Creating a Timeline and Budget For Your Capital Planning Process
Do you want your Capital Plan approved? In this blog, we will move your organization one step closer to that goal! Our last blog, Score Big with Your Capital Plan presented steps to create a scoring system to rank your Capital Projects. With a scoring strategy in place, your next step is to set a razor sharp schedule and budget to move forward. Adding these two tactical elements to your capital plan document helps bring it to life and enables your stakeholders to quickly assess whether the plan is practical and will be successful. We've organized our advice into 6 helpful tips.
For in-depth details, please download our Tip Sheet, Creating a Schedule for Your Capital Planning Process.
1. Have a calendar for your Capital Plan. The most successful facility managers have a long-range capital plan in place showing their 3-5 year outlook.
Facility managers are always asked – “what happens if we push this project off a year?”
This timeline is updated as projects are completed and allows the facility manager to show immediate priorities and long-range needs, life cycle component replacements, and modernization projects. Download the tip sheet to find out more.
2. Consider budget cycle variables. Understand your budget cycle. Be certain to take into account the following points when determining budget parameters.
- For large projects, it's typical that approval must take place more than a year in advance of the project.
- Federally funded projects must go through a detailed approval and budgeting process.
Whether your property is private, commercial, educational, institutional or other, design components should also be taken into consideration. Determine the amount of extra time needed for the design process. Are you working with a known vendor or a new vendor?
If you're a government or educational facility manager you may be dealing with an RFP process. Are you familiar with how long the approval process will take?
3. Preparing for the timeline and budget. What you should do now to be ready.
Step 1: Assess and inventory your capital projects.
- Have you performed a building condition assessment?
- Have you recently noted systems past their useful life (UL)?
- Have you included any code compliance issues or mandates?
Step 2: PRIORITIZE your project list.
- Identify the need and criteria for priority.
- Determine which projects are essential to maintain the facility.
- Determine which projects cannot be deferred without adversely affecting the budget.
See our previous Tip Sheet, Scoring System to Rank Capital Project Requests for additional tips on this step.
Step 3: Lay out your calendar.
Determine when budgets are due as well as the anticipated duration of the project. Take weather, geographic location, and facility type (commercial, education or government) into consideration when determining the window for construction. Is there any wiggle room on the calendar for any of these items?
4. Develop a timeline checklist. Straight-forward and simple is a starting point.
5. Separate long lead time projects from short fuse projects. Roadmap to success.
The most successful capital plans have big ticket items prioritized and planned well in advance, but also have repair and maintenance projects included in the budget to be executed in a short window.
From Roofing and Parking Lot improvements to HVAC repairs/replacement, ensure that your site condition assessments account for capital plans and R&M projects.
6. Accelerate the process, to take advantage of fiscal year surplus. Avoiding project pitfalls, budget constraints, and adjusting contracts.
Veteran capital planners understand that the best-laid plans often go awry. For example: projects with approved funding aren’t executed in the planning window.
- Does your budgeting process allow you to carry over funding from one fiscal year to the next?
- Can a design contract be awarded at the end of a fiscal year with surplus funding?
- Do you have contracts in place with mechanical vendors, roofing contractors, and finish contractors?
- Pre-positioned contracts with routine vendors can be efficiently awarded at end of the fiscal year.
- Have you considered Job Order Contracting (JOC) - a variation of pre-approved open-end contracts?
- These types of contracts allow you to streamline the execution of projects.
The above is a sample of criteria and questions, that when used in conjunction with our Capital Plan Scoring System, should be considered for all of your Capital Projects.
Get the full scoop on Creating a Schedule for your Capital Planning Process by downloading our Tip Sheet specific to your property type:
Capital Planning Tip Sheet for Government and Education