This article about changes to maintenance plans and what you need to know has been provided by Shane White, Strata Title Consult.
All strata schemes require maintenance at some stage or another. No matter if your strata scheme is a single level 2 to 9 Lot scheme or a multi level high rise building.
The requirement for maintenance can be found in Part 8 of the new Strata Titles Act.
Administrative Fund and Reserve Fund
The money available for maintenance is derived from either the Administrative Fund or the Reserve Fund sec. 100.
The strata company Must have an Administration Fund sec. 100 (1).
The requirement for the Reserve Fund sec. 100 (2) carries a specific qualification:
“The strata company must, if it is a designated strata company and may, in any other case –
- establish a reserve fund”
What are the key points of this section?
- The words May and Must have both been used:
- The word “May” being the prerogative (is an option)
- The word “Must” being the imperative (is not optional)
The is another specified phrase – “Designated Strata Company”
The definition of this phrase appears at the end in sec.100(7):
“Designated strata company” means –
- a strata company for a scheme with 10 or more Lots: or
- a strata company included in this definition by the regulations”.
To recap: If you are a 2 to 9 Lot strata scheme, you don’t have to have a maintenance plan although it would be a good idea to have one. With the following exception:
Your strata scheme may be included as a “designated strata company if:
- STGR Reg 78(1) Designated Strata Company – extended meaning
- a strata company for a strata scheme that has a scheme building replacement cost of more than $5,000 000;
- a strata company for a survey-strata scheme if the replacement cost of the improvements on the common property is more than $5,000 000.
The 10 year Plan
STGR Reg 76 sets out the “Requirement to have a 10 year plan”.
The 10 year plan and the details required are extensively specified in Reg 76(2) which lists the “covered items” and the “condition report”.
The items specified in the “condition report” are:
- (e) a list of items of common property, and personal property of the strata company, that the strata company anticipates will require maintenance, repair, renewal or replacement (other than of a routine nature) in the period covered by the plan (the covered items).
A complete reading of this regulation would be required to fully comprehend the extensiveness of this report.
The 10 year plan must be revised at least once in each 5 years and the revised plan is extended to cover the following 10 years.
It is up to the strata company to adequately budget and set aside the required funds as it thinks are necessary to achieve maintain the building in accordance with the 10 year plan.
This post appears in Strata News #308.
Have a question about the Maintenance Plans or the 10 year plan or something to add to the article? Leave a comment below.
Strata Title Consult
E: [email protected]
Disclaimer: this article should not be relied on as legal advice.
- WA: Reforms to WA Strata Legislation – As a Lot Owner, Should I Care?
- WA: Maintenance Planning and Insurance: The Strata Titles Amendment Act 2018 (STAA 2018)
1 May 2020 Update:
The amended Strata Titles Act 1985 took effect in Western Australia on 1 May 2020. It includes grace periods for some new requirements to ensure those affected have adequate time to meet them. This information has been taken from Landgate: Timelines for Change.
Improving strata management and by-laws: Introduction of 10-year maintenance plan and reserve fund.
|What’s new?||Timeline for change||Who needs to know?|
|Strata schemes with 10 lots or more are required to have a 10-year maintenance plan and reserve|
fund. This is also required from schemes with a $5 million replacement cost for building/s or improvements on the common property.
|By 1 May 2021 or after.|
The 10-year plan must be submitted at the first annual general meeting that is one full year after commencement.