BOK Chapter Update: Deferred Capital Renewal and Deferred Maintenance

This chapter on Deferred Capital Renewal and Deferred Maintenance has been updated in the Body of Knowledge (BOK). It appears in Part 2: Operations and Maintenance.

Historically, the terms deferred capital renewal and deferred maintenance have been used interchangeably. While this is still acceptable in some areas and operations, it is recommended that a differentiation of the two be employed.

Deferred capital renewal is defined as major maintenance or capital projects that had gone unfunded in previous budget cycles. It is the failed air handling unit that is not running. The air compressor that is past its life-cycle. The chiller running on 50% capacity because of age and wear.

Deferred maintenance is defined as preventive, predictive, or corrective maintenance that assets and systems should have undergone but have not yet done so. It is the three-month backlog of preventive maintenance work orders. The air handler components that need repair. The leaky but repairable roof that is dripping into a collection and drainage system. Throughout this section of the BOK, we will employ the use of this distinction between deferred capital renewal and deferred maintenance.

From the very beginning, when the facilities condition assessment began to catch on as increasingly common practice, uncertainty prevailed about whether to include the prospective costs of subsystems life expiration, because prospective costs of renewal did not fit within the definition of “unfunded in previous budget cycles.” If these costs anticipated in the future were included in reports of what was called deferred capital renewal, then those deferred capital renewal backlogs ballooned to disproportionate amounts, because they included both past accumulated deficiencies and projected future needs.

Available to APPA members only, the BOK is a searchable, digital database that develops, updates, and disseminates the foundational content required by facilities professionals at colleges, universities, and other nonprofit educational organizations. Its 63 chapters, which are reviewed and updated on an ongoing basis, cover topics categorized in the four core areas of General Administration and Management; Operations and Maintenance; Energy, Utilities, and Environmental Stewardship; and Planning, Design, and Construction.  

APPA members wishing to get involved in the BOK, whether as chapter authors or peer reviewers, contact Glen Haubold and Steve Maruszewski using the subject line APPA Body of Knowledge.