1.1 In the case of either a conversion condominium or a new construction condominium, the developer must establish a reserve fund at a level adequate for deferred maintenance, repairs and replacement of those common elements or major components of common elements that must be replaced on a periodic basis. The developer must contribute to such a reserve fund in proportion to the number of condominium units owned by the developer. 2.1 "Common elements" is defined as all of the condominium except the units. 2.2 "Major components of common elements" is defined as including but not limited to the following: • painting • outside lighting fixtures • roofing • carpets and floors in common areas • boilers • elevators • central heat & air conditioning • private streets/driveways • recreational facilities/amenities • furnishings and equipment • piping • miscellaneous underground utilities, i.e., storm sewers, water pipes, and electrical system 3.1 The amount of reserves that are required to be set aside will be based on the following process: • An inventory of those common elements subject to periodic replacement. • Determination of the remaining useful life of each element to be replaced over time. • Estimation of the cost of replacement at the expiration of the remaining useful life of each common element. • Adjustment of that amount by any salvage value that may remain. • Division of the total sum derived from the above cited procedure by the number of years of remaining useful life will determine the annual sum needed to be set aside to assure that adequate funds are available when replacement is required. 4.1 The budget reserve requirement must be incorporated as part of the disclosures in the "Consumer Guide." 5.1 The provisions of this regulation are severable. If a court holds that a provision is invalid or inapplicable, the remainder of the regulation remains in effect.