Capital Reserve Fund

  Every year as members of The Landings Association, we pay our Annual Property Owner Dues. For the last three years, the dues have been $1,850. A portion of the Annual Dues gets allocated to the Capital Reserve Fund. The Capital Reserve Fund is restricted in use, only for major repair and replacement of assets and infrastructure such as Roads, Community Paths, Bridges, Storm Drains, and Heavy Equipment. These assets are inventoried, tracked, and scheduled for replacement at the end of their useful life in the Association’s Capital Asset Management Plan (CAMP). The Landings Association owns and manages an extensive and diverse set of capital assets with an estimated replacement value of close to $80M, maintained and replaced through the Capital Reserve Fund.

• How much money is needed in the Capital Reserve Fund? National Reserve Standards require a minimum 30% to 70% fully funded reserve balance for an “adequate” level of funding.
• We just had a Reserve Study. What did that tell us? The Reserve Study completed in January 2020 determined the Capital Reserve Fund contributions are too low to maintain The Landings Association’s assets in the near-term future. The required scheduled replacement costs rapidly erode the fund balance as illustrated in the chart below.

 

• What does this mean for the upcoming Annual Dues vote? Given that the Reserve Study determined that the Capital Reserve Fund is too low to maintain the Association’s assets in the future, the Proposal increases the dues over a three-year period to meet the 30% minimum funding National Reserve Standards by the end of 2023.
• Why is an increase needed? An increase is needed to prevent a rapid and visible decline in the quality and character of the community, the accompanying decline in community  property values, and to prevent increased costs associated with deferred maintenance.
• Will residents have a chance to ask questions and find out more information about the upcoming Annual Dues vote? Yes. The Association and the Board will be scheduling a mix of in-person and virtual sessions over the next several months to answer questions and provide information on the upcoming vote.

Please stay tuned to your Association communications for more information.