Updated Surplus Numbers

Updated Surplus Numbers
Updated Surplus Numbers: Actual surplus 2018 per audit was $85,163.
Boards 2011-2018 implemented policies and procedures with specific goals:
stabilize owner fees, achieve maintenance objectives and achieve annual budget surpluses.
Any surplus was retained by the association.
The board elected in fall 2018 decided to increase owner fees, even in view of a large potential surplus

Average fees prior to 2019

Average fees prior to 2019
Average fees per owner prior to 2019:
RED indicates the consequences had boards continued the fee policies prior to 2010,
BLUE indicates actual fees. These moderated when better policies and financial controls were put in place by boards

Better budgeting could have resulted in lower fees

Better budgeting could have resulted in lower fees
Better budgeting could have resulted in lower fees:
RED line = actual fees enacted by boards,
BLUE line = alternate, fees, ultimately lower with same association income lower had
boards used better financial controls and focused on long term fee stability

Thursday, February 15, 2018

Constructing the Rule


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With expert opinion, the rules can be changed. Our association goes through rules changes periodically. One could ask "How is it that certain issues come to the top of the list while others don't?"  That's a good question and it all depends upon whose hot button gets pushed. I've seen rules committees stonewall rules changes and I've seen rules committees insist upon other rules changes. I'm of the opinion rules changes are difficult to make and even more difficult to enforce. That opinion is the result of years of observations and walking the entire HOA, attending numerous meetings, etc.

However, if a rule change is to be considered, there are questions to be asked and expert opinion to be obtained. Preferably, questions shouldn't lead the experts to a specific conclusion but I see that all the time. I suggest many flawed rules are a direct consequence of personal agendas at play.   Based upon practical experience, there is no point to revising or creating a rule if the rules committee isn't behind it. Which is one explanation for why things are the way they are.

Here are a few of the questions to be asked by boards and rules committees when addressing rules changes. The following is directed specifically at a proposed rule change to reduce ambient and impact sound in a HOA. This rule change is being proposed and spearheaded by the rules committee.

It the following question aren't asked or if the rules committee doesn't address them then the rule may be flawed. What do I mean by "flawed"? I mean ineffective, too narrow, undesirable, or unenforceable. Getting this right is the responsibility of the rules committee:
  1. What sound rating is desired?
  2. At what cost to owners?
  3. At what tangible benefit to owners?
  4. What sound rating will be actually required?
  5. In which units is the rule to apply?
  6. How to address existing floor treatments?
  7. When are these changes to occur?
  8. Who will write the rule?
  9. How much money is the board willing to spend to update the rule? (Experts $65-$150 per hour and upwards, attorney $200 per hour and upwards).
  10. How will the rule be enforced? What inspection and impartial enforcement methods are to be applied? When, by whom and how frequently?
  11. When will owners be informed?  During the discussion or after it is a done deal?
Of course, all of the board members are involved in this, or they should be. But it is the sole responsibility of the rules committee to get the necessary information, elicit the support and input from the other board members, draft a rule that is workable and then once it has been passed enforce it.  This obviously requires some communications skills. In the good old day committees might just ram the rule down the throat of boards and owners. Such an approach simply isn't workable. Such an approach shouldn't be necessary.

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