CONTENTS 1.0 INTRODUCTION... 1 2.0 EXECUTIVE SUMMARY... 2 3.0 PURPOSE & SCOPE... 3 3.1 PURPOSE... 3 3.2 SCOPE... 3 3.3 SOURCES OF INFORMATION... 4 4.0 DESCRIPTION... 6 5.0 OBSERVATIONS... 6 6.0 RESERVE FUND ANALYSIS... 11 7.0 CONCLUSION... 12 8.0 LIMITATIONS... 12 APPENDIX A: RESERVE FUND PROJECTIONS... APPENDIX B: PROJECT PHOTOGRAPHS... McConnell Condominiums
1.0 INTRODUCTION The Condominiums at McConnell Owners Association, Inc. (Association) authorized Criterium Giles Engineers to conduct a Reserve Fund Study for the McConnell Condominiums property located in Kernersville, North Carolina. Studies of this nature are important to ensure a community has sufficient funds for long-term, periodic capital expenditure requirements. Anticipating large expenditures over an extended period of time through a structured analysis and scheduling process assists the Association in meeting financial requirements without increasing the service fees above permitted maximums, borrowing the funds, or levying special financial assessments to the home owners. Typically, a community association has two broad cash requirements: the general operating reserves and the capital repair and replacement reserves. In this report, we will focus on those items falling under the capital repair and replacement reserve criteria. We have projected a capital repair and replacement reserve for twenty (20) years. The first ten years are the most reliable. Such a study should be updated every five years. This report is structured to analyze components of the community for which the Association is responsible and to assess a useful expected life and useful remaining life to those components. The anticipated scheduled repair or replacement of the component and the anticipated expense for the activity are then analyzed in conjunction with the current capital reserves funding program for the community. Funding program recommendations are made with the objective of limiting substantial cash excesses while minimizing financial burdens that can result from significant cash inadequacies. This report is intended to be used as a tool to determine reserve fund allocation requirements for the community, to manage future Association obligations, and to inform the community of future financial needs in general. The report that follows has been prepared from the perspective of what an owner of this property would benefit from knowing. Some items, beyond those of immediate concern, may be discussed. Therefore, the report should be read in its entirety in order to fully understand all of the information that has been obtained. McConnell Condominiums Page 1
2.0 EXECUTIVE SUMMARY McConnell Condominiums project is comprised of 190 residential condominiums contained within 22 quadraplex style buildings and 6 condominium buildings located off Lambeth Farm Lane and McConnell Drive in. According to Forsyth County real estate records, the first phase of construction was completed in 2002 with continued construction through 2008. The association has responsibility for the exterior of the condominium buildings, the common area mechanical equipment, and the site improvements. The wood decks and patios are Limited Common Elements and the responsibility of the homeowner. The most significant site improvements include the asphalt paved parking areas/streets, concrete flatwork, drainage systems and mailboxes. The buildings, common areas and grounds are generally in good to fair condition. Based on our evaluation, the current level of funding is not projected to maintain a positive balance through the term of this study. We have provided alternatives for annual reserve contribution schedules that provide sufficient funding to meet capital expenditure requirements in the next twenty years. A more detailed analysis of the reserve fund has been provided in Appendix A. Some significant expenditures are expected over the term of the study. Some of the more notable examples are listed below: Replace building roofs Repair/resurface asphalt paving There are, of course, other capital expenditures to be expected over the next twenty years. Those items that will require attention are discussed later in this report. McConnell Condominiums Page 2
3.0 PURPOSE & SCOPE 3.1 Purpose The purpose of this study is to perform a reserve fund analysis and to determine a capital needs plan. It is intended to be used as a tool for McConnell Condominiums in determining the allocation requirements into the reserve fund in order to meet future anticipated capital expenditures for the community. This report forecasts obligations for the community twenty years into the future. It should be noted that events might occur that could have an effect on the underlying component or system useful life assumptions used in this study. Likewise, inevitable market fluctuations can have an impact on component or system replacement and repair costs. Therefore, a study such as this should be updated from time to time, usually on a three to fiveyear cycle, in order to reflect the most accurate needs and obligations of the community. 3.2 Scope This study has been performed according to the scope as generally defined by McConnell Condominiums, Criterium-Giles Engineers Inc., CAS, Inc., and the standards of the Community Associations Institute. The findings and recommendations are based on interviews with the community s management personnel; a review of available documents; and an investigation of the buildings and site. The Cash Flow Method of calculating reserves has been utilized, whereby contributions to the reserve fund are designed to offset the variable annual expenditures. Funding alternates are recommended which are designed to achieve a Baseline Funding goal by maintaining a positive balance for the term of the study. The guidelines used to determine which physical components within the community are to be included in the component inventory are based on the following general criteria: 1. The component must be a common element, or otherwise noted to be the responsibility of the Association to replace. 2. The component must have an estimated remaining useful life of twenty years or less. As the site ages, additional components may need to be added. 3. The funding for replacement should be from one source only, not funded from another area of the budget or through a maintenance contract. 4. The cost of replacement should be high enough to make it financially unsound to fund it from the operating budget. Our reserve study analysis included evaluating the following association property: Buildings: The association is responsible for maintenance and replacement of the roofing, and the exterior façade on the condominium buildings. McConnell Condominiums Page 3
