Re-roofing has begun. It was our intention to replace the aging solar system simultaneously. However, several unforeseen problems have made it prudent to postpone replacing the solar system, possibly until next year, for financial reasons. The delay will not impact our potential tax savings since Congress has extended the Federal Energy Tax Credits for five years.
We have not signed a contract with a solar contractor. There are still unresolved cost issues with the solar project. The contractor made an error on the original bid, increasing the project cost by over $26,000.
When re-roofing was begun, the roofing contractor found that some of our peaked roofs were not properly vented when built. This has resulted in moisture damage to some plywood sheathing due to condensation. Fortunately the damage is limited to the plywood nearest the ridge line. To correct this situation and prevent similar damage in the future, a ridge vent must be installed along the ridge line of the roof in these areas. Our roofing contractor will do the work, and we have issued an amendment to their contract authorizing this on a time-and-materials basis. This additional work will add to the cost of the roofing project. The exact increase will not be known until all the roofs have been uncovered and re-shingled, but it will add significantly to the cost of the job.
Because of the increased amount of dry rot damage that we have been experiencing, we asked J&D to provide an estimate of how much additional repair work might be required. They recently completed this, and came up with an estimate of approximately $130,000. This estimate includes repairing a number of decks as well as siding. Their figure exceeds the amount we had budgeted in our reserves, but the work must be done because dry rot does not stop. The degree of severity varies, and we plan to prioritize the required projects, doing the most serious and threatening damage repairs first. All this work may not have to be done this year. Once the work has begun, we will have a better idea of the accuracy of J&D’s estimate and the true extent of the projected cost.
If we were to proceed with the solar project and repairs, our 2016 year end reserve balance would end up negative. By postponing the solar project, our reserves will remain positive and healthy this year. In 2017, with our reserves allowing it, we can proceed with the solar project.