Preparing for Budget Ratification Season – Avonlea Geisbert, Office Manager
Our office is currently buzzing with preparations for our associations’ Annual and Budget Ratification meetings! Typically, homeowners only get to see the ratification meeting, and none of the behind-the-scenes planning. How does your management company prepare for your ratification meeting?
Community Manager Preparation
Your Community Manager will begin the process by scheduling your ratification meeting, updating your reserve study if needed, reviewing any audits, etc. Your Community Manager will also consider any vendor contract increases and utility increases for the following year. Your CM will then draft a budget for board review in our system, Caliber. (Our managers typically disappear into a budget-preparation cave during this time, not to be disturbed, only surviving off sheer will!)
Board Adoption
Once a draft of your budget is created, it is emailed to the board of directors for review. Your CM will take the time to advise the board of ratification timeline requirements, explain the reserve fund status, and recommend funding plans. Once the board approves the final budget, the CM will request a reserve study disclosure from the reserve study provider, if applicable.
Budget Notice and Ratification
Upon board approval, your CM will schedule a venue/Zoom meeting within the ratification timeline restrictions. A notice is drafted and carefully proofread by designated proofreaders at our office. Per WCIOA, the budget ratification notice must include detailed information regarding the budget, including any assessment increases, date assessments are due, special assessment information, etc. Mailers for larger associations (250+ units) require special planning with our mailroom clerk to ensure they are sent out on time.
Your CM or board of directors will typically prepare a presentation for the ratification meeting. During the ratification meeting, owners can vote to approve or disapprove the budget in person or by proxy (proxy forms are sent out with the notices and can be found on the Portal). Unless a majority of the association membership votes against the budget, it will automatically be ratified. Non-answers are counted as an approval.
Post-Ratification
The budget has been ratified, but there is still work to do! Your Community Manager will report to the accounting department any changes in assessments, whether your association will use statements or coupons, and any special assessment information, if applicable. Our accounting team will then prepare a notice of increased assessments out to the membership, along with updated account statements.
As you can see, months of careful planning and drafting goes into preparing your association’s budget. Homeowners are encouraged to participate in the process by attending the budget ratification meeting or submitting votes by proxy. If you have any questions regarding your association’s budget, feel free to reach out to our office at info@vismanagement.com or 800-537-9619.