Reserve Studies are intended as a tool to anticipate and budget for the expense of repairing, refurbishing, or replacing common areas in an Association-governed community. In order for these shared locations to be properly maintained, enough funds must be allocated to “reserves” so that any deterioration and/or damage that occurs on the property may be fixed in a timely manner.
A Reserve Study is a tool to analyze and assess the physical health of any property. In the case of Association-governed communities like condos, co-ops, HOAs, OAs, POAs, and PUDS, the property’s future is in the hands of the Board of Directors. A Reserve Study that is up to date and relevant on an annual basis safeguards board members from any liability that may arise from any evidence that the reserves have been mismanaged or poorly maintained.
A significant deadline is rapidly approaching: the 3/15/2012 date when the higher 2010 ADA standards apply to all new and altered recreational facilities.
We’ve all heard the famous quote “Nothing is certain except for death and taxes”, often attributed to Benjamin Franklin. But we all know there are a few more certainties in life.
Reserve Studies are budget planning and disclosure documents prepared to help the board meet their responsibility to care for the assets of the association.
What’s better – $50/mo Reserve contributions (as part of your condo’s total monthly assessment) or $70/mo? All other things being equal, I’d rather pay a $50 monthly bill than a $70 monthly bill. But… not all other things are equal.
