December 2023 CT

INFLATION... from page 46.

nance funds. However, these solutions are band aids. They may be helpful in getting your budget to balance in the current year, but without addressing the root source of the problem, you will only find yourself in a similar situa tion next year. After all that we have seen in recent years, the largest takeaway is to take action at the appropriate time, as you never know what other challenges will come up in future years. Using band aid solutions will simply push your problem to next year. Whether it be loan repayments, increased contributions to the replacement fund, or just a general increase in operating expenses, it is imperative to maintain your maintenance fees at a level that is sufficient to cover your costs. After all, your home is an investment. One that requires maintenance and service throughout the year to ensure that its value is maintained. Keeping maintenance fees at an appropriate level will go a long way to ensure that you are not only able to maintain the value of each home within your community, but that you are able to maintain the level your residents have come to expect for years to come. n

significant increases. This put a great strain on getting the budget to balance. Unless an association has commercial space or other significant revenue sources, an overwhelm ing percentage of an association’s annual revenue comes directly from unit owner/homeowner assessments. As such, boards were limited in their option when trying to balance the budget. Operating expenses and replacement fund contributions have both increased significantly, and for many associations, the only way to make ends meet was to increase maintenance assessments. In all of the examples mentioned above, the solutions tend to gravitate toward the same path: increasing main tenance assessments, update the reserve study regularly and fund per the study. While it is unfortunate, the reality of the situation is that other viable solutions are few and far between. Some associations that I work with were able to offset the impact of inflation by utilizing accumu lated working capital funds, or unused deferred mainte

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DECEMBER 2023