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Enhancing property values and creating quality of life through recreation, community events, and leadership

Regular Meeting of DelegatesRecreation Center at Eastridge

Gordon Von Stroh Community Room9568 University Boulevard

February 17, 2015AGENDA

Business Meeting

1. Remarks from Invited Guests Approximate Time:

Jill Repella Douglas County Commissioner 6:30 p.m. C470 Coalition

2. Call to Order 7:00 p.m.

3. Proof of Notice of Meeting 7:01 p.m.

4. Roll Call / Establishment of Quorum 7:02 p.m.

5. Pledge of Allegiance 7:05 p.m.

6. Approval of Minutes from the January 20, 2015 Meeting 7:06 p.m.

7. Forum (Sign up in advance) 7:08 p.m.

Member

8. Board of Directors Reports 7:15 p.m.

Scott Lemmon, Dennis Seymour, Brock Norris, Jeff Suntken, Melissa Park

9. Continued / New Business Board Candidates Introductions and Q&A Dennis Seymour

10. Staff and Committee Reports 8:00 p.m.

Community Relations Update - Jamie Noebel

Backcountry Study Group - Jed Caswall

11. Forum (Sign up in advance) 8:30 p.m.

Delegate12. Adjournment 8:35 p.m.

The Board of Directors Meeting follows immediately upon adjournment of Delegate Meeting

Next Delegate and Board meeting will be held on Tuesday, March 17, 2015, at the Eastridge Recreation Center in theGordon Von Stroh Community Room.

___________________________________________________________________________________________________

Disclaimer This packet is provided for informational purposes only and is subject to change. Other matters may be considered asdeemed appropriate. Some documents or information may have been unavailable at the time this agenda was prepared.

For additional information, contact: [email protected].

The Board Working Session, Regular Delegate Meeting, Board of Directors Meeting, and all otherHRCA Committee Meetings are open to our Members

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9568 University Blvd., Highlands Ranch, CO 80126 FAX 303-791-6705 or email [email protected]

If filling out online be sure to save the document, attach a copy in an email, and send.

PROXY(For Regular Delegate Meetings)

The undersigned Delegate of the Highlands Ranch Community Association, Inc., a Coloradononprofit corporation ("HRCA"), revoking any proxy previously given, hereby appoints__________________________, of Highlands Ranch, Colorado, with full power ofsubstitution as my Proxy and attorney-in-fact to (i) attend the regular meeting of the Delegatesof HRCA to be held on __________________________, 20___, or any postponements oradjournments thereof ("Meeting"), (ii) vote all votes which I represent in my Delegate Districton my behalf in his or her discretion on all matters properly presented for action at theMeeting, and (iii) take any other action which I could personally take if present at the Meeting.I hereby revoke any proxy previously given relating to the Meeting.

Dated: ____________________________

_____________________________________ __________________Delegate Signature District #

Printed name of Delegate:_______________________________

This Proxy is valid only for the Meeting indicated above and only so long as the signing Delegateis qualified to serve as a Delegate.

THIS PROXY MAY BE REVOKED PRIOR TO ITS EXERCISE BY (1) ATTENDANCE OF THESIGNING DELEGATE IN PERSON AT THE MEETING AND VOTING IN PERSON, (2)REVOCATION IN WRITING FILED WITH THE CHAIRMAN OF THE MEETING PRIOR TOTHE TIME THIS PROXY IS EXERCISED, OR (3) EXECUTING A NEW PROXY WITH ALATER DATE.

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Regular Meeting of DelegatesRecreation Center at Eastridge


January 20, 2015MINUTES

Business Meeting1. Remarks from Invited GuestsTony Spurlock Douglas County Sherriff

Sheriff, Tony Spurlock and Chief Deputy Tim Moore provided an update about the Sheriffsoffice. Sheriff Spurlock was recently sworn in as the new Sheriff. Citizens have the opportunityto be Reserve Deputies. They can serve and volunteer with the Sheriffs Office through thisprogram. Sheriff Spurlock urged Highlands Ranch to consider how important communicationsare and what we can do to serve the needs of the majority. Advancing forward with smartertechnology is important. Sheriff Spurlock reported that increased enforcement is being added toQuebec and on North to County Line, due to the large number of accidents that occur there.

Chief Deputy, Moore gave an overview about the communication needs of the Sheriffs office.The Sheriffs Office has considered multiple sites for the communications tower. There is a raceagainst time, knowing that the communications system could go down at any time due to nothaving the necessary coverage. There is a team that meets every week on the Tower project totalk about location sites and to identify possible alternative sites from the Backcountry.Examples of other sites that have been considered are Grace Presbyterian, Moore Road,Childrens Hospital, Shea Buildings and Avaya. They are doing everything possible to not buildin the Backcountry and not build more than one tower.

Questions from the audience occurred. Some questions asked were about the price of two towersvs. one tower, specific locations like Mission Hills area, Century Link, the existing tower onHolly and County Line, and also the existing Excel tower site.

2. Call to Order: 7:15 p.m.3. Proof of Notice of Meeting4. Roll Call / Establishment of Quorum

Roll call was taken by Brock Norris. A quorum was established with 16,638 lots in attendance outof 30,521 total lots.

5. Pledge of Allegiance6. Approval of Minutes from the November 18, 2014 & December 9, 2014 Meetings

ACTION: A motion was made by District #23, Sue Mutzebaugh and seconded by District # 40,Frank Impinna to approve the November 18, 2014 minutes. Motion carried with (1) abstentionfrom District #61, Allen McEwen.

ACTION: A motion was made by District # 114, Clay Karr and seconded by District #20, JeanRehnke to approve the December 9, 2014 minutes. Motion carried with (1) abstention from District#61, Allen McEwan.

7. Forum (Sign up in advance): None

Member3


8. Board of Directors Reports

Scott Lemmon, Dennis Seymour, Brock Norris, Jeff Suntken, Melissa ParkScott Lemmon and Jeff Suntken provided a power point presentation for the BoardReport. The Directors reported that 2015 Objectives will be shared at the Februarymeeting, there is an upcoming Board to Board meeting with the HRMD on February 3,Candidate Data forms for Director Positions are due January 30, 2015 and the monthlyFinance Committee meetings will also be changing from Wednesdays to Mondays.

9. Continued / New Business: None

10. Staff and Committee Reports

Facility Update - Ken JosephKen Joseph provided a power point presentation showing the projects that have beencompleted from the $160,000 project list.

Community Relations Update - Jamie NoebelJamie Noebel provided a power point presentation. The December events were wellattended including the Hometown Holiday, Breakfast with Santa and Sparkling WineTasting. Coming up are the Cultural Concert Series, Father Daughter Sweetheart Ball,and Glow in the Dark Yoga. Jamie urged everyone to participate in the community eventsthat are offered.

Backcountry Study Group - Jed CaswallJed reported that the Backcountry Study Group did not meet in January, but willreconvene again in February.

11. Forum (Sign up in advance)

DelegateJed Caswall, District #112 shared about pending legislation which would affecthomeowners associations ability to bring forward lawsuits on faulty construction createdby the builder. If this legislation passes homeowners; in particular condo complexes wouldneed 50% approval from all homeowners in order to bring the lawsuit forward. In HighlandWalk, they had such a lawsuit and if this legislation were in place, there would be no waythat they could have gotten approval from 50% percent of all homeowners. Jed asked theDelegate Body to follow this legislation and if needed take a position on it.

Ashley Panahi District, District #106 announced that she would be running as a BoardCandidate and urged homeowners to get more involved with the HRCA.

Suresh Damle, District #89 asked for a questions committee in order to draft questions forthe Board Candidates to answer at the next Delegate meeting. Jed Caswall and SureshDamle will lead the committee.

