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Ten year maintenance plans

Posted by: | Posted on: October 19, 2018

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Ten year maintenance plans

Ten year maintenance plans for sectional title management schemes in South Africa

1. We provide ten year maintenance plans inside the borders of Gauteng Province, South Africa.

We provide streamlined ten year maintenance plans for Community Management Schemes like Sectional title schemes, Share block companies, Home or property owners associations, Housing schemes for retired persons, Housing co-operatives, Gated Villages with a Constitution, Social Co-operatives and even some shopping malls.

We have a questionnaire which must be completed and returned to us, to enable us to start with drawing up the ten year plan. The questionnaire is in PDF format and can be downloaded from the Internet. We also pay a visit and conduct a joint inspection.

 

View my credentials here.

Sectional title ten year maintenance plan contact details

Users of my services in Gauteng Province, also get a free copy of my ten year maintenance plan training guide.

View this ten year maintenance plans slideshow:

This presentation slide above can also be downloaded in PDF format by clicking here. If you want to find this presentation again in the near future, it may be expedient and advisable to store this PDF file on your hard drive, where you can easily retrieve it again.

2. Ten year maintenance plan training guide.

Get trained in how to compile ten year maintenance plans with our streamlined system. As I cannot do all the work in all the outstretched regions of the country, I am making the training guide for my streamlined system available to others, who may need it.

Ten year maintenance plan training guide e-cover

 

2.1 Reasons for compiling this training guide:

All the required forms and regulations can be downloaded from the Community Schemes Ombud Service web site: http://csos.org.za/. They do not, however, have any guidelines on how to draw up and submit a ten year maintenance plan, except for the rules pertaining to the level of the reserve fund budget.

Consequently, after intense research, I discovered an example published by The Ministry of Business, Innovation and Employment of New Zealand, which I converted to the South African environment, by changing some of the linguistic terms. I found this to be a workable document, but a bit cumbersome, as all calculations must be done manually with a calculator.

I then combined the ideas and methods of the New Zealand example into a spread sheet calculation model by using a Microsoft Excel spread sheet computer program. Luckily I had ample experience with using the formulas inside spread sheet programs, as I previously had to develop several models for different purposes.

After receiving many enquiries and questions of how to do it and after compiling several ten year maintenance plans for different building complexes, I realised there is a need for guidelines.

From my previous lifetime experience in writing training manuals, I decided to come up once again with a training manual for compiling the ten year maintenance plan, which the Ombud Service require, but do not have any guidelines for.

The training manual has now become a handy guideline for building complex managements outside of Gauteng borders, as they are too far away to make use of my services in drawing up their plans.

However, if they do not have knowledge of using spread sheet programs, I can still do it with the help of a questionnaire to be completed by the management body.

Several manuals have been sold and I have already compiled several ten year plans for Body Corporate Managements, Home Owners Associations and Retirement Villages.

The biggest problem found so far, is that one cannot easily find a building construction expert, a spread sheet user expert and a financial statement expert, all rolled up into one single person. The solution for this dilemma is to assemble a team of knowledgeable persons for the task, if needed.

