Re: HOA Dues Increase
From: Diana Carroll (dianaecarrollgmail.com)
Date: Sat, 6 Jul 2019 09:26:26 -0700 (PDT)
I just realized we didn’t really answer Pat’s original question about how
to recognize the need for an increase in dues and how to consense on it.

I don’t have much to say about the first. We do up a budget every year and
it is either higher or lower than last year. We’ve never set out to make an
increase per se, although our budget is almost always higher than the
previous year.

But as far as coming to consensus...that would tie closely to the community
culture. We (Mosaic Commons) try for total transparency. Every year the
Trustees prepare a budget (with input from members) in September or October
and share it electronically with the members. We then set up a discussion
in a general meeting about the budget, and then a later meeting to reach
consensus.

The Trustees, as well as teams requesting funding, go through line by line,
comparing it to previous years and explaining how and why it changed. For
instance “the electricity rates increased X%” or “we mis-budgeted expenses
for landscaping last year so this is a correction “ or “the garden team
plans to increase the number of beds at a cost of $Y”.

We rarely have difficulties agreeing on a budget because everyone
understands the logic behind the numbers (or perhaps they just trust the
Trustees). In your case, there might be more explaining required as your
members have been led to believe (probably falsely) that expenses are
fairly constant, but hopefully everyone in the group is equally committed
to having a financially healthy community that can function to meet the
needs and desires of the members.

Perhaps an analogy to a family budget would help. Expenses change over the
years. When kids are young you have to budget for daycare. If you move, you
have to change the budget for the new mortgage amount.  If your salary goes
up, it might make sense to set aside more to savings. Etc.

Good luck!

Diana


On Fri, Jul 5, 2019 at 3:28 PM fergyb2 via Cohousing-L <
cohousing-l [at] cohousing.org> wrote:

>        Actually California law requires a Reserve Fund report to the HOA
> but there is no requirement to adequately fund it.  Most HOA s are
> underfunded and this leads to much misery as the buildings age and major
> repairs and/or replacements (like roofs) become necessary and the only way
> to pay for them are large special assessments.  We’ve always tried to keep
> our Reserve adequately funded but even so we got blindsided by our local
> government suddenly deciding we were responsible for testing and repairing
> the lateral sewer lines that connect to the main sewer pipe which turned
> out to be a $60,000 job. So we had to have a special assessment after all.
>         Bonnie Fergusson
>       Swans Market Cohousing
>       Oakland, CA
>
> Sent from my iPad
>
> > On Jul 4, 2019, at 11:44 PM, Jerry Koch-Gonzalez <
> jerry [at] sociocracyforall.org> wrote:
> >
> > If yoiu have never had a condo fee increase I am either very happy or
> very
> > sad for you.
> > I assume first of all that in all these 11 years you have for the most
> part
> > not overspent your budget. Great. But my next question is: have you
> > adequately funded your replacement reserves? If not, you could be in for
> a
> > big shock - a special assessment or a steep hike in your condo fees.
> > Adequate funding of your replacement reserves is probably a legal
> > requirement in California, and there are definitions of what adequate
> means.
> > Our condo fees are based on a formula - part on just presence and part on
> > the size of the units. And we have an automatic condo fee increase. So we
> > need consent to lower the amount of increase rather than the other way
> > around. Saves a lot of argument.
> >
> > Jerry Koch-Gonzalez
> > Founding Resident, Pioneer Valley Cohousing Community
> > <http://cohousing.com/>
> >
> >
> >
> > On Fri, Jul 5, 2019 at 12:59 AM G/P Looney-Burman <
> > burloon [at] fresnocohousing.org> wrote:
> >
> >> Our almost-11 year old community of 28 homes has never had an HOA dues
> >> increase, and we are now, obviously belatedly, going to have one.  We're
> >> asking for input regarding methods of dues increase: how do you
> determine
> >> how much of an increase is needed? How do you reach consensus or
> agreement
> >> about having an increase?  Are your dues based on the size of each home?
> >> Have you had annual increases?  Increases as needed?
> >>
> >>
> >>
> >> Any information is welcome!  Thank you in advance.
> >>
> >>
> >>
> >> Pat Looney-Burman
> >>
> >> La Querencia (Fresno Cohousing)
> >>
> >> _________________________________________________________________
> >> Cohousing-L mailing list -- Unsubscribe, archives and other info at:
> >> http://L.cohousing.org/info
> >>
> >>
> >>
> >>
> > _________________________________________________________________
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> >
> >
> >
>
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