This past year, many condominium associations enjoyed a double dose of good fortune: a milder winter with less snow removal and salting, resulting in a little extra money left in the coffers by spring. The question then becomes: What to do with those funds—what is the best way to ensure they are put to the best use possible?
As anyone with a household budget knows, there are always plenty of needs waiting to be filled by a few extra dollars. For most communities, “there are surpluses in some accounts and deficits in others,” says David A. Levy, CPA, based in Brookline, Massachusetts. If there is $10,000 left over from the snow plow contract, that money will not be held back and put into next year’s snow plow fund. Instead, it likely will be used to help ease expenses for unit owners in the months and budget year to come.
“Generally speaking, many associations have taken and re-evaluated their budgets to assist owners in keeping fees where they were last year,” says Lou Gargiulo, CEO and founder of the New Hampshire-based firm Great North Property Management. “With the economy the way it is and with people hurting, it feels like that’s the most important and best thing to do.”
He adds, “Other associations have used it for deferred maintenance to keep costs down, while others have deferred doing anything with the surplus until the end of 2012 to wait and see where it will be needed for 2013.”
“The operating budget,” says Mark Love, CPA, of Love, Jarominski & Raymond, LLP, in Worcester, Massachusetts, “is a management tool.” Creating one is both “an art and a science,” he says. In 2011, who would have assumed we would have had that much snow and in 2012, that little snow?”