NPR ran a story this morning about how condo maintenance fees should cover not only ongoing routine maintenance but also build a rainy-day fund for predictable but occasional expenses like replacing a roof. Unfortunately, condo associations like to keep maintenance fees low and seldom set aside the funds necessary for big-ticket repairs needed in the indefinite future. The NPR story, of course, was inspired by the deferred maintenance problems at Florida’s Champlain Towers South that threatened owners with special assessments of a hundred thousand dollars or more.
Unfortunately, it is not only Florida condos that have not prepared for large and inevitable maintenance expenses. President Biden’s infrastructure proposals have drawn most attention to new expenditures that the federal government has not funded before. But much of the standard infrastructure bill—the roads and bridges part—is for deferred maintenance and predictable replacements.
Like condo associations, governments should plan for predictable maintenance. When a bridge is built, for example, there will be an ongoing need for inspection and routine maintenance. Eventually, there will be a need for a major rehab or even a replacement. These expenses are not unexpected, but politicians are willing to pay for the bridge, cut the ribbon when it is completed, and leave maintenance to future politicians. This is why the U.S. is perceived to have a crumbling infrastructure.
As do the most responsible condo associations, when government builds a highway, bridge, tunnel, or dam, it should create a special maintenance fund for the infrastructure and, likely, pay into the fund every year. The fund should be set aside for that piece of the built environment exclusively. Such a plan will increase perceived construction costs, of course, but it will make trillion-dollar infrastructure bills a thing of the past. When maintenance, rehab, or replacement is needed, the money needed will be available.
Is there any chance politicians will begin to take such a forward-looking approach to infrastructure? Probably not. They love to cut those ribbons. Repairs only cause traffic delays.
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