Association Budget Transparency

How to Create More Transparency in the Association Budget Process

Posted by Julianne Rossiter, CMCA, AMS, Sep 12, 2011

Providing opportunities for owner participation during budget development often results in greater understanding and support from the community for the proposed budget. Community involvement should begin early in the budget process. Periodic communication and transparency are essential elements of budget development, especially if the Board anticipates a significant assessment increase. Three successful avenues are committees, surveys and general meetings.

Committees

Committees are a great opportunity to create a larger work group that better represents the experience, ideas and preferences of the community. The budget committee, often lead by the Treasurer would have primary responsibility for developing the budget. The committee should also gather budget requests and input from the other committee chairs.

Survey Owners

Prior to developing the annual budget, ask owners about their priorities for the community. Sending specifically targeted surveys is a great way to gather opinions. Some questions you may want to ask are.

• What association services and amenities are most mportant to them?
• What projects would they like the board to focus on next year?
• Are they satisfied with the current maintenance programs?
• What changes would they like to see incorporated into the annual operating budget?
• Do they have any new cost-saving ideas or revenue generating ideas?

Although input and suggestions from owners are important, the Board must carefully sift through these suggestions and implement only those that will be meaningful, productive and prove beneficial to the community as a whole rather than to a small number of residents.

General meetings

Review the association’s current reserve study with the owners and share the funding goals so everyone understands the long-range financial and major maintenance plans for the community.

Consider holding an informational meeting for the owners to seek input on the proposed budget prior to the formal ratification. The ratification meeting is not the place to ask for owner input since is too late to make changes to the proposed budget. In addition, due to notice requirements, any changes made at the ratification meeting will typically necessitate another ratification meeting and its associated expenses.

Trestle Community Management is a full-service manager of condominium and homeowner associations with headquarters in downtown Redmond, WA. Trestle can be reached at www.TrestleCM.com.