When there is a major component that we know will have some related expenditures but where predicting the size and timing of those expenditures are difficult, we often provide the association an “allowance”, meaning a sum of money every few years to handle estimated periodic expenses related to the component.
Many associations choose to obtain insurance against a possible significant loss: earthquake, flood, wind, or other major catastrophe. Due to the nature of this type of insurance, the deductible is often very large. While insurance is expected to cover the majority of a loss,
Reserve planning is done so owners can avoid getting hit with special assessments when predictable major Reserve expenses occur. By planning ahead, owners pay their “fair share” of the deterioration of major components on an even and stable ongoing basis. But how far ahead is it reasonable to plan? What do you do when you replace your 20-yr old shingles with roofing material “guaranteed” for 40 years, or rebuild your seawall with a concrete structure that is designed to last 50 or 60 years?
It is never appropriate for the association to set aside or expend association funds for assets the association is not responsible to maintain. If the fences belong to homeowners, expending association funds for maintenance would be inappropriate
We were recently doing a site inspection for a luxury mountain timeshare. It was relatively new, and the engineer had plenty of tales of the “kinks” that he had to work out to get the facility running smoothly. The story of the garage goes like this:
Our interactions with the “real people” in this industry are always interesting and often entertaining. On what might be considered a “normal” site inspection, there is often something humorous or fascinating that happens if you just pay attention. In the last month, I came home several times with a smile and a story. Here’s a recent anecdote:
