A.T. from Hartford County writes:
Dear Mister Condo,
Mister Condo replies:
A.T., no, that is not correct. However, correcting the action may prove a bit tricky. Each and every year, the Board is tasked with developing a budget for your condo association. Sometimes the budget is prepared by a third party, like a Property Manager; sometimes it is done by a Treasurer or other officer; and sometimes it is an amalgamation of folks working on particular sections of the budget. However, the budget that is developed in this manner becomes the proposed budget until it is ratified at the Annual Meeting of unit owners. Even if there was no annual meeting of unit owners (that’s a whole other issue!), the Board should have met and either approved or rejected the proposed budget. Minutes must be kept for all meetings of the Board and meetings of the unit owners as these minutes are records that must be made available to all unit owners upon request. Therefore, regardless of whether the budget was approved at the proper Annual Meeting or improperly at an Executive Board meeting, the minutes from that meeting are association records and, as such, must be made available to any unit owners who wish to inspect them. Your condo documents clearly spell out this process and there is also wording in the Common Interest Ownership Act (CIOA) to support these statements. Technically, a budget that has not been approved by the unit owners is void and the previously approved (previous year) budget is considered still in place until such time as a new budget is ratified by a proper approval from the unit owners.
Now comes the lesson in practicality, A.T.. While it sounds like a foul has been committed by the Executive Board on the budget ratification, there is the reality of the association needing income (common fees and assessments) to offset all of the expenses of the association. If this new budget isn’t radically different from the previous year’s budget, I would request that the Board hold a proper meeting of unit owners to accept or reject the budget they plan on using this year. If the budget is similar or even identical to last year’s budget, that shouldn’t present too much of an issue. However, if they have significantly increased common fees or taken on new capital improvement projects (big ticket items like a club house or pool) the owners have every right to challenge the budget and demand that the proper procedure for budget ratification take place. If the Board refuses to comply with the request, it is time to recall them. A Board that refuses to operate properly and in the public eye can be truly caustic to the community which they serve. The correct way is open and honest. Anything less should not be tolerated. Once again, your condo documents outline how to take corrective action is a recall is required. You may also wish to seek assistance from a community association attorney if you need additional guidance. Good luck!