Mechanical Systems: The association is responsible for maintaining the common exterior lighting and fire suppression/alarm systems. Site and Grounds: The association is responsible for the parking areas and private streets, mailboxes, and drainage systems. The above list was obtained from the site inspection and discussions with the management firm prior to the inspection. This study estimates the funding levels required for maintaining the longterm viability of the facility. Our approach involves: 1. Examining association managed equipment, building and site facilities. 2. Predicting their remaining service life and, approximating how frequently they will require repair or replacement. 3. Estimating repair or replacement costs (in 2016 dollars) for each capital item. 4. Using data developed in Steps 1, 2 and 3 to project Capital Reserve balances for Years 1 through 20. The statements in this report are opinions about the present condition of the subject community. They are based on visual evidence available during a diligent investigation of all reasonably accessible areas falling under the responsibility of the Association. We did not remove any surface materials, perform any destructive testing, or move any furnishings. This study is not an exhaustive technical evaluation. Such an evaluation would entail a significantly larger scope than this effort. For additional limitations, see Section 8.0. 3.3 Sources of Information Onsite inspections of the property occurred on the following date: April 19, 2016 The following people were interviewed during our study: Johnny Grindstaff, Community Manager, CAS, Inc. The following documents were made available to us and reviewed: Forsyth County real estate records Recorded plat maps, condo maps Association governing documents Association budget and balance sheet McConnell Condominiums Page 4
We based our cost estimates on some or all of the following: Our data files on similar projects Local contractor estimates R.S. Means Construction Cost Data For your reference, the following definitions may be helpful: Excellent: Component or system is in "as new" condition, requiring no rehabilitation and should perform in accordance with expected performance. Good: Component or system is sound and performing its function, although it may show signs of normal wear and tear. Some minor rehabilitation work may be required. Fair: Component or system falls into one or more of the following categories: a) Evidence of previous repairs not in compliance with commonly accepted practice, b) Workmanship not in compliance with commonly accepted standards, c) Component or system is obsolete, d) Component or system approaching end of expected performance. Repair or replacement is required to prevent further deterioration or to prolong expected life. Poor: Component or system has either failed or cannot be relied upon to continue performing its original function as a result of having exceeded its expected performance, excessive deferred maintenance, or state of disrepair. Present condition could contribute to or cause the deterioration of other adjoining elements or systems. Repair or replacement is required. Adequate: A component or system is of a capacity that is defined as enough for what is required, sufficient, suitable, and/or conforms to standard construction practices. All ratings are determined by comparison to other buildings of similar age and construction type. Further, some details of workmanship and materials will be examined more closely in higher quality buildings where such details typically become more relevant. All directions (left, right, rear, etc.), when used, are taken from the viewpoint of an observer standing in front of a building and facing it. Repair/Replacement Reserves - Non-annual maintenance items that will require significant expenditure over the life of the buildings. Included are items that will reach the end of their estimated useful life during the course of this forecast, or, in the opinion of the investigator, will require attention during that time. McConnell Condominiums Page 5
4.0 DESCRIPTION McConnell Condominiums project is comprised of 190 residential condominiums contained within 22 quadraplex style buildings and 6 condominium buildings located off Lambeth Farm Lane and McConnell Drive in. According to Forsyth County real estate records, the first phase of construction was completed in 2002 with continued construction through 2008. McConnell Condominiums Page 6 The association has responsibility for the exterior of the condominium buildings, the common area mechanical equipment, and the site improvements. The wood decks and patios are Limited Common Elements and the responsibility of the homeowner. The most significant site improvements include the asphalt paved parking areas/streets, concrete flatwork, drainage systems and mailboxes. Exterior surfaces are primarily comprised of brick masonry and vinyl siding with sections of aluminum wrapped trim components. The building roofs are clad with asphaltic fiberglass three tab shingles. Rainwater is conveyed through gutters and downspouts that discharge at grade or into underground pipe extensions. The buildings are constructed over a concrete slab on grade with footings. Site drainage is provided via landscaped swales and catch basins in the paved and landscaped areas. These systems direct water flow off site through the public drainage infrastructure 5.0 OBSERVATIONS The following key observations were made about the current condition of the more significant and costly common elements of the property. Site and Grounds The association is responsible for maintaining sections of the streets and the parking areas located in the community. Based on a review of the recorded plat maps, Lambeth Farm Lane, Lake Way, McConnell Landing, McConnell Drive and McConnell Court are public streets and not maintained by the association. The remaining streets and parking areas appear to be maintained by the association and have been included in this analysis. The asphalt paving generally appeared to be in good to fair condition. We noted areas of on longitudinal cracking, which is typical considering the age of the paving. The paving does not appear to have been seal coated since original construction. Typically, we recommend the application of an oil-resistant seal coat over all paved areas on an approximately 7 year cycle. At this same time, all cracks should be properly filled, patched, and sealed. We have allocated funds for crack filling, seal coating and restriping the paving in the community on a 7 year cycle beginning in 2017. Assuming seal coat and crack fill applications are completed in the interim, we estimate the asphalt paving to have a remaining useful life of approximately 10 to 15 years. Resurfacing would include light milling around the edges of the paving to maintain an adequate drainage profile
around concrete curbing and the installation of a 1.5 to 2 thick asphalt overlay over all paving areas maintained by the association. We have allocated funds for asphalt resurfacing on a 25 year cycle beginning in 2029. Concrete walkways provide pedestrian access to the building entrances and are located along the sections of private streets/parking areas. Concrete curb and gutter is installed along the perimeter of the paved areas in the community. We noted minor cracking developing in limited areas of the concrete. We also noted areas of spalling developing in concrete sidewalks. No indications of major structural failure were observed in the concrete flatwork and curbing, though cracking and upheaval will likely occur over time due to differential settlement. It is likely that sections of the concrete flatwork and curbing will require periodic repairs including grinding concrete to even out upheaved areas and saw-cutting, removing and re-pouring sections of damaged concrete. We have provided funds to repair approximately 5% of the concrete flatwork and curbing on a 10 year cycle beginning in 2026. Drainage systems in the community include inlet basins in