 Unit of Measure - SF Estimated Total Current Cost $ 119,000 Normal Useful Life (Years) - 25 Estimated Total Future Cost $ 133,936 Estimated Remaining Useful Life (Years) - 4 Fully Funded Balance $ 99,960 Estimated Replacement Year Depreciation This Year $ 4,760 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 10.66% Life Remainging Percent - 16% Asphalt Concrete Repairs Approximate Component Quantity - 1 Estimated Current Unit Cost $ 6, Unit of Measure - Allowance Estimated Total Current Cost $ 6,000 Normal Useful Life (Years) - 10 Estimated Total Future Cost $ 6,956 Estimated Remaining Useful Life (Years) - 5 Fully Funded Balance $ 3,000 Estimated Replacement Year Depreciation This Year $ 600 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.32% Life Remainging Percent - 50%

28 Fencing/Rails Vinyl Patio Fencing Approximate Component Quantity Estimated Current Unit Cost $ Unit of Measure - LF Estimated Total Current Cost $ 14,400 Normal Useful Life (Years) - 25 Estimated Total Future Cost $ 26,008 Estimated Remaining Useful Life (Years) - 20 Fully Funded Balance $ 2,880 Estimated Replacement Year Depreciation This Year $ 576 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.31% Life Remainging Percent - 80% 602 Fencing/Rails Wood Patio Fencing Approximate Component Quantity - 90 Estimated Current Unit Cost $ Unit of Measure - LF Estimated Total Current Cost $ 2,340 Normal Useful Life (Years) - 20 Estimated Total Future Cost $ 2,410 Estimated Remaining Useful Life (Years) - 1 Fully Funded Balance $ 2,223 Estimated Replacement Year Depreciation This Year $ 117 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.24% Life Remainging Percent - 5%

29 Fencing/Rails Wood Patio Fencing Approximate Component Quantity - 30 Estimated Current Unit Cost $ Unit of Measure - LF Estimated Total Current Cost $ 780 Normal Useful Life (Years) - 20 Estimated Total Future Cost $ 1,368 Estimated Remaining Useful Life (Years) - 19 Fully Funded Balance $ 39 Estimated Replacement Year Depreciation This Year $ 39 Cost Source - 1 Monthly Contribution $ 3.61 Depreciation Percent % Fully Funded Balance Percent 0.00% Life Remainging Percent - 95% Fencing/Rails Metal Pool Fencing Approximate Component Quantity Estimated Current Unit Cost $ Unit of Measure - LF Estimated Total Current Cost $ 17,600 Normal Useful Life (Years) - 25 Estimated Total Future Cost $ 21,015 Estimated Remaining Useful Life (Years) - 6 Fully Funded Balance $ 13,376 Estimated Replacement Year Depreciation This Year $ 704 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 1.43% Life Remainging Percent - 24% 578 Fencing/Rails Wall Repairs Approximate Component Quantity - 1 Estimated Current Unit Cost $ 5, Unit of Measure - Allowance Estimated Total Current Cost $ 5,000 Normal Useful Life (Years) - 10 Estimated Total Future Cost $ 5,796 Estimated Remaining Useful Life (Years) - 5 Fully Funded Balance $ 2,500 Estimated Replacement Year Depreciation This Year $ 500 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.27% Life Remainging Percent - 50%

30 Pool & Spa Area Pool Resurface/Tile Approximate Component Quantity - 1 Estimated Current Unit Cost $ 15, Unit of Measure - Each Estimated Total Current Cost $ 15,000 Normal Useful Life (Years) - 12 Estimated Total Future Cost $ 15,450 Estimated Remaining Useful Life (Years) - 1 Fully Funded Balance $ 13,750 Estimated Replacement Year Depreciation This Year $ 1,250 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 1.47% Life Remainging Percent - 8% 586 Pool & Spa Area Pool Heater Approximate Component Quantity - 1 Estimated Current Unit Cost $ 4, Unit of Measure - Each Estimated Total Current Cost $ 4,000 Normal Useful Life (Years) - 10 Estimated Total Future Cost $ 5,219 Estimated Remaining Useful Life (Years) - 9 Fully Funded Balance $ 400 Estimated Replacement Year Depreciation This Year $ 400 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.04% Life Remainging Percent - 90%

