Generally, a policy of continued deferred maintenance may result in higher costs, asset failure, and in some cases, health and safety implications.
Maintenance and repairs, as distinguished from capital improvements, exclude activities directed towards expanding the capacity of an asset or otherwise upgrading it to serve needs different from, or significantly greater than, its current use."
Maintenance which is deferred because of insufficient funding may result in increased safety hazards, poor service to the public, higher costs in the future, and inefficient operations.
“Redefining the term ’maintenance’ to include repair activities and better reflect asset management practices is an initial step in resolving the problems noted,” according to Chairman Allen.
Pursuant to the FASAB Rules and Procedures, the proposed Statement has been submitted concurrently to the Director of the Office of Management and Budget, the Comptroller General, and the Secretary of the Treasury for a 90-day review.