New York's Cooperative and Condominium Community

Habitat Magazine Business of Management 2021

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ARCHIVE ARTICLE

Barton Management: Capital Planning

THE BIG PICTURE

So many things go on in buildings – new owners coming in, old owners moving out – but an important focus for a new board member, particularly in smaller buildings, should be to take a look at the property’s finances. In particular, I would recommend examining the corporation’s reserve accounts.

Because your co-op or condo is made up of many owners with different income levels, funding projects can be challenging. Just as you would in your own home, you want to put some money on the side for special projects.

BE SMART

As a new board member, you could gather input from the other board members concerning projects and necessary work. You could meet with the managing agent and the super and build a spreadsheet of the estimated costs for these projects and/or repairs, and then discuss with the board the most prudent way to raise money to pay for them. If it looks like an assessment is needed, you could help fashion a sensible one so that all the owners can manage these payments.

Maybe a smaller steady assessment over a longer period of time would serve all the unit-owners best, particularly those who are on fixed incomes. If the goal is to pay for your building’s projects, you really have to be aware that there are different levels of income among the shareholders or unit-owners. This means that large sums gathered over short time frames might not work.

So if you know of a special project that’s coming up, or some repairs that may be more costly than what was expected, take a look at your reserve account and discuss funding options with the other board members. It might be better to implement an assessment over a longer time frame – 12 to 18 months – rather than putting a strain on your building’s residents with a large assessment over a short time.

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