31 Pool & Spa Area Pool Filter Approximate Component Quantity - 1 Estimated Current Unit Cost $ 1, Unit of Measure - Each Estimated Total Current Cost $ 1,200 Normal Useful Life (Years) - 10 Estimated Total Future Cost $ 1,236 Estimated Remaining Useful Life (Years) - 1 Fully Funded Balance $ 1,080 Estimated Replacement Year Depreciation This Year $ 120 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.12% Life Remainging Percent - 10% Pool & Spa Area Pool Pump/Motor Approximate Component Quantity - 2 Estimated Current Unit Cost $ 1, Unit of Measure - Each Estimated Total Current Cost $ 2,000 Normal Useful Life (Years) - 7 Estimated Total Future Cost $ 2,060 Estimated Remaining Useful Life (Years) - 1 Fully Funded Balance $ 1,714 Estimated Replacement Year Depreciation This Year $ 286 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.18% Life Remainging Percent - 14% Pool & Spa Area Spa Resurface/Tile Approximate Component Quantity - 1 Estimated Current Unit Cost $ 5, Unit of Measure - Each Estimated Total Current Cost $ 5,000 Normal Useful Life (Years) - 8 Estimated Total Future Cost $ 6,149 Estimated Remaining Useful Life (Years) - 7 Fully Funded Balance $ 625 Estimated Replacement Year Depreciation This Year $ 625 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.07% Life Remainging Percent - 88%

32 Pool & Spa Area Spa Heater Approximate Component Quantity - 1 Estimated Current Unit Cost $ 3, Unit of Measure - Each Estimated Total Current Cost $ 3,500 Normal Useful Life (Years) - 10 Estimated Total Future Cost $ 4,434 Estimated Remaining Useful Life (Years) - 8 Fully Funded Balance $ 700 Estimated Replacement Year Depreciation This Year $ 350 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.07% Life Remainging Percent - 80% Pool & Spa Area Spa Filter Approximate Component Quantity - 1 Estimated Current Unit Cost $ 1, Unit of Measure - Each Estimated Total Current Cost $ 1,200 Normal Useful Life (Years) - 10 Estimated Total Future Cost $ 1,236 Estimated Remaining Useful Life (Years) - 1 Fully Funded Balance $ 1,080 Estimated Replacement Year Depreciation This Year $ 120 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.12% Life Remainging Percent - 10% Pool & Spa Area Spa Pump/Motor Approximate Component Quantity - 2 Estimated Current Unit Cost $ 1, Unit of Measure - Each Estimated Total Current Cost $ 2,400 Normal Useful Life (Years) - 7 Estimated Total Future Cost $ 2,866 Estimated Remaining Useful Life (Years) - 6 Fully Funded Balance $ 343 Estimated Replacement Year Depreciation This Year $ 343 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.04% Life Remainging Percent - 86%

33 Pool & Spa Area Pool Wood Trellis Replace Approximate Component Quantity Estimated Current Unit Cost $ Unit of Measure - SF Estimated Total Current Cost $ 21,000 Normal Useful Life (Years) - 30 Estimated Total Future Cost $ 24,345 Estimated Remaining Useful Life (Years) - 5 Fully Funded Balance $ 17,500 Estimated Replacement Year Depreciation This Year $ 700 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 1.87% Life Remainging Percent - 17% 593 Pool & Spa Area Pool Wood Trellis Paint Approximate Component Quantity Estimated Current Unit Cost $ 2.00 Unit of Measure - SF Estimated Total Current Cost $ 3,000 Normal Useful Life (Years) - 6 Estimated Total Future Cost $ 3,278 Estimated Remaining Useful Life (Years) - 3 Fully Funded Balance $ 1,500 Estimated Replacement Year Depreciation This Year $ 500 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.16% Life Remainging Percent - 50% Pool & Spa Area Lounge Chairs Approximate Component Quantity - 14 Estimated Current Unit Cost $ Unit of Measure - Each Estimated Total Current Cost $ 6,300 Normal Useful Life (Years) - 7 Estimated Total Future Cost $ 6,489 Estimated Remaining Useful Life (Years) - 1 Fully Funded Balance $ 5,400 Estimated Replacement Year Depreciation This Year $ 900 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.58% Life Remainging Percent - 14%

34 Pool & Spa Area Table & Chair Sets Approximate Component Quantity - 3 Estimated Current Unit Cost $ 1, Unit of Measure - Each Estimated Total Current Cost $ 4,200 Normal Useful Life (Years) - 7 Estimated Total Future Cost $ 4,326 Estimated Remaining Useful Life (Years) - 1 Fully Funded Balance $ 3,600 Estimated Replacement Year Depreciation This Year $ 600 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.38% Life Remainging Percent - 14% Pool & Spa Area Deck Caulk Approximate Component Quantity - 1 Estimated Current Unit Cost $ 5, Unit of Measure - Allowance Estimated Total Current Cost $ 5,000 Normal Useful Life (Years) - 4 Estimated Total Future Cost $ 5,000 Estimated Remaining Useful Life (Years) - 0 Fully Funded Balance $ 5,000 Estimated Replacement Year Depreciation This Year $ 1,250 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.53% Life Remainging Percent - 0% Pool & Spa Area Restroom & Shower Remodel Approximate Component Quantity - 1 Estimated Current Unit Cost $ 20, Unit of Measure - Allowance Estimated Total Current Cost $ 20,000 Normal Useful Life (Years) - 20 Estimated Total Future Cost $ 21,855 Estimated Remaining Useful Life (Years) - 3 Fully Funded Balance $ 17,000 Estimated Replacement Year Depreciation This Year $ 1,000 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 1.81% Life Remainging Percent - 15%

