What Our Reserve Study Reveals and Our Capital Improvement Plan.

The following information was taken from the Reserve Study that was started December 21th, 2016. I have (2) two copies of the Reserve Study. One was downloaded from the www.gh-cp.org website in its entirety, and one printed copy was hand delivered to my home, by a current Board Member of the Glebe Harbor – Cabin Point Association Inc Board of Directors.

I completed the Board Leadership Program given by the Community Associations Institute in 2014. I have also completed two on-line seminars dealing strictly with how to interpret Reserve Studies, as they apply to Home Owners/Condo Owners/Property Owners Associations. The company that wrote our reserve study report, used the guidelines developed by the Community Associations Institute.

Any words in BOLD font, are simply meant to bring attention to the paragraph, word, figure or sentence. Any text that is Underlined is a reference taken from a website. Any text that is in “Italicize font”, was taken from the original Reserve Study verbatim. When I make a written statement in this report concerning my opinion of this Reserve Study, my words will be in “Regular font”.

When Miller – Dodson and Associates wrote our reserve study in December 2016, it seems it was done so with the understanding that the Glebe Harbor – Cabin Point Sanitary District, was a Property Owners Association and their calculations would be based on 450 homes paying monthly dues. I assume this from the language they used to describe our Communities.

Description. Glebe Harbor Cabin Point is a property owners association located in Montross, Virginia. Constructed in the 1960’s, the community consists of 450 single family homes”.

It seems as if our Board of Directors have now renamed this “Reserve Study”, as a “Capital Improvement Plan Study”. I will address the Reserve Study findings first, and then the Capital Improvement Plan Study. The factors that will affect the original Reserve Study written by Miller – Dodson and Associates consist of four (4) calculation errors, as well as their original estimated total cost of repairs/replacement items, was simply incorrect.

  1. Their calculations for monies needed to be paid, were based on 450 homes, not 1,370 taxable lots.
  2. Miller – Dodson and Associates have listed items that must be recalculated from the original reserve study, due to some being grossly, miscalculated.
  3. Reserve studies do not account for volunteers.
  4. Reserve studies do not consider items that a Community, may decide to simply do away with,to reduce their budget.

We became a Sanitary District on May 4th, 2016 and our Management & Operating Agreement with Westmoreland County became effective on May 1st, 2017. According to Westmoreland County, we have 1,370 taxable lots. In 2017 our Recreational User Fee (RUF) was $190.00 per taxable lot and Property Owners were billed around September of 2017 with the cut off date being December 5th of that year. This is a matter of public record.

The figure Miller – Dodson and Associates recommended each Homeowner pay monthly was  $26.28, based on 450 homes. Now lets do the same math using the correct figures, using 1,370 taxable lots. That amount would now equal $4.33 per month.

With our Recreational User Fee currently set at $200 per year, every Property Owner pays $16.66 per month. As a Community, we pay almost 4 times the amount, as recommended. The math is there and regardless of how others may try and spin these figures, in my opinion, they will have a very hard time doing so.

Now, lets talk about using the original Reserve Study as a Capital Improvement Plan. What is a “Capital Improvement Plan”? According to Wikipedia and in my opinion, they nailed it:

A capital improvement plan (CIP), or capital improvement program, is a short-range plan, usually four to ten years, which identifies capital projects and equipment purchases, provides a planning schedule and identifies options for financing the plan. Essentially, the plan provides a link between a municipality, school district, parks and recreation department and/or other local government entity and a comprehensive and strategic plan and the entity’s annual budget”.

Since we are a Sanitary District and we are governed by Westmoreland County, we must provide to them a plan, or list, of what we consider “Capital Improvements”. Since Westmoreland County does their Capital Improvement Plans in five year increments, we must supply them with our Capital Improvement Plan looking forward, or into the future, for five years as well.

If you think about every service that is under the authority of Westmoreland County, the numbers are staggering as everyone must submit the same five year  Capital Improvement Plan, as we do. This Capital Improvement Plan is often referred to as a “Wish List”. Some Departments or Sanitary Districts will add everything under the sun, just hoping something will be excepted, and others will simply provide the wrong information or items, that do not meet the criteria for being considered a “Capital Improvement”.

In our particular case, Westmoreland County has required that our present or future Board of Directors, gather input from our Community concerning our Capital Improvement Plan, before it is submitted. It is my opinion that our current Board of Directors are in direct violation of this requirement. Why do 9 individuals think they can speak for 1,008 Sanitary District Members, that now have a right to be heard? Do they still think they run a POA?

In conclusion, I would like to ask three questions. Please feel free to comment with your answers.

  1. Since we already pay almost 4 times as much in fees that Miller – Dodson and Associates recommended, why does our Board of Directors think we need to raise our yearly RUF?
  2. Why did our Board of Directors elect not to share the information concerning our Capital Improvement Plan with our Community, before they submitted it to Westmoreland County?
  3. Is it possible they were afraid of the amount of backlash they would receive, if they made the five year Capital Improvement Plan information available, like the amount of backlash Westmoreland County received, when our Board of Directors tried to raise our RUF, three years in a row?

Please let me know. Your neighbor, Dana.

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