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| LIFE IN SOLERA | MARCH 2022 | 3 FROM THE BOARD By Pat King Living in an HOA has its pros and cons. We have the security of living in a gated community with a community pool, tennis, pickleball and bocce ball sports courts, the best Fitness Center in the Pass, a landscape company that keeps our Common Areas looking great, and a Management Company that keeps it all running smoothly! These shared benefits would be too expensive for most of us to own and maintain, but with the expenses divided among our 1,290 homeowners, the benefits far outweigh the cost that each one of us pay in our monthly assessments. We are fortunate to have many homeowners on Committees who assist the Board and Management to ensure an efficiently run Association. One of those committees is our Finance Committee. They manage our investments and closely monitor our yearly budget. As we move into March and April, our Finance Committee will be putting together our 2022-23 budget. Our Finance Committee Chairman, Wayne Otte, along with Jim Tatman, Becky Spalding, and Alternate Peter Marchi, will carefully review our current budget and with input from Management, determine what our budget will be for the coming year. The 2022-23 budget will be presented in April. As we all know, prices have increased in about every area of our lives and next year's budget will likely show some increases. One important cost in our budget is our contribution to our Reserve Account. When I teach the New Residents Class "Living in an HOA," I ask, "How many of you checked our Association's Reserve Account balance before you moved in?" I seldom get a hand raised! Hint: A well-funded Reserve Account protects residents from any Special Assessments. Reserve Accounts are not a required cost in California, so many HOAs do not fund a Reserve Account. When an expense comes along, each homeowner gets a special assessment and this can be very expensive. When Pulte turned ownership over to Solera, they set up a Reserve Account. For the past 15 years, homeowners have paid their assessments which include a $40 contribution to the Reserve Account. Some may find it boring to know how our Reserves work, but I do not. I do not want a Special Assessment. This is how it works: Our Association contracts with "Association Reserves" to 'study' our facility and to identify our Association's predictable, long-term expenses, i.e., roads, fences, pools, air conditioners, clubhouse, painting, etc. They put together a responsible funding plan so that each homeowner pays their fair share each month to ensure these items are maintained appropriately. Our Association has two types of expenses: the day-to-day operating expenses and the reserve expenses incurred for the replacement of major components the Association is responsible to maintain. Our Association Reserves representative came out in early 2021 for an onsite visit and reviewed all the items that have a 'useful life.' A determination was made of how long each item will last and how much it will cost to be eventually replaced. When an item has reached '0' life or needs to be replaced because it breaks, there is money in the account to replace it. There were several Reserve items that were due to be replaced a year or so before the remodel actually began. We knew they would be replaced during the remodel, so we waited until then. We used approximately $375,000 from the Capital Improvement Fund and approximately $780,000 was taken from the Reserve Account, which included these deferred items.

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