Cohousing-L Mailing List: Re: Guidelines for teams managing budgets

[Mac Thomson (macthomson]

We have several budgets that may impact each team:
Operating Budget - the normal annual spending of a team
Extraordinary Spending - a special one-off project (e.g., install solar panels 
on the workshop)
Team Reserves - anticipated spending that happens less frequently than every 
year (e.g., replace common house stove)

The Operating Budgets are fairly predictable and don’t change much from year to 
year. Extraordinary Spending projects are almost always something new. Team 
Reserves get massaged every couple of years as we add assets or learn from 
experience.

Every year we also have a Contingency Fund which is set at 10% of the Operating 
Budget. Teams can get money from the Contingency Fund when they are going to be 
over budget. Our Steering Team considers requests for Contingency Fund money.

If for some reason, the Contingency Fund runs out of money (has only happened 
twice in 23 years) and a team needs more money in their budget, a community 
decision would be needed to get more funding (has only happened once in 23 
years).

I’ve given a talk or two about how we structure our finances, which can 
probably be found on the CohoUS website. I’ve got an overview doc (pdf) which 
I’d be happy to share. Just send me a private email: macthomson [at] mac.com 
<mailto:macthomson [at] mac.com>.

Cheers,
Mac

-- 
Mac Thomson

Heartwood Cohousing
Southwest Colorado
http://www.heartwoodcohousing.com


"I hear and I forget. I see and I remember. I do and I understand."
        - Chinese proverb
**********************************************************




> On Jan 10, 2024, at 1:10 PM, Elizabeth Magill <pastorlizm [at] gmail.com> 
> wrote:
> 
> We have gone through many iterations of this, but presently each team has a
> mandate, and included in that mandate is permission to spend their budget.
> (The mandate also says who is on the team --volunteers or elected, what the
> team does, how to contact the team, and when the team is expected report
> out. Essentially it delegates community decisions to the team.)
> 
> Then we have a discretionary fund, run by the trustees, which any team (or
> individual) can ask for additional funding for cohousing projects.
> 
> We did this because every year our cohousing expenses were significantly
> less than than what was budgeted. Teams put everything in their proposal,
> but then often didn't have the energy to do all they planned. It took a
> couple years, but now teams only budget for items they are actively working
> on. No dreaming that in six months we might decide to build a fence.
> 
> When a team decides, mid-year to take on a project they haven't budgeted
> for, they ask the trustees for more money. Trustees use a number of things
> in their decision making--how much is left in the discretionary fund, how
> much is requested, and whether it seems like the community needs to talk
> about it before proceeding. So far, this has worked really well--good ideas
> get funded, big ones geet discussed and then funded, but there isn't an
> excess of money locked up in team budgets and then not spent.
> 
> -Liz
> (The Rev. Dr.) Elizabeth Mae Magill
> Pastor, Ashburnham Community Church
> Minister to the Affiliates, Ecclesia Ministries
> www.elizabethmaemagill.com
> 508-450-0431
> 
> 
> On Wed, Jan 10, 2024 at 2:57 PM Marjorie Kamine <mkamine [at] gmail.com> 
> wrote:
> 
>> We just consensed on our first new annual budget after our HOA turnover.
>> All teams were involved in setting their team budgets and now we want to
>> encourage them to "own and track" their budgets and stick within them as
>> best as possible. We know that unexpected expenses that they didn't think
>> of in just one year of operating might come up and Finsnce is wondering if
>> anyone can share your "budget guidelines for teams." Do you have policies
>> in place regarding when teams need to come to Finance if they have gone
>> over or anticipate going over, and does your Coho have a threshold amount
>> that a team is requesting that might actually need to go to the community
>> to consense on? Any guidance, samples of guidelines would be appreciated.
>> Marjie at River Song Cohousing, Eugene. mkamine [at] gmail.com
>> _________________________________________________________________
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>> 
>> 
>> 
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