Deferred maintenance is a term that gets thrown around a lot and yet I find many people have no real idea what it means. Let's start with a definition:
Deferred maintenance is the practice of postponing maintenance activities such as repairs on both real property and personal property (i.e. machinery) in order to save costs, meet budget funding levels, or realign available budget monies. The failure to perform needed repairs could lead to asset deterioration and ultimately asset impairment. Generally, a policy of continued deferred maintenance may result in higher costs, asset failure, and in some cases, health and safety implications. (Wikipedia.com)
In a previous blog entitled "The "4 X" Reality of Deferred Maintenance" we provided some very sobering realities from national research projects...here they are again:
“Every $1 in deferred maintenance costs $4 of capital renewal needs in the future.”
“If a necessary repair is deferred and allowed to remain in service until the next level of failure, the resultant expense will be 30-times the early intervention cost.”
If those 2 statements do not shake you up a little, then you may need to see a doctor or psychiatrist. If you believe EVERYTHING belongs to God...and that HE has ENTRUSTED His ministry facilities to us to STEWARD...then you cannot take this lightly.
Let's explore what the keys are to conquering deferred maintenance.
1. Identify YOUR deferred maintenance - The first step in nearly any issue in life is to first recognize there is an issue. If we do not acknowledge there is an issue, how can we resolve it? In most churches, there is a lack of understanding of what their deferred maintenance issue are. We get so busy with budgets, "doing church", break/fix items, etc that we do not stop to take time to see the trees for the forest. In many cases, even if you took the time, you may not know what you are looking for. This is where a set of "FRESH EYES" can be beneficial.
2. Provide adequate general maintenance budgets - Over the past couple years, we have done facility assessments for several million square feet of church facilities. The aggregate amount of deferred maintenance has been in the tens of millions of dollars. That is sad! The "church" claims to be an organization focused on being "good stewards" and yet we allow our buildings to deteriorate right under our feet. In every single case, the General Maintenance budget was under-funded. There was not enough money in the budget to keep up with the natural rate of physical deterioration. Check out this quote from Kevin Folsom, former Facilities Director at Dallas Theological Seminary:
“There are numerous levels that can be used to go about this, but to start we have to remember our early Physics lessons in high school about the 2nd Law of Thermal Dynamics. Everything we build will decay, but it may last longer if properly maintained. So, here’s a puzzling question…If we build facilities that the natural law causes them to decay at fairly predictable rates throughout its birth to burial, why do we not plan for it?”
The best way to conquer deferred maintenance is to have a budget that addresses the natural decay and deterioration of your facility.
3. Properly "staff" your facility team - In every instance referenced above, not only was the budget under-funded, but they were under-staffed...and not by just a little! If you only have enough staff to address the break/fix emergencies of the urgent, then how do you expect to stay on top of the natural decay and deterioration? Quick answer...YOU CAN'T! Based on national surveys by our firm and IFMA, we believe the number of facility staff for a well-run organization is one Full Time Facility Staff Employee for every 25,000 – 35,000 SF. This is not for cleaning…that is another story…this is for general maintenance.
4. Have a Properly funded Capital Reserve Plan - Gentlemen...this is a football! Church leader...capital replacement is not an “IF” consideration but rather a “WHEN” and “HOW MUCH”. You WILL replace every HVAC unit. You WILL replace all your carpet. You WILL replace your roof. You WILL have to re-surface your parking lot. To turn a blind eye to the need of a capital reserve fund is kin to telling God that the laws of science and natural resources...that HE created...don't apply to your church. You are above the laws of God. REALLY?!?! Do you have a 401K or similar account for the future or do you assume retirement or old age is not part of your future...that it does not apply to you?
If we were proactive with our operational budgets and capital reserves, there would not be any deferred maintenance. In a perfect world, we would properly fund our general maintenance budget to keep the building in the best physical condition as possible…AND…we would have adequate capital reserves when we approach “end of life” of our facility component.
That is how you conquer Deferred Maintenance. To quote Sean Connery in The Untouchables - "What are you prepared to do?"
Almost every component of your facilities will have to be replaced at some point. Do you have an action plan? INTENTIONAL organizations plan today for tomorrow’s costs. That’s why it’s critical you establish a capital reserve account now.
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