# Repair & Maintenance Fund

The RAAC Treasury is obligated to fill the Repair & Maintenance Fund (R\&M Fund) up to a target threshold. The target threshold is a percentage of total real estate assets under management by RAAC, weighted by the real estates’ risk profile to account for the probability and size of required repairs. For example, Housing Choice Voucher Program properties are more risky and might require repairs worth a couple of monthly rents every year.

$$
RM Target Size = a × \sum\_{i}^{n} (Value\_{i} ×weight\_{Risk\_{i}})
$$

> *with*\
> *i: real estate object*\
> *a: base percentage of AUM that should go to the R\&M Fund*

## Parameters

At launch, RAAC will use the following parameters:

| Base Percentage |       |
| --------------- | ----- |
| a               | 2.50% |

| Risk Score                                        | Weight |
| ------------------------------------------------- | ------ |
| 1 (e.g. Prime housing)                            | 1      |
| 2                                                 | 1.5    |
| 3 (e.g.Housing Choice Voucher Program properties) | 2      |

{% hint style="info" %}
Until the target size is hit, 70% of the treasury’s USD fund are allocated to the R\&M Fund, 30% remain in the treasury for other use.
{% endhint %}


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