Reserve Studies – Capital Budgets – Maintenance Plans
Facilities Advisors is unique in the services we offer, in our ability to meet the needs of our clients, and in our strong conceptual knowledge of capital budgeting processes. Our Facilities Advisors team possesses a broad set of skills that none of our competitors can match. We have offices in the USA and Mexico and travel to the rest of the world.
Reserve Studies are a specialized form of capital budget that are unique to the community association industry. A more appropriate description is that the reserve study is a Major Repair and Replacement (MRR) study because it generally cannot include capital improvements. Reserve studies evolved in the 1980’s as a hybrid service that is neither a capital expenditures budget nor a maintenance plan but is something that is a scaled down combination of the two. While we have been providing this service since 1982, longer than anyone else in the community association industry, we have also always stressed the importance of having a formal maintenance plan. Too many in the community association industry believe that the reserve study takes the place of a maintenance plan - it does not. Full discussion of reserve studies here.
Capital Budgets are used in all industries other than the community association industry. While many, particularly in the community association industry, use the terms capital budget and reserve study interchangeably, they are in fact quite different. The biggest differences are; (1) capital budgets outside the community association industry do include capital improvements, (2) the capital budget does not have the “built in” funding source common to reserve studies in the community association industry, and (3) users of capital budget reports generally tend to be finance-oriented business managers as opposed to residential unit owners in the community association industry who far too often have neither the financial or maintenance backgrounds or knowledge to fully absorb the capital budget reports. Full discussion of capital budgets here.
Maintenance Plans are the non-financial foundation upon which capital budgets and reserve studies are based. Both reserve studies and capital budgets are intended to be the financial reflection OF the maintenance plan. The problem is that most organizations don’t have a formal maintenance plan. That’s where Facilities Advisors comes in – we have the necessary Skill, Knowledge, and Experience (SKE) to help you create your formal maintenance plan. Having a maintenance plan reduces overall maintenance costs, assures building safety, protects property investment value and increases the accuracy of the financial projections in the capital budget or reserve study. Full discussion of maintenance plans here.
Facilities Advisors Benefits for You
Competitive fees – Our fees are competitive because of our extensive experience and dedication to using technology to make us more efficient. We are the only reserve study company to have developed on-site electronic data capture, which reduces the time necessary to gather component data and translate it into a reserve study report. We also "scope" the reserve study to determine the appropriate level of component detail and use software to do the “heavy lifting” This results in reports detailed enough to understand, but not so detailed that it overwhelms the reader.
Responsiveness - We are responsive to your needs. If you request changes to your report, we will make them. It is your report. We allow as many revisions as you need for a 30 day period after the draft report is issued.
Easy-to-read reports - Our reports conform to Generally Accepted Reserve Study Standards as issued by the International Capital Budgeting Institute and give you the information you need to (1) prepare your budget, (2) communicate summary information to your board of directors and members, and (3) meet statutory and regulatory disclosures.
Internet-based software - We provide you with access to the same internet-based software we used to prepare your reserve study. This allows you to keep your reserve plan up-to-date and save money in the future by (1) proactively planning reserve projects, and (2) minimizing future reserve study costs based on your update of component information.
Reports - We will provide a draft report for your review and approval and make any changes you request before issuing a final report. The report will be similar in format to the sample report on our website and will include a 30-year funding plan and percent funded disclosure by year. Supplemental schedules will include a component inventory with photos.
Software - A one year annual software license to the Facilities 7 internet-based reserve study software is included at no additional charge. This is the same software that we use to prepare your reserve study. You may extend the license subject to an annual license fee. We will provide instructions and reasonable training, which is normally conducted via web-based screen sharing software.
Industries Served
The industries we serve depends on the services being provided.
Reserve study services are generally provided only to the community association industry. Included in this industry group are condominium associations, homeowner associations (planned developments), cooperative associations, condo-hotels, and some timeshare associations. While most of these types of associations are residential in nature, it also includes commercial associations such as office condominiums, industrial parks, and retail projects. Some timeshare associations fall into this group due to their governing documents, while others fall under the capital budgeting group.
Capital budgeting services are generally provided to all organizations that are not part of the community association industry group described above. Broad categories within this group are for-profit businesses, nonprofit, and governmental organizations.
Maintenance plan services apply to any organizations that maintain physical facilities. The maintenance plan is not dependent on the industry or type of organization but is based solely on the nature of the physical facilities that must be maintained.
Condominums and Timeshares
Our condominium and homeowner association practice encompasses all types of associations, and from associations as small as 2 units, to projects of more than 10,000 homes that literally represent cities. While some associations have virtually no amenities, others have items such as golf courses, marinas, campgrounds, shooting ranges, lakes, etc. One of our association clients maintains more than 150 miles of privately maintained roads. Our reports are designed to consider the reporting needs of each type of association, and we are unique in our ability to provide data at any level requested by the association. Our fees are competitive, and we do not charge extra for travel time or expenses. The fee quote in our proposal is the ONLY fee we charge.
Timeshare associations and other fractional properties represent a unique challenge because of the need to budget for the replacement of significant interior furnishings and renovations. Our timeshare association practice encompasses associations as small as 10 units (510 intervals), to projects of more than 1,100 units with more than 55,000 interval owners. Further, we have worked with traditional timeshare associations, fractional ownership associations, and vacation clubs. Our reports are designed to consider the reporting needs of each type of association, and we are unique in our ability to provide data at any level requested by the association. Our fees are competitive, and we do not charge extra for travel time or expenses. The fee quote in our proposal is the ONLY fee we charge.
Our nonprofit organization practice encompasses various types of organizations, such as country clubs, social clubs, churches, and schools. Our reports are designed to consider the reporting needs of each type of organization, and we are unique in our ability to provide data at any level requested by the organization. Our fees are competitive, and we do not charge extra for travel time or expenses. The fee quote in our proposal is the ONLY fee we charge.
Our governmental practice encompasses various levels of governmental entities from small water and sewer districts to special projects to units of cities and counties and units of the federal government. Our reports are designed to consider the reporting needs of each organization, and we are unique in our ability to provide data at any level requested by the organization. Our fees are competitive, and we do not charge extra for travel time or expenses. The fee quote in our proposal is the ONLY fee we charge.