Kappes Miller - Consulting & Construction Management

Why is a Reserve Study Needed?

Four main reasons for a Reserve Study

  • Comply with Washington State law
    Reserve studies have become so important to the ongoing health of associations that Washington State has passed legislation requiring them annually (SB 6215). The Federal Housing Authority (FHA) requires an updated Reserve Study and a minimum standard of Reserve Fund health in order for future buyers to qualify for funding.
  • Maintain the property's value and appearance
    A Reserve Study helps maintain the property's value and the property owner's investment. By identifying and budgeting for future capital improvements, the property's common elements continue to look attractive and well-kept, adding to the community's overall quality of life.
  • Fulfill the board of directors' fiduciary responsibility
    The board is to act within their authority, to exercise due care, and to act in good faith and with ordinary care that they believe to be in the best interests of the association.
  • Establish sound financial planning and budget direction
    Most of the "major" components which the association is responsible to maintain will require replacement in a predictable manner. Therefore it is possible to prepare well in advance for these inevitable expenses, spreading out the contributions evenly over time. The Reserve Study will layout a schedule of repairs and give cost estimates to components, objective being to maintain an adequate reserve balance.

Board of Directors Meeting
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