12. Adjourn: 7:50 p.m.

Respectfully Submitted, Brock Norris, Secretary4

DIST. DELEGATE TOTAL # DIST. DELEGATE TOTAL # # OFNO. NAME OF LOTS* LOTS* F+O NO. NAME OF LOTS* LOTS* F+O

1 MICHAEL O'MUIREADHAIGH 297 80 MONICA WASDEN (PA20) 1,533 1,5332 JESUS ROCHA 266 81 AL BONNEAU 203 BRAD POTTEBAUM 184 184 82 ELAINE BROWN 7784 ROY KING (Stratton Ridge) 153 153 83 VACANT 180 05 VACANT (Bradford Hills) 108 84 JIM ALLEN 705 7056 JEANNE HOFFMANN (Sugarmill) 126 126 85 DEBORAH SPICER 7847 LARRY PERKINS 295 295 86 JASON BEZON 1,2908 HEATHER BLAKE (Chalet) 97 87 SHON PAYNE (Indigo Hill) 4819 SUE LEIDOLPH (Remington Bluffs) 50 50 88 CAROLYN GROOM (Weatherstone) 294 294

10 ALISON JONES 143 89 SURESH DAMLE (Villages at H.R.) 323 32311 DEREK LONG 251 251 90 ERIC WEINSTEIN (Spaces) 25012 CONNIE ROSEL (Falcon Hills North) 113 113 91 GINGER NIXT (Settlers Village) 19913 JIM ELLINGSON 199 199 92 BARBARA SALISBURY (Canyon Ranch) 44014 DR. L. MAC CROPSEY 185 93 BARBARA SALISBURY 26015 VACANT 200 0 94 AL PELKOWSKI (Westridge Knolls) 617 61716 ELIZABETH STROCK 105 105 95 MICHELLE STEINMAN (Coventry Ridge) 5617 GREG HERMAN 166 166 96 VACANT (Highwoods) 104 018 AL SHELBOURN 318 318 97 VACANT 336 020 JEAN REHNKE 208 208 98 LISA KIRWAN (Sundance @ Indigo Hill) 22521 VACANT 189 0 99 LINDA PETERSON (Carlyle Park) 21322 VACANT 132 0 100 PAT KAPTAIN 177 17723 SUSAN MUTZEBAUGH 142 142 101 VACANT 111 024 VACANT 83 0 102 ERIN YOUNG 20225 JACK TROUTMAN 438 438 103 VACANT 401 026 REBECCA ROTHWELL 183 183 104 ERIK BOSTROM 53227 KAREN GREWELL 242 242 105 JOSEPH ADEN 353 35328 MATT GILBERTSON 48 106 ASHLEY PANAHI 226 22630 GEORGE ELLIOTT (Timberline) 368 368 107 ALDIS SIDES (HR Golf Club) 579 57940 FRANK IMPINNA 368 368 108 VACANT 208 041 FRANK IMPINNA 366 366 109 TIM LINDSEY (Backcountry) 659 65949 STEVE TROLINGER 291 291 110 MARK DICKERSON (Stonebury) 8750 LINDA MALLETTE (Gleneagles) 345 345 111 MIKE WOODLAND (Firelight) 1,863 1,86351 DAVID PASLEY 253 253 112 JED CASWALL (Highland Walk) 298 29852 DEBORAH O'DELL 234 113 SCOTT JANSON 517 51753 SHARYN LANDIS 171 171 114 CLAY KARR (The Hearth) 1,652 1,65260 RANDEE RYAN 181 181 115 KARL PAETZEL (Brownstones) 35961 ALLEN McEWEN 105 105 116 DENIS OULLETTE (Tresana) 44762 NANCY SMITH 197 197 120 VACANT (Clock Tower Residences) 204 063 KATHY LANDGRAVE 51 212 VACANT (Stoneybridge) 77 064 COREY MARTIN 130 130 213 VACANT (Palamino Park Gold Peak) 523 065 DON WOODLAND 96 9666 CINDI THOMPSON 22468 GRACE MCMAHON 15269 VACANT 182 070 TERI HJELMSTAD (The Village) 81 8171 EARL HOSTERMAN (Falcon Hills South) 2673 AMIT GUPTA 1,18474 BILL BUETTNER 94075 SARA LEBOFSKY 74 7476 SUSAN BREMNER 223 22377 DANIEL SCHLACHTENHAUFEN 420 42078 VACANT 274 0 TOTAL 30,521 14,889 1,749 0 0 079 CAROLYN SAMUELS (The Retreat) 101 QUORUM 51% 15,566 16,638 107%

*If the number of lots column is filled out, it indicates that the delegate was present in person or by proxy for this meeting.

DISTRICT DELEGATE ROLL CALLMEETING DATE: JANUARY 20, 2015RECORD DATE: JANUARY 8, 2015

PROXYTOTAL IN

FAVORTOTAL

OPPOSED PROXYTOTAL IN

FAVORTOTAL

OPPOSED

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February FYIs

CampsOn Martin Luther King Jr. Day, we offered our usual Day Camp and Enrichment program for full time workingparents. For those kids looking for just a half day activity, we offered the Queen of Tarts Cooking camp andNinjango LEGO camps as well. All camps were full and offered a great alternative for kids out of school.

PreschoolThis month we celebrate Health Week in the Preschool program. All classes will have visits from adentist, Childrens Hospital, The Lions Club and Whole Foods. Theyll learn about the importance ofbrushing their teeth, washing their hands and overall hygiene care. Theyll receive a free vision screeningand get to do fun activities that help them learn about healthy food and healthy bodies.

DramaWe have 2 full theatre sessions beginning this month. Toys! Is a fun production that explores whathappens when the playroom door closes and the toys are left to their own devices! This is a greatopportunity for children ages 5-12 to learn important skills like public speaking, confidence,memorization and team work.

Will SeminarThe first Will Seminar of the year was offered on February 9th. It was a full class for this popular andgrowing adult seminar. Those in attendance were provided with a notarized will, general power ofattorney, medical power of attorney and living will.

AquaticsWe have just finished another successful year partnering with the five local High Schools girls swim teams. Theypractice M-F and host their swim meets at Northridge during the swim seasons. The combined boys swim teamrecently started practicing and will be hosting their swim meets at Northridge until mid-May.

Fitness/Race SeriesPersonal Training and Group Fitness classes have been very popular. We hosted the second of four yogaworkshops on Sunday, February 8th at Southridge. The Highlands Ranch Race Series will kick off its first race of theseason, the St. Patricks Day 5k on Saturday, March 14.

SportsBoys Basketball is in mid-season and is going great. We are beginning to gear up for CARA Volleyball and Pee WeeSoccer Leagues. Youth Fencing has taken off and is near capacity each month. Adult Volleyball, Basketball andIndoor Soccer Leagues are running smoothly.

TennisJanuary finished up with the start of a new session for youth and adults and the beginning of the first wintersession of In-House Doubles Leagues. Registration began on February 2 for the Adult league season. HRCA offersa total of eleven leagues, comprised of the Colorado Tennis Association leagues, Intermountain Tennis Associationleagues, and the United States Tennis Association leagues. The beautiful tennis courts at Northridge, Westridge,and Southridge will be used for home matches in the 2015 season.

Therapeutic RecreationJanuary happenings for the TR Program included Unified Basketball weekly games serving 12 athletes with the helpof 12 partners. February will bring the continuation of personal instruction on land as well as aquatic therapy formany individuals and groups. February Sweetheart Dance took place on February 13th

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Board of Directors MeetingRecreation Center at Eastridge


February 17, 20156:30pm

AGENDA

1. Call to Order

2. Establishment of Quorum/Roll Call

3. Proof of Notice of Meeting

The Board Chair will remove any Consent Agenda item upon timely request of any Board member or Member of theAssociation who has an interest in the item. A request is timely if made prior to the Board vote on the Consent Agenda.Items removed from the Consent Agenda will then be considered separately by the Board immediately following actionon the Consent Agenda or placed later on the agenda at the discretion of the Board.

