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Condo association owners promised a popular vote

Posted on Wed, Jan 09, 2013 @ 07:59 AM
  
  
  
  
We live in a 62 condo association. Our bylaws specify that each unit of the Association is to have one vote in Condo affairs. From 1999 until 2009 we voted to approve the proposed next year's budget and monthly assessment. Then in 2010 the Chairman informed the association that there was no need to vote on budgets--and that earlier years' votes were only "courtesy" votes. And we need not vote on the annual assessments either. Now the proposed budgets are not even given to us at our annual meeting. but we are given it to us two weeks before the new fiscal year. Two years ago we were told that the monthly assessments were to be raised from $160 to $190. Two years later it was raised another $20. It seems contrary to the "one vote per condo unit" when 5 members of the association (on the Board) can decide the question without the vote of the rest of us. Who gives final approval and has the decisive decision : the Board or the Association? The board does a reasonably good job of management, but our promised "one vote each" has been taken away. Is there some way to impress on them that we also want input into money spent. structures erected on the "common elements" etc.? 

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It would probably benefit you greatly to sit down and have a long read of you condo docs, specifically your by-laws. They should spell out whether or not you get to vote on your budget, when your budget should be presented to you. All of this should be spelled out for you generally in a separate section or "Article" entitled Fiscal Management. Sounds to me like your Board has already ead the by-laws thoroughly and are now applying the the rules to the letter of the law.

posted @ Wednesday, January 09, 2013 8:25 AM by Joe W


You may be misinterpreting your by-laws. Yes, most by-laws typically state one vote per unit, but most also state what you vote for. Have you looked under the section of your by-laws regarding the duties of the directors? Most by-laws have under the duties that the directors (board) is to set the budget and the assessments. The membership elects the directors and the directors then manage and administer the affairs of the association. 
What one board did was decide that it was more "fair" and "right" to have the membership approve the budget and the dues (assessment). My guess, without seeing your documents, is that this is not how it is supposed to be done. The reason for that is that the board is supposed to do the proper research and have the history to adequately set the budget and assessments. You are relieved from that tedious work, but you must also trust the board to do that correctly, fairly and accurately. 
In my opinion and experience, it is not beneficial for the membership to set the budget and the assessments. As a portfolio manager, we had one community that did do that, per their bylaws. The board every year did a presentation on the costs and why the assessments should be where the board proposed; and most of the time, it got voted down. Most people will not vote to increase the fees on themselves, even when given adequate information.  
Your one vote is to elect board members and in most documents, you have other actions your vote would apply for - recalling board members, amending your documents, dissolving the condominium association - any of these items should be listed in your by-laws. Look at the voting section and the board responsibility section. You may also wish to consult a real estate attorney.  
That being said, maybe your documents do have the community setting the budget and assessments, but you need to know where it says that so that you can show the board. The board should have been telling you where in the documents it states that it is their responsibility and authority. I would advise that you ask them. 
If it is a board responsibility, you may want to form a financial committee to assist the board by reviewing costs and the budget.

posted @ Wednesday, January 09, 2013 8:28 AM by Joe Schuirmann


Somehow most of the questions posted on this website can be answered by reading your By-laws. Each owner in our 22 unit building has a percentage of ownership depending on where in the bldg they are located (crazy I know but that is the way it was originally set up) Voting is by your percentage. We usually just have a voice vote on things but if there was a real divide as to how people feel then we would go to the percentage vote. BUT-the key answer to your question is-what rights and responsibilites do the board have. Ours clearly states that the board has the right to raise the monthly assessment-no vote needed. We still would call a short owners meeting just to let them know what and why. It isn't required but it sure makes things "more livable". Budgets and annual financial reports are give 10 days before the annual meeting and the owners have a chance to ask questions at the meeting and I have all the financial documents along if anyone wants to see them. They also have the right to inspect then any time during the year.

posted @ Wednesday, January 09, 2013 8:28 AM by Jan


Sounds similar to how HOA operates, at least you get one before the fiscal year. I've been a member since ours was formed in 2001 and our devious autocratic President has never presented one to us! It's only a board issue.

posted @ Wednesday, January 09, 2013 8:36 AM by Suitcase


Typically the Board approves a budget proposal among themselves first.Our Declaration requires an annual budget and assessments be presented annually to the unit owners.The Board has already apprroved the Budget and seeks its ratification by a majority of unit owners attending the meeting only.It takes a majority vote of all unit owners to reject the Board's budget.We have never had a majority of unit owners at Budget meetings.Having said that it is what the Board submitts at the annual meeting.Some associations have property managers do the Budget preparatuin for the Board.They are always presented annually.Our declaration allows the Board to increase assessment fees by15% of the operating budget without a vote of unit owners to cover extra ordinary expenses encountered.

