Deferred maintenance has become a buzz word in the education sphere. Are you sick of hearing it? Let’s dive in and determine what it really means, how to manage facilities renewal and how to avoid emergency repairs and replacements.
In April, American School & University published this article by Mike Kennedy discussing the state of America’s school buildings and the costs of maintenance and repairs. Kennedy cited research over the years demonstrating the costs involved to address repairs and deferred maintenance in our schools; those costs most recently reached $542 Billion! And the deferred maintenance costs in America’s colleges are also a big challenge.
Rick Biedenweg, President of Pacific Partners Consulting Group and former Assistant Vice President of information resources at Stanford University, focused his career and research on deferred maintenance and facilities renewal. He was a true pioneer for school renewal planning and worked with more than 225 universities to predict their budget needs for renewals and deferred maintenance. SchoolDude worked closely with Biedenweg, who passed away in December 2009. We have a great amount of gratitude and respect for Biedenweg, as his work was revolutionary to higher education and K-12 schools as well and has helped many plant directors justify and receive the funding needed to tackle deferred maintenance.
Simply put, Biedenweg’s and his colleagues’ research states: Every $1 deferred in maintenance costs $4 of capital renewal needs in the future. In essence, his work proves the ‘pay me now or pay me more later’ adage. However, 4:1 is a high ratio—how did Biedenweg’s team come up with it?
Their research indicates educational institutions should be spending 0.5% of their building and system’s current replacement value (CRV) on ongoing maintenance and regular preventive maintenance and 1.5% of CRV on capital repairs. His team did extensive research with a number of universities to determine average CRV spending for those campuses. You can find the methodology and results of his research here.
The data from this study demonstrates the campuses were only spending 0.2% on average on ongoing maintenance, increasing the amount necessary for annual capital repair from 1.5% to 2.7% of CRV. Why the increase in capital repairs?
1) Less preventive maintenance on your systems shortens their life cycle by as much as one-third, research indicates.
2) Less preventive maintenance results in more emergency repairs, which are more costly than planned repairs.
So you say “this all makes sense, but how does this equate to $4 more capital needed for every $1 deferred?” Let’s look at the math:
· (2.7%-1.5%) divided by (5%-.2%) =
· 1.3% divided by .3% = 4:1
Find out more about the numbers and data behind the math and read Biedenweg’s study in full.
This research established new ways to approach renewal analysis in both higher-ed and K-12. Though the research is complex, we believe the results from implementing Biedenweg’s findings are simple and impactful:
1) Conduct a renewal analysis. A simple way to do this is using a TARA analysis.
2) Plan your renewal needs and forecasting with an automated capital planning solution, like SchoolDude’s PlanningDirect
3) Factor that into the budget
4) Save quadruple the money for your campus or district over time
To learn more about Rick Biedenweg’s work, download his research study.
Also, find out what other universities and colleges have done to tackle their deferred maintenance now.
SchoolDude solely serves the education sector to help small and large institutions manage their facilities, IT and business operations. Check out how to improve your capital planning with PlanningDirect by SchoolDude.