2.2 Table of contents for the Ten year maintenance plan training guide (40 pages):

1. Job skills requirements to become a provider of ten year maintenance plans
2. Information needed to compile a ten year maintenance plan.
2.1 Identification
2.2 Income statement information regarding owner common property levy contribution
2.3 Annual inspection results on structures to be renovated, equipment repairs & maintenance
2.4 Administrative Fund and Reserve Fund balances at latest year-end from financial statements
2.5 Personal contact details of persons responsible/accountable for the complex ten year maintenance plan (preferably more than one)
2.6. Complex Google maps coordinates or physical address
2.7. Latest audited financial statements included.
2.8. Describe what kind of agreement exists with unit owners, with regard to operational costs and maintenance costs.
3. Compiling a ten year maintenance plan manually, without using a spreadsheet program
3.1 Ten year maintenance plan example template without a spreadsheet program
4. Illustration of how to combine the Administration fund budget with the ten year Maintenance budget in a spreadsheet program.
4.2 Illustration of a Body Corporate 10 year maintenance plan (with MS Excel spreadsheets).
4.3 How to apply the rules of the law in the software program. See page 4 of the Act:
4.4 How to spread out maintenance cost to minimise levies. See rule 22 of the Act, page 37.
4.5 The purpose with the reserve fund.
5. Maintenance lifespan and costs for community complexes.
5.1 Building component and equipment lifespan/life cycle for ten year maintenance plans.
6. Illustration of how to report to the Community Schemes Ombud Service (CSOS).
7. Exceptional cases of adding a savings plan to the ten year maintenance plan.
7.1 Here is an example of equal annual amounts at 0% interest revenue
7.2. Here is an example of required annual savings at 3% interest p.a.
8. The following assumptions are part and parcel of the sale of this guide
9. Get a free spreadsheet program and save thousands
10. Bonus: Where to get these eight training manuals for peanuts. Use them for internal training sessions of employees or to train yourself
10.1 MS Suite 8 training manuals in hard copy
10.2 MS Suite 8 training manuals in digital E-book format
10.3. The one only MS Excel 2016 training manual in digital E-book format
11. Summary notes:
11.1 Easy bookkeeping
11.2 Effect of adding cost items to the Administrative Fund budget
11.3 Effect of adding cost items to the ten year maintenance plan
12. Last step of reporting
13. The huge market potential for providers of ten year maintenance plans

The market size is made up of all Sectional titles development schemes, Share block companies, Home or property owners associations, Housing schemes for retired persons, Housing co-operatives, Gated villages with constitutions, Social Co-operatives and even some Shopping malls with shared ownership. Community Management Schemes is the fastest growing type of building development projects in the country.

2.3 Job skills requirements to become a provider of ten year maintenance plans:

• Knowledge of building construction and building regulations.
• Knowledge of the lifespan of construction components (civil building disciplines).
• Knowledge of construction component costs.
• Knowledge of construction component labour cost.
• Knowledge of construction tools cost.
• Annual inspection of structures to identify what must be changed, repaired or replaced as preventative maintenance actions against higher eventual cost.
• How to spread preventative maintenance actions out over time to minimize and even out costs for owners.
• How to plan ahead for the prescribed maintenance reserve fund annual levies, not to fall irreparably behind.
• How to decide what escalation formulas to use over a planning period of ten years.
• How to combine the operational cost financial entries and maintenance cost financial entries into one planning and monitoring cash flow projection document for ten years.
• Knowledge of interpretation of financial statements and balance sheets.
• Knowledge of technological improvements in the building industry.
• Knowledge of law requirements and changes thereto.
• Knowledge of spread sheet calculation models and the theory of finance.

It is clear that a combination of technical, mathematical, financial and a few other competencies will be needed. It is very seldom that one will find all the above skills and knowledge rolled up into one single person. However, one can contract knowledgeable persons in when needed. As time goes by experience and knowledge will also grow.

2.4 How to purchase the ten year maintenance plan training manual:

Buy this training guide through the secure servers of PayPal for $91.00 with your credit/debit card by clicking the image below. On 2018-10-19 the currency conversion rate was 1 USD = 14,47 ZAR. Therefore $91.00 USD x 14,47 = ZAR 1316,53.

Buy through the secure servers of PayPal for $91.00 by clicking the buy button below:

 

PayPal buy button

 

If prior approval for this transaction is needed, just send me an email, requesting a quote and provide the details to whom it must be addressed, with the product name. Receive everything in your mail box within two respite days together with an invoice. Buyers of this product will also get updates free for one year.

3. Maintenance guideline advice on maintenance lifespan/life cycle replacement/renovation:

Economical replacement point in time: When the cost of repairing a capital item is more than 50% of the new replacement cost, it is better to replace it (rule of thumb).

Building weak spots: When it comes to building construction components like cemented bricks, paving and concrete, it is normally renovated, as the lifespan can go far beyond 100 years. Gutters, roof covering and roof structures can be another thing, depending on the material and previous preventative maintenance actions. Water leaks can make wooden beams, rafters and purlins to rot. It can also make ceilings to soften, discolour and sag, cause steel to rust and fungi to grow on all types of material. Fungi growth is a real high health risk. Weather conditions can thus create the need for premature renovations to building structures. Falling objects can damage ceramic floor tiles.

