Reserve study proposals tend to look the same: a price, a turnaround time, and a promise to follow industry standards. The difference shows up months later, when the board opens the report and either understands it or doesn't.
A reserve study is supposed to answer three questions in a way homeowners can follow: what does the association own, when will each piece need money, and how much should each owner pay each month so the money is there? If the report can't answer those in plain language, it doesn't matter how thick it is.
Here's what to ask before you hire, and what we've built into our own studies after seeing what boards actually need.
1. Who does the site visit, and what's their background?
A full study (Level I under the Community Associations Institute's National Reserve Study Standards) starts with someone walking the property and measuring every common-area component. Ask who that person is. Someone who has managed construction or done the repair work knows what a deteriorating retaining wall or a failing culvert looks like, and what it really costs to fix.
Red flag: the company can't tell you who will be on site, or the "site visit" is a drive-by.
2. What level of study are you proposing?
There are three levels:
- Level I, full study: new component inventory, site visit, financial analysis
- Level II, update with site visit: existing inventory, re-inspected
- Level III, update without site visit: financials refreshed, no inspection
All three are legitimate. They are not interchangeable. If your association has never had a full study, or the property has changed, you need a Level I.
Red flag: a low price for a "reserve study" that turns out to be a desk update of someone else's component list.
3. Can we see a sample report?
Read it as a homeowner would. Is there a summary up front that says where the association stands and what the plan is, before the first table? Or does it open with forty pages of component schedules?
In our reports, the first page after the cover is a one-page summary in plain English: the reserve balance, percent funded, the problem if there is one, the plan the board chose, and what each owner will pay per month. A board member should be able to read that page aloud at the annual meeting.
4. Will the report show what each plan costs per home?
Boards don't vote on "reserve contributions of $7,885 per year." They vote on what it does to dues. Ask whether every funding plan shows the cost per unit, per month, and what total dues become.
In the study featured on our reserve studies page, the plan the board adopted moved total dues from about $42 to $49 per home per month over two years. That one number is what made the decision easy to explain.
5. How many funding plans will you show, and can you model ours?
The standards describe three funding goals: full funding, threshold funding (stay above a chosen floor), and baseline funding (just don't run out of cash). A good study shows them side by side so the board can see the trade-offs.
Boards often have their own idea, such as "we can live with 10% this year and 6% next year." We model the board's own plan exactly as entered, next to the standard plans, and show any year it would run short instead of quietly solving it. We also include a catch-up alternative when the gap is too big to close in one year.
6. What happens if a special assessment is unavoidable?
Sometimes the math says the money isn't there. Ask whether the study shows alternatives. When a plan would require a special assessment, we also model it with a loan instead, repaid through a temporary dues surcharge, so the board can compare a one-time bill with a smaller monthly increase.
7. Does the cash flow include the operating budget?
Reserves don't exist in isolation. Owners pay one dues amount that covers operations and reserves. We project the whole association's cash flow, operating budget included, so the board sees the full picture of dues in and money out, not just the reserve account.
8. Who explains the plan, and who takes the heat?
A report emailed as a PDF often goes unread. Ask what the preparer delivers beyond the report, and whether changes are included once the board has reviewed it.
Every study we prepare includes a presentation to the board, and one free revision after that session. Boards often want to see a different dues schedule or a project moved a year; that's included.
Then there's the hard part. When the plan means dues have to go up, the people delivering that news to the community are usually volunteer board members talking to their neighbors. For an added fee, we present the study and the plan to the homeowners ourselves, answer the technical questions owners raise, and serve as the independent third party explaining why the increase is needed. The board isn't left defending the math alone.
9. What will updates cost?
A reserve study should be updated regularly, typically every year without a site visit and every few years with one. Ask for update pricing up front so the board can budget for the full cycle, not just this year.
Red flags, in short
- No named person doing the site visit
- No component photos in the sample report
- One funding plan, take it or leave it
- No per-home cost for each plan
- No summary a homeowner could understand
- No revisions once the board has reviewed it
- A price that's far below everyone else's (it's usually a desk update)
Why the preparer's background matters after the study
The study tells you what's coming due. When the sidewalk repairs or the pond dredging come up, the board needs someone to scope the work, compare bids, and make sure it gets done right. A preparer who has done that work knows which estimates are realistic, and can help when the time comes. That's how our project management and bid consulting work usually starts.
This guide is general information. Your governing documents and your association's attorney are the final word on what your association must do.