4. Consent Agenda

Approval of Minutes of Action from the January 20, 2015 Board Meeting

Approval of Architectural Committee Motions

Approval of Architectural Committee Meeting Minutes for January 6 & 20, 2015 Meeting

Approval of Development Review Committee Minutes from February 4, 2015 Meeting

Approval of Commercial Signage

Approval of the Fund Management Policy

Approval of Finance Committee Minutes from December 17, 2014 Meeting

Approval of Finance Committee Minutes from January 21, 2015 Meeting

5. Forum - Member

6. Director Comments

7. Committee Reports

Delegate Meeting

Backcountry Planning Areas Advisory Committee

Architectural Review Committee

Development Review Committee

Commercial Review Committee

Finance Committee

8. General Manager Report

9. Continued Business

10. New Business

11. Delegate Forum

12. Adjournment

_____________________________________________________________________________________________________________Disclaimer This packet is provided for informational purposes only and is subject to change. Other matters may be considered as

deemed appropriate. Some documents or information may have been unavailable at the time this agenda was prepared.

The Board Working Session, Delegate Meetings, Board of Directors Meeting and all otherHRCA Committee Meetings are open to our Members.

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Board of Directors MeetingRecreation Center at Eastridge


January 20, 20156:30pm

MINUTES

1. Call to Order2. Establishment of Quorum/Roll Call

Board Members Melissa Park, Brock Norris, Dennis Seymour, and Scott Lemmon werepresent.

3. Proof of Notice of MeetingThe Board Chair will remove any Consent Agenda item upon timely request of any Boardmember or Member of the Association who has an interest in the item. A request is timelyif made prior to the Board vote on the Consent Agenda. Items removed from the ConsentAgenda will then be considered separately by the Board immediately following action onthe Consent Agenda or placed later on the agenda at the discretion of the Board.

4. Consent Agenda

Approval of Minutes of Action from the December 9, 2014 Board Meeting

Approval of Architectural Committee Motions

Approval of Architectural Committee Meeting Minutes for December 2, 2014

Approval of Commercial Signage

Approval of Finance Committee Minutes from November 19, 2014 Meeting

Accept the November 30, 2014 Financial Statements

Approval of the December 17, 2014 Tribunal Hearing Recommendations at 9641

Dunning Circle

ACTION: A motion was made by Dennis Seymour and seconded by Jeff Suntken to

approve the consent agenda. Motion carried

5. Forum Member: None

6. Director CommentsBrock commented that the efforts of the Sheriffs Office are much appreciated. He looks forwardto their continued working relationship and more information in the future. Scott Lemmon echoedthese comments and also thanked the Sheriffs Office for coming to the Delegate Meeting.

7. Committee Reports

Delegate Meeting: None

Backcountry Planning Areas Advisory Committee: None

Architectural Review Committee: None 8


Development Review Committee: None

Commercial Review CommitteeMike Bailey commented on the Metro Districts handout, that new businesses Bank ofAmerica, Kneaders Bakery and Mici Italian Restaurant have not come before thecommittee with any submittals yet.

Finance Committee: None

8. General Manager ReportJerry Flannery reminded the Board of the Retreats on January 28th and January 30th. The C-470Coalition will be at the February Meeting to present. Meet the Candidates and Commissioner JillRepella will also be on the agenda.

9. Continued Business: None10. New Business: None

11. Forum

Delegate

Jed Caswall, District #112 thanked the Sheriffs Office for coming before the Delegates topresent. Jed Caswall asked about banking fees that Wells Fargo Charges for Highland WalkManagement and can anything be done to bring these fees down? HRCA has approachedWells Fargo about this issue, and since they are such a large bank there has not been a lot ofwillingness to negotiate their fees. HRCA may do an RFP to look at other banks with betterservices and fees.

12. Adjournment: 8:10 p.m.

______________________________________________________________________Respectfully Submitted, Brock Norris Secretary

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DEVELOPMENT REVIEW COMMITTEE

DATE: February 4, 2015

MEETING MINUTES

I. CALL TO ORDER

The meeting was called to order at 6:30 p.m. by Woody Bryant. The meeting was Chaired by Woody Bryant.

Roll call was taken and a quorum was established.

Member Name Present Absent Excused

Woody Bryant, Chair

Kendall Tomes, Vice Chair

Eric Taylor, Secretary

Doug Flin

Erik Okland

Jim Reps

Carole Schumacher

Dawn Vaughn

Krystal Woodbury

Also in attendance: HRCA STAFF: Jerry Flannery; Mike Bailey, Kim Quijano

ATTENDEES: Randall Burkhardt (Douglas County/Heritage Turf)

HRCA Board of Directors: Scott Lemmon,

Brock Norris, Jeff Suntken, Melissa Park

II. ZR2015-001 - Highland Heritage Park Synthetic Turf Fields

LOCATION: 9651 S. Quebec St.

Location & Extent application to construct two (2) synthetic turf fields in Highland Heritage Regional

Park, as well as three (3) shelters, pedestrian plaza, landscaping, vault restroom, drinking fountain,

picnic area, parking lot improvements and other landscaping.

General Comments:

A Location and Extent Review is a process used for the review of proposed public facilities or uses. The Douglas County Planning Commission is the governmental approval entity that will review plans for the

construction of public facilities or uses, including a public utility, whether it is publicly or privately owned.

State Statute (30-28-110 of the Colorado Revised Statutes) stipulates that the entirety of the review must be completed within 30 days, unless extended with permission from the applicant.

o The DRC thanks the applicant for agreeing to extend the review so that this proposal could be vetted in a public hearing format by the DRC.

Typically, a Location and Extent process is the sole land use review process required of most public entities. Additional review and permitting may be required through the Douglas County Department of Public

Works Engineering depending on the scope of the project. Additional permits and requirements could

include access permits; Grading, Erosion, and Sediment Control (GESC) permits; and requirements related

to the provision of storm drainage and storm water detention facilities.

For this application (as a Location and Extent proposal), the DRC is a REFERRAL ENTITY ONLY and will only offer comments.

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DEVELOPMENT REVIEW COMMITTEE

FEBRUARY 4, 2015

MEETING MINUTES page 2


Review Comments:

The DRC expresses concern regarding the intensity of the proposed lighting. They recommend that a timer be utilized which will extinguish the lights no longer than one (1) hour after the completion of the

activity, or 11:00 pm, whichever occurs first.

The DRC questions the need to have the 70 light fixtures on the east side which face west. There is a grade difference (fields lower than the residences) which may help to mitigate some of the light.

Conversely, this elevation change could make the lighting nuisance worse because the living space

elevation may be closer to the elevation of the fixtures. The DRC asks that the applicant work closely

with their lighting designer to ensure the best light coverage is attained while still protecting the neighbors

from nuisance lighting.

The narrative provided noted that there would be no additional impacts to the Big Dry Creek drainage way with this project. The DRC disagrees with this assessment and notes that there will be impacts to

the BDC drainage way because of the additional impervious area (parking lot) proposed. The DRC

acknowledges these impacts will likely be negligible; however, there will be impacts and feels the no

additional impacts categorization is improper. A drainage report was not available on the Douglas County

eReferral System to review. Minimally, the DRC expects that stormwater water quality will be required

for the parking area. The DRC acknowledges that stormwater detention will likely not be required

because this area is served by a Regional Detention Pond.

The DRC recommends traffic calming devices be installed on the access drive. The DRC recommends consideration be given to relocating the western shelter to a more central location

as it is located in very close proximity to the fields.

There are concerns regarding impacts to drainage at Cheese Ranch. The DRC acknowledges that the applicant is working closely with UDFCD and others regarding this and appreciate these efforts.

Action re: COMMENTS:

A motion was made by Carole Schumacher to Accept the Above Comments as Read; seconded by Doug Flin.

o 6 member(s) Concur; o 0 member(s) Dissent; o 1 member(s) Abstain (Krystal Woodbury).

MOTION CARRIES

III. OTHER BUSINESS

Approval of December 3, 2014 DRC MEETING MINUTES:

A motion was made by Kendall Tomes to Accept the December 3, 2014 Meeting Minutes; seconded by Dawn Vaughn.

o 7 member(s) Concur; o 0 member(s) Dissent; o 0 member(s) Abstain.

