One of the biggest frustrations of the 2021 AGM was that the old board wasn’t given a chance to respond to every statement made. This includes the current financials. Statements were made that the new board will be putting financials in order. This from a group that was unable to ask a single question during the financial report. The 2020-year end was approved at the AGM unanimously without a single question. A lot of work was put into the reporting. The 2020 board was the first in the history of Ventana Woods to post financials monthly. Suggestions that the financials are not in order is just a thoughtless statement.
The biggest challenge every condominium corporation deals with is its financial position as it ages. This is due to the increasing cost to maintain a property as it ages. Recently this has been compounded by the increasing cost of insurance. Condominium insurance pricing has spiked with increasing losses driving some insurance providers out of the market. Even though our monthly contributions have increased slightly we have fallen behind in the amount of our monthly contribution toward the reserve fund.
During the pandemic the previous boards reduced the contributions to the Reserve Fund to keep the monthly contributions from increasing. There is no magic in financials. The only way to raise more funds is to have owners pay more. Increasing monthly contributions or levying special assessments.
The Condominium corporation has two budgets. The operating budget and the reserve fund budget. The operating funds are used for the day-to-day operation and maintenance of the complex. The reserve fund is the money that is put aside to make capital replacements such as driveway replacements. Starting in 2021 financial statements are posted online as they are approved by the board.
The reserve fund relies on a reserve fund study as a strategic plan to direct the board in the capital replacements needed and how to fund them. In Alberta the Condominium Property Act (CPA) regulates the operation of Condominium Corporations. The CPA mandates that the reserve fund study is done by a trained independent third party to avoid any conflict of interest in the operation of the condominium corporation. The reserve fund study for Ventana Woods is posted on Condo Genie. A new study must be conducted in 2022.
Our reserve funds are above the recommended minimum fund balance but well below the maximum suggested in the study. It is easy to try and blame past boards for the short fall in the reserve fund. The reality is Ventana Woods has had a very high driveway failure rate. Forcing previous boards to hire an engineering firm to develop an engineered driveway solution to deal with the high-water table in the area. Replacing driveways in the complex is expensive and something most developments don’t have to deal with for 25 years or more (35 years according to our current reserve fund study). The current reserve fund study recommends a special assessment of $ 1,429 per unit in 2022.
The community is fortunate to have many passionate owners. We can come together with the common goal of saving money and building the reserve fund. Despite the mistruths that were spread the past few months. I wish the new board the best as we are in this together.