Decks / Lanais systems are typically one of the larger project expenses a community will face. Budgeting for their short and long term care is not always as straightforward as it appears to be as the degree of deterioration of this component is heavily reliant on historical maintenance trends in the community. I will touch on one of the more common budgeting mistakes we see on a regular basis. Maintenance and proper care will actually save a community a significant amount of money in the long run; deciding who (and how) this component is maintained can have a significant impact on the budgeting recommendations in the reserve study as well as budgeting requirements.
Common Budgeting Mistake - Who Maintains & Inspects the Decks / Lanais?
This question is often interpreted very differently by Boards even when the Governing Documents are similarly written. Often decks / lanais are limited common elements which are to be used exclusively by a particular unit. Often Boards decide this is to be interpreted as the replacement/refurbishment of the deck is the Association’s responsibility but the ongoing maintenance (paint, topcoating, inspection, drain clean out) are the responsibility of the Unit Owner. This appears on the surface to be a good middle ground to take by the Board but one which over the long haul we have found to be very expensive for the Association.
The inspection, touch up painting, and minor repairs of the decking / lanai systems are needed to be completed annually – with waterproofing and drainage repairs (larger scale paint, topcoating, sealing, drain inspection/repair) to be done every 5-7 years or as needed due to damage/deterioration. The issue with having to rely on Unit Owners taking care of these maintenance responsibilities is that they are often ignored, delayed or incorrectly completed during DIY projects. The result of the lack of and/or incorrect maintenance of these decks / lanais is often water intrusion issues around the decking systems, water intrusion behind the siding and safety issues at the railings due to rot. These water intrusion issues can be present for many years with little outward appearance – all the while significant rot and safety issues are being developed.
What is the Impact on Budgeting & Project Costs? - What could have been a refurbishment project every 20-25 years instead is a full blown replacement of all the decking system and repairs to the siding where rot is found. The cost of these replacement projects is often double to triple the cost of the refurbishment project (even after taking into consideration for the maintenance over the years). Wow… now this is a shocker for Boards when the bids come in.
From the Reserve Analyst’s perspective the future project expenses are directly correlated to the past maintenance cycles of these systems. So when we are told than the Unit Owners maintain the decks / lanais but the Association is responsible for the replacement/refurbishment we know that typically we should recommend full scale replacement projects. This is also typically verified during our site inspection when the Reserve Analyst will look at these components to see what kind of maintenance appears to be taking place. With significant cost difference between a refurbishment project versus a replacement & repair project there is often the desire by Boards to budget for just the refurbishment of the decks in the future – we have found this to be a big mistake that has played out in many communities. If the rot and water intrusion have been present (often times for years) Vendors will not do a refurbishment of the deck as they cannot guarantee their own work when areas of rot impact the safety and longevity of the refurbishment project. The result of budgeting for a refurbishment project when a repalcement and repair proejct is needed is often a special assessment, loan, deferred maintenance and safety issues.
Possible Solution – The easiest solution is to have the Association handle all maintenance of the decking / lanai systems (paint, topcoat, inspection, sealing). The cost is relatively inexpensive compared to having to budget for very large replacement & repair projects and the overall cost for maintenance over the years will likely be cheaper on a square footage basis as Vendors will charge less per square foot if they have a significant amount of work in one community to tackle at one time – versus making many trips at varying times of the year. This expense should be handled anyway by the Unit Owners so the Association could actually be saving them money by taking on the maintenance responsibility. Depending on how the governing documents are written the Board may just need to change their interpretation of the governing documents; if they are more specifically written a vote may be required on the issue. This is a great time to relay the cost differences to the community so everyone understands the long term impact in the reserve account and the recommended allocation rate provided in the reserve study.
There are many decking / lanai systems in use; the type frequency of maintenance of them can vary but overall we have found regardless of the type of system installed if the basic maintenance of these components is not kept up their useful life is minimized and the degree to which they must be refurbished/replaced is must higher and more costly, especially if damaged are incurred to the other areas of the building. If at all possible we recommend staying on top of maintenance and aiming for a refurbishment project of these systems.
Now with that being said, a community can absolutely decide they would like to leave the maintenance of the decks / lanais in the hands of the Unit Owners. But with making that decision they also take on the responsibility of make sure the Unit Owners actually do the maintenance work properly or appropriately budget for the eventual much larger project expenses at a later date. Either way we strongly recommend relaying the decision to the Reserve Analyst who can then appropriately update the reserve study with budgeting recommendations and funding scenarios.