Re: Property Management [was emergency communications]
From: Sharon Villines (sharonsharonvillines.com)
Date: Tue, 1 Nov 2005 11:05:25 -0800 (PST)

On Nov 1, 2005, at 1:40 PM, Sharon Villines wrote:

Hire a small financial services firm to handle the finances if you don't have members who can do this. With QuickBooks, you everything that needs to be done. You just need good controls over money handling -- different people (not friends) to handle the checkbook and the accounting so they double check each other, and two people to sign each check (again, not roommates or lovers or father and son). You can also have these people bonded. And have books audited once a year.

Also I should have said find a CPA who does property management audits to help you set up accounts. This will give you an education in what you need to track, how to manage reserves, etc.

We now have reserves set up for major contingencies. In addition to the legally required capital reserves to replace common elements (from roofs to refrigerators), we now have reserves for major maintenance ($10,000 which builds up each year to cover painting, tree pruning, and other expenses that are not annual), capital improvements (Fencing the SE corner, architectural improvements to the commonhouse, etc.), and emergency reserves ($10,000 for things we have no idea will occur).

As a result when we got a bid for $40,000 to paint our Hardy Plank 10 years before we expected to paint it, we had the funds on hand.

A note on Hardy Plank -- the plank itself may not need to be painted for 15 years but the building needs calking every 3-6 years (depending on who you speak to) and that means a mess unless you paint at the same time. Also the planking cracks for various reasons, like some one hit it with a dumpster or a bicycle or a concrete block, and must be sealed and painted again. And paint doesn't last for 15 years so the siding looks awful.

Our management company advised us on none of these reserves or warned us about the painting schedule and is not set up to track more than one reserve fund.

Sharon
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Sharon Villines
Takoma Village Cohousing, Washington DC
http://www.takomavillage.org


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