Your property manager and your assigned accountant are currently gathering historical information that will be used to build a draft budget with your board members. There is a lot to keep track of in a community association, so they get started early. Just like in your personal budget, your community’s budget details income, expenses, and short- and long-term savings.
Your association’s income. The condo assessments we collect for your association are income, of course, but so are the fines, parking fees or any usage fees for your amenities (such as a rental fee for your clubhouse). Some high-rise buildings collect income for allowing radio equipment or commercial satellites on their roofs, or leasing advertising space. Your association may also earn income on investments.
Your association’s expenses. Ongoing projects must be paid for, along with insurance and legal fees for any outstanding legal matters involving your community. Your property manager will analyze utility usage to estimate next year’s usage. If your board has planned for any special projects in 2019, the manager is asking vendors for proposals now so that the board can make a decision and pricing is added to the budget. In addition, if the board has any ‘wish list’ items they’d like to tackle, or issues they have noticed on a property walk, they will be working with the manager to get this into the budget.
Staff payroll and benefits, along with administrative costs, are placed in the expense column. Finally, the accountant works with the property manager to determine if the amount directed to the reserve fund for long-term projects is sufficient, if adjusted for inflation and the current state of the structures.
The board goes through the items line-by-line with the property manager before presenting the budget to owners for a vote. Clearly, there are many pieces to the finances puzzle, but Lieberman’s experts are always at your side to give you guidance!