Q: Management sent a budget notification to members with an agenda, date, time and location. The board meeting was attended by the directors and several homeowners. The board met with the treasurer to go over the proposed budget and voted to accept one of several dues increase options. In the past, there was one meeting to approve a draft which was then presented at the next open regularly scheduled board meeting where it is ratified. It was not listed on the later board meeting agenda.
Increasing assessments by a figure of up to 20% can have a major impact on the homeowners , so even though the board has the power to pass a large increase, it is a good idea to take time to explain to the entire membership why the increase is necessary. A: Unfortunately, many boards pursue “target-based” budgeting instead of anticipating the coming year’s reasonably anticipated expenses. In that method, boards set a predetermined expense goal and expect the manager to create a budget meeting that target.