Early last December you received your 2010 assessment coupon. Your Board of Directors anguished over raising assessments, but when the debating ended their decision was to provide a budget that would adequately cover your association’s annual costs.
You will find that most budget line items remained the same as last year — some decreased. Others increased slightly due to increased cost. There was, however, one significant cost increase common to each association, i.e., delinquent payment of annual assessment fees, resulting in bad debt (see adjoining chart). As with homeowner and condo associations throughout the country, bills must be paid — thus income from you who pay your dues must be used to make up for those who fail to pay.
Delinquencies, and hence foreclosures, in 2010 may remain at the 2009 level — or could increase. You will notice that 2010 estimated delinquencies for 2010 are less than those for 2009. A 2010 shortfall will be covered by retained revenue, if necessary.
Your Boards will closely monitor expenditures again this year and hold back on spending of non-specific discretionary funds until later in the year when the amount of delinquencies could be better determined.