Paul Tomblin wrote:

In a previous article, Andrew Gideon said:
Paul Tomblin wrote:
No, it means that your monthly fees include an upgrade reserve.

How much? We've an avionics upgrade fund, but even that wasn't easy to
get

I think we're aiming at $30,000 a year. That pays for a new engine and a
prop overhaul when we need it, and if we go a year without needing one of
those, we get a stormscope or a paint job or something.

Interesting. We have dedicated reserves, which is a little different than
what you're describing. That is, we do have an engine overhaul reserve for
each airplane. These accrue over several years, so "going w/o needing one"
over a year is more the norm than the exception.

Wouldn't you have a problem if (for example) two planes needed an overhaul
w/in the same year if you're not building up engine overhaul reserves over
multiple years? Or am I missing something?

We also have "interior" and "paint" reserves (and, I think, "prop reserves"
for the two constant speed props...but I'm not sure).

More, items like an engine reserve are usually included in an aircraft's
hourly rate (as opposed to a monthly fee). So your fleet upgrades come out
of hourly rates?

Our avionic reserve is paid by monthly, but the engine, paint, etc. reserves
are paid by hourly. I don't recall all the math, but I believe (for
example) the hourly rate is computed so as to accrue the price of an
overhaul ($20,000?) in 2000 hours.

[...]
Growing the membership is one avenue open to a club using our
(share/equity-base) model. But I'm interested in how such a club can fund
upgrades independent of increasing membership.

Like I said, by making sure the monthly fees have an upgrade reserve.

I've been assuming that any upgrade funding would be time-based (and
therefore to be taken from the monthly). But, if I've understood correctly
(and as I wrote above) your club is paying for upgrades out of hourly.

Have you a reason for choosing one over the other? I've been thinking along
the lines of avionics, and I think of new features/models/capabilities as
coming over calendar time rather than flight hours. That's why I tend to
think "monthly" for upgrades.

The other local club at our field
does an equity thing, and it costs $32,000 to join. And when they
increased the fleet to 4 aircraft, every one of them got hit with an
additional assessment.

That's seems quite high. Do you know their member/aircraft ratio?

Last time I checked, it was 24 members and 4 planes, including a Lance.
They also have t-hangers for each plane, so their monthly dues are about
double ours.

Hmm. That's almost $200,000 equity per airplane. Unless those are recent
models or very upgraded or all "high end" aircraft, that seems high to me.

- Andrew