FCC White Paper Report

construction would be a logistics challenge and add to the project's cost due to the need for temporary facilities.

H. The new structure would include a restroom, connections to the sewer system, office space, overnight accommodations for emergency coverage needs, the addition of a fiber optic connection to the main clubhouse and golf maintenance facilities, incident reporting software, camera upgrades, and a new generator.

VIII. The Cost of Doing Something - Possible Solution for Clubhouse and Gatehouse To consider moving forward, a good faith estimate of the costs to implement the possible solution must be understood, as discussed in this white paper. What has been developed is an estimate of the rough magnitude of costs. These drawings represent an idea of what could be done given the known deficiencies with the Clubhouse and Gatehouse and suggested improvements developed with focus group input. The cost will change based on several factors, including member survey feedback. At this time, total costs for the possible solution, as discussed, are estimated to be in the range of $38 million to $42 million. To pay for a solution, four potential funding sources are considered: • Debt/Borrowing- an attractive funding source allowing current members to pay for and enjoy improvements as long as they remain members. In addition, future members would pay for those improvements as they enjoy the club, with the understanding that the payment would stop after the loan is repaid. A ten-year loan agreement has been recommended. • Net Joining Fee - have increased in the past few years. The funding model assumes the sale of twenty-nine homes each year. The amount of funds projected from this source can be unpredictable based on the number of home sales and the percentage of equity held by members moving out of the community. The new joining fees are also subject to potential increases (positive – helping us to pay back the debt sooner) or decreases (negative) that can impact available capital and our ability to pay debt service. Net joining fees will not be adequate to fund the proposed projects fully but will be used to supplement other funding sources.

• Monthly Member Renovation Capital Contribution- the most reliable and steady source of capital funds that can be dedicated to capital projects and debt payments. This source is typically billed, which allows monthly, allowing members

19