Reserve fund study
Reserve fund study
(OP)
1. Is the attached what would be expected in a reserve fund study? It seems rather skimpy, and vague on some items.
2. Does anyone have a sample page from a reserve fund study?
3. There is an item for painting exterior concret. Why? If it is not already painted, then painting it provides no significnt protetion to anything (assuming normal paint) and creates an added maintenance item of having to repaint every 15 to 20 years. If the concrete looks dirty, seems to me that if that is an issue, would be better to power wash it.
2. Does anyone have a sample page from a reserve fund study?
3. There is an item for painting exterior concret. Why? If it is not already painted, then painting it provides no significnt protetion to anything (assuming normal paint) and creates an added maintenance item of having to repaint every 15 to 20 years. If the concrete looks dirty, seems to me that if that is an issue, would be better to power wash it.






RE: Reserve fund study
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Professional Engineer (ME, NH, MA) Structural Engineer (IL)
American Concrete Industries
https://www.facebook.com/AmericanConcrete/
RE: Reserve fund study
Dik
RE: Reserve fund study
If anyone can comment on how the items of the reserve fund study were listed and described (on the attachment to my starting post), that would also be helpfull to me. Some of the descriptions seem so lacking in detail that I cannot know the extent of the future remedial measures that they have in mind. Is that normally the case in these studies?
Also, what happens if it is found that an item does not need replacement or remedial work at the end of what was its estimated life, but looks like it will last say another 10 or 20 years? Is the amount of the reserve fund adjusted downward?
RE: Reserve fund study
Looking past the numerous grammatical and formatting issues in the 1 page of the report you provided, yes the information looks skimpy. I have seen many similar lower end reserve fund studies in my time. There are companies that do complete very nice documents, but they are in the minority. Typically reserve fund studies are done very cheaply, which leads to a report worth what you paid for it.
I think if you take a look at the site you will find the existing concrete is already painted. I agree with the above comments that this becomes a future maintenance liability, however, what was done is done. Therefore, a reserve fund should account for the repainting of previously painted exterior concrete, it is a cost the condo will have to pay at some point.
Reserve funds look into the future, without the aid of a crystal ball. Assumptions need to be made on the reasonable service life for various building components. Sometimes you win, sometimes you lose, however using estimated lifespans allows for future budgets to be set that are reasonable. Reserve funds are updated periodically, as per timelines determined by the legislation. There is always engineering judgment used to determine remaining life and make adjustments to the financials of the reserve fund. There is absolutely no reason to replace or repair something that does not need to be just because it is at the end of it's expected service life. If the exterior paint has an expected life span of 30 years (as per the report), you should budget for it's replacement at that time, but if at year 29 it is still in pristine condition, why would anyone recommend recoating it? Perhaps A) monitor, B) make sure they keep the funds in place for the eventual recoating at year ?35, 40?, whatever, C) continue to maintain a healthy reserve fund. (and 30 years for the life expectancy of exterior paint on concrete seems way too long)
RE: Reserve fund study
1. Is the amount of the reserve fund adjusted when it is found that a significant cost item is still in good condition at the end of its estimated design life?
2. What do they do in the review, if they do not visit the site (the company literature says that they do not visit the site for the reviews)?
3. Is there legislation saying that the reserve fund must be signed by a professional engineer or architect, or can anyone do it?
4. Is there legisation spelling out how a reserve fund must be carried out, and how oftern it must be updated, and whether site visit must be made when updating?
5. Is there PEO documents spelling out this?
6. I am told the exterior concrete is not currently panted, but I have not seen it myself. I will try to go look.
RE: Reserve fund study
RE: Reserve fund study
RE: Reserve fund study
Keeping in mind I used to do reserve funds years ago, but not in last 15 years, some answers might need checking. But in response to your questions:
1. Yes, the reserve fund can be adjusted, typically at 3 year intervals. It can be adjusted based upon expenditures (i.e. a roof was replaced as per schedule), or deferred items due to their condition.
2. Typically every 3 years the reserve fund must be updated. The first reserve fund study is a full one, with site visit, the second one an update without a site visit, then the next one is a comprehensive one that includes a site visit. All that is done for the updates (no site visit) is that the remaining life spans are updated, any work that was completed is updated, and possibly any special assessments for unforeseen work are accounted for and then the numbers re-crunched. Adjustments to the reserve fund contribution may, or may not occur at this point.
3. There is a list of people that are allowed to do it (engineers, architects, quantity surveyors, technologists, crp's??, members of the appraisal institute, etc..), and a list of people who are not allowed to do it (board members, condo owners, relatives of the aforementioned, etc...)