35 Pool & Spa Area Water Heater Approximate Component Quantity - 1 Estimated Current Unit Cost $ 1, Unit of Measure - Each Estimated Total Current Cost $ 1,400 Normal Useful Life (Years) - 10 Estimated Total Future Cost $ 1,400 Estimated Remaining Useful Life (Years) - 0 Fully Funded Balance $ 1,400 Estimated Replacement Year Depreciation This Year $ 140 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.15% Life Remainging Percent - 0% Pool & Spa Area Pool Deck Replacement Approximate Component Quantity Estimated Current Unit Cost $ 8.00 Unit of Measure - SF Estimated Total Current Cost $ 35,200 Normal Useful Life (Years) - 35 Estimated Total Future Cost $ 40,806 Estimated Remaining Useful Life (Years) - 5 Fully Funded Balance $ 30,171 Estimated Replacement Year Depreciation This Year $ 1,006 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 3.22% Life Remainging Percent - 14% Landscaping Irrigation System Upgrade Approximate Component Quantity - 1 Estimated Current Unit Cost $ 15, Unit of Measure - Allowance Estimated Total Current Cost $ 15,000 Normal Useful Life (Years) - 15 Estimated Total Future Cost $ 16,391 Estimated Remaining Useful Life (Years) - 3 Fully Funded Balance $ 12,000 Estimated Replacement Year Depreciation This Year $ 1,000 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 1.28% Life Remainging Percent - 20%

36 Landscaping Landscape Replacements Approximate Component Quantity - 1 Estimated Current Unit Cost $ 15, Unit of Measure - Allowance Estimated Total Current Cost $ 15,000 Normal Useful Life (Years) - 10 Estimated Total Future Cost $ 16,391 Estimated Remaining Useful Life (Years) - 3 Fully Funded Balance $ 10,500 Estimated Replacement Year Depreciation This Year $ 1,500 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 1.12% Life Remainging Percent - 30% Landscaping Tree Remove/Replace Approximate Component Quantity - 1 Estimated Current Unit Cost $ 5, Unit of Measure - Allowance Estimated Total Current Cost $ 5,000 Normal Useful Life (Years) - 3 Estimated Total Future Cost $ 5,150 Estimated Remaining Useful Life (Years) - 1 Fully Funded Balance $ 3,333 Estimated Replacement Year Depreciation This Year $ 1,667 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.36% Life Remainging Percent - 33% Lighting Pole Lights Approximate Component Quantity - 44 Estimated Current Unit Cost $ 1, Unit of Measure - Each Estimated Total Current Cost $ 63,800 Normal Useful Life (Years) - 25 Estimated Total Future Cost $ 73,962 Estimated Remaining Useful Life (Years) - 5 Fully Funded Balance $ 51,040 Estimated Replacement Year Depreciation This Year $ 2,552 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 5.44% Life Remainging Percent - 20%

37 Miscellaneous Mailboxes Approximate Component Quantity - 93 Estimated Current Unit Cost $ Unit of Measure - Each Estimated Total Current Cost $ 11,160 Normal Useful Life (Years) - 20 Estimated Total Future Cost $ 15,448 Estimated Remaining Useful Life (Years) - 11 Fully Funded Balance $ 5,022 Estimated Replacement Year Depreciation This Year $ 558 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.54% Life Remainging Percent - 55% 585 Miscellaneous Termite Treatment Approximate Component Quantity - 3 Estimated Current Unit Cost $ 5, Unit of Measure - Buildings Estimated Total Current Cost $ 17,700 Normal Useful Life (Years) - 3 Estimated Total Future Cost $ 19,341 Estimated Remaining Useful Life (Years) - 3 Fully Funded Balance $ - Estimated Replacement Year Depreciation This Year $ 5,900 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.00% Life Remainging Percent - 100%

38 Miscellaneous Utility Doors & Hardware Approximate Component Quantity - 35 Estimated Current Unit Cost $ Unit of Measure - Each Estimated Total Current Cost $ 7,875 Normal Useful Life (Years) - 5 Estimated Total Future Cost $ 8,355 Estimated Remaining Useful Life (Years) - 2 Fully Funded Balance $ 4,725 Estimated Replacement Year Depreciation This Year $ 1,575 Cost Source - 1 Monthly Contribution $ Depreciation Percent % Fully Funded Balance Percent 0.50% Life Remainging Percent - 40%