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RESERVE <br />ADVISORS <br />1. RESERVE STUDY EXECUTIVE SUMMARY <br />Client: Arden Hills City Hall <br />Location: Arden Hills, Minnesota <br />Reference: 242530 <br />Property Basics: Arden Hills City Hall is a two-story municipal building. The building was built <br />in 1995. <br />Reserve Components Identified: 29 Reserve Components. <br />Inspection Date: March 13, 2025. <br />Funding Goal: The Funding Goal of this Reserve Study is to maintain reserves above an <br />adequate, not excessive threshold during one or more years of significant expenditures. Our <br />recommended Funding Plan recognizes these threshold funding years in 2030 due to the <br />replacement of the built-up roof sections, in 2035 due to the replacement of the windows and <br />doors, and in 2045 due to replacement of the make-up air handling units. <br />Methodology: We use the Cash Flow Method to compute the Reserve Funding Plan. This <br />method offsets future variable Reserve Expenditures with existing and future stable levels of <br />reserve funding. Our application of this method also considers: <br />• Current and future local costs of replacement <br />• 2.7% anticipated annual rate of return on invested reserves <br />3.3% future Inflation Rate for estimating Future Replacement Costs <br />Sources for Local Costs of Replacement: Our proprietary database, historical costs and <br />published sources, i.e., R.S. Means, Incorporated. <br />Unaudited Cash Status of Reserve Fund: <br />• $0 as of December 31, 2024 <br />• No budgeted Reserve Contributions in 2025. <br />Project Prioritization: We note anticipated Reserve Expenditures for the next 30 years in the <br />Reserve Expenditures tables and include a Five -Year Outlook table following the Reserve <br />Funding Plan in Section 3. We recommend the building prioritize the following projects in the <br />next five years based on the conditions identified: <br />• Modernization of the hydraulic elevator due to age <br />• Inspection and partial repairs to the masonry facade due to noted occurrences of cracks, <br />spalls and lintel corrosion <br />• Replacement of the built-up roof sections due to age <br />• Capital repairs to the make-up air handling units due to age <br />Page 1.1 - Executive Summary <br />