Hi Micah,
I use different budgeting processes for capital and ongoing maintenance expenditures. Capital expenditures are budgeted through the zero based process and drilled down to the NEED vs the WANT per location. HVAC is always a need dependent on the status of the system and vendor report of life due to ongoing issues and repairs. I will budget for the unit "just in case" which allows for the expected replacement or funds to be shuffled around for any other unforeseen emergencies that arise if not used.
The maintenance budget is tracked per location and calculated on the current year expense, forecasted since I start in August, with an added 5% to cover any rate increases or unforeseen issues. The budget covers all utilities and ongoing regular maintenance such as landscaping, pest control, janitorial, HVAC routine maintenance, etc. This is more efficient for us due to the changes that take place through the year and having to justify any variances.
Looks like there are some similarities to the processes Richard and Jonathon shared. :)
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Christi McGonigal
Facilities and Construction Manager
Rogue Credit Union
Medford OR
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Original Message:
Sent: 10-08-2024 16:24
From: Micah Arnold
Subject: Budgeting for Miscellaneous
Greetings,
We are deep in the budget season for 2025, and I use the zero-based budget methodology. It's relatively easy to forecast regular expenses, such as the quarterly HVAC PMs; however, the miscellaneous/unknown expenses are more difficult to forecast. How do you forecast the miscellaneous expenses that are difficult to know? We are on a cadence to replace our HVAC package units between years 15-20, so there are fewer large misc. expenses that come from that.
Best regards,
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Micah Arnold
Facilities Asst Manager
Bay Federal Credit Union
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