Rec Doc 2016-099081 CONF The Grove Declaration of Restrictions (CC&Rs)

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adequate reserves therefor; and if so, the statement shall also set out the estimated amount, commencement date and duration of the assessment; (vi) A statement as to the mechanism or mechanisms by which the Board will fund reserves to repair or replace major components, including assessments, borrowing, use of other assets, deferral of selected replacement or repair, or alternative mechanisms; and (vii) A general statement addressing the procedures used for the calculation and establishment of those reserves to defray the future repair, replacement or additions to the major components. The statement shall include, but need not be limited to, reserve calculations made using the formula described in Civil Code section 5570(b)(4) and may not assume a rate of return on cash reserves in excess of 2 percent above the discount rate published by the Federal Reserve Bank of San Francisco at the time the calculation was made. (viii) A statement as to whether the Association has any outstanding loans with an original term of more than one (1) year, including the payee, interest rate, amount outstanding, annual payment and when the loan is scheduled to be retired. (ix) A summary of the Association's property, general liability, earthquake, flood and fidelity insurance policies. The summary shall include: (i) the name of the insurer; (ii) the type of insurance; (iii) the policy limits of the insurance; and (iv) the amount of deductibles, if any. To the extent that the information required to be disclosed is specified in the insurance policy declaration page, the Association may meet its disclosure obligations by making copies of that page and distributing copies to all its Members. The summary shall contain, in at least 10 -point boldface type, the following statement: This summary of the Association's policies of insurance provides only certain information as required by Civil Code section 5300 and should not be considered a substitute for the complete policy terms and conditions contained in the actual policies of insurance. Any Association member, upon request and reasonable notice, may review the Association's insurance policies and, upon request and payment of reasonable duplication charges, obtain copies of those policies. Although the Association maintains the policies of insurance specified in this summary, the Association's policies of insurance may not cover your property, including personal property, or real property improvements to or around your dwelling, or personal injuries or other losses that occur within or around your dwelling. Even if a loss is covered, you may nevertheless be responsible for paying all or a portion of any deductible that applies. Association members should consult with their individual insurance broker or agent for appropriate additional coverage. The Association, as soon as reasonably practical, shall notify its Members by first-class mail if any of the policies have lapsed, been cancelled and not immediately renewed or restored or if there is a significant change such as a reduction in coverage or limits or an increase in the deductible for any policy. If the Association receives any notice of non -renewal of a policy, the Association immediately shall notify its Members if replacement coverage will not be in effect by the date the existing coverage will lapse. 5.10.2 Assessment and Reserve Funding Disclosure Summary. The Assessment and Reserve Funding Disclosure Summaryform prepared under Civil Code section 5570 shall be distributedwith each annual budget report or summary. 5.10.3 Financial Statement Review. A review of the financial statement of the Association shall be prepared in accordance with Generally Accepted Accounting Principles by a licensee of the California State Board of Accountancy for any fiscal year in which the gross income of the Association exceeds $75,000. A copy of the review of the financial statement shall be distributed within one hundred twenty (120) days after the close of each fiscal year by individual delivery pursuant to Civil Code section 4040. EDNB\53295\996553.3 16 August 18, 2016