Now that the December 31, 2024, deadline for the SIRS has passed, many within our industry are asking themselves, “What’s next?”
With the deadline behind us, this marks the beginning of the real work – integrating these reports into budgets that safeguard your community for years to come.
This roadmap will provide a high-level guide to help you map out your community’s next steps effectively and efficiently.
1. Understand Your SIRS
First, take the time to ensure you thoroughly understand your SIRS report and its findings. At its core, this document outlines how long your structural components will last and the financial plan to repair or replace those items as needed. The shorter the useful life, the faster your community will need to come up with the funds to repair or replace that item. So, pay close attention to any immediate issues flagged in the study that require further inspection or short-term action.
Ensure you know what is covered and what isn’t included in this study. By law, your SIRS should include the following items:
- Roof
- Structure, including load-bearing walls and primary structural members and primary structural systems as those terms are defined in Statute 627.706
- Fireproofing and fire protection systems
- Plumbing
- Electrical systems
- Waterproofing and exterior painting
- Windows and exterior doors
- Any other item that has a deferred maintenance expense or replacement cost exceeding $10,000 that would impact the structural integrity of the building
It’s important to remember that while your SIRS only includes funding for structural components, it is vital to consider the costs of non-structural items in your financial planning.
2. Seek Legal and Financial Counsel
Consult with legal or financial professionals to determine how your reserve funds can be used. A legal consultant can guide you on local and state laws regarding your reserve funding, as well as any specifics determined by your governing documents. Beyond legal regulations, a financial professional can help you navigate the practical use and setup of your reserves to ensure the money is used strategically to fit your community’s needs.
3. Identify Priority Projects
With your SIRS report in hand, identify the projects that need immediate attention. Prioritize repairs that address critical safety concerns or offer cost-saving opportunities in the long term. This includes anything posing a current threat to the “life & safety” of your community or the strategic use of your funds. (Learn more about the importance of “life & safety” here.) A clear understanding of urgent versus non-urgent needs will save time and resources.
For instance, a flagged concern on your stairways should betaken care of sooner rather than later if the inspector considers it a “life& safety” issue. A leaky roof, while not always an immediate need, can quickly drain your reserves if not taken care of. Temporary repairs to “fix” the roof can quickly add up. These costs can be avoided by a roof replacement. While a more costly investment up front, it could save your community hundreds of thousands of dollars in wasted money spent to repair an unsalvageable roof.
4. Develop a Comprehensive Plan
Creating a detailed plan is essential for effective project execution and ideal results. Your plan should evaluate:
- Repair vs. Replacement: Determine whether it’s more cost-effective to repair or replace specific components.
- Quality Investments: Choose materials and methods that address the root causes of issues to ensure durability, even if the upfront cost is higher.
- Waterproofing: Proper waterproofing protects your structures from costly water damage and extends their lifespan. Prioritize waterproofing measures to prevent future damage and prolong the life of your assets.
5. Choose the Right Vendor
Selecting the right vendor with the right credentials is crucial for successful project results.
- Check References: Verify the vendor’s experience and past performance by speaking with previous clients.
- Warranty Coverage: Ensure that the vendor offers a warranty to safeguard your investment. Understanding the differences between Prorated and No Dollar Limit warranties will help to protect your community’s budget down the line.
- Define Scope of Work: Specify the exact area where the work needs to be completed. This will help you to avoid “scope creep” beyond the original work area, which can lead to increased costs and delayed timelines.
- Protect Yourself: Schedule progress checks with the vendor throughout the project to monitor the quality of work, materials used, and adherence to timelines.
By following this roadmap, your community can move forward with confidence, knowing that you’re taking proactive measures to maintain the structural integrity of your property while maximizing your reserves.