MOTION CARRIES

With no further business, the meeting adjourned at 6:56 pm.

Respectfully Submitted,

Woody Bryant, Chair

Development Review Committee

.

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COMMUNITY IMPROVEMENT SERVICES DEPARTMENT STATUS REPORT January 2015

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ARCHITECTURAL REVIEW COMMITTEE MEETINGS The Architectural Review Committee met on January 6th and January 20th. SUBMITTALS The Architectural Review Committee reviewed 233 requests for improvements. Of these, 208 were approved as submitted, 4 were conditionally approved, 7 were partially approved, and 14 were not approved. LETTERS OF NONCOMPLIANCE 820 letters of general noncompliance were mailed. The violations were:

2 Courtesy letter 6 HRCA notified by county applying for permit 1 Noncomplying portable basketball goal 22 Remove commercial vehicles/trailers 1 Sump pump drainage noncompliance 6 Maintain fencing 40 Remove inoperable vehicle 3 Maintain landscaping 3 Remove dead trees 4 Comply with 72 hour rule 1 Refrain from parking on landscaping/rocks 520 Paint letters 3 Store play equipment 20 Remove all signage 80 Comply with trash pickup 63 Maintain property 36 Remove unsightly material 2 Storage pod 6 Submit miscellaneous improvement 1 Failure to comply

NOTICES OF COMPLAINT TO THE BOARD 22 Notices of Complaint to the Board of Directors were mailed. The violations were:

1 Remove trailer 1 Maintain fencing 6 Remove inoperable vehicle 1 Remove all signage 6 Comply with trash pickup 3 Maintain property 3 Remove unsightly material 1 Submit miscellaneous improvement

TRIBUNALS - There were no Tribunal held in January.

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COMMUNITY IMPROVEMENT SERVICES DEPARTMENT STATUS REPORT January 2015

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COMMERCIAL STATUS 2 compliance letters sent. 315 site visits conducted. Sign Inspections/Consultations - 72 Sign Applications: 4 approved

Highlands Ranch Family Dental 9265 S. Broadway #250 (Town Center I) Signage approved

Beaber Orthodontist 9425 University Blvd. (Marketplace I)

Signage approved

Quebec HR Animal Clinic 7136 E. County Line Road Signage approved

Highlands Ranch Optical 9370 S. Colorado Blvd.

Signage approved

Minor Amendments: 1 approved / 2 No Exception

SB2014-078 Hunting Hill Filing 1, 7th Amendment Replat Referral comments submitted - No Exceptions

DR 2015-001 Douglas County Zoning Resolution Amendments to Section 1 and 15 Referral comments submitted No Exceptions

Branch Automotive 6030 County Line Road

Building Addition Approved

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Community Relations Monthly UpdateUpcoming February Events

CAA Winter Cultural Series: February 5 (Ballet & Modern Dance), February 19 (Broadway Sings the Classics)Cherry Hills Community Church 7:00 8:30 p.m.Treat yourself to cultural events close to home. A highlight of the many cultural program's brought to you by the Highlands Ranch Cultural AffairsAssociation (CAA), the 2015 Winter Cultural Series features a variety of performances that have widespread appeal and are full of fun, familyentertainment you are sure to enjoy. Visit www.HRCAonline.org for additional details on each performance. $7 in advance/$10 everyone the day ofthe event, if it is not sold out.

Father/Daughter Sweetheart Ball: February 6 & 7 Recreation Center at SouthridgeFebruary 6, 6:30 p.m. OR February 7, 1:30 p.m. or 6:30 p.m.Create wonderful memories full of fun, laughter, love and dancing with your sweetheart at the Father and Daughter Sweetheart Ball. Held at theRecreation Center at Southridge Wildcat Mountain Auditorium, this ball includes refreshments, a corsage and a special gift for each little sweetheart. Inaddition, you receive a commemorative photo of you and your little lady.

Sweetheart Teddy Bear Tea: February 14 Recreation Center at Southridge 10:30 a.m. NoonYour little darling will love this tea with a special Valentines theme. Enjoy tea, refreshments, and a small stuffed bear for each child. Then its time to beentertained! Children must be accompanied by a registered adult. Dont forget your camera! No one under 2 please. $11in advance, $15 day of event ifnot sold out (all ages.)

CAA Chinese New Year Celebration: February 21 Recreation Center at SouthridgePerformances: 1:00 2:00 p.m. & 4:00 5:00 p.m. Cultural Fair and Shopping: 12:00 5:30 p.m.Highlands Ranch Cultural Affairs Association and the SCFD is partnering with Great Wall Chinese Academy to present a cultural program to celebrateChinese New Year. The program features exciting Chinese dragon and lion dances, beautiful Chinese folk dances, amazing Chinese martial art - KungFu, and well-prepared choral and instrumental performances. All performers are talented school-age individuals. All children will receive a red envelope,the traditional means of giving a blessing to the younger generation in the Chinese New Year. $7 in advance and $10 day of the event, if it is not soldout. Ages 2 and under are free, but must sit in a parents lap.

Upcoming March Events

Vodka Tasting: March 7 Recreation Center at Southridge-Debus Wildcat Mountain Auditorium 5:00 7:00 p.m.Wine Tasting move over! Spend the evening with Davidsons Liquors sampling different varieties of vodka! Delicious appetizers from Whole FoodsMarket Highlands Ranch will round out the evening. $17 in advance, $20 day of event if not sold out. 21+ only.

CAA Adult Comedy: March 13 7:00 8:00 p.m.Recreation Center at Southridge, Debus Wildcat Mountain AuditoriumThe Highlands Ranch Cultural Affairs Associations Showtime at Southridge series features live performances from both professionals and talentedamateurs. Come and enjoy Shawn Preston for some serious magic and comedy. Ages 21+ and over. New, cash bar with beer and wine available 6:30 7:30. $7 in advance/$10 everyone the day of the event, if it is not sold out. Children under 2 are free if they sit on a parents lap.

Spring Bazaar: March 21 Recreation Center at Eastridge 9:00 a.m. 5:00 p.m.By definition, a bazaar is "a fair at which miscellaneous articles are sold". Highlands Ranch Community Association's Spring Bazaar upholds thatdefinition. The bazaar atmosphere attracts a multitude of vendors who sell a wide variety of handcrafted as well as commercial items. Look for treasuressuch as handcrafts, scrap booking materials, candles, dolls, jewelry, and much more. Admission is free and open to the public.

Population as of January, 2015Population figures are based on an average 2.89 per household. Apartments are based on an average of two people per unit.

Total # of New Homes: 30,551 Total # of Apts: 3,529 Total Closings: 72Total # of New Homes: 0 Total # of Resales: 72 Total Closings YTD: 72Total # of New Homes YTD: 0 Total # of Resales YTD: 72 Population: 95, 350

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Committee Members Present: Members Absent:Jeff Suntken, ChairLyle Daley, Vice ChairSheela Damle Others PresentKay Schneider Christina Caputo, Finance ManagerStephanie Young Brian Sheppelman, Accounting ManagerTom Waters

Jeff Suntken called the meeting to order at 6:03p.m. in the Aspen/Vail Conference Room at the Eastridge Recreation Center. A quorumwas present.

A motion was made to approve the November 19, 2014 Highlands Ranch Community Association Finance Committee meetingminutes as presented. The motion was approved.

Motion: Lyle Daley Second: Stephanie Young

The Finance Committee reviewed the answers that the HRCA staff provided to the questions from the November 19, 2014 meeting.

