Appoint Your 2012 Budget Committee Now
Atlanta, Georgia–With the first quarter already coming to a close, it’s not too early to start thinking about budget planning for Atlanta business community associations and homeowners associations. A tip to help with the process is to utilize a properly run budget committee. The budget committee is comprised of members of the community association, which enables residents to have a say in how their money is spent. How does the budget committee work and who serves on it?
The Treasurer’s and Accountant’s Roles
It makes sense for the board treasurer of your Atlanta community association to chair the budget committee. As chair, it’s the treasurer’s job to keep everyone on track as the budget is prepared. The treasurer also presents the budget for approval to the board and members. If your community association works with an accountant, he or she may offer consulting, but the accountant really has no significant role in the process of devising the budget.
Who Should Be on the Association’s Budget Committee?
The owners who serve on the budget committee should represent a cross-section of your Atlanta community association. Of course, if there are members willing to serve who have expertise in areas such as insurance, landscaping, contracting, that’s even better. When it comes to size, a good general guideline is that the committee shouldn’t be so large that it becomes unwieldy.
What the Budget Committee Does
The treasurer of your Atlanta community association should make sure that all committee members understand the three basic components of the budget:
1. Non-Discretionary Operating Expenses. Funds needed for daily operation of your Atlanta community association, such as common area electricity and water, landscaping maintenance, Atlanta association management, insurance, and general maintenance. These expenses are either contractual or can be reasonably estimated based on experience. One important consideration when looking at items in the operating budget is the level of service sought by your Atlanta community association. Do owners want a landscaper who is on site three times a week or once a week? Do your Atlanta association homeowners want a landscaper who is a “blow, mow, and go” type, or do they want a landscaper who provides a higher level of service? Do your Atlanta homeowners association members want a lifeguard present at your association pool for twelve hours everyday or want to allow owners to swim at their own risk? These decisions will significantly impact the your Atlanta community association’s operating expenses.
2. Future Reserves. Funds needed to maintain your Atlanta community association’s reserves at sufficient levels are essential for preserving the value of Atlanta condominium and homeowners associations. Reserve funds provide money for the repair and replacement of the community’s assets—such as the pool, roofs, pavement, etc. and must be set aside in the budget to be able to meet future expenses as they become due.
3. Discretionary Expenses. Funds for additions or enhancements to the existing property. This is a function of what members of your Atlanta community association wants and is willing to pay for. The community should provide input and approval for this component. For example, you may want to erect a gazebo on the common grounds or install a new water slide at your community association pool. These expenses are discretionary and should be included in your Atlanta community association’s budget only if there is money left over to pay for them after payment of all non-discretionary expenses and reserve funding.
How to Crunch the Numbers
Armed with this knowledge, your Atlanta community association’s budget committee should be able to estimate total expenses for the coming year and compare that sum to your Atlanta community association’s potential revenue (assessments, interest on investments, swim and tennis team income, and so on). If expenses are greater than revenue, the budget committee needs to look for ways to lower expenses without compromising services. If that doesn’t balance the budget, the budget committee may have to make a tough decision—whether to increase assessments or levy a one-time special assessment.
Riverside Property Management is a Homeowners and Condominium Association management company management company proudly serving Roswell, Alpharetta, Buckhead, Marietta and all of North Georgia. Riverside is also an expert Georgia association management company and high rise Atlanta association management company. To find out more about Riverside Property Management and why it is one of Georgia’s fastest growing property management companies, go to www.riversidepropertymgt.com. You’ll be glad you did.
0.000000
0.000000