Cohousing-L Mailing List: Re: Large Increase in Capital Reserve requirements (Chris Hansen)

[Alan O'Hashi (adoecos]

Chris:  Have you determined at what percentage you are funding your reserve 
account? You’ll have the fiscal conservatives want to fund reserves at a high 
level and a range of risk takers who are okay with amounts as liw as 50 
percent. A generally accepted number is 70 percent. Say the total assessment is 
$32000 per year, which is $1000 per household. Seventy percent is $700. The 
burden per unit is $58/month. Some will be higher or lower depending on house 
size. You can monkey with the formula and have the market rate owners subsidize 
the low to mod income people. If you have a few large home owners who complain, 
then what will happen, the small home owners will end up subsidizing the big 
home assessments. suddenly big home owners become very self interested. You 
could also start by funding at a higher percentage like 80 percent and taper 
down until the percentage achieves the desired fund account balance. My place 
has 16 condos. We bumped ours for two years, I think, and afterward now pay 
three percent more each year as the fudge factor. Also be sure each owner adds 
insurance to their homeowner policy to cover their percentage of the deductible 
in case of a catastrophic loss. That’s usually part of policies these days to 
account for global warming.


Thx


Alan o


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> Hi everyone
> We in Burlington CoHousing are a widely mixed-income group of 32 households
> with 9 affordable units for people on lower incomes quite a number of
> others on low or limited income and some of much more comfortable means
> We have just undergone a Capital Reserve Study which has necessitated a
> very steep increase requiring us to raise $50k-$60k each year for the next
>