the curbing and landscaped areas leading to buried storm sewer piping. The storm sewer piping leads to stormwater ponds located onsite. We have assumed the stormwater ponds are maintained by the master association. We noted minor erosion developing in areas of the property including near the foundation on the right side of the 5000 Lambeth Farm Lane building. We also noted bare soils and minor erosion developing on embankments in the community. We recommend maintaining adequate soil stabilizing ground cover to mitigate erosion concerns in the community. We have allocated funds for drainage improvements on a 5 year cycle beginning in 2017. Drainage improvements will likely include re-grading/trenching swales, repairing soil erosion, installing soil stabilizing ground cover, installing additional drainage systems such as French drains or buried piping. Short sections of timber retaining walls are located behind quadraplex style buildings along Geoffrey Way. We noted evidence of deterioration in the timber retaining walls including leaning and bulging. We also observed sections of the retaining walls covered by overgrown vegetation and shrubs. We have allocated funds to replace the timber retaining walls on a 20 year cycle beginning in 2017. We recommend replacing timber retaining walls with geo-grid reinforced segmental block retaining walls which have a much longer expected useful life. A mail kiosk station is located near the northeast section of the community and includes an open air structure with roof and siding. We have included funds below for repairs to the building. The mail kiosks generally appeared to be in good condition and have an expected useful life of approximately 30 years. We have allocated funds to replace the kiosks in 2035. Limited sections of privacy fencing are installed around the rear patios of the quadraplex units, we have assumed this fencing is maintained by individual unit owners. McConnell Condominiums Page 7
Building Exteriors The buildings in the community are predominately clad in vinyl siding. Limited faces of the condo buildings are clad in brick veneer. Vinyl shutters flank windows on most faces of the buildings. The exterior doors are primarily of painted metal and fiberglass skin construction with sections of painted wood trim (casing and brickmold). We noted several missing or loose vinyl shutters, specifically on the 2000 McConnell Drive and 2000 Lambeth Farm Lane buildings. We also noted several shutters that have faded in color in the community. We also noted flaking paint in wood trim components around doors in the community and loose trim components around front porch roofs on the three story condominium buildings. The breezeways and stairwells in the 3-story condominium buildings include sections of painted drywall ceilings. We have allocated funds to paint the doors and painted trim components, replace/paint shutters and for minor repairs to the vinyl siding in the community on a 10 year cycle beginning in 2017. This cycle would include repairing caulking at transitions, painting/repairing drywall ceilings in the breezeways, repairing sections of vinyl siding and painting limited sections of metal railings in the common areas. Note that we do not anticipate significant replacement of the vinyl siding will be required over the term. The brick veneer sections appeared to be in good condition and no significant repairs or repointing are anticipated to be required to the brick veneer components over the term. The predominant pitched roof surfaces over the buildings are clad in asphaltic fiberglass three-tab shingles. Roof surfacing is likely applied over roof sheathing, and appears to be in good to fair condition. We are unaware of any concerns with current roof leaks. We noted limited areas of patching in sections of the roofs. Minor roof repairs will likely be periodically required including replacing vent boots, flashing and drip edge repairs, and gutter repairs; we have assumed these minor repairs would be funded from an annual maintenance budget. If inspections and repairs occur in the interim, these types of roofing surfaces will typically last approximately twenty years. We strongly recommend that any re-roofing project closely follow procedures outlined by the National Roofing Contractors Association s Roofing and Waterproofing Manual, current edition. A re-roofing sequence should include removal of the existing roofing material, replacement of any inadequate roof sheathing, replacement of any damaged flashing, and replacement of drip edge components. Gutters and downspouts are in generally good condition and should not require replacement until the time of roof replacement, as this component typically provides twenty years of relatively trouble free service. Limited replacements are included in the re-roofing funds. We have allocated funds for roof replacement in phases based on original McConnell Condominiums Page 8
construction dates and the condition of the roofing observed during our inspection. Roof replacement phases by building and address are projected as follows: Address Number of Units Year Built Roof Replacement Phase 1002-1008 Geoffrey Way 4 2002 1 1102-1108 Geoffrey Way 4 2002 1 901-907 Geoffrey Way 4 2002 1 701-707 Geoffrey Way 4 2002 1 802-808 Geoffrey Way 4 2002 1 5000 Lambeth Farm Lane 18 2002 1 602-608 Geoffrey Way 4 2003 2 501-507 Geoffrey Way 4 2003 2 101-107 Geoffrey Way 4 2003 2 202-208 Geoffrey Way 4 2003 2 302-308 Geoffrey Way 4 2003 2 1101-1107 McConnell Dr. 4 2003 2 3101-3107 McConnell Dr. 4 2003 2 4101-4107 McConnell Dr. 4 2003 2 2000 Lambeth Farm Lane 18 2003 2 402-408 Geoffrey Way 4 2004 3 6101-6107 McConnell Dr. 4 2005 3 102-108 Richmond Terrace 4 2005 3 202-208 Richmond Terrace 4 2005 3 2000 McConnell Drive 12 2005 3 5000 McConnell Drive 18 2005 3 101-107 Williams Way 4 2006 4 201-207 Williams Way 4 2006 4 202-208 McConnell Landing 4 2006 4 402-408 McConnell Landing 4 2006 4 301-307 McConnell Landing 4 2007 4 7000 McConnell Drive 18 2006 4 7000 Lambeth Farm Lane 18 2008 4 McConnell Condominiums Page 9
From our review of the Declarations and in discussions with the Association, it appears that exterior wood decks, exterior doors and window replacement are limited common elements and the maintenance responsibility of the individual homeowner. The association is responsible for maintaining the common area windows located at the top floor of the common area breezeways/stairwells. We have allocated funds to replace these windows on a 30 year cycle beginning in 2036. Note that the association is responsible for maintaining the wood framed stairwells and decking (wood and composite) in the stairwells of the 3- story condominium buildings. These sections of the decking are protected from weather exposure and should have an expected useful life well beyond the term of this study. Minor repairs and periodic cleaning and possibly staining will likely be required, which we have assumed would be funded from an annual maintenance budget. Mechanical Per our understanding, the association is responsible for the common area plumbing and electrical systems including common area exterior light fixtures in the condominium buildings, common area fire suppression/alarm systems and condominium building entrance call boxes. The three-story condominium buildings include wall and ceiling mounted light fixtures located in the common area