Our financial crisis continues to be the big news for us. Our new financial statements clarify the difference between our regular annual operations and our capital maintenance. This gives us a clearer picture of our financial resources.
The basic news is simple: our buildings and grounds have deteriorating conditions in a backlog of capital maintenance projects in the range of $900,000, and we are now also facing the prospect of roof replacements in the range of $525,000 over the next five to ten years. As of February, we had $55,000 as our Reserve, though $18,000 of that is restricted to work on chimneys. The money from our regular monthly dues goes right out again as we encounter unexpected emergencies (anything health and safety-related).
The figures for our backlog are broad estimates, underscoring the need for the Reserve Study that is now under way. As noted in my letter to homeowners, the Board has directed our Director of Facilities and Operations, Frank Gaddini, to inspect all the units in the development, including their inner patios or courtyards, so that we can make sure we have taken into account all needed capital maintenance both for our backlog and to know how much we need in Reserves to avoid this kind of crisis in the future.
This is an additional burden on Frank’s time, so I am stepping in take up the work of fielding questions and other communications from homeowners. To help us with this, please call or email me instead of Frank (email will be faster). While I will do my best to respond promptly, response time will be slower than it has been.
I know this is grim news, and we certainly have a deep hole to climb out of. There’s a glimmer of hope for the future, though. We have spent a fair amount of money on repairing dry rot in our wood siding and structures, but much of that has been caused or worsened by neglect. When properly maintained – meaning properly painted and weatherproofed – wood siding can last a very long time. When painting goes neglected, however, siding can start to deteriorate, and then after a while the structure below the siding begins to be damaged. At each stage of deterioration, the costs to repair go up dramatically. With the proper Reserves in hand, and some reasonable vigilance in oversight, we can keep our buildings in excellent condition.
These documents contain the minutes from Board of Directors and special meetings, plus other useful information.