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Greening the Reserve Study

Enhanced Reserve Fund Study can help Associations become more Efficient and Sustainable. 

People change. Markets change. Condos change. Many established condo complexes in Maine want to look outside the box and not automatically replace their common assets with what they have lived with for the last 20 or 30 years. Associations are now using a more sophisticated maintenance plan, namely, an ‘enhanced’ reserve fund study to seek new ways to become more efficient and sustainable.

In the past, boards once sought only the counsel of accountants and attorneys for their reserve fund needs.   Now, more boards than ever are seeking help from engineers, architects, and contractors to plan their future.  The purpose of this expanded or broadened search for information is to add consultants who know what needs to be done to maintain a building complex - and most importantly, how to get it done at the right price.  In addition, with the use of an ‘enhanced’ reserve study, the board has more than a replacement-in-kind option to consider, but also upgrades to take advantage of modern materials or more energy efficient components.

One force driving this trend is the emergence in Maine of retirement communities and 55+ condominiums featuring more natural and sustainable themes and amenities including the provision of access to nature trails; on-site food prepared from local organic farms; composting; and use of green cleaning and maintenance products.  Some communities have even developed programs for the responsible disposal of medications.

This movement is not just for aging boomers but also young millennials and first time condo buyers who want their unit’s floors, walls, countertops, and insulation to be of more natural products like bamboo, cork, cotton, and quartz.  They want their home environment free of ozone depleting agents like chlorofluorocarbon gas and carcinogenics like polyvinyl chloride.

Instead of replacing their current street and interior light fixtures with the same type of lamp they want to upgrade to LED type fixtures.  When major renovation projects are planned they want their engineer to develop job specifications for the construction bidding to include a requirement for recycling demolition materials such as doors; vinyl windows; cabinetry; appliances; and laminate countertops.  In some case instructing the renovation contractor to send the discarded material to organizations such as Habitat for Humanity.

This trend has not been lost on major condo developer marketing staff.  We noted a recent flyer for a large retirement community north of Portland referring to their complex as “a 635-acre oasis of natural beauty and community with an unprecedented incorporation of conservation.”  The fact the brochure did not feature tennis courts and other standard amenities speaks to the future, and when communities do tout these features it will be like the new Falmouth complex hosting an indoor lap swimming pool heated by solar panels.

And speaking of solar panels, it has not gone unnoticed the political battle going on in Maine about the future of solar power for community solar farms and individual residential solar panels. After months of negotiations and compromises from all interested parties, a bi-partisan bill was put forth from the Maine legislature for a cutting-edge method of accounting for the cost of energy produced by solar panels to replace the current restricted ‘net-metering’ form of selling excess solar generated electrical power back to the grid.  Maine’s governor vowed to veto the bill as he deemed its subsidy program to be unfair to most electrical rate payers.  After much debate, this bi-partisan bill was defeated by falling short by two votes in May, 2016.  Though this was a surprise to many, what would be even more of a surprise to some would be the discovery of the two strongest allies to the governor’s position were the two largest residential solar panel installers in the country, as they did not want this elimination of ‘net-metering’ to be established in Maine and become a trend across the country.

Changes are indeed coming on the wind.  Just like solar power, new technologies are being developed to harvest the wind for use by condos to provide electricity for a variety of common element needs.  These new wind mills are not the huge towers you see on top of mountain ridge tops but rather compact screw-like blades and units no larger than a TV dish antenna.  But to incorporate these new features into future planning, an association will need an ‘enhanced’ reserve study to expand the condo’s capital reserve horizons.    

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Article written by Jack Carr, P.E., R.S., LEED AP, Criterium Engineers

Published in Condo Media, July, 2016

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