Older housing buildings in coastal areas present own unique maintenance problems, as well as buildings still having asbestos cladding or roofing.

High priority and risk: For most residential complexes landscaping and security are high priorities. Landscaping and gardening for aesthetic reasons and security because of the high crime rate. In the case of retirement villages, health and medical facilities and medical equipment may also be classified here, depending on nearness and dependability of such outside facilities. Depending on importance it may be better to budget an amount than to be surprised by unexpected premature failure. If premature failure does not occur, the available budget can always be used for other expenses or to make a bank account stronger. Technological advances can render high priority equipment sooner as out-dated.

Differentiation between small and major: The differentiating figure to decide what must be regarded as Small repairs and replacements versus Major repairs and replacements is an arbitrary figure. The lower the differentiation figure, the more items and amounts will shift over to the ten year maintenance plan. All administrative amounts, including small repairs and replacements plus the reserve fund budget will form the complete budget for a new year.

The following can be applied to a complex of 450 units, which can be regarded as relatively big. In other cases of smaller complexes, the division of cost between Administrative Fund and the ten year maintenance plan may differ.

Small for 450 units:
Lifespan if cost replacement for an individual item or job is below R 20 000.00 for Administrative Fund Budget:
• Electronic devices and equipment – 3 years
• Electric machinery, devices & equipment – 5 years
• Gardening machinery, equipment & tools – 5 years
• Security machinery, devices & equipment – 3 years
• Interior office & room furniture – 12 years
• Vehicles like bicycles, scooters, ride-on lawnmowers, motorbikes & golf carts – 10 years
• Tar roads (potholes) – 20 years (depending on underneath compacting material and soil deficiencies)
• Paved roads (sagging) – 20 years (depending on underneath compacting material and soil deficiencies)
• Cement repairs, painting & varnishing – 7 years
• Smaller building construction renovation (other than paint) – 30 years
• Steel construction renovations – 10 years

If replacement cost is above R 3000.00, always consider repairs according to the 50% rule when failure occurs, as it can help to reduce actual expenses against budgeted figures.

Major for 450 units:
Lifespan if cost replacement for an individual item or job is higher than R 20 000.00 for ten year maintenance plan:
• Electronic devices and equipment – 5 years
• Electric machinery, devices & equipment – 7 years
• Gardening machinery, equipment & tools – 7 years
• Security machinery, devices & equipment – 5 years
• Interior office & room furniture – 20 years
• Vehicles like LUV’s, cars, trucks, ride-on lawnmowers, motorbikes & golf carts – 12 years
• Tar roads (potholes) – 20 years (depending on underneath compacting material and soil deficiencies)
• Paved roads (sagging) – 20 years (depending on underneath compacting material and soil deficiencies)
• Cement repairs, painting & varnishing – 7 years
• Major building construction renovations (other than paint) – 30 years
• Steel construction renovations – 10 years

Always consider repairs according to the 50% rule when failure occurs, as it can help to reduce actual expenses against budgeted figures.

The bigger a complex the higher the differentiating figure can become. What may be big for a complex with 10 residential units may become small change for a bigger complex with more units. For instance, R 3000.00 for one household may be regarded as big, but small for a complex of 50 units.

The lifespan indicators above can be broken up further for individualised items and its lifespan adjusted according to own experience with it. In other words, it can be fine-tuned.

One gets sophisticated computerised systems for calculating economic replacement point in time for vehicles and other equipment. All running and maintenance costs must then be separately and individually captured according to cost codes. These systems are, however, only viable for big vehicle fleets and big quantities of the same type of equipment.

4. The purpose with the ten year maintenance reserve fund:

The sole purpose with the reserve fund is to provide for all unforeseen and unexpected expenses, not budgeted for and not covered by levies, whether it is administrative or maintenance.

The reserve fund budget must be calculated on the Administrative Fund total budget only. It must also be used to pay for the major items in the ten year plan. Furthermore the ten year plan is not part of the Administrative Fund Budget.

The first due date for filing the plan with the Community Schemes Ombud Service (CSOS) was January 2017.

 

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