Agenda 2014 Highlights 2015 Proposed Budget Key Expense Trends - - PDF document

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2015 Budget Meeting

December 10, 2014

Agenda

2014 Highlights 2015 Proposed Budget Key Expense Trends Your Capital Reserve Our Website Resources Stucco Wall Replacement Project Questions

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2014 Highlights

Replaced Mailboxes (capital expense) Garage Door Painting

New House Numbers (Social Club) Mildew Walls Cleaned Updated Alarm System The Big Snow Expense Hail damage claim receipts $62,636

2015 Operating Budget

2014 Budget 2014 Projected 2015 Budget Increase

(2015 vs 2014)

Operating Expenses 675,648 668,458 682,155 13,697 Quarterly Assessment 1,224 1,224 1,236 12 Special Snow Assessment 69,000 (69,000) Total Spending 675,648 737,458 682,155 (55,303) Assessment Per Home 4,896 4,944 48

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2015 Budget (Fixed)

Fixed Contract Cost 2015 Budget 2014 Projected Incr. % Incr. Quarterly Assessment

Master Association

234,043 234,043 0% 424 Landscape Maintenance 126,109 124,491 1,618 1.3% 228 Property & Liability Insurance 47,994 56,032 (8,038)

• 14.3%

87 Trash Removal 24,840 24,840 0% 45 Management Fees 35,322 35,322 0% 64 Total Fixed Contract 468,308 474,728 (6,420)

• 1.4%

848

2015 Budget (Variable)

Variable Cost 2015 Budget 2014 Projected Incr. % Incr. Quarterly Assessment * Snow Removal 61,500 60,000 1,500 2.5% 111

• Misc. Bldg. Maintenance

29,000 32,248 (3,200)

• 10.1%

53 One Time Projects 20,000 47,605 (27,605)

• 58.0%

36 Landscape Improvements 4,000 4,000 0% 7 Large Tree Pruning 4,000 3,850 150 3.9% 7 General Maintenance 7,000 7,556 (556)

• 7.4%

13 General Administration 4,960 4,960 0% 9 Common Utilities 2,500 2,500 0% 5 Reserve Contribution 80,887 31,011 49,876 160.8% 147 Total Variable Cost 213,847 193,730 20,117 10.4% 387 * Note: Excludes an additional $ 69,000 spent

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2015 Budget Recap

Operating Expenses 2015 Budget 2014 Projected Incr. % Incr. Quarterly Assessment Total Fixed Expense 468,308 474,728 (6,420)

• 1.4%

848 Total Variable Expense 213,847 193,730 20,117 10.4% 387 Total Operating Expense 682,155 668,458 13,697 2.0% 1,236 Total Revenue Quarterly Assessment 682,155 1,236 675,489 1224 6,666 12 1.0% 1.0% 1,236

123 123 124 124 126 72 20 40 129 62 33 48 20 23 35 22 32 29 4 6 5 8 7 10 20 30 40 50 60 70 80 90 100 110 120 130 2011 2012 2013 2014 2015 THOUSANDS

Yardley Key Expense Trends

HM Landscape Snow Projects Misc Bldg Genl Maint

HM Landscape Snow Removal Projects Misc Bldg Genl Maint [Note: 2010 SNOW $75K]

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Your Capital Reserve

Savings fund for Roofs. Roads, etc. As of December 1, 2014

Allocation Current Target Stocks 45.9% 40 % Bonds 25.0% 50 % Short-term Reserve 29.10% 10 %

Note: Next planned capital expenditure is in 2021 for asphalt paving.

Value: $1,095,726 ($7,940 per owner)

Visit Yardley Web Site to view Village Files

Link to Yardley web page: www.yardleyvillage.com Or: http://hersheysmill.org/villages/s-to-z-villages/yardley/

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Stucco Wall Replacement Project Scope Time Table Status of Legal Suit Expenses

Stucco Wall Replacement Project

GENERAL STATEMENT All estimates stated are Joe Ciasullo’s. The estimates are based on our current contractors proposal to complete houses1640, 1641,1642 and applying such information to the number and type of houses being discussed. The estimates do not include the replacement cost of new windows and sliding doors, or the legal and engineering consulting costs

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Scope

1) Higher than normal moisture readings detected at 66 areas on 36 houses in the 2013/2014 probes. 2) High readings primarily below windows, but some sliding doors and dormers. 3) Invasive testing completed at four houses: 1640, 1641, 1642 & 1659. 4) Testing involved cutting stucco & cladding away from 2 x 2 foot square at specific locations to determine the damage and possible causes. 5) Primary causes appear to be water entering the wall due to the poor installation of the windows and sliding doors and other deficiencies in the stucco system. 6) Problems appear to be systemic in nature and not restricted to the current 36 houses. 7) Current estimate to repair & re-stucco all walls except fronts of all village houses is estimated at $3.8 million

Time Table

1) Current plan is to complete the repair of the walls with existing high moisture readings on 12 houses in 2015, and the remaining 24 houses in 2016. The estimated cost of the 36 houses is $850,000. 2) It is expected that such work could commence in the April/May timeframe. 3) Prior to the April timeframe, the board intends to determine the viability of utilizing less expensive siding material such as: Hardie Plank or Premium Vinyl.

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New Siding Materials

4) New siding materials creates added issues:

a) Requires addressing entire buildings rather than individual houses. b) Adds 29 more houses, for a total of 65. c) While cost per unit is reduced by 15% to 39%, it also adds $298,000 or $743,000 to initial outlay of $850,000. d) Changes the look of village over a period of time if started immediately. e) Current estimate to repair all walls, except the front of all village houses: with Hardie Plank $3.2 million. with Premium Vinyl $2.3 million. Compared to $3.8 million for stucco.

Status of Legal Suit

1) Complaint was filed against K.Hovnanian at Hershey’s Mill, Inc. and K.Hovnanian Construction Mgmt. Inc. on August 20, 2014, in the Court of Common Pleas, Chester County, PA. 2) As expected, K.Hovnanian’s legal reps responded on October 2, 2014, denying any responsibility for the specific issues. 3) Our response demanding jury trial was filed on October 30, 2014. 4) We received our first set of interrogatories from K.Hovnanian’s legal reps on November 20, 2014, for which we are currently compiling appropriate responses. 5) We have barely scratched the surface of the normal legal steps leading to a conclusion. 6) Our legal counsel, two separate engineering experts, and our repair contractor have supported the validity of our legal claim against K.Hovnanian

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Expenses

1) Expenses incurred to date by Yardley Village H.O.A. through October 31, 2014:

2013 Special Assessment Capital Reserves Total Expenses Village Moisture Probes 87,896 Selected Moisture Retests 1,500 Engineering Services 24,191 Repairs: 1632 & 1637 18,402 Legal 34,267 Total Expense-To-Date 87,896 78,360 166,256

2) Expect legal and engineering services to reach $150,000 by the end of 2015, and could reach at least $400,000 before conclusion.