At this time, the Finance Committee reviewed and discussed the November 2014 HRCA Financial Statements. The actual to budgetunfavorable variances in excess of 10% and $5,000.00 and favorable variances in excess of 25% and $10,000.00 were identified,explained and discussed. The following specific topics were discussed:

It was noted that YTD Total Revenues for the Administrative Fund are 5% ahead of budget. Administrative expenses are 3% favorableto budget. Recreation Operating YTD Net Revenues before transfers are 1% ahead of budget. The Recreational Fund expenses(excluding the Programming activities) are 3% ahead of budget. The YTD Net Facility Revenues were 12% ahead of budget.

It was noted that the YTD Recreational Program Revenues are 19% ahead of budget after the overhead allocation.

The Finance Committee also reviewed the detailed Backcountry Fund, the unearned revenue in programs, and the current investmentschedule for all funds.

A motion was made to recommend the HRCA Board of Directors accept the November 2014 Highlands Ranch CommunityAssociation Financial Statements as presented. The motion was approved.

Motion: Sheela Damle Second: Tom Waters

The Finance Committee reviewed the changes to the Fund Management Policy and this version will be sent to legal counsel forapproval. A final version will be put together and approved at the next Finance Committee meeting.

The Finance Committee reviewed the 2015 meeting calendar. The meeting dates are proposed to be changed to the third Monday ofeach month. A final approval of the 2015 meeting calendar will be approved at the next Finance Committee meeting.

Applicants for the Finance Committee will be interviewed before next months meeting based on Board of Directors directions.

The next regularly scheduled Finance Committee meeting is set for Wednesday January 21, 2015 at 6:00 p.m. at the EastridgeRecreation Center in the Aspen/Vail conference room.

The meeting was adjourned at 8:06 p.m.


Brian SheppelmanHighlands Ranch Community Association, Accounting Manager

Minutes of the December 17, 2014 FINANCE COMMITTEE MEETINGHighlands Ranch Community Association, Inc.

19

Committee Members Present: Members Absent:Jeff Suntken, Chair Sheela DamleLyle Daley, Vice Chair Others PresentKay Schneider Christina Caputo, Finance ManagerStephanie Young Brian Sheppelman, Accounting ManagerTom Waters Dennis Seymour, HRCA Director

Melissa Park, HRCA Director

Starting at 6:00 p.m. the Finance Committee interviewed four potential new candidates for the Finance Committee.

Jeff Suntken called the meeting to order at 7:23 p.m. in the Aspen/Vail Conference Room at the Eastridge Recreation Center. A quorumwas present.

The Finance Committee discussed the four candidates from the interview process. The Finance Committee will forward three of thefour candidates to the HRCA Board of Directors for recommended approval to the committee.

A motion was made to approve the December 17, 2014 Highlands Ranch Community Association Finance Committee meetingminutes as presented. The motion was approved.

Motion: Stephanie Young Second: Kay Schneider

The Finance Committee reviewed the answers that the HRCA staff provided to the questions from the December 17, 2014 meeting.

At this time, the Finance Committee reviewed and discussed the December 2014 HRCA Financial Statements. The actual to budgetunfavorable variances in excess of 10% and $5,000.00 and favorable variances in excess of 25% and $10,000.00 were identified,explained and discussed. The following specific topics were discussed:

It was noted that YTD Total Revenues for the Administrative Fund are 5% ahead of budget. Administrative expenses are 2% favorableto budget. Recreation Operating YTD Net Revenues before transfers are 1% ahead of budget. The Recreational Fund expenses(excluding the Programming activities) are 2% ahead of budget. The YTD Net Facility Revenues were 8% ahead of budget.

It was noted that the YTD Recreational Program Revenues are 21% ahead of budget after the overhead allocation.

The Finance Committee also reviewed the detailed Backcountry Fund, the quarterly Subassociation detailed income statement, theunearned revenue in programs, and the current investment schedule for all funds.

The Committee will formally approve the 2014 HRCA Financial Statements after the 2014 audit is complete and has been reviewed.

The Finance Committee reviewed the final changes to the Fund Management Policy.

A motions was made to recommend that the HRCA Board of Directors adopt the Fund Management Policy. The motion wasapproved.

Motion: Stephanie Young Second: Lyle Daley

A motion was made to accept the 2015 Finance Committee meeting calendar and 2016 budget meeting calendar. The motionwas approved.

Motion: Kay Schneider Second: Stephanie Young

The Finance Committee discussed the fourth quarter 2014 financial statements for the Highlands Ranch Cultural Affairs Association.

A motion was made to recommend that the HRCAA Board of Directors accept the fourth quarter 2014 Highlands RanchCultural Affairs Association Financial Statements as presented. The motion was approved.

Motion: Kay Schneider Second: Stephanie Young

The Finance Committee discussed the fourth quarter 2014 financial statements for the Highlands Ranch Community Scholarship Fund.

A motion was made to recommend that the HRCSF Board of Directors accept the fourth quarter 2014 Highlands RanchCommunity Scholarship Fund Statements as presented. The motion was approved.

Motion: Stephanie Young Second: Kay Schneider

Minutes of the January 21, 2015 FINANCE COMMITTEE MEETINGHighlands Ranch Community Association, Inc.

20

The next regularly scheduled Finance Committee meeting is set for Monday February 16, 2015 at 6:00 p.m. at the Eastridge RecreationCenter in the Aspen/Vail conference room.

The meeting was adjourned at 8:51 p.m.


Brian SheppelmanHighlands Ranch Community Association, Accounting Manager

21

Board of Directors MeetingFebruary 17, 2015

AGENDA

I. Call to Order

II. Roll Call

III. Approval of Minutes of Action from November 18, 2014

Reports

a. Accept Fourth Quarter Financial Statements

IV. Additional Business

V. Adjournment

22

Board of Directors MeetingNovember 18, 2014

MINUTES

I. The meeting was called to order at: 8:00 pm.

II. Roll call was taken and quorum was established.

III. Approval of Minutes of Action from August 19, 2014

ACTION: A motion was made by Dennis Seymour and seconded by BrockNorris to approve the August 19, 2014 minutes. Motion carried.

IV. Accept The Third Quarter Financial Statements

ACTION: A motion was made by Brock Norris and seconded by JeffSuntken to approve the third quarter financial statements. Motion carried.

V. Reports: None.

VI. Additional Business: Resolution 14-11-05; HRCAA signatories

ACTION: A motion was made by Dennis Seymour and seconded by BrockNorris to approve Resolution 14-11-05; HRCAA signatories. Motion carried.

VII. Adjournment: 8:03 p.m.


______________________

Brock Norris, Secretary

23

Board of Directors MeetingFebruary 17, 2015

Agenda

I. Call to Order

II. Roll Call

III. Approval of Minutes of Action from November 18, 2014

IV. Reports

Accept the Fourth Quarter Financial Statements

V. Additional Business

VI. Adjournment

26

Board of Directors MeetingNovember 18, 2014

Minutes

I. The meeting was called to order at: 8:03 p.m.

II. Roll Call was taken and quorum was established.

III. Approval of Minutes of Action from August 19, 2014

ACTION: A motion was made by Dennis Seymour and seconded by JeffSuntken to approve the August 19, 2014 Minutes. Motion Carried.

IV. Accept the Third Quarter Financials

ACTION: A motion was made by Dennis Seymour and seconded by JeffSuntken to approve the third quarter financials. Motion carried.

V. Reports: None

VI. Additional Business: Resolution 14-11-06; HRCSF account signatories

VII. ACTION: A motion was made by Brock Norris and seconded by JeffSuntken to approve Resolution 14-11-06; HRCSF account signatories. Motioncarried.