breezeways/stairwells and adjacent to the building entrances. The light fixtures generally appeared to be in good condition and have an expected useful life of approximately 20 years. We have allocated funds to replace the common area light fixtures in 2027. The common area corridors in the three-story condominium buildings include smoke detectors, emergency lights, exit lights and pull stations. A Honeywell fire alarm control panel is installed in a mechanical room on the ground floor of each building. The smoke detectors, emergency lights and other fire/life safety fixtures have an expected useful life of approximately 20 years and we have allocated funds for their replacement in 2027. We have allocated funds to replace the fire alarm control panels on a 15 year cycle beginning in 2021. The three story condominium buildings are served by a wet fire suppression system with riser pipe, valves and gauges located in ground floor mechanical rooms. We noted inspection tags by Sunland Fire Protection dated for 2011. We strongly recommend routine inspections and testing of the fire suppression and fire alarm/life safety equipment. In addition to regular inspections and maintenance, we anticipate more significant expenses in repairs to the fire suppression systems will be required. We have allocated funds for repairs to the common area fire suppression systems on a 10 year cycle beginning in 2021. McConnell Condominiums Page 10
The three story condominium buildings include Tektone call boxes at the entries to the buildings. We have allocated funds to replace the call boxes on a 15 year cycle beginning in 2022. 6.0 RESERVE FUND ANALYSIS Using software developed by Criterium Engineers and KPMG Peat Marwick, we have analyzed capital reserves draw-down for the projected capital expenditures to determine the amount needed. The following is a projected reserve fund analysis for non-annual items as discussed in the report. This projection takes into consideration a reasonable return on invested moneys and inflation. Please review this thoroughly and let us know of any changes that may be desired. The intent of this reserve fund projection is to help the Association develop a reserve fund to provide for anticipated repair or replacements of various system components during the next twenty years. The capital items listed are those that are typically the responsibility of the Association and are derived from a list provided the Association with several items added as a result of the inspection. However, association bylaws vary, and therefore, which components are the responsibilities of the owner and which are the responsibilities of the Association can vary. The Association should confirm that the items listed should be financed by the reserve fund. This projection provides the following: An input sheet that defines all the criteria used for the financial alternatives, including the assumed inflation rate of 3% annually and rate of return on deposited reserve funds of 1.5% annually. A table that lists anticipated replacement and/or repair items complete with estimated remaining life expectancies, projected costs of replacement and/or repair, a frequency in years of when these items require replacement and/or repair, and a projection based on this frequency. A table and graph that represent end of year balances versus capital expenditures based on your current funding program and reserve balances, and alternatives to your current program. The provided graphs illustrate what effects the funding methods will have over the presented twenty-year period versus the anticipated capital expenditures. Note that based on our developed list of capital items and taking inflation into account; the current funding level is not adequate. The Association should bear in mind that unanticipated expenditures can always arise and maintenance of a significant reserve fund balance can be viewed as a way to avoid special assessments. We have included alternatives to your current reserve funding program and McConnell Condominiums Page 11
recommend that the board adopt an alternative that best reflects the objectives of the community. In summary they are as follows: Current Reserve Funding Rate: $20,121 per year ($8.83 per unit per month). Current Reserve Balance: $89,141 (projected 01/01/17 balance = current balance + remaining 2016 reserve contributions) Alternative 1: In 2017, increase the annual reserve contribution to $42,921 per year (average increase of $10.00/unit/month). Then, increase the annual reserve contribution by $22,800 every other year for the next 6 years (an average increase of $10.00/unit/month). This alternative is projected maintain a positive balance through the term of this study. Alternative 2: In 2017, increase the annual reserve contribution to $44,000. Then, increase the annual contribution by 15% every year for the next 7 years. This alternative is projected maintain a positive balance through the term of this study. Alternative 3: Maintain the current reserve funding rate of $20,121 per year. Two special assessments are projected to be required, each in the amount of $494,000 ($2,600 per unit). The first is projected to be required in 2022 and the second in 2027. Note that we do not endorse this alternative as special assessments are not a preferred method of funding reserves. Please note that the reserve fund study does not include typical annual maintenance items. Our assumption is that you already have an annual operating budget that provides for these typical, repetitive items. This includes miscellaneous repairs, lawn and grounds maintenance, routine minor painting, etc. We have focused on those significant, non-annual items where careful financial planning is important. Finally, please note that the estimates we have developed are based on 2016 dollars. Our reserve fund study does adjust for an estimated annual inflation and a given return on investment assuming that the indicated fund balances are maintained. 7.0 CONCLUSION The alternatives provided above will provide sufficient funding to meet estimated capital expenditures during the next twenty years. Further detail of the reserve fund analysis is provided in Appendix A. 8.0 LIMITATIONS The observations described in this study are valid on the date of the investigation and have been made under the conditions noted in the report. We prepared this study for the exclusive use of McConnell Condominiums. Criterium-Giles Engineers Inc. does not intend any other individual or party to rely upon this study without our express written consent. If another individual or party relies on this study, they shall indemnify and hold Criterium-Giles Engineers Inc. harmless for any damages, losses, or expenses they may incur as a result of its use. McConnell Condominiums Page 12
