Get a bunch of community association homeowners in a room and what do they talk about? Money, money and snow.
Such were the concerns of the attendees at a free open forum hosted recently by the Illinois Community Associations Institute. A panel of industry professionals answered questions and provided insight.
Here is a recap.
Why do we need a reserve study?
A reserve study, which calculates the remaining usefulness of an association’s common elements and the cost to repair or replace them, is the best way to know how much money you need to save for the future, said certified public accountant Mark Cantey, of Wheaton.
If the association wants to borrow money for a project, one of the questions lenders will ask is what other projects will come up and how much is being put aside for those, said Timothy Haviland, vice president at Community Advantage, a division of Barrington Bank & Trust Co. in Palatine.
How much does a reserve study cost?
It depends on the size of the property and the common elements, said Mark Waldman, president at Waldman Engineering Consultants in Naperville.
A reserve study for an association whose common elements consist of an entrance sign and a fence will cost far less than one for a high-rise condominium with elevators, heating and cooling systems and a parking garage, he said.
“You can pay for the reserve study from your reserve fund,” he said.
Our association’s assessments include water, and the residents tend to be wasteful. The cost is enormous.
Can we take out our single meter and install individual meters, so the owners pay for their own water?
The answer depends on whether your declaration lists water as a common expense, said association attorney Ben Rooney of Keay & Costello in Wheaton.
If it does, the declaration must be amended to make water an individual expense, he said.
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How do you feel about providing a credit card in the name of the association for a staff member to buy supplies?
“I think it has to be evaluated case by case,” said community association manager Leslie Pollard at ACM Community Management in Downers Grove. “I see associations who have had staff on payroll for years and years, and there is a relationship and trust and never a reason to doubt. But there is always a chance that the credit card can fall into the hands of the wrong individual.”
We are over budget this year because of the snow last winter. Can we transfer the difference from our reserves?
Don’t take money from reserves to pay for operational expenses like snow removal, Cantey said. “If you’re in the hole this year, you have to make it up,” he said. “What I suggest is taking that deficit or shortage for 2014 and putting it as a line item for 2015.”
When is the latest time of year you can successfully add new plants to the landscaping?
The time to plant grass and perennials is pretty well over for 2014, said Matthew Trowbridge, an account manager with Acres Group landscaping and snow removal firm in Plainfield. “Trees and shrubs you can plant all the way through winter, as long as you can dig the holes.”
What are the differences between using a steel-edge blade and a poly-edge blade for removing snow from asphalt driveways?
Trowbridge said the steel blade gets the driveway cleaner than a poly blade, but it tends to leave scratches and scrapes on the surface of the asphalt. Also, poly blades wear out faster, so the cost is higher.
The Illinois Community Associations Institute sponsors several open forums each year. Go to cai-illinois.org for details.