VIII. Adjournment: 8:06 p.m.

Respectfully submitted,

_________________________

Brock Norris, Secretary

27

HRCA FUND MANAGEMENT POLICYDate Policy Adopted: February 17, 2015

Table of Contents

SECTION 1 - OBJECTIVES AND GUIDING PRINCIPLES.....................................................................2

1.1 Objectives ............................................................................................................................... 2

1.2 Guiding Principles.................................................................................................................... 2

SECTION 2 - OPERATING AND CAPITAL RESERVE FUNDS............................................................... 2

2.1 Administrative Operating Unrestricted Retained Earnings ........................................................ 2

2.2 Administrative Functions ReserveFund .................................................................................... 3

2.3 Recreation Operating Unrestricted Retained Earnings ............................................................. 3

2.4 Recreation Functions Reserve Fund ........................................................................................ 4

2.5 Backcountry Operating Unrestricted Retained Earnings ........................................................... 5

2.6 Backcountry Reserve Fund......................................................................................................5

2.7 OSCA Fund ............................................................................................................................. 5

2.8 Capital Improvement Fund.......................................................................................................6

2.9 Debt Service (Bond) Fund .......................................................................................................6

SECTION 3 - ACCUMULATED UNRESTRICTED RETAINED EARNINGS............................................. 6

SECTION 4 - ADMINISTRATION...........................................................................................................7

4.1 Reserve Contributions ............................................................................................................. 7

4.2 Minimum and Maximum Reserve Balances .............................................................................. 7

4.3 Internal Borrowing ................................................................................................................... 7

4.4 Responsibilities ....................................................................................................................... 7

4.5 Guide and Transition ............................................................................................................... 8

SECTION 5 - GLOSSARY..................................................................................................................... 8

APPENDIX A NONPROFIT OPERATING RESERVES INITIATIVE 2011 (NORI) ............................ 10

APPENDIX B RESERVE/UNRESTRICTED RETAINED EARNINGS SUMMARY 10

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SECTION 1 - OBJECTIVES AND GUIDING PRINCIPLES

1.1 ObjectivesThe HRCA objectives, in terms of its various reserves and unrestricted retained earnings are set out inthis Fund Management Policy (Policy). HRCA will measure progress of all funds as outlined in this policyon a yearly basis during the budget cycle to ensure finance stability and will continually measureprogress toward achieving those objectives.

1.2 Guiding PrinciplesThe following principles form the basis for this Policy:

Healthy reserves and unrestricted retained earnings levels are important in achievingcommunity goals including financial health and stability;

Actual reserves and unrestricted retained earnings balances should be benchmarked withbest business practices, other similar community organizations, HOAs, or municipaljurisdictions and with pre-determined targets on an ongoing basis to gauge whetherfinancial health is being achieved;

Reserves and unrestricted retained earnings goals need to be consistent with andsupportive of realistic longer-term financial plans;

Reserves and unrestricted retained earnings appropriations need to conform to thestatutory/legal requirements of the Colorado Common Interest Ownership Act (CCIOA),the HRCA Community Declaration, and Generally Accepted Accounting Principles(GAAP) recommendations.

SECTION 2 - OPERATING AND CAPITAL RESERVE FUNDS

Section 8.2 Establishment of Other Funds, of the Community Declaration provides that theAssociation may establish other funds as and when needed and If the Community Associationestablishes and additional funds, the Board shall designate an appropriate title for the fund to distinguishit from other funds maintained by the Community Association. Pursuant to Section 8.19 Funding ofReserve Funds of the Community Declaration, the Board shall endeavor, whenever possible, to fundthe Administrative Functions Reserve Fund, each Recreation Function Reserve Fund and the PublicFunctions Reserve Fund, if any, by regularly scheduled payments, included as part of the CommonAssessments, rather than by large Special Assessments. In this way, the Association will establish areserve fund for a specified purpose and direct that money to be placed to the credit of the reserve fund.The following funds have been established for the purpose(s) so identified:

2.1 Administrative Operating Unrestricted Retained EarningsFunding Sources Any excess Administrative general operating fund revenues (includingassessments) over expenditures and transfers at the end of each fiscal year.

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The Administrative Operating Unrestricted Retained Earnings has been established for the followingpurposes:

For Major Emergent Operating Issues / Insurance Reserve - HRCA may be exposed to major non-recurring costs related to various emergency events or situations, e.g. inclement weather, environmentalhazards, etc. This unrestricted retained earnings provision has been established to offset the cost ofinsurance claims, coinsurance limits for business income and deductibles, the magnitude and timing ofwhich is often indeterminable. HRCAs insurance exposure is in part due to the fact that the HRCA issubject to a 50% coinsurance provision for business income. These emergent situations cannot beanticipated and budgeted for and it is not feasible to absorb the cost of such events in other budgetareas in any given year. HRCA may also be subject to cash flow shortages from time to time dependenton cash requirements.

To Offset Unrealized Revenues - Some of the HRCAs revenue sources (e.g., transfer fees, legal,late and financing fees, sub-association property management and architectural fees/fines) are subjectto downturns in the economy. HRCA tries to anticipate economic downturns by budgeting for a basedollar amount of these revenues in its general operations. Despite its best efforts, HRCA is exposed tothe possibility of unrealized revenues and/or to declines in base revenues from year to year which couldresult in a net deficit for that year. HRCA cannot always count on budgetary savings or other revenuesto offset these shortfalls.

2.2 Administrative Functions Reserve FundFunding Sources Annual budgeted allocations transferred from administrative operating fund.

The Administrative Functions Reserve Fund has been established for the following purposes:

Replacement of Administrative Fixed Asset Items - To fund major repair and replacement of capitalassets like computers, software, furniture and equipment related to the Administrative Function. It shallbe the Boards responsibility to create and maintain adequate reserves to provide for the orderly andtimely repair and replacement of the common area components so as to minimize the risk to themembership of special assessments, deferred maintenance, or unfunded losses. If these items werefunded from assessments, annual spikes and subsequent declines in assessments would result;therefore, it is not prudent to fund these projects from on-going assessment revenue. These items willbe included separately in each reserve study that is commissioned as stated in section 2.4.

2.3 Recreation Operating Unrestricted Retained EarningsFunding Sources Any excess Recreation general operating fund revenues (including annualassessments) over expenditures and transfers at the end of each fiscal year.

The Recreation Operating Unrestricted Retained Earnings has been established for the followingpurposes:

For Major Emergent Operating Issues / Insurance Reserve - HRCA may be exposed to major non-reoccurring costs related to various emergency events or situations, e.g. inclement weather,environmental hazards, etc. This Unrestricted retained earnings provision has been established to offsetthe cost of insurance claims, coinsurance limits for business income and deductibles, the magnitude andtiming of which is often indeterminable. HRCAs insurance exposure is in part due to the fact that the

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HRCA is subject to a 50% coinsurance provision for business income. These emergent situationscannot be anticipated and budgeted for and it is not feasible to absorb the cost of such events in otherbudget areas in any given year. HRCA may also be subject to cash flow shortages from time to timedependent on cash requirements.

To Offset Unrealized Revenues Some of the HRCAs revenue sources, e.g. facility revenues,membership fees, assessments, and programming revenues are subject to downturns in the economy.HRCA tries to anticipate economic downturns by budgeting for a base dollar amount of these revenuesin its general operations. Despite its best efforts, HRCA is exposed to the possibility of unrealizedrevenues and/or to declines in base revenues from year to year. HRCA cannot always count onbudgetary savings or other revenues to offset these shortfalls.

2.4 Recreation Functions Reserve FundFunding Sources Annual budgeted allocations transferred from the Recreation Operating Fund.

The Recreation Functions Reserve has been established for the following purposes:

Replacement of Recreation Fixed Asset Items - The Recreation Functions Reserve Fund has beenestablished to fund major repair and replacement of capital assets like facility improvements andequipment of the Recreation Facilities. It shall be the Boards responsibility to create and maintainadequate reserves to provide for the orderly and timely repair and replacement of the common areacomponents so as to minimize the risk to the membership of special assessments, deferredmaintenance, or unfunded losses.

In meeting this responsibility, the Board will commission a comprehensive (Full) Reserve Study at leastevery five years following the current Reserve Analysis which will be completed in 2014 (see thedefinition of Reserve Studies). The Reserve Study is to establish a schedule of anticipated repair andreplacement projects, and recommend a Reserve contribution rate.