This study is limited to the visual observations made during our inspection. We did not remove surface materials, conduct any destructive or invasive testing, move furnishings or equipment, or undertake any digging or excavation. Accordingly, we cannot comment on the condition of systems that we could not see, such as buried structures and utilities, nor are we responsible for conditions that could not be seen or were not within the scope of our services at the time of the investigation. We did not undertake to completely assess the stability of the buildings or the underlying foundation soil since this effort would require excavation and destructive testing. Likewise, this is not a seismic assessment. We did not investigate the following areas: Buried utilities or infrastructure Concealed structural members or systems Unit interiors Inaccessible interior common areas We do not render an opinion on uninvestigated portions of the community. We did not perform any computations or other engineering analysis as part of this evaluation, nor did we conduct a comprehensive code compliance investigation. This study is not to be considered a warranty of condition, and no warranty is implied. The appendices are an integral part of this report and must be included in any review. Members of the Criterium-Giles Engineers team working on this reserve study are not members of, or otherwise associated with the association. Criterium-Giles Engineers has disclosed any other involvement with the association that could result in conflicts of interest. Information provided by the official representative of the association regarding financial, physical, quantity, or historical issues, will be deemed reliable by Criterium-Giles Engineers. The reserve balance presented in the Reserve Study is based upon information provided and was not audited. Information provided about reserve projects will be considered reliable. Any on-site inspection should not be considered a project audit or quality inspection. Criterium-Giles Engineers is not aware of any additional material issues which, if not disclosed, would cause a distortion of the association s situation. In our Reserve Fund Analysis, we have provided estimated costs. These costs are based on our general knowledge of building systems and the contracting and construction industry. When appropriate, we have relied on standard sources, such as Means Building Construction Cost Data, to develop estimates. However, for items that we have developed costs (e.g.: structural repairs), no standard guide for developing such costs exists. Actual costs can vary significantly, based on the availability of qualified contractors to do the work, as well as many other variables. We cannot be responsible for the specific cost estimates provided. We have performed no design work as part of this study, nor have we obtained competitive quotations or estimates from contractors as this also McConnell Condominiums Page 13
Appendix A: RESERVE FUND PROJECTIONS
Itemized Worksheet Capital Item Reserve Frequency Remaining To Be Replaced Quantity Unit cost Requirement (*) (yrs**) Life (yrs) Information Source Site Crack fill, seal coat, stripe asphalt paving 16,500 SY $2.00 $33,000.00 7 0 Resurface asphalt paving 16,500 SY $12.00 $198,000.00 25 12 Repair sections of concrete curb and gutter 425 LF $40.00 $17,000.00 10 9 5% every 10 years Repair sections of concrete flatwork 135 SY $95.00 $12,825.00 10 9 5% every 10 years Drainage improvements 1 LS $15,000.00 $15,000.00 5 0 Replace timber retaining walls 120 SF $40.00 $4,800.00 20 0 Replace mailboxes 20 EA $1,800.00 $36,000.00 30 18 Building Exterior Paint exterior doors, shutters, repair siding 1 LS $47,500.00 $47,500.00 10 0 Replace roofs phase 1 315 SQ $265.00 $83,475.00 20 5 Bldgs constructed in 2002 Replace roofs phase 2 450 SQ $265.00 $119,250.00 20 6 Bldgs constructed in 2003 Replace roofs phase 3 355 SQ $265.00 $94,075.00 20 8 Bldgs constructed in 2004-2005 Replace roofs phase 4 435 SQ $265.00 $115,275.00 20 10 Bldgs constructed in 2006-2008 Replace common area windows 14 EA $550.00 $7,700.00 30 19 Building Interior Mechanical Replace common area exterior light fixtures 136 EA $125.00 $17,000.00 20 10 Replace common area life safety fixtures 153 EA $250.00 $38,250.00 20 10 smoke detectors, emergency lights, etc. Replace fire alarm control panels 6 EA $4,200.00 $25,200.00 15 4 Repair fire suppression systems 1 LS $15,000.00 $15,000.00 10 5 Repair/replace call boxes at condo buildings 28 EA $1,200.00 $33,600.00 15 5 Amenities Other * Costs are typically 10%± ** Reserve study is based on a 20 year projection of non-annual maintenance Totals $912,950.00 Total Over Term $1,141,475.00 Criterium Engineers Page 1 of 17 4/27/2016
Annual Expense By Year Year: 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 Year Number: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Site Crack fill, seal coat, stripe asphalt paving 33,000 0 0 0 0 0 0 33,000 0 0 0 0 0 0 33,000 0 Resurface asphalt paving 0 0 0 0 0 0 0 0 0 0 0 0 198,000 0 0 0 Repair sections of concrete curb and gutter 0 0 0 0 0 0 0 0 0 17,000 0 0 0 0 0 0 Repair sections of concrete flatwork 0 0 0 0 0 0 0 0 0 12,825 0 0 0 0 0 0 Drainage improvements 15,000 0 0 0 0 15,000 0 0 0 0 15,000 0 0 0 0 15,000 Replace timber retaining walls 4,800 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Replace mailboxes 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Building Exterior Paint exterior doors, shutters, repair siding 47,500 0 0 0 0 0 0 0 0 0 47,500 0 0 0 0 0 Replace roofs phase 1 0 0 0 0 0 83,475 0 0 0 0 0 0 0 0 0 0 Replace roofs phase 2 0 0 0 0 0 0 119,250 0 0 0 0 0 0 0 0 0 Replace roofs phase 3 0 0 0 0 0 0 0 0 94,075 0 0 0 0 0 0 0 Replace roofs phase 4 0 0 0 0 0 0 0 0 0 0 115,275 0 0 0 0 0 Replace common area windows 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Building Interior Mechanical Replace common area exterior light fixtures 0 0 0 0 0 0 0 0 0 0 17,000 0 0 0 0 0 Replace common area life safety fixtures 0 0 0 0 0 0 0 0 0 0 38,250 0 0 0 0 0 Replace fire alarm control panels 0 0 0 0 25,200 0 0 0 0 0 0 0 0 0 0 0 Repair fire suppression systems 0 0 0 0 0 15,000 0 0 0 0 0 0 0 0 0 15,000 Repair/replace call boxes at condo buildings 0 0 0 0 0 33,600 0 0 0 0 0 0 0 0 0 0 Amenities Other Total Costs 100,300 0 0 0 25,200 147,075 119,250 33,000 94,075 29,825 233,025 0 198,000 0 33,000 30,000 Total Costs Adjusted For 3% Inflation 100,300 0 0 0 28,363 170,500 142,391 40,586 119,171 38,915 313,166 0 282,301 0 49,915 46,739 Criterium Engineers Page 2 of 17 4/27/2016
Annual Expense By Year Site Crack fill, seal coat, stripe asphalt paving Resurface asphalt paving Repair sections of concrete curb and gutter Repair sections of concrete flatwork Drainage improvements Replace timber retaining walls Replace mailboxes Building Exterior Paint exterior doors, shutters, repair siding Replace roofs phase 1 Replace roofs phase 2 Replace roofs phase 3 Replace roofs phase 4 Replace common area windows Building Interior Mechanical Replace common area exterior light fixtures Replace common area life safety fixtures Replace fire alarm control panels Repair fire suppression systems Repair/replace call boxes at condo buildings Amenities Other Total Costs Total Costs Adjusted For 3% Inflation Year: Year Number: 2033 2034 2035 2036 17 18 19 20 0 0 0 0 0 0 0 0 0 0 0 17,000 0 0 0 12,825 0 0 0 0 0 0 0 0 0 0 36,000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 7,700 0 0 0 0 0 0 0 0 0 0 0 25,200 0 0 0 0 0 0 0 0 0 0 36,000 62,725 0 0 61,288 109,989 Criterium Engineers Page 3 of 17 4/27/2016
