Road Improvement Presentation Road Improvement Committee (RIC) Informational Meetings March 2016 Member discussion will follow presentation Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting 12 miles of roads 48 cul-de-sacs Parking lots 52 Culverts 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Members Marvin Theobald – RIC Chairman Tim Coan – HLA Board President Tim Weir – HLA Board Vice President Bob Pirtle – HLA Board Maintenance Director Shawn Cassatt – Road Committee Chairman Jim Flynn – Finance Committee Representative Brad Reed – Road Committee Representative Rick Stokes – Environmental Control Committee Chairman 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Mission The HLA Road Improvement Committee is a group of designated HLA Members charged with providing to the Board and Members recommended options and cost estimates for the restoration, long term maintenance and funding of HLA roads, culverts, shoulders, ditches, parking areas and campground roads. This charge is with specific purpose toward providing solutions in conjunction with the Road and Finance Committees. The RIC is granted Board authority to negotiate HLA road related construction issues with outside sources for the purpose of education, design, cost estimating and funding. The RIC shall explore any and all areas related to the funding of road reconditioning. RIC Members are not permitted to enter into any contractual agreements or make any financial commitments in behalf of HLA. 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

What has been done since 2015 Annual Meeting Completed road/culvert inventory and condition evaluation in conjunction with engineer service Identified road design variables Established restoration priorities Clarified Tazewell County funding expectations Completed cost analysis of various road designs Developed restoration recommendations 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting Funding Challenge Prior Construction Cost Estimates 2012 County Transportation- $7,440,000 2015 Hermann & Associates - $9,220,000 (Not included: inflation, interest or legal costs) Current Road Fund 20 yr Income - $1,750,000 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting RIC Recommended Plan Primary / Secondary Road Resurface Similar to Scarborough Dr (A-1/A-2 chip seal) Primary Road Reconstruction Similar to Bradford Dr (Till, 3” CAM-6, 3.75” asphalt) Secondary Road Reconstruction Similar to Scarborough Dr (Till, 2” recycle asph, A-3) Parking Lots and Campground Roads No restoration planned Total Construction Cost - $3,100,000 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting Variables Considered Current road and culvert conditions Construction quality and durability Construction costs Future road maintenance Future road maintenance costs Drainage issues Funding alternatives, amounts and durations Applicable inflation and interest 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting Inputs Considered Hermann & Associates Study and Report Road and culvert evaluations and recommendations UCM Construction Quotes Road feature costs and recommendations Hoerr Construction Quote Culvert liner costs Tazewell County Transportation Committee 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Restoration Priorities Preserve roads not in need of reconstruction Reconstruct Primary Roads Reconstruct Secondary Roads Repair or replace culverts (concurrent) Repair shoulders and ditches (concurrent) Monitor and maintain roads (continuous) 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting Primary Roads to be resurfaced Secondary Roads to be resurfaced Primary Roads to be reconstructed Secondary Roads to be reconstructed Recently restored 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting RIC Recommended Plan $650 Annual Per Property Owner Primary / Secondary Road Resurface Similar to Scarborough Dr (A-1/A-2 chip seal) Primary Road Reconstruction Similar to Bradford Dr (Till, 3” CAM-6, 3.75” asphalt) Secondary Road Reconstruction Similar to Scarborough Dr (Till, 2” recycle asph, A-3) Parking Lots and Campground Roads No restoration planned Total Construction Cost - $3,100,000 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting Funding Alternatives Special Service Area (SSA) County initiated funding mechanism through bond issuance to fund construction costs Repayment of loan through property taxes over defined period of time HLA Road Fund (HLA) Annual payments by members to Heritage Lake Association 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

SSA/HLA Common Features Construction quality is the same Flat annual payments for duration of funding Include 20 years estimated maintenance cost Require changes to HLA By-Laws Include 10% contingency funds No Roads will be dedicated 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting SSA/HLA Differences Special Service Area HLA Road Fund Construction completion 2 construction seasons Payment duration - 20 years County collects in property tax Provides engineering funds for county to plan and execute project Payments may be eligible for tax deductions Total costs $8.2M Construction completion - 14 years Payment duration - 14 years HLA responsible for collections Provides limited engineering funds for HLA to execute a defined plan Road Fund payments are not eligible for tax deductions Total costs $5.5M 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting Risk Considerations SSA Funded Option Bond/loan interest rate is unknown Up front legal & engineering cost if SSA is not funded HLA Road Fund Option Potentially high inflation due to long term plan Non-Payments could exceed 10% Plan subject to future changes by HLA members 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting Risk Considerations Current HLA Road Fund Further road deterioration Increased future cost Impact on property values Road Safety Culvert failures due to aging 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting Conclusion Current Road Fund is inadequate Without an increase in funds roads will deteriorate further and become more costly RIC recommended plans most cost effective solutions for returning roads to a reasonable condition 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting

Road Improvement Committee Presentation – 2016 Annual Meeting Member Discussion 9/22/2018 Road Improvement Committee Presentation – 2016 Annual Meeting