It shall be the policy of the HRCA to:

1. Only consider repair and replacement expenditures over $3,000 as part of the Reserve Studyanalysis and to be funded from the Recreation Functions Reserve Fund. Items that arepurchased in bulk that cost less than $3,000 apiece may be considered in the reserve study if thecombined total is greater than $3,000.

2. Maintain the Recreation Functions Reserve Fund in accordance with the schedule of theanticipated repair and replacement projects in the reserve study. The Finance Committee willreview and recommend to the Board of Directors an annual contribution to maintain therecommended fund balance each year during the budgeting process.

3. Authorize expenditures from Recreation Functions Reserve Fund for:a. Projects or purchases pre-approved in the annual budget;b. Projects or purchases anticipated in the Reserve Study but not in the annual budget as set

forth in the Capital and Reserve Expenditure Procedure.

4. Maintain Reserve Funds in a general fund managed as indicated in the Investment Policy.

5. Reserve Study updates will be done in accordance with the Reserve Study Policy.

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2.5 Backcountry Operating Unrestricted Retained EarningsFunding Sources Any excess Backcountry general operating fund revenues over expenditures andtransfers at the end of each fiscal year.

The Backcountry Operating Unrestricted Retained Earnings has been established for the followingpurposes:

For Major Emergent Operating Issues / Insurance Reserve - HRCA may be exposed to major non-reoccurring costs related to various emergency events or situations, e.g. inclement weather,environmental hazards, etc. This unrestricted retained earnings provision has been established to offsetthe cost of insurance claims, coinsurance limits for business income and deductibles, the magnitude andtiming of which is often indeterminable. HRCAs insurance exposure is in part due to the fact that theHRCA is subject to a 50% coinsurance provision for business income. These emergent situationscannot be anticipated and budgeted for and it is not feasible to absorb the cost of such events in otherbudget areas in any given year. HRCA may also be subject to cash flow shortages from time to timedependent on cash requirements.

To Offset Unrealized Revenues - Some of the Backcountrys revenue sources, e.g. programs, grantsand special events are subject to downturns in the economy. HRCA tries to anticipate economicdownturns by budgeting for a base dollar amount of these revenues in its general operations. Despite itsbest efforts, HRCA is exposed to the possibility of unrealized revenues and/or to declines in baserevenues from year to year. HRCA cannot always count on budgetary savings or other revenues tooffset these shortfalls.

2.6 Backcountry Reserve FundFunding Sources Annual budgeted allocations transferred from Backcountry Operating Fund.

The Backcountry Reserve has been established for the following purposes:

Replacement of Backcountry Fixed Asset Items - To fund major repair and replacement of capitalassets like trails, vehicles, fences and office equipment. It shall be the Boards responsibility to createand maintain adequate reserves to provide for the orderly and timely repair and replacement of thesecomponents so as to minimize the risk to the membership of deferred maintenance, or unfunded losses.These items will be included separately in each reserve study that is commissioned as stated in Section2.4.

2.7 OSCA FundFunding Sources Transactions of the Association related to the agreement with Shea Homes.

The Open Space Conservation Agreement (OSCA) Fund has been established for the followingpurposes:

To fund capital projects in the Backcountry not specifically funded from other establishedReserves/Unrestricted Retained Earnings. Capital projects that will be funded from this reserve arebudgeted within the HRCAs long-term Five-Year Capital Plan. This Fund may be utilized to fund orpartially fund large projects that have been planned and designated as major organization projectpriorities by the Board of Directors.

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2.8 Capital Improvement FundFunding Sources Annual budgeted allocations transferred from Recreation Operating Fund.

The Capital Improvement Fund has been established for the following purposes:

To fund general capital projects not specifically funded from other established Reserves/UnrestrictedRetained Earnings. Capital projects that will be funded from this reserve are budgeted within theHRCAs long-term Five-Year Capital Plan. This Fund may be u t i l i ze d to fund or p a r t ia l l y f undla rg e projects that have been planned and designated as major organization project priorities by theBoard of Directors.

2.9 Debt Service (Bond) FundFunding Sources Monthly budgeted allocations transferred from Recreation Operating Fund.

The Debt Service Fund has been established for the following purposes:

To accumulate funds that are utilized to retire the three bond obligations established in 1995, 1999, and2005 which funded the original construction of Recreation Centers. HRCA must comply with thespecific bond covenants, including a requirement to deposit one-twelfth of the annual principal andinterest due for the fiscal year to the Bond Fund each month.

SECTION 3 - ACCUMULATED UNRESTRICTED RETAINED EARNINGS

Accumulated Unrestricted Retained Earnings refer to funds that have amassed over time and areavailable for spending. HRCA needs to maintain Accumulated Unrestricted Retained Earningsbalances for working capital purposes, to provide for operating expenditures before assessments,program revenues, and other administrative / facility revenues are collected. Maintaining minimumworking capital levels eliminates or reduces the need to borrow externally and/or internally foroperations.

HRCA may also require emergency funds from time to time, from any one of its UnappropriatedUnrestricted Retained Earnings balances, for unforeseen costs or net deficit. When this occurs theCommunity needs to rely upon sufficient balances being available in the applicable UnappropriatedUnrestricted Retained Earnings. For this purpose the Finance Committee has recommended that theAssociation maintain between one and three months of average operating expenses (excludingprogramming operating expenses and depreciation, in-kind, and other non-cash expenses) as anUnrestricted Retained Earnings in both the Administrative and Recreation Funds. The minimum andmaximum recommended amounts will be calculated annually during the budgeting process using theprior 3 years of actual expenses.

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SECTION 4 - ADMINISTRATION

4.1 Reserve ContributionsAnnual and/or periodic contributions to Reserve Funds shall be specific to each Reserve, asapproved by the HRCA Board of Directors through the annual financial planning/budgeting process.

4.2 Minimum and Maximum Reserve BalancesMinimum and maximum fund balance guidelines have been set for some of HRCAs Operatingand Capital Reserve Funds, Accumulated Unrestricted Retained Earnings are shown in attachedAppendix A. The purpose and source(s) of funding applicable to each Fund are also shown in thisAppendix. The minimum balances ensure that the respective balances are not depleted to the degreethat those balances are no longer able to serve their intended purpose(s). The maximum balancesensure that the Associations guiding principles are achieved and that the respective balances do notgrow beyond their intended purpose(s) and thus create idle assets that could be otherwise utilized forother organization priorities. A formal comparative review of actual, minimum and maximum fundbalances shall be undertaken annually during the budgeting process. The Finance Committee willrecommend actions to the Board of Directors for any fund with actual or reasonably projected year endbalances below the minimum or above the maximum.

4.3 Internal BorrowingInternal borrowing from specific Reserve Funds and Accumulated Unrestricted Retained Earningsbalances shall be permissible, if a clearly defined and attainable payback plan, including payment ofreasonable interest (based on associations ability to invest in short-term investments per the investmentpolicy), is in place, as internal borrowing allows for more flexibility in terms of payback amounts andloan duration than that of external borrowing. Paybacks shall be executed according to plan.

4.4 ResponsibilitiesHRCAs Financial Manager shall be responsible for:

Recommending the necessary contributions and transfers so that HRCA sOperating/Capital Reserve Funds and Accumulated Unrestricted Retained Earnings aremaintained in accordance with this Policy;

Conducting an annual review of all Operating/Capital Reserve Funds andAccumulated Unrestricted Retained Earnings balances including comparing actual levelswith the established minimum and maximum levels within this Policy and with otherjurisdiction benchmarks, and reporting the results of such a review to the FinanceCommittee and Board of Directors;

Recommending changes to the minimum and maximum balance guidelines shown inthis Policy; and,

Recommending any revisions or amendments to this Policy, as may be required fromtime to time, as a result of changes in applicable statutes, accounting standards,economic conditions, etc.

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HRCAs Finance Committee shall be responsible for:

Measuring the progress of objectives and make appropriate recommendations to the Boardof Directors.

HRCAs Board of Directors shall be responsible for:

Review and approval/disapproval of recommendations from staff and the FinanceCommittee.

