A contingency reserve balance is not a stand-alone measure of strata health. Buyers should compare it with the building's upcoming work, depreciation-report scenarios, approved spending, unit allocation, operating results, and ability to fund uncertainty.
Decision points
- 01
Do not divide the reserve balance by the number of units and stop.
- 02
Match available cash to the timing and scope of planned work.
- 03
Separate approved expenditures from possible future projects.
Reconstruct the reserve position
Start with the most recent financial statement, then account for approved spending, transfers, contributions, projects completed after the statement date, and proposals in newer minutes. Confirm whether the balance is current and unrestricted for the scenario being considered.
Compare the fund with the capital plan
Map major components, estimated timing, current cost assumptions, funding scenarios, and work already deferred. A large balance may still be inadequate for near-term projects; a smaller balance may be part of a deliberate staged plan.
Model the unit-level question
Estimate only the reserve amount realistically available, apply the correct allocation method, and run cost ranges. The result is a question-generating scenario, not a forecast of a future levy or vote.
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