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C. Effect of Condemnation_ The Park Owner may make leases subject to <br /> termination upon condemnation or sale in lieu of condemnation. <br /> VI. FORMULAS FOR INCREASES TO MONTHLY RENTS <br /> The Adjusted Monthly Rents shall be adjusted annually and shall be calculated as set <br /> forth below: <br /> (I) From the Adjusted Monthly Rent subtract the existing amortized Capital <br /> Improvement costs (Article VII) if any. This is the Monthly Rent. <br /> (2) Multiply (1) by the Cost of Living, but not less than 2% nor more than <br /> 5%. <br /> (3) Add the amount in (2) to the Monthly Rent. <br /> (4) Add to (3) the amortized Capital Improvement costs, if any, including any <br /> new amortized capital improvement costs. Round to the nearest half dollar. This <br /> is the Adjusted Monthly Rent. <br /> VII. CAPITAL IMPROVEMENT COSTS <br /> A. Capital Improvements; Amortization. If the Park Owner constructs new Capital <br /> Improvements, the Park Owner shall amortize the costs, and shall be allowed to pass through to <br /> the Residents the amortized costs, as provided in this Article. In addition, attached as Exhibit D <br /> are the Capital Improvements which exist at the Park and their original construction cost. If the <br /> Park Owner rehabilitates or replaces any existing Capital Improvements, the Park Owner shall <br /> amortize (as provided in this Article), and shall be allowed to pass through to the Residents, the <br /> difference between the original cost of the Capital Improvement and the cost to rehabilitate or <br /> replace the Capital Improvement, unless the useful life of such Improvement has expired. In that <br /> case, the Park Owner shall amortize the entire cost of the Capital Improvement, and shall be <br /> allowed to pass through to the Residents the amortized cost. Capital Improvement costs shall not <br /> be amortized unless they exceed $2,000. Any costs as to any particular Capital Improvement <br /> that are under the threshold amounts ($2,000) shall not be amortized. Any Capital Improvement <br /> costs that are for maintaining, replacing, or repairing utilities shall not be amortized if the Park <br /> Owner receives a reimbursement from a utility company for that purpose. <br /> B. Amortization Periods. The Capital Improvement amortization periods shall be as <br /> follows: <br /> $ 2,000— 3,499 2 years <br /> 3,500— 5,999 3 years <br /> 6,000— 8,999 4 years <br /> 9,000 — 13,999 5 years <br /> 14,000 — 19,999 6 years <br /> 20,000—29,999 7 years <br /> 30,000 + 8 years <br /> 6 <br />