1 Defect Remediation Project West Campus Point March 13, 2007

2 What Is West Campus Point? 65 units Built in 1986 Affordable housing for faculty 71 ladder faculty members (9% of total) Very successful in recruiting and retaining faculty Managed by WCP Homeowners Association

3 WCP Homeowners Association Governed by Board of Directors elected annually Members usually serve 2 – 3 years Manages property with assistance from Town 'N Country Property Management Monthly financial reports and Board meetings Regular maintenance “walk-arounds”

4 WCP Long-term Financial Planning Comply with California law governing homeowners associations Annual budgeting and auditing for both short-term and long-term maintenance Long-term cost estimates derived from professional “reserve studies” –every 2 – 3 years –Analyze common infrastructure lifetime maintenance and replacement costs –Fully fund recommendations Some issues have transcended scope of any HOA

5 Leak Remediation Efforts

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11 Leak Locations

12 Roof Drainage

13 Roof Drainage

14 Roof Drainage

15 Roof Drainage

16 Roof Drainage

17 Roof Drainage

18 Roof Drainage

19 Roof Drainage

20 Roof Drainage

21 Roof Drainage

22 Roof Drainage

23 Drain Outlets

24 Envelope Penetration

25 Envelope Penetration

26 Envelope Penetration

27 Envelope Penetration

28 Door and Window Leaks

29 Door and Window Leaks

30 Shoddy Construction

31 Shoddy Construction

32 Shoddy Construction

33 Rot and Mold

34 Rot and Mold

35 Rot and Mold

36 Rot and Mold

37 Additional Issues Soil grading (flooding) Communication between WCP and University Cost recovery mechanism Valuation of units

38 Guiding Principles WCP Board needs to be an equal partner with University in shaping and approving all aspects of the solution No one wants to go through this #$#%&! again!

39 Action Items Regular operational meetings Access to senior administrators Timetable Periodic high-level progress reviews

40 End End

41 Everett Kirkelie created the first budget in 1986 Yearly Budgeting > Homeowners’ Assessments WCP Finances 2007 Assessments based on reviews conducted every 2-3 years of 30-year infrastructure needs Operating… 2/3 $323 per month 1)Landscaping 2) Insurance 3)Management Reserves… 2/3 $168 per month 1)Roofing 2) Paint 3)Street

: $491/month $177,000/(30 Years) 1987: $135/month $48,600/(30 years) 1987 Scaled by Faculty Salary Scale (CPEC) Total Monthly Payment Per Unit Sources: WCPHOA Annual Reports, BLS, CPEC Original budget created by Everett Kirkelie

: $491/month $177,000/(30 Years) 1987: $135/month $48,600/(30 years) 1987 Scaled by Consumer Price Index 1987 Scaled by Faculty Salary Scale (CPEC) Sources: WCPHOA Annual Reports, BLS, CPEC Total Monthly Assessment Per Unit

44 Total CPI Roof/Deck/Trellis Sources: WCPHOA Reserve Studies, BLS CPI Assessment Based on Reserve Studies 100% funding of recommended assessments

45 Total CPI Roof/Deck/Trellis Sources: WCPHOA Reserve Studies, BLS CPI Assessment Based on Reserve Studies

46 Why Reexamine the WCP “Index” for Appreciation of Units over Time? To restore original intent of both the University and faculty To restore original intent of both the University and faculty To increase the chances that WCP owners would be able to move out, thus freeing the homes for future recruits. To increase the chances that WCP owners would be able to move out, thus freeing the homes for future recruits. To create a common standard to apply across all UCSB faculty housing owners at WCP, North Campus, etc. based on current published economic information. To create a common standard to apply across all UCSB faculty housing owners at WCP, North Campus, etc. based on current published economic information.

48 Total Percentage Change in Real Estate Prices and CPI, 1975 QI – 1985 QIV This graph This graph Approximates a graph shown to first buyers to justify using CPI as index. Approximates a graph shown to first buyers to justify using CPI as index. Shows that CPI and real estate prices rose at similar rates, on average, in base period. Shows that CPI and real estate prices rose at similar rates, on average, in base period.

Total Percentage Change Since 1986-IV In CPI and Three Housing Price Indices (Housing Data: Office of Federal Housing Enterprise Oversight) Year Cumulative Percent Change California Housing USA Housing CPI National S. Barbara Co. Housing

Total Percentage Change Since 1986-QIV in CPI and Three Housing Price Indexes Inflation in housing prices has far outstripped the CPI in the last decade Inflation in housing prices has far outstripped the CPI in the last decade “Santa Barbara Co.” trend data are for the “Santa Barbara-Santa Maria Metropolitan Statistical Area” “Santa Barbara Co.” trend data are for the “Santa Barbara-Santa Maria Metropolitan Statistical Area” OFHEO data cover OFHEO data cover Single family homes Single family homes Repeat sales of same properties: “constant quality” Repeat sales of same properties: “constant quality” Conforming mortgages only, up to $417K Conforming mortgages only, up to $417K Readily available data Readily available data