posted @ Wednesday, January 09, 2013 8:41 AM by Ron H


Respectfully to all, 
It sounds as if you had certain practices in the past, which may not have been completely in compliance with the the strict operating procedures of state law, the declarations, the master deed and the by-laws.  
Often it is not a town meeting structure but more like a republic (or more accurately, an small non-profit corporation.). 
It all depends on your documents. I will reference how it is in our condo documents: 
1) The Board of Directors have full control over all expendatures, including the budget and the assessments.  
2) The unit owners only have the power to vote for board members when their terms expire, or they have the power to call special meetings to depose board members. 
3) The unit owners are entitled to full access to all the financial and minute records of the association. In my state, the treasure is legally bound to submit a budget to the unit owners for review. However, the unit owners legally only can voice their opinions, or vote out the BOD if they do not agree with the expendatures and assessments.  
In other words, the only direct ballot power the unit owners have is control over the terms of the board of directors. They do not have decision making power on the assessments or expenses. 
Your condo association structure may or may not be similar,  
respectfully, "John Mastro".

posted @ Wednesday, January 09, 2013 9:05 AM by john_mastro


A HOA Board is responsible for all business related to the HOA including budgets and assessments. A review of the next fiscal year's budget at an annual meeting and subsequent affirmation vote by HOA members (owners) is done to give the HOA members a sense of participation and approval. 
 
It is extremely important that HOA Boards keep all HOA members informed of HOA business on an ongoing basis, usually through newsletters. Mailing the next fiscal year's budget along with the annual meeting notice is important to ensure HOA members have time to review and ask questions at the meeting. No HOA Board is perfect and all feedback and questions should be welcomed. 
 
Any HOA Board that attempts to be secretive and not receptive to feedback or questions should expect the HOA membership to be discontent and question every action such as you have. 
 
As a Board member for our HOA, I have found that conducting Town Hall meetings in the hallway entrance of each of our condo buildings in Spring and Fall is the best way to convey Board activities and projects as well as solicit issues and concerns from HOA members (even renters) which can be addressed at the meeting or added to Board agenda for new business. 
 
May I recommend that you volunteer to be a Board Member, no prior experience is necessary.

posted @ Wednesday, January 09, 2013 9:27 AM by Ron - NC


Your Board of Directors hs to have authority to make a budget that keeps the condominium going. Our documents only requiere a membership vote if the annual budget exceeds the Consumer Price Increase. Even if the membership votes down the increase, our board still has authority to increase assesments if necessry in the future.

posted @ Wednesday, January 09, 2013 9:50 AM by Don


This issue may have more to do with an amended (or new) condominium statute than condo bylaws or declaration. 
In Connecticut, budget voting is different from all other unit owner voting, in that, unit owners vote to reject the annual budget not to approve it. In other words, if the required number of owners (majority or 2/3 usually) do not REJECT the budget, the budget for the upcoming year is approved. This law took effect in CT on July 1, 2010 as part of the comprehensive amendments to the Common Interest Ownership Act. This particlar section about the annual budget is codified at Sec. 47-261e of the CT General Statutes. In practical terms, budgets are more easily appoved now, and owners must organize to defeat a budget. The board can know whether its proposed budget can be defeated as soon as the sign in sheet is completed. If the number of attendees and proxies do not meet the level of votes required to defeat a budget (say 2/3 of the voting membership), the budget is essentially passed without a vote. Again, the vote taken on an annual budget is a vote to defeat the budget, not a vote to approve the budget.

posted @ Wednesday, January 09, 2013 10:41 AM by George Cameron, Esq. Farmington, CT


@George 
To add to the mix our Association "also" votes for new directors at the AGM. I understand about the budget voteing but no one else does. What happens when there is no quorum? 
Roberts Rules says no quorum the actions taken are null and void.

posted @ Wednesday, January 09, 2013 12:18 PM by Dizzy


In our 300+ PA condo BOD presents any proposed budget or assessment at a meeting with explanation, input, discussion. A 2nd meeting is called via announcement including the final draft budget. More discussion. BOD then votes - in private if they wish. 
Owners, thereafter, within 60 days can override ANY any all BOD decisions with 75% disapproval vote. 

posted @ Wednesday, January 09, 2013 2:45 PM by Verda


@Dizzy, 
If it is like our By-laws, in the case of no quorum of the members at large there is no change in the board. In the case of no quorum of the board or failure to submit a budget, the budget in place stands and the assessments in place stand. In the case that the minimum number of board members are not filled by a volunteer (three in our case), theoretically a unit owner can petition a court to put the association into recievership, if the associations fails to fill the board.

posted @ Thursday, January 10, 2013 3:33 AM by john_mastro


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