Reserve Study Worksheet General Information: 1 Organization: The Condominiums at McConnell Subdivision 2 Address: 3 Number of Units 190 4 Age of Building (in years) 14 5a Study Period (in years) 20 5b Normal Fiscal Year starts: January 1, 2017 5c Partial Fiscal Year starts: January 1, 2017 5d Partial Year Length: 12 months 6 Site Inspection Date April 19, 2016 7 Reserve Funds at start $89,141 8 Rate of Return on invested Reserve Funds (%) 1.5% 9 Inflation Rate (%) 3.0% 10 Current Funding Levels Existing Funding Levels Total/Month Total Annual Per Unit/Month Per Unit/Year Reserve Fund Contribution... $1,677 $20,121 $8.83 $105.90 Years Out Total Annual Per Unit Planned Special Assessment... 0 $0 $0 Balance Computed... ($1,008,732) 11 Alternative Reserve Fund Contribution Alternative 1 Level Funding with Steps Total/Month Total Annual Per Unit/Month Per Unit/Year Monthly Amount, (First Year)... $3,577 $42,921 $18.83 $225.90 Monthly Amount, (Last Year)... $9,277 $111,321 $48.83 $585.90 Balance Required Final Year... $75,181 Special Assessments: Years Out Total/Year Per Unit First Assessment... 0 $0 $0 Second Assessment... 0 $0 $0 Balance Computed... $615,773 Alternative 2 Escalating Funding at 15% per Year Total/Month Total Annual Per Unit/Month Per Unit/Year Monthly Amount, (First Year)... $3,700 $44,400 $19.47 $233.68 Monthly Amount, (Last Year)... $9,842 $118,105 $51.80 $621.60 Balance Required Final Year... $75,181 Base Escalation %... 15.00% Special Assessments: Years Out Total/Year Per Unit First Assessment... 0 $0 $0 Second Assessment... 0 $0 $0 Balance Computed... $696,339 Alternative 3 Escalating Funding with Special Assessments Total/Month Total Annual Per Unit/Month Per Unit/Year Monthly Amount, (First Year)... $1,677 $20,121 $8.83 $105.90 Monthly Amount, (Last Year)... $1,677 $20,121 $8.83 $105.90 Balance Required Final Year... $75,181 Base Escalation %... 0.00% Special Assessments: Years Out Total/Year Per Unit First Assessment... 6 Jan 2022 $494,000 $2,600 Second Assessment... 11 Jan 2027 $494,000 $2,600 Balance Computed... $18,542 Criterium Engineers Page 4 of 17 4/27/2016
Reserve Fund Worksheet Fiscal Years: Normal: Jan 2017 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 Partial: Jan 2017 (12 months) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Existing Funding Levels Beginning Reserve Fund Balance: Revenue: Special Assessments: Investment Earnings: Capital Expenditures: Ending Reserve Balance: $89,141 $9,096 $29,656 $50,523 $71,704 $64,414 ($85,965) ($208,235) ($228,700) ($327,750) ($346,544) ($639,589) ($619,468) ($881,648) ($861,527) $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $134 $438 $747 $1,060 $952 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $100,300 $0 $0 $0 $28,363 $170,500 $142,391 $40,586 $119,171 $38,915 $313,166 $0 $282,301 $0 $49,915 $9,096 $29,656 $50,523 $71,704 $64,414 ($85,965) ($208,235) ($228,700) ($327,750) ($346,544) ($639,589) ($619,468) ($881,648) ($861,527) ($891,321) Alternative 1, Level Funding with Steps Average Cap. Expenditure $75,181 Beginning Reserve Fund Balance: Revenue: Special Assessment #1: Special Assessment #2: Investment Earnings: Capital Expenditures: Ending Reserve Balance: $89,141 $32,238 $76,287 $144,138 $213,007 $277,262 $198,212 $169,650 $243,991 $239,682 $316,770 $116,649 $231,389 $61,316 $175,226 $42,921 $42,921 $65,721 $65,721 $88,521 $88,521 $111,321 $111,321 $111,321 $111,321 $111,321 $111,321 $111,321 $111,321 $111,321 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $476 $1,127 $2,130 $3,148 $4,097 $2,929 $2,507 $3,606 $3,542 $4,681 $1,724 $3,420 $906 $2,590 $3,549 $100,300 $0 $0 $0 $28,363 $170,500 $142,391 $40,586 $119,171 $38,915 $313,166 $0 $282,301 $0 $49,915 $32,238 $76,287 $144,138 $213,007 $277,262 $198,212 $169,650 $243,991 $239,682 $316,770 $116,649 $231,389 $61,316 $175,226 $240,181 Alternative 2, Escalating Funding at 15% per Year Beginning Reserve Fund Balance: Revenue: Special Assessment #1: Special Assessment #2: Investment Earnings: Capital Expenditures: Ending Reserve Balance: $89,141 $33,740 $86,072 $146,962 $217,707 $271,005 $192,656 $155,259 $236,270 $238,732 $322,691 $129,544 $251,363 $88,475 $209,679 $44,400 $51,060 $58,719 $67,527 $77,656 $89,304 $102,700 $118,105 $118,105 $118,105 $118,105 $118,105 $118,105 $118,105 $118,105 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $499 $1,272 $2,172 $3,217 $4,005 $2,847 $2,294 $3,492 $3,528 $4,769 $1,914 $3,715 $1,308 $3,099 $4,168 $100,300 $0 $0 $0 $28,363 $170,500 $142,391 $40,586 $119,171 $38,915 $313,166 $0 $282,301 $0 $49,915 $33,740 $86,072 $146,962 $217,707 $271,005 $192,656 $155,259 $236,270 $238,732 $322,691 $129,544 $251,363 $88,475 $209,679 $282,036 Alternative 3, Escalating Funding with Special Assessments Beginning Reserve Fund Balance: Revenue: Special Assessment #1: Special Assessment #2: Investment Earnings: Capital Expenditures: Ending Reserve Balance: $89,141 $9,096 $29,656 $50,523 $71,704 $64,414 $414,155 $296,264 $279,936 $183,599 $167,277 $368,232 $394,178 $133,979 $156,411 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $20,121 $0 $0 $0 $0 $0 $494,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $494,000 $0 $0 $0 $0 $134 $438 $747 $1,060 $952 $6,121 $4,378 $4,137 $2,713 $2,472 $0 $5,825 $1,980 $2,311 $1,899 $100,300 $0 $0 $0 $28,363 $170,500 $142,391 $40,586 $119,171 $38,915 $313,166 $0 $282,301 $0 $49,915 $9,096 $29,656 $50,523 $71,704 $64,414 $414,155 $296,264 $279,936 $183,599 $167,277 $368,232 $394,178 $133,979 $156,411 $128,516 Criterium Engineers Page 5 of 17 4/27/2016
Reserve Fund Worksheet Fiscal Years: Normal: Jan 2017 Partial: Jan 2017 (12 months) 2032 2033 2034 2035 2036 16 17 18 19 20 Existing Funding Levels Beginning Reserve Fund Balance: Revenue: Special Assessments: Investment Earnings: Capital Expenditures: Ending Reserve Balance: ($891,321) ($917,939) ($897,818) ($877,697) ($918,864) $20,121 $20,121 $20,121 $20,121 $20,121 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $46,739 $0 $0 $61,288 $109,989 ($917,939) ($897,818) ($877,697) ($918,864) ($1,008,732) Alternative 1, Level Funding wi Beginning Reserve Fund Balance: Revenue: Special Assessment #1: Special Assessment #2: Investment Earnings: Capital Expenditures: Ending Reserve Balance: $240,181 $309,335 $426,966 $546,361 $605,340 $111,321 $111,321 $111,321 $111,321 $111,321 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $4,571 $6,310 $8,074 $8,946 $9,100 $46,739 $0 $0 $61,288 $109,989 $309,335 $426,966 $546,361 $605,340 $615,773 Alternative 2, Escalating Fundin Beginning Reserve Fund Balance: Revenue: Special Assessment #1: Special Assessment #2: Investment Earnings: Capital Expenditures: Ending Reserve Balance: $282,036 $358,703 $483,960 $611,096 $677,932 $118,105 $118,105 $118,105 $118,105 $118,105 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $5,301 $7,152 $9,031 $10,019 $10,291 $46,739 $0 $0 $61,288 $109,989 $358,703 $483,960 $611,096 $677,932 $696,339 Alternative 3, Escalating Fundin Beginning Reserve Fund Balance: Revenue: Special Assessment #1: Special Assessment #2: Investment Earnings: Capital Expenditures: Ending Reserve Balance: $128,516 $103,426 $125,401 $147,704 $108,136 $20,121 $20,121 $20,121 $20,121 $20,121 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,528 $1,853 $2,183 $1,598 $274 $46,739 $0 $0 $61,288 $109,989 $103,426 $125,401 $147,704 $108,136 $18,542 Criterium Engineers Page 6 of 17 4/27/2016
Itemized Graph Categories Totals Site $457,450 Building Exterior $514,775 Building Interior $0 Mechanical $169,250 Amenities $0 Other $0 Total $1,141,475 Itemized Graph Site, $457,450 Site Building Exterior Building Interior Mechanical Amenities Other Other, $0 Amenities, $0 Mechanical, $169,250 Building Exterior, $514,775 Building Interior, $0 Criterium Engineers Page 7 of 17 4/27/2016
