Question: If we do regular painting touch-ups in our building does this come out of the admin or the sinking fund?
I understand a Sinking Fund is established to cover the cost of “capital works of a non-recurring nature”. All other Body Corp costs are to be paid for out of the Administration Fund.
If we paint our building every 10 years, this clearly should be allowed for and be paid out of the Sinking Fund.
However, if we do touch-up painting in highly trafficked areas every two or three years should this be allowed for in the Administration fund or the Sinking fund? Does it matter which one we use?
Answer: It would depend on the scope of works and cost each time paint touch ups are carried out.
Most Body Corporates will be able to get 10 years out of their painting if they look after it, e.g. if the building’s washed each year. Buildings in a high saline environment or one with harsh afternoon sun in QLD may need to increase frequency to say a 7-8 year cycle, but your painting contractor should be able to advise on this.
Regarding minor painting or sporadic touch ups as needed, a decision by the committee and body corporate manager would need to take place each time deciding whether the work / project would be considered a major expense or simply minor repairs and maintenance.
The legislation around the use of a sinking fund is ambiguous and does not give the clearest definition so your BC manager will be able to assist depending on the scope of works and cost each time.
This post appears in Strata News #562.
Dakota Panetta Solutions in Engineering E: dakotap@solutionsinengineering.com P: 1300 136 036