Village 2 Update
village2homeowners@gmail.com (new email address)

DATE: June 14, 2010
TO: VILLAGE TWO HOMEOWNERS
REGARDING: ROOFING PROJECT UPDATE #3

1.Q: What has the Board done since homeowners received newsletter #2 dated April 19, 2010?
A: As one can imagine, the tile roofing project is a huge undertaking, so board members have been educating themselves and researching all aspects of the roofing project. At the special board meeting on May 18, 2010, which focused only on the roofing project, the Board discussed a tentative timeline for the project (see 7.Q). In addition, the Board considered options to finance the project. (see 7.Q).

2.Q: If the tile is not the problem, what is the problem?
A: It’s the underlayment which, over 25 years, has deteriorated due to heat and age in spite of regular maintenance. The Board hired Louis Hunt, an independent roofing inspector, to assess the condition of the roofs of the 12 buildings. His report, which was presented at the annual meeting of Village 2 homeowners on March 4, 2010, mentions that all 12 roofs are “at the end of [their] serviceable life.” (LHunt@prmteam.com) of PRM Consulting Services (http://www.prmteam.com/)

3.Q: Does this project have to be done right now?
A: There are several risks resulting in doing nothing: property deterioration and devaluation, association uninsurability, and Board failure of fiduciary responsibility. The report from Louis Hunt states “the roof should be replaced within the next two years.”

4.Q: How will the project be funded?
A: Based on the preliminary projections given to us by Mr. Hunt, it is obvious that this project will require a special assessment.

5.Q: What will this project cost?
A: Board members have met with Mr. Hunt to develop a process by which we might determine a justifiable dollar amount for the project. Mr. Hunt’s report includes a very preliminary estimate that does not include costs such as any necessary construction repairs, bringing the roofs into compliance with current City of Scottsdale building codes (venting, for example), inflation, consulting fees, and other factors unknown at this time. The Board will ask two roofing contractors to provide bids at today’s prices. This information will be used to develop the working project amount. Once a working project amount is established, homeowner assessments will be determined. As soon as possible, this figure will be communicated to all homeowners.

6.Q: Who determines whether there will be a special assessment and for how much?
A: The Village Two CCR’s authorizes the Board of Directors to take this action for special projects.

7.Q: How will I pay the special assessment, and how long will I have to pay?
A: Answers to financing questions are premature, but it is important that homeowners understand that a special assessment of all Village Two homeowners will be required to pay for the project. The Board is considering setting the formal assessment in January 2011. Homeowners would have until June 30, 2011 (one year from now) to pay their assessment. Contracting bids would be taken in August 2011, and the project would begin in September or October 2011. This timeline is subject to change.

8.Q: Why is the roof project not being funded from our reserve monies?
A. Over the past few years, the Association has paid approximately $95K for painting our 12 buildings, and before that, approximately $75K for paving. In addition, there have been on-going roof maintenance projects. All these projects have been paid for from the reserve monies. Further, it is clear that the total expense for the roof project far exceeds the money in reserves.

9.Q: How might I communicate my thoughts to the Board regarding this project?
A: Input from homeowners is always welcome at board meetings. Meeting information is posted well in advance on all dumpster doors and at Pool C. Management can be reached at 480-443-5566 for meeting information. Homeowners are invited to submit questions for future newsletters to ashleynps@aol.com, or questions may be mailed to National Property Services at P.O. Box 31176, Phoenix, AZ 85046.

The Board will continue keeping homeowners updated as additional information becomes available. Homeowners are urged to read the project report that was presented by Louis Hunt at the annual HOA meeting on March 6, 2010, with excerpts in a newsletter mailed at the beginning of April. The entire report can be e-mailed to you electronically if you send your request to ashleynps@aol.com, or is available at http://village2homeowners.blogspot.com.

DISCLOSURE
The Village Two Board of Directors has a fiduciary duty, by law, to inform the homeowners of potential issues that have come to their attention. Furthermore, the Board has a fiduciary duty to correct the issues to the best of their ability, exploring all possible options. When homeowners buy into a condominium homeowners' association (HOA), there are at least two implied agreements: 1) homeowners agree to abide by the CCR's (restrictions), and 2) homeowners agree to pay for improvements and maintenance/upkeep of the property. Now that the Board, Management, and Village Two homeowners are all aware of the roofing situation, it is required by law that this information be disclosed to realtors and all future homebuyers.