Board can direct changes to the policy

4.5 Guide and TransitionThe minimum and maximum fund balance guidelines shown in this Policy serve as a guide in movingHRCA toward the goals or targets it wishes to attain, in terms of individual fund balances. It isrecognized that HRCAs fund balances may not be between the minimum or maximum levels at thetime of enacting this Policy, however, HRCA is transitioning toward meeting the recommended targets.

SECTION 5 - GLOSSARY

The following terms are used in this Policy and are defined as follows:

1) "Accumulated Unrestricted Retained Earnings" - means the accumulated excess of revenuesover expenditures from prior years which has not been set aside for specific purposes.

2) Annual Unrestricted Retained Earnings - means the excess of revenues over expendituresfor the current budget year which has not been set aside for specific purposes. It could also bereferred to as current year surplus.

3) Reserve Funds - means funds that are set aside for a specified purpose by the HRCA Boardof Directors pursuant to the Community Declaration. These reserves are established via anindependent Reserve Study that is to be conducted in accordance with the Reserve StudyPolicy.

4) Reserves - means all of the HRCAs Reserve Funds.

5) Reserve Studies - There are two components of a reserve study

A physical analysis performed by a reserve provider who evaluates information regardingthe physical status and repair / replacement cost of the Associations major common areacomponents.

A financial analysis only assesses HRCAs reserve balance (measured in cash or as apercent funded) to determine a recommendation for an appropriate reserve contributionrate (funding plan). The Finance Committee recommends to the Board of Directors anappropriate reserve balance and reserve contribution.

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APPENDIX A NONPROFIT OPERATING RESERVES INITIATIVE 2011 (NORI)

The unrestricted retained earnings minimum and maximum amounts for operating funds were establishedusing an assessment process recommended by NORI.

Operating Reserve Calculations

The NORI Workgroup recommends operating reserves of 25% or about 3 months of the annual operatingexpense budget adjusted for risk factors depending on the organizations needs. There is no single correctsolution or benchmark one size simply does not fit all when it comes to setting the amount for OperatingReserves. HRCA auditors have recommended higher operating reserves of 6 to 9 months.

The formula can be calculated in terms of: A percentage (Operating reserves divided by annual operating expense):

Ex. $75,000 (available) $600,000 (annual expense) = 0.13 or 13%

Or number of months (Operating reserves divided by 1/12th of the annual operating expense):

Ex. $600,000 (annual expense) 12 = $50,000 per month$75,000 (available) $50,000 (1/12th annual expense) = 1.5 or 1 months

* The prior year actual expenses are generally used to calculate amounts.

Risk Factors Impacting Operating Reserve Requirements

1. Revenue volatility factors (such as economic health of the community, issues that couldadversely affect current or future revenues and likelihood of severe weather or natural disastersthat would affect the organization).

2. Spending flexibility factors (such as the organizations importance in the community for crisissituations, the extent to which economic downturns or other types of events may affect demandfor services (either up or down), balance of permanent full time staff vs. temporary parttime, theextent of funding commitments made for longer than one year and the amount of unsecured debtcarried by the organization).

3. Governance & management factors (such as planning and budgeting processes).

The Finance Committee determined HRCAs revenue volatility risk is minimal, our spending flexibilityrisk is low to medium and our governance and management risk is also very low. For these reasons a 1to 3 month range of operating reserves was determined to be sufficient.

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APPENDIX B RESERVE/UNRESTRICTED RETAINED EARNINGS SUMMARY

Fund(s) Purpose Funding Source(s) MinimumAmount (2014)

MaximumAmount (2014)

12/31/13Balance

Rationale for LevelsEstablished

RESERVE FUNDS

AdministrativeOperatingFundUnrestrictedRetainedEarnings

For working capitalpurposes within theAdministrative generaloperating fund and forunforeseen generaloperating emergencyexpenditures.

Any excess Administrativegeneral operating fundrevenues (includingassessments) overexpenditures and transfers atthe end of each fiscal year.

$239,141 $717,424 $346,132

(Note:$82,961 inRestrictedbalance in

SpecialProject

account notincluded.)

Minimum: One monthof adjusted operatingfund expenditures.

Maximum: Threemonths of generaloperating fundexpenditures.

AdministrativeFunctionsReserve Fund

To fund major repairsand replacement ofAdministrative Fund fixedassets (e.g., computers,furniture and officeequipment.)

Annual budgeted allocationsfrom general operating fund(including assessments).

TBD TBD $122,692 As directed by theindependent ReserveStudy.

RecreationOperatingFundUnrestrictedRetainedEarnings

For working capitalpurposes within theRecreation generaloperating fund and forunforeseen generaloperating emergencyexpenditures.

Any excess Recreation generaloperating fund revenues(including assessments) overexpenditures and transfers atthe end of each fiscal year.

$1,191,208 $3,573,623 $968,528 Minimum: One monthof adjusted operatingfund expenditures.


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12/31/13Balance


RecreationFunctionsReserveFund

To fund major repairsand replacement ofRecreation Fund fixedassets (e.g., rec facilityrepairs, equipmentrepairs andreplacement).

Annual budgeted allocationsfrom general operating fund(including assessments).

TBD TBD $2,403,207 As directed by theindependent ReserveStudy.

BackcountryFundUnrestrictedRetainedEarnings

For working capitalpurposes within theBackcountry generaloperating fund and forunforeseen generaloperating emergencyexpenditures.

Any excess Backcountrygeneral operating fundrevenues over expendituresand transfers at the end ofeach fiscal year.

$32,477 $97,432 $84749.22 Minimum: One monthof general operatingfund expenditures.


BackcountryReserve Fund

To fund major repairsand replacement ofBackcountry fixed assets(e.g., trail, vehicle, andfence maintenance, andoffice equipment).

Annual budgeted allocationsfrom general operating fund(transfer from Backcountryoperating budget).

TBD TBD $287,620 As directed by theindependent ReserveStudy.

OSCA Fund To fund majorimprovements to theBackcountry (e.g., newtrails, vehicles, fences,and amenities).

Transactions of the Associationrelated to the agreement withShea Homes, the declarant.

N/A N/A $?,???,??? As directed byagreements with SheaHomes.

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12/31/13Balance


CapitalImprovementReserve

To fund future Recreationfacility capital projects orimprovements deemednecessary by the Board.This list of CapitalImprovements is notspecifically funded fromother establishedReserves.

Annual budget allocation fromRecreation Operating Fund(includes assessments).

N/A N/A $250,091 $250,000 budgeted in2014, but futurecontributions to beidentified by Board fiveyear plan.

General DebtService Fund

To accumulate funds forthe repayment of bondsused to financeconstruction of recreationcenters.

Semi-annual payments asdirected by the three bondseries obligations (includesassessments).

N/A N/A $4,000,036 As directed by theBond Covenantrequirements.

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01 February_2015 Delegate_Agenda.pdf02_Regular Meeting of Delegates PROXY Form.pdf03_January 20th Minutes and Roll Call.pdf01 January_2015 Delegate_Minutes.pdfCopy of Jan 20 2015 Delegate Roll Call.pdf

04_FYI's(1).pdf05 February_2015 BOD Agenda(1).pdf06 January_2015 BOD Minutes(1).pdf07_February 2015 DRC Minutes_BryantReviewFINAL.pdf08_01 06 2015 ARC minutes.pdf09_01 20 2015 ARC minutes.pdf10_January Status 2015.pdf11_February 15 Community Rel Report(1).pdf12_Finance committee minutes 12-17-14(1).pdf13_Finance committee minutes 1-21-15.pdf14_ CAA_February_2015 Agenda.pdf15_ CAA_November_2014 Minutes.pdf16_4th Quarter 2014 HRCAA financials.pdf17_ SF_February_2015 Agenda.pdf18__ SF_November_2014 Minutes.pdf19_4th quarter 2014 HRCSF financials.pdf20_Fund Management Policy - Final.pdf

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