Itemized Funding Monthly Annual Balance Reserve Reserve Full Reserve Beginning Requiring Funding Funding Funding Percent Categories Requirement Balance Funding Required Required Balance Funded Site $457,450 $27,579 $429,871 $1,689 $20,267 $173,143 Building Exterior $514,775 $49,456 $465,319 $4,499 $53,986 $310,487 Building Interior $0 $0 $0 $0 $0 $0 Mechanical $169,250 $12,106 $157,144 $1,618 $19,417 $76,005 Amenities $0 $0 $0 $0 $0 $0 Other $0 $0 $0 $0 $0 $0 Totals $1,141,475 $89,141 $1,052,334 $7,806 $93,670 $559,635 15.9% Criterium Engineers Page 8 of 17 4/27/2016
Existing Funding Levels Beginning Year Reserve Fund Fee Special Investment Capital Ending Year Number Balance Revenue Assessments Earnings Expenditures Balance 2017 1 $89,141 $20,121 $0 $134 $100,300 $9,096 2018 2 $9,096 $20,121 $0 $438 $0 $29,656 2019 3 $29,656 $20,121 $0 $747 $0 $50,523 2020 4 $50,523 $20,121 $0 $1,060 $0 $71,704 2021 5 $71,704 $20,121 $0 $952 $28,363 $64,414 2022 6 $64,414 $20,121 $0 $0 $170,500 ($85,965) 2023 7 ($85,965) $20,121 $0 $0 $142,391 ($208,235) 2024 8 ($208,235) $20,121 $0 $0 $40,586 ($228,700) 2025 9 ($228,700) $20,121 $0 $0 $119,171 ($327,750) 2026 10 ($327,750) $20,121 $0 $0 $38,915 ($346,544) 2027 11 ($346,544) $20,121 $0 $0 $313,166 ($639,589) 2028 12 ($639,589) $20,121 $0 $0 $0 ($619,468) 2029 13 ($619,468) $20,121 $0 $0 $282,301 ($881,648) 2030 14 ($881,648) $20,121 $0 $0 $0 ($861,527) 2031 15 ($861,527) $20,121 $0 $0 $49,915 ($891,321) 2032 16 ($891,321) $20,121 $0 $0 $46,739 ($917,939) 2033 17 ($917,939) $20,121 $0 $0 $0 ($897,818) 2034 18 ($897,818) $20,121 $0 $0 $0 ($877,697) 2035 19 ($877,697) $20,121 $0 $0 $61,288 ($918,864) 2036 20 ($918,864) $20,121 $0 $0 $109,989 ($1,008,732) Criterium Engineers Page 9 of 17 4/27/2016
Existing Funding Levels Beginning Balance as of start of year beginning Jan 2017: $89,141 CONTRIBUTIONS SPECIAL ASSESSMENTS AMOUNT Totals $20,121.00 per year Per Year $0 Per Unit $0 $105.90 per unit per year $1,676.75 per month $8.83 per unit per month Projected Annual Funding and Expenditures: Year: 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 Year Number: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 End of Year Reserve Fund Balance 9,096 29,656 50,523 71,704 64,414 (85,965) (208,235) (228,700) (327,750) (346,544) (639,589) (619,468) (881,648) (861,527) (891,321) Capital Expenditures: 100,300 - - - 28,363 170,500 142,391 40,586 119,171 38,915 313,166-282,301-49,915 Total Revenue (all sources) 20,255 20,559 20,868 21,181 21,073 20,121 20,121 20,121 20,121 20,121 20,121 20,121 20,121 20,121 20,121 Year: 2032 2033 2034 2035 2036 Year Number: 16 17 18 19 20 End of Year Reserve Fund Balance (917,939) (897,818) (877,697) (918,864) (1,008,732) Capital Expenditures: 46,739 - - 61,288 109,989 Total Revenue (all sources) 20,121 20,121 20,121 20,121 20,121 Existing Funding Levels 200,000-2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 (200,000) (400,000) Dollars (600,000) (800,000) (1,000,000) (1,200,000) Funding Years Criterium Engineers Page 10 of 17 4/27/2016
Alternative 1: Level Funding with Steps Beginning Year Reserve Fund Fee Special Special Investment Capital Ending Year Number Balance Revenue Assessments 1 Assessments 2 Earnings Expenditures Balance 2017 1 $89,141 $42,921 $0 $0 $476 $100,300 $32,238 2018 2 $32,238 $42,921 $0 $0 $1,127 $0 $76,287 2019 3 $76,287 $65,721 $0 $0 $2,130 $0 $144,138 2020 4 $144,138 $65,721 $0 $0 $3,148 $0 $213,007 2021 5 $213,007 $88,521 $0 $0 $4,097 $28,363 $277,262 2022 6 $277,262 $88,521 $0 $0 $2,929 $170,500 $198,212 2023 7 $198,212 $111,321 $0 $0 $2,507 $142,391 $169,650 2024 8 $169,650 $111,321 $0 $0 $3,606 $40,586 $243,991 2025 9 $243,991 $111,321 $0 $0 $3,542 $119,171 $239,682 2026 10 $239,682 $111,321 $0 $0 $4,681 $38,915 $316,770 2027 11 $316,770 $111,321 $0 $0 $1,724 $313,166 $116,649 2028 12 $116,649 $111,321 $0 $0 $3,420 $0 $231,389 2029 13 $231,389 $111,321 $0 $0 $906 $282,301 $61,316 2030 14 $61,316 $111,321 $0 $0 $2,590 $0 $175,226 2031 15 $175,226 $111,321 $0 $0 $3,549 $49,915 $240,181 2032 16 $240,181 $111,321 $0 $0 $4,571 $46,739 $309,335 2033 17 $309,335 $111,321 $0 $0 $6,310 $0 $426,966 2034 18 $426,966 $111,321 $0 $0 $8,074 $0 $546,361 2035 19 $546,361 $111,321 $0 $0 $8,946 $61,288 $605,340 2036 20 $605,340 $111,321 $0 $0 $9,100 $109,989 $615,773 Criterium Engineers Page 11 of 17 4/27/2016
Alternative 1: Level Funding with Steps Beginning Balance as of start of year beginning Jan 2017: $89,141 CONTRIBUTIONS SPECIAL ASSESSMENTS SETTINGS (analyzed by year) FIRST YR LAST YR Totals Starting amount ($): 3576.75 $42,921.00 $111,321.00 per year First Per Year $0 Per Unit $0 Increment by ($): 1900 $225.90 $585.90 per unit per year Second Per Year $0 Per Unit $0 Every 2 year $3,576.75 $9,276.75 per month Frequency: 3 time $18.83 $48.83 per unit per month Projected Annual Funding and Expenditures: Year: 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 Year Number: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 End of Year Reserve Fund Balance 32,238 76,287 144,138 213,007 277,262 198,212 169,650 243,991 239,682 316,770 116,649 231,389 61,316 175,226 240,181 Capital Expenditures: 100,300 - - - 28,363 170,500 142,391 40,586 119,171 38,915 313,166-282,301-49,915 Total Revenue (all sources) 43,397 44,048 67,851 68,869 92,618 91,450 113,828 114,927 114,863 116,002 113,045 114,741 112,227 113,911 114,870 Year: 2032 2033 2034 2035 2036 Year Number: 16 17 18 19 20 End of Year Reserve Fund Balance 309,335 426,966 546,361 605,340 615,773 Capital Expenditures: 46,739 - - 61,288 109,989 Total Revenue (all sources) 115,892 117,631 119,395 120,267 120,421 Alternative 1: Level Funding with Steps 700,000 600,000 500,000 400,000 Dollars 300,000 200,000 100,000-2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 Funding Years Criterium Engineers Page 12 of 17 4/27/2016
Alternative 2: Escalating Funding at 15% per Year Beginning Year Reserve Fund Fee Special Special Investment Capital Ending Year Number Balance Revenue Assessments 1 Assessments 2 Earnings Expenditures Balance 2017 1 $89,141 $44,400 $0 $0 $499 $100,300 $33,740 2018 2 $33,740 $51,060 $0 $0 $1,272 $0 $86,072 2019 3 $86,072 $58,719 $0 $0 $2,172 $0 $146,962 2020 4 $146,962 $67,527 $0 $0 $3,217 $0 $217,707 2021 5 $217,707 $77,656 $0 $0 $4,005 $28,363 $271,005 2022 6 $271,005 $89,304 $0 $0 $2,847 $170,500 $192,656 2023 7 $192,656 $102,700 $0 $0 $2,294 $142,391 $155,259 2024 8 $155,259 $118,105 $0 $0 $3,492 $40,586 $236,270 2025 9 $236,270 $118,105 $0 $0 $3,528 $119,171 $238,732 2026 10 $238,732 $118,105 $0 $0 $4,769 $38,915 $322,691 2027 11 $322,691 $118,105 $0 $0 $1,914 $313,166 $129,544 2028 12 $129,544 $118,105 $0 $0 $3,715 $0 $251,363 2029 13 $251,363 $118,105 $0 $0 $1,308 $282,301 $88,475 2030 14 $88,475 $118,105 $0 $0 $3,099 $0 $209,679 2031 15 $209,679 $118,105 $0 $0 $4,168 $49,915 $282,036 2032 16 $282,036 $118,105 $0 $0 $5,301 $46,739 $358,703 2033 17 $358,703 $118,105 $0 $0 $7,152 $0 $483,960 2034 18 $483,960 $118,105 $0 $0 $9,031 $0 $611,096 2035 19 $611,096 $118,105 $0 $0 $10,019 $61,288 $677,932 2036 20 $677,932 $118,105 $0 $0 $10,291 $109,989 $696,339 Criterium Engineers Page 13 of 17 4/27/2016
Alternative 2: Escalating Funding at 15% per Year Beginning Balance as of start of year beginning Jan 2017: $89,141 CONTRIBUTIONS SPECIAL ASSESSMENTS SETTINGS (analyzed by year) FIRST YR LAST YR Totals Starting amount ($): 3700 $44,400.00 $118,104.88 per year First Per Year $0 Per Unit $0 Increment by (%): 15 $233.68 $621.60 per unit per year Second Per Year $0 Per Unit $0 Step (%): $3,700.00 $9,842.07 per month Every 1 year $19.47 $51.80 per unit per month Frequency: 7 time Projected Annual Funding and Expenditures: Year: 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 Year Number: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 End of Year Reserve Fund Balance 33,740 86,072 146,962 217,707 271,005 192,656 155,259 236,270 238,732 322,691 129,544 251,363 88,475 209,679 282,036 Capital Expenditures: 100,300 - - - 28,363 170,500 142,391 40,586 119,171 38,915 313,166-282,301-49,915 Total Revenue (all sources) 44,899 52,332 60,891 70,744 81,661 92,151 104,994 121,597 121,633 122,874 120,019 121,820 119,412 121,204 122,273 Year: 2032 2033 2034 2035 2036 Year Number: 16 17 18 19 20 End of Year Reserve Fund Balance 358,703 483,960 611,096 677,932 696,339 Capital Expenditures: 46,739 - - 61,288 109,989 Total Revenue (all sources) 123,406 125,257 127,136 128,124 128,396 Alternative 2: Escalating Funding at 15% per Year 800,000 700,000 600,000 500,000 Dollars 400,000 300,000 200,000 100,000-2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 Funding Years Criterium Engineers Page 14 of 17 4/27/2016
Alternative 3: Escalating Funding with Special Assessments Beginning Year Reserve Fund Fee Special Special Investment Capital Ending Year Number Balance Revenue Assessments 1 Assessments 2 Earnings Expenditures Balance 2017 1 $89,141 $20,121 $0 $0 $134 $100,300 $9,096 2018 2 $9,096 $20,121 $0 $0 $438 $0 $29,656 2019 3 $29,656 $20,121 $0 $0 $747 $0 $50,523 2020 4 $50,523 $20,121 $0 $0 $1,060 $0 $71,704 2021 5 $71,704 $20,121 $0 $0 $952 $28,363 $64,414 2022 6 $64,414 $20,121 $494,000 $0 $6,121 $170,500 $414,155 2023 7 $414,155 $20,121 $0 $0 $4,378 $142,391 $296,264 2024 8 $296,264 $20,121 $0 $0 $4,137 $40,586 $279,936 2025 9 $279,936 $20,121 $0 $0 $2,713 $119,171 $183,599 2026 10 $183,599 $20,121 $0 $0 $2,472 $38,915 $167,277 2027 11 $167,277 $20,121 $0 $494,000 $0 $313,166 $368,232 2028 12 $368,232 $20,121 $0 $0 $5,825 $0 $394,178 2029 13 $394,178 $20,121 $0 $0 $1,980 $282,301 $133,979 2030 14 $133,979 $20,121 $0 $0 $2,311 $0 $156,411 2031 15 $156,411 $20,121 $0 $0 $1,899 $49,915 $128,516 2032 16 $128,516 $20,121 $0 $0 $1,528 $46,739 $103,426 2033 17 $103,426 $20,121 $0 $0 $1,853 $0 $125,401 2034 18 $125,401 $20,121 $0 $0 $2,183 $0 $147,704 2035 19 $147,704 $20,121 $0 $0 $1,598 $61,288 $108,136 2036 20 $108,136 $20,121 $0 $0 $274 $109,989 $18,542 Criterium Engineers Page 15 of 17 4/27/2016
Alternative 3: Escalating Funding with Special Assessments Beginning Balance as of start of year beginning Jan 2017: $89,141 CONTRIBUTIONS SPECIAL ASSESSMENTS SETTINGS (analyzed by year) FIRST YR LAST YR Totals Starting amount ($): 1676.75 $20,121.00 $20,121.00 per year First Jan 2022 Per Year $494,000 Per Unit $2,600 Increment by (%): 0 $105.90 $105.90 per unit per year Second Jan 2027 Per Year $494,000 Per Unit $2,600 Step (%): 0 $1,676.75 $1,676.75 per month Every 3 year $8.83 $8.83 per unit per month Frequency: 3 time Projected Annual Funding and Expenditures: Year: 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 Year Number: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 End of Year Reserve Fund Balance 9,096 29,656 50,523 71,704 64,414 414,155 296,264 279,936 183,599 167,277 368,232 394,178 133,979 156,411 128,516 Capital Expenditures: 100,300 - - - 28,363 170,500 142,391 40,586 119,171 38,915 313,166-282,301-49,915 Total Revenue (all sources) 20,255 20,559 20,868 21,181 21,073 520,242 24,499 24,258 22,834 22,593 514,121 25,946 22,101 22,432 22,020 Year: 2032 2033 2034 2035 2036 Year Number: 16 17 18 19 20 End of Year Reserve Fund Balance 103,426 125,401 147,704 108,136 18,542 Capital Expenditures: 46,739 - - 61,288 109,989 Total Revenue (all sources) 21,649 21,974 22,304 21,719 20,395 Alternative 3: Escalating Funding with Special Assessments 450,000 400,000 350,000 300,000 Dollars 250,000 200,000 150,000 100,000 50,000-2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 Funding Years Criterium Engineers Page 16 of 17 4/27/2016
Summary of Reserve Balances Year Yearly Year Number Expenditures Alt. 1 Alt. 2 Alt. 3 2017 1 $100,300 $32,238 $33,740 $9,096 2018 2 $0 $76,287 $86,072 $29,656 2019 3 $0 $144,138 $146,962 $50,523 2020 4 $0 $213,007 $217,707 $71,704 2021 5 $28,363 $277,262 $271,005 $64,414 2022 6 $170,500 $198,212 $192,656 $414,155 2023 7 $142,391 $169,650 $155,259 $296,264 2024 8 $40,586 $243,991 $236,270 $279,936 2025 9 $119,171 $239,682 $238,732 $183,599 2026 10 $38,915 $316,770 $322,691 $167,277 2027 11 $313,166 $116,649 $129,544 $368,232 2028 12 $0 $231,389 $251,363 $394,178 2029 13 $282,301 $61,316 $88,475 $133,979 2030 14 $0 $175,226 $209,679 $156,411 2031 15 $49,915 $240,181 $282,036 $128,516 2032 16 $46,739 $309,335 $358,703 $103,426 2033 17 $0 $426,966 $483,960 $125,401 2034 18 $0 $546,361 $611,096 $147,704 2035 19 $61,288 $605,340 $677,932 $108,136 2036 20 $109,989 $615,773 $696,339 $18,542 Summary of Reserve Balances $800,000 $700,000 $600,000 Dollars $500,000 $400,000 $300,000 $200,000 $100,000 $0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Funding Years Alt. 1 Alt. 2 Alt. 3 Criterium Engineers Page 17 of 17 4/27/2016
Appendix B: PROJECT PHOTOGRAPHS
Location: Photo Taken by: Date: McConnell Condominiums Kevin R. Giles, RS 04/19/16 Description: View of three story condominium buildings. Photo Number 1 Description: View of typical quadraplex style buildings. Concrete sidewalks in common areas. Photo Number 2
Location: Photo Taken by: Date: McConnell Condominiums Kevin R. Giles, RS 04/19/16 Description: View of soil erosion areas on embankments. Photo Number 3 Description: View of erosion developing around building foundations. Photo Number 4
Location: Photo Taken by: Date: McConnell Condominiums Kevin R. Giles, RS 04/19/16 Description: View of leaning timber retaining wall. Photo Number 5 Description: General view of asphalt paving. Photo Number 6
Location: Photo Taken by: Date: McConnell Condominiums Kevin R. Giles, RS 04/19/16 Description: View of longitudinal cracking developing in asphalt paving. Photo Number 7 Description: General view of asphalt paving, concrete curb and gutter. Photo Number 8
Location: Photo Taken by: Date: McConnell Condominiums Kevin R. Giles, RS 04/19/16 Description: General view of condominium buildings. Photo Number 9 Description: Building roofs, vent boots. Photo Number 10
Location: Photo Taken by: Date: McConnell Condominiums Kevin R. Giles, RS 04/19/16 Description: Missing shutters noted in areas of buildings. Photo Number 11 Description: Close up view of flaking paint at doorway of building. Photo Number 12
Location: Photo Taken by: Date: McConnell Condominiums Kevin R. Giles, RS 04/19/16 Description: View of flaking paint on building trim components. Photo Number 13 Description: View of interior breezeway with ceiling light fixture and emergency lights. Photo Number 14
Location: Photo Taken by: Date: McConnell Condominiums Kevin R. Giles, RS 04/19/16 Description: Fire alarm control panel, fire suppression system components. Photo Number 15 Description: Wood framed steps and decking in interior stairwells. Photo Number 16
Location: Photo Taken by: Date: McConnell Condominiums Kevin R. Giles, RS 04/19/16 Description: Smoke detector, painted drywall in stairwells. Photo Number 17 Description: Mail kiosks. Photo Number 18