Your HOA at Work

Covenant Hills Asphalt Reconstruction Project

In 2021 LARMAC contracted with GMU Pavement Engineering to conduct an extensive evaluation of the private streets in Covenant Hills. With more than 2.3 million square feet of pavement surface area in Covenant Hills, asphalt is overwhelmingly the most expensive asset listed in the Covenant Hills Reserve Study.

Following this evaluation, GMU presented LARMAC with a Pavement Management Plan (PMP) Report, which provided essential information pertaining to the current condition of the streets and a recommendation for optimizing street conditions and estimating the cost to maintain at an appropriate level going forward. Implementing the recommendations from the PMP Report will extend pavement life and reduce the overall cycle cost over time of the Covenant Hills private streets.

Timeline of Events:

  • April 6, 2022 - Future street repair recommendations and an updated funding plan were incorporated into the Covenant Hills Reserve Study in FY 2023, which was approved by the Board of Directors.
  • June and July of 2022 - Highlights from the GMU PMP Study, as well as reserve contribution and funding information, were mailed to Covenant Hills homeowners.
  • September 21, 2022 - A Town Hall meeting was held to address questions and provide a more in-depth look into the street issues and solutions for rectifying the issues. Presenters included GMU Engineering and LARMAC legal counsel.

Project Updates:

  • Phase 1 - Phase 1 of the mutil-year street repair project was completed in November of 2022. The project included street repairs on the following streets: Anapamu, Ali, Sam, Basillica, Friar, Becker, Pointe, Kane and Hammonds.   
  • Phase 2 - Phase 2 of the multi-year project was completed in September 2024. The project included street repairs to the following streets: Katy Rose, John, Adele, Julia, Michael, David, Eric, Emmy and Jenny. This phase also included a seal coat on the streets listed above in Phase 1 as well as Cambridge Road.   
  • Phase 3 - Phase 3 of the multi-year project was completed in October 2024. This project included street repairs to the following streets: Lemonpeel Rd, Christopher St, Sky Ranch Rd, Pistoria Ln, Pisano St, Stockmen Rd, Cowboy Rd, Gaucho Rd, Vaquero Rd and Catalina Vista Rd.     
  • Phase 4 - Planned street repairs for Summer of 2026. Streets included in the phase are: Coral Blue, Crespi, Cloister, San Jose, Fansiscan, Mission Ridge, San Juan Bautista, San Luis Obispo and Bell Pasture. The following streets are scheduled to receive a seal coat: Alexa, Broken Arrow, Columnar, Buckaroo, Sky Ranch, La Riata, Paniolo, Rickie, Thomas, Old Coach and Overlook. 

Note - Localized repairs occur as needed and are separate from the phased projects. As an example, a few sections on Covenant Hills Drive have been repaired knowing that Covenant Hills Drive street repairs are not planned until after all of the neighborhood streets have been completed, which is currently slated for 2033-2034.   

As part of the FY 2026 budget review and approval process, future repair and replacement budgets were updated based on more recent construction costs, which have increased by about 35-40% due to a local asphalt plant closure.  These updates have a significant impact on the funding plan, specifically the percentage funded, which is displayed below.

Included as part of the Reserve Study approval, an updated funding plan was approved for Covenant Hills. This funding plan has been designed to build up reserves to a sufficient level over the next several years to fund future asphalt repair projects. 

Following large reserve contribution increases in FY 2023 (83.7%) and FY 2024 (64.4%), the current monthly reserve contribution only increased by 10.2% for FY 2025 (effective June 1), which equates to a $188.19 monthly reserve contribution. This is up from a rate of $56.56 from three (3) years ago. The updated reserve funding plan includes a more typical 7% annual reserve contribution increase for the next nine (9) years starting in 2025-2026. The plan then reflects a 9% decrease for 7 years at the tail end of the significant street repairs to level out the funding levels. The exhibit below is a section of the updated funding plan, which shows the estimated monthly reserve contribution year over year as well as the corresponding percent funded. As you can see from the exhibit below, the percent funded continues to slowly increase each year despite only factoring in 7% increases in the monthly contribution each year for the next nine (9) years. After a 9% decrease in fiscal years 2035 - 2041, the anticipated monthly reserve contribution is estimated at $178.79 per month and the percent funded is expected to be 79%.

Note - The Reserve Study and Funding Plan are reviewed and updated annually as part of the budgeting process. Every year, updates are incorporated into the Reserve Study, such as actual expenses incurred vs. estimates that were budgeted. Additionally, life expectancies can vary based on actual experiences - all of which have an impact on the Funding Plan.    

EXHIBIT: Reserve Funding Plan at a Glance

Approved Funding Plan

Covenant Hills 2021 Pavement Management Plan (PMP) - This was the original PMP study conducted. 
Covenant Hills 2024 Pavement Management Plan (PMP) - This was an updated PMP study three (3) years later.