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Frequently Asked Questions

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What is a structural inspection?

Criterium-Caruso Engineers' structural inspection is a Professional Engineer's opinion of the current condition and future performance of a building's structural system based on visual evidence. The inspection can include a review of all of the visible structural components or be restricted to a particular component or issue (ie. foundation, roof framing etc.). The inspection is performed in accordance with the standards of the National Academy of Building Inspection Engineers (NABIE).

How much does an inspection cost?

Fees for structural problem solving and engineering reviews are generally based upon our hourly fee for engineering time with a minimum charge.  Final costs are based upon age, size, location, and complexity of the building, the service level you request and are set by each individual Criterium office.  Call our office for our hourly rate.  An estimate of the anticipated fee for an inspection can also be provided.

We can provide cost proposals for building inspections, PCA’s, Reserve Studies and other type services when information is provided and the scope of the project is outlined.

Why use a licensed engineer?

Quality depends to a large degree upon the qualifications and experience of the consultant. “No standard can be designed to eliminate the role of professional judgment, competence, and the value and need for experience”.  Consequently, the qualifications of the assessor are critical to the performance of the any building inspection.  Engineers specializing in building inspection bring education, judgment, licensing, experience and accountability to every building inspection that they perform.

What is a certified Building Inspection Engineer?

A Professional Engineer duly licensed and registered to practice engineering in the governmental jurisdiction and accredited by BIECI (Building Inspection Engineer Certification Institute) as knowledgeable in the skills required to perform building and facility inspections.

Why do I need to have a Reserve Study for my community?

When you join a Common Interest Realty Group, part ownership in a wide variety of assets is assumed by each member.  Most of these assets are readily observed and widely acknowledged.  Others are not so clearly defined.  Still others are hidden or misunderstood.  A careful study of the documentation, the building plans and the plat plans of the property along with an inspection can usually identify most of the assets that are the Associations’ responsibility.  This is one goal of the Reserve Study for the community.

The importance of a reserve fund for capital improvements is well established across the country.  More than 35 states have some statutes relating to the adoption and review of reserve accounts for unit owners’ associations and common interest groups.  The scope of the statutes varies widely from statements noting that the associations may adopt and amend budgets for reserves to strict guidelines mandating reserve accounts.

The responsibilities for maintenance, repair or replacement can translate into significant costs to the individual owners and the community and also pose significant liabilities.

Are there standards for Reserve Studies?

A reserve study is a valuable tool in managing capital expenditures and cash reserves.  State ordinances refer to reserves, FHA puts emphasis on reserves, homebuyers ask about reserves.  The Community Association Institute (CAI) has defined the reserve balance as the “actual (or projected) funds at a given point in time identified by the Association to defray the future repair or replacement costs of those major components the association is obligated to maintain”.  A Reserve Study is defined as “a budget planning tool that identifies the current status of the reserve fund and a stable and equitable funding plan to offset the anticipated future major common area expenditures”.  The reserve study should consist of two parts: the physical analysis and the financial analysis. 

The importance of a reserve study has been recognized and some national standards have been developed, most notably by CAI (Community Associations Institute).  These standards can be found in the CAI literature, GAP report #24, Appendix A.  Gap Report # 24 also includes examples, techniques and guidance for reserve funding and investments strategies.

CAI has identified individuals with extensive experience in performing reserve studies with the designation of RS (Reserve Specialist).

How often should a reserve study be updated?

Is it time to update your reserve study?  Some of the factors to consider when trying to determine when to update a study are as follows:

  • Has inflation increased costs significantly since the original study was completed?  Has the rate of return on invested funds changed? 
  • Have there been significant additional assets or components added to the inventory? 
  • Have significant repairs or capital improvements been performed since the last Reserve Study was performed?
  • Have areas of the common property been significantly damaged by fire, storms etc?
  • Have significant improvements and additions been made to the property?
  • Did the anticipated capital expenditures occur as planned and scheduled?
  • If the Association is using a baseline or threshold funding method, has the reserve fund balance dropped below the prescribed threshold?
  • Have unexpected expenditures occurred during the period since the original reserve study was completed?
  • Have any circumstances changed which would affect the communities’ ability to fund the reserves? 

If one or more of these situations apply to your association, it may be time to consider an update or even a new reserve study.  The general rule of thumb recommended in the CAI literature is that one should update with field observations every third year for an Association up to 10 years of age and every other year after 10 years of age.

Why would I need a Transition Study?

Transition studies are used by Common Interest Realty Groups to determine if the developer has met the reasonably accepted standards and performed the reasonably expected requirements to transition the community to the newly formed owner Association. The purpose of the Transition Study is therefore to determine if the project is complete and reasonably consistent with the relevant construction documents and regulatory approvals. The result of our study will recommend if the newly formed association should accept the complex as is, with conditions, or not accept it until certain work is done.

What is included in the standard Reserve Study analysis?

The Capital Reserve Study is based upon an on-site review of the systems in the common areas of the development, a review of plans provided by the Association, and discussions with knowledgeable members/owners. The information gathered is entered into a proprietary computer program developed by Criterium Engineers in cooperation with the accounting firm of KPMG Peat Marwick. The package includes:

  • A table that lists anticipated replacement/repair items complete with estimated remaining life expectancies, projected repair/replacement costs, frequency (in years) when these items require repair/replacement, and a projection, based on this frequency, of the year in which these items will require attention.
  • A table that shows the annual expense listing per year with subtotals of anticipated repair/replacement costs for each of the twenty years. The table also presents these costs as adjusted for an assumed rate of inflation.
  • A table and graph that represents end of year fund balance vs. capital expenditures based on the currently funded program and reserve balances. Any special assessments planned and/or received to date are included.

Three alternatives that will fund a reserve account based on anticipated capital expenditure projections, presented in graphic and tabular form for review.

What is a Physical Needs Assessment (PNA)?

A Physical Needs Assessment (PNA) is best described as an inspection of a multi-family residence or Community Association facility in order to facilitate the development of a capital reserve study.

What is a Property Condition Assessment (PCA)?

Criterium-Caruso Engineers' Property Condition Assessment is a comprehensive due diligence service designed to meet the objectives for your real estate portfolio and meet industry standards, whether you represent a commercial real estate owner or manager, institutional investor or investment banker. Criterium- Caruso Engineers works with clients to understand those objectives, to develop scopes and formats to serve those needs, and to deliver comprehensive and high quality property condition reports.

What qualifications do licensed Professional Engineers have?

Engineers are licensed by the state in which they practice. At a minimum, they have completed an accredited, degreed engineering program, 4 years of work under the direction of other engineers, and have passed a comprehensive 2-day exam. They are bound by a code of ethics and state law to practice only in areas where they are qualified.

Do you have insurance?

All Criterium Engineers' offices maintain comprehensive professional liability insurance with nationally recognized firms. Professional liability insurance is different than other insurance and is only available to Professional Engineers and Professional Architects. But the most important quality is our accountability as Professional Engineers. We stand behind our work and are legally and ethically accountable to you.