Create a funding plan
Overview¶
A funding plan is a multi-year contribution strategy for an association's reserves. Creating one lets you test a contribution strategy for a fiscal year, built on that year's component data, before your board chooses which plan to adopt. This article covers the single task of creating one plan. For the wider process of building several plans, comparing them, and recording the one your board selects, see Create and compare funding plans for your next budget year.
Setup¶
Funding Plans view access opens the "Plans" page. Creating a plan needs Funding Plans edit access. Without edit access, the "Plans" page opens, but the "+ Plan" tile is not shown.
"Plans" appears in the left navigation only when the fiscal year selected in the top navigation is a future planning year, or, for the current year, when SmartProperty has turned on current year planning for your property. Outside of those two cases, "Plans" does not appear in the left navigation. To plan inside a year that has already started, contact SmartProperty.
The first time you select a future year with no plans yet, SmartProperty walks you through a short setup: "Review anticipated expenditures", "Verify financial details", "Complete". Finishing the setup creates a copy of your component data for that year. You can then test plans without changing your live components. Select "Start planning" at the end to open "Plans".
A new plan starts from your property's financial assumptions for the fiscal year: the starting reserve balance, fees, and rates. Set or check these before you create a plan. See Set your financial assumptions.
You can hold up to five funding plans per property per fiscal year. Once five exist, the "+ Plan" tile is not shown. Remove a plan first; see Remove a plan in Create and compare funding plans for your next budget year.
How-to¶
Open the property, select the fiscal year you are planning for in the fiscal year selector, then select "Plans" in the left navigation. This opens the "Plans" page, showing any funding plans already built for that year.
On the "Plans" page, select the "+ Plan" tile. This opens a dropdown listing the default plans available for your property, with "Add New" at the bottom. A default plan already added to the page appears grayed out in the dropdown.
Starting from a default plan¶
Select a default plan in the dropdown. Doing so creates the plan immediately, using that plan's preset strategy together with your property's current financial assumptions. There is no wizard and no save step. The new plan appears on the "Plans" page right away, alongside any others for the year. See Default plans in Reference for the plan names and for what you can still change on a plan created this way.
Building your own plan¶
Select "Add New". This opens the "Create a Plan" wizard, with "Plan Info", "Funding Details", and "Financial Details" numbered across the top.
On "Plan Info", choose a "Plan Type" and enter a "Plan Name". The "Plan Type" list includes "Current Funding", "Threshold Funding", "Targeted Funding", "Cash Flow Funding", "50% Funded", and "Ladder Funding". "Loan / Special Assessment Funding" is also listed when SmartProperty has set up Loan Analysis for your portfolio. Without Loan Analysis, this option is not listed. SmartProperty checks the "Plan Name" as you type: a name that matches a default plan name, such as "Current" or "Minimum Threshold", or that matches another plan already on this property for the same fiscal year, is rejected. Until "Plan Type" and "Plan Name" are both valid, "Next" is not available.
On "Funding Details", the fields depend on the "Plan Type" you chose on the previous step. "Current Funding" asks for "Annual Reserve Contributions", "Rate of Annual Reserve Contribution Increases", and "Additional Funds to Reserves". "Targeted Funding" asks for "Target %" and "Target Year", plus the same rate and additional funds fields. "Threshold Funding", "Cash Flow Funding", and "50% Funded" each ask you to choose the method for your minimum reserve balance, "Percent of Current Replacement Cost" or "Dollar Amount", and a Threshold value, plus the same rate and additional funds fields. "Ladder Funding" asks for a series of steps instead of a single set of values: each step sets "Annual Reserve Contributions", "Rate of Annual Reserve Contribution Increases", "Duration", and "Additional Funds to Reserves", with its "Starting Fiscal Year" filled in for you. Select the plus button below the last step to add another one. "Loan / Special Assessment Funding" uses the "Annual Reserve Contributions" and "Rate of Annual Reserve Contribution Increases" fields and also adds a section for listing loan and special assessment entries on the plan.
On "Financial Details", set "Reserve Balance" on the fiscal year start date, "Plan Duration" (20 or 30 years), "Interest Rate on Reserve Funds", and "Component Inflation Rate". These values start from your property's financial assumptions for the fiscal year. Change them here only if this particular plan should use different numbers. Select "Show Advanced Options" to add forward planning and additional revenue assumptions to this plan; see Set your financial assumptions for what each of those sections does.
Select "Create Plan" to finish. Until every field on this step is valid, "Create Plan" is not available. On a "Ladder Funding" plan, "Create Plan" is also not available until the step durations add up to the "Plan Duration". If they do not, return to "Funding Details" and adjust the steps. Selecting "Create Plan" saves the plan and returns you to the "Plans" page, where the new plan now appears alongside any others for the year.
Reference¶
Plan types and their Funding Details fields¶
| Plan Type | What "Funding Details" asks for |
|---|---|
| Current Funding | "Annual Reserve Contributions", "Rate of Annual Reserve Contribution Increases", and "Additional Funds to Reserves". |
| Targeted Funding | "Target %" and "Target Year", plus the same rate and additional funds fields. |
| Threshold Funding, Cash Flow Funding, and 50% Funded | The method for your minimum reserve balance, "Percent of Current Replacement Cost" or "Dollar Amount", and a Threshold value, plus the same rate and additional funds fields. |
| Ladder Funding | A series of steps, each with "Annual Reserve Contributions", "Rate of Annual Reserve Contribution Increases", "Duration", and "Additional Funds to Reserves". "Starting Fiscal Year" is filled in for you on each step. |
| Loan / Special Assessment Funding | "Annual Reserve Contributions" and "Rate of Annual Reserve Contribution Increases", plus a section for adding loan and special assessment entries. Listed only when SmartProperty has set up Loan Analysis for your portfolio. |
Default plans¶
The default plan names are "Current", "Minimum Threshold", "100% in 10 Years", "75% in 10 Years", "50% in 10 Years", "Fully Funded in 30 Years", "Cash Flow", and "50% Funded".
On a plan created from one of these, "Plan Type" and "Plan Name" are locked, along with the values that define the strategy: "Target %" and "Target Year" on a targeted plan, and the threshold method and threshold value on a threshold plan. The starting balance, rates, plan duration, contributions, and additional funds stay open for you to edit.
Limits¶
A property holds a maximum of five funding plans per fiscal year. Plan names must be unique for the property and fiscal year, and cannot reuse a default plan name.
Troubleshooting¶
"Create Plan" is not available on the "Financial Details" step. A required field on this step, or an earlier step, still needs a valid value. On a "Ladder Funding" plan, check that the step durations add up to the "Plan Duration".
"Next" is not available on the "Plan Info" step. "Plan Type" or "Plan Name" still needs a valid value, or the name you entered was rejected. Choose a different name.
The "+ Plan" tile is not shown. Either this property already has five funding plans for the fiscal year, or your role does not include Funding Plans edit access.
Related articles¶
Create and compare funding plans for your next budget year