I have a lease template that covers my states legal requirements.

I also took his list to Lowe’s and Home Depot and created a price listing covering each item.  

Also - I’d look into the history of the condo fees - do they raise the fees periodically and what do these fees cover?

I spent 30+ years in Washington State and have had some involvement with DSHS (although not with housing).My advice to you: 1) Everything the state does takes three times as long as it should and three times as much paperwork as it should.  2)  You will probably have to attend some indoctrination -- I mean class -- either on-line or in person.  3) Your tenant will be endlessly "educated" on their rights and will have free legal representation. 4 ) Just when you think you know the rules and try to play by them, an administrator will come up with an "ETR" -- Exception to Rule. 

If the landlord is named on the policy, then the landlord is also notified if you cancel the policy (which would put you in violation of your lease).I would talk to an insurer about the amount of the policy - renter's insurance can also cover damages caused by the renter (you) and as well as the contents of the rental unit. 

Unfortunately the renter downstairs has been having his utilities covered in his rent.

Lee do you account for Capex as well, or only 10% for maintenance to cover all needed repairs?  

Nice guy but he relapsed and covered the heat lamp it the bathroom with a towel and left it on, started a fire, towel dropped and burned plastic tub, corner of cabinet, soot everywhere.

They can cover over multiple companies in multiple states.  

The Money out of MY Pocket: Is to cover a small portion of the mortgage and water/sewage.