4. Yes, the condominium act prescribes these things, but there are more friendly summaries out there identifying generally the minimum requirements. There is a fair amount of latitude in how it is actually presented. Google is your friend to find this info.
5. No PEO documents that I am aware of, but easy enough for you to check it out on their website.
6. I could see the condo number through the sticky and just used google street view, so my comments might not be accurate. The address that showed up via google definitely had painted concrete shear walls each side of the balconies. No clue whether or not I was looking at the correct building. If you have the exact address, try google street view and I am sure you will have your answer quite quickly and perhaps save you the trip.
Good luck.
RE: Reserve fund study
I see that you are very resourceful, but you must be looking at the wrong building. The one that I am talking about does not have any balconies. I will use Google earth as you suggest, to double check if the walls are painted, but the person that I am talking to there says that they are not.
Thanks for the other comments. Very nicely and clearly presented. I can look further into it as you suggest.
Thanks very much. Much appreciated.
RE: Reserve fund study
1. The reserve fund report is signed in the fllowing format (although not as "John Doe"):
John Doe, M.A.Sc., B.Tech ARCH
Is there anything in this to indicate that the report was written by an architect licensed to practice in the Province of Ontario? (I have checked the PEO website and he is not indicated there as being a liccensed professional engineer in Ontario, so now I am interested in knowing if he is a licensed architect in Ontario).
2. Can an item that is considered as "betterment" be added to the reserve fund study?
RE: Reserve fund study
Under the Condo Act, are the people who can carry out a "Performance Audit" the same as the people who can carry out a "Reserve Fund Study"? Seems like Performance Audit is limited to Professional Engineers and Architects. Right?
RE: Reserve fund study
https://www.ontario.ca/laws/statute/98c19?search=o...
If this is not exactly what you are looking for, there is a localized search bar at the top of the page. Or start at www.ontario.ca
Short on time, will look into it more later.
excerpt from private website, unverified:
(maytower.ca)
The Regulations to the Condominium Act 1998 note who is permitted:
◾Members of the Appraisal Institute of Canada
◾Persons who hold a certificate of practice within the meaning of the Architects Act
◾Certified Engineering Technologists
◾Architectural Technologists
◾Holders of a CRP designation
◾Persons who hold a certificate of authorization within the meaning of the Professional Engineers Act
◾Quantity Surveyors
◾Graduates of Ryerson Polytechnic University with a Bachelor of Technology (Architectural Science) Building Science or Architecture option.
Notwithstanding the above, there are regulations on who cannot prepare the Study which include members of the Board, the condominium's property manager, certain relatives of Board members, an owner or a resident in the-condominium. In addition, the person/company being considered cannot have any direct or indirect interest in a contract or proposed contract with any Board member outside of his/her capacity as a Board member.
Aside from professional credentials, you want someone who has demonstrated experience with condominiums. Notwithstanding the Study being a budget document, it is also a technical report that involves the review of architectural and engineering drawings and the visual inspection of common elements. A trained eye can identify building problems for which repair costs can be included in the Study. In addition, much of the future Reserve Fund expenditures will be due to building envelope (roofing, windows, exterior cladding) and structural restoration (parking garages, balconies). These costs are often very site dependent for which "costing manuals" are of little use. Companies that have designed and administered these types of rehabilitation projects will be better suited to provide budgets for similar future work that the Corporation may be facing.
The regulations to the Condominium Act stipulate the minimum liability insurance requirements; $1,000,000.
RE: Reserve fund study
I don't see where in the document this list of acceptable people who can carry out the reserve fund study, but I will look thru the condo act document more carefully during the weekend. I will also spend some time to see if the Performance Audit is limited to registered architects and engineers. If I can't find that in the document, I will post something here Saturday evening or Sunday and the perhaps you could help me further. Thanks.
RE: Reserve fund study
Thank you for this information. Much appreciated.
Can you (or anyone) point me to where in the condominium act that it gives such a specific list of who may carry out the reserve fund study? All I can find in the act is the following:
(a.1) a report or opinion of a reserve fund study provider with respect to a reserve fund or a reserve fund study, as determined by the regulations, if any; or
(b) a report or opinion of a lawyer, public accountant, engineer, appraiser or other person whose profession lends credibility to the report or opinion. 1998, c. 19, s. 37 (3); 2004, c. 8, s. 47 (1); 2015, c. 28, Sched. 2, s. 80 (5).
Am I correct that there must also be a "Performance Audit" and this must be carried out ONLY by either a Professional Engineer with a Certificate of Authorization from PEO, or by an Architect licensed in Ontario?
Finally, am I correct in assuming that the Reserve Fund Study must be based on a Performance Audit?