Board Condominium Financial Governance Rules Enforcement

Condo Fees and Fines

M.R. from New Haven County writes:

Dear Mister Condo,

I am wondering what kinds of fees and fines other condo associations have. Apart from the monthly HOA dues, that is.

Mister Condo replies:

M.R., the term “common fee