Qualifications of the Inspector, and Service Levels
Inspector Certifications and Qualifications
Reserve studies can be created a variety of professionals specializing in the preparation of reserve studies, or large architectural or engineering firms who complete reserve studies as a small aspect of their larger business. Recently, certification criteria have been created to allow for a more ordered system of identifying those individuals who have been specifically trained in the creation of reserve studies. One such certification, that of reserve Specialist (RS), is available through the Community Associations Institute (CAI). To obtain this certification, candidates must have prepared at least 30 reserve studies within the past 3 calendar years, hold a bachelors degree in construction management, architecture, or engineering (or something equivalent based on experience and education), and complied with various other rules and codes of conducts.
Another credential is the Professional Reserve Analyst (PRA), created and promoted by the reserve study industry’s own trade organization, the Association of Professional Reserve Analysts (APRA). The PRA was the first accrediting body for Reserve Professionals. The PRA credential is similar in that it takes years, demonstrated experience, and compliance with standardized terminology to obtain although the experience levels are a bit higher than that required for the RS and their efforts include studies both inside and outside of the CID industry. APRA also requires its PRA’s to maintain proficiency with continuing education.
In Canada there are several designations and training programs. The Real Estate Institute of Canada (REIC) offers the Certified Reserve Planner (CRP) program, which is the only nationally accepted specialty designation listed in provincial legislation as qualified. Members of the Appraisal Institute of Canada (AIC) must use the methodology and standards of the REIC program if they wish to complete the report. The Canadian National Association of Real Estate Appraisers (CNAREA, based in Qualicum Beach (Vancouver Island), started to offer the Designated Reserve Planner (DRP) program through a weekend course to designated appraiser members since 2012. The PRFA and the DRP designations require demonstrated experience and compliance with standardized terminology and methodology to obtain. All PRFA and DRP designated planners are required to use the RFA Pro Reserve Fund Analysis software or provide a quality assurance report of their chosen calculation methods. Applied Science Technologists & Technicians of British Columbia (ASTTBC) offers the Registered Reserve Fund Analysts (RRFA) training program to Home inspectors, as home inspectors are restricted from completing Depreciation Reports / Reserve Studies in their bylaws. As of 2013, Sauder School of Business Real Estate Division is offering the first of 2 courses towards a certification called the Reserve Fund Planning Program (RFPP), but yet no trade group has recognized this designation. All CRP, DRP and PRFA reserve fund planners are required to carry $2,000,000 in E & O Insurance coverage.
Levels of Service
There are three types of reserve studies based on standards set by the Association of Professional Reserve Analysts and Community Associations Institute, differing in how exhaustively the Physical Analysis is conducted. These three types of reserve studies allow the association to select the “Level of Service” appropriate to their current budget preparation and disclosure needs. Listed beginning with the most exhaustive, they are:
1.”Full” reserve study (creation of the reserve study, involving creation of the component list, measuring/quantifying all reserve components, and development of the Useful Life, Remaining Useful Life, and Current Replacement Cost based on a diligent, visual on-site inspection). Note that for most associations, a “Full” reserve study only needs to be done once. After a “Full” reserve study has been done, in subsequent years the association can choose between the two reserve study update options shown below:
2.”Update With-Site-Visit” reserve study (an update of an existing reserve study involving a diligent visual on-site inspection, but presuming that all components have been properly identified and quantified). This type of update is often performed every two to five years.
3.”Update No-Site-Visit” reserve study (an update of an existing reserve study without a site inspection, done by client interviews and interviews with knowledgeable vendors and service providers). This type of update is typically performed in the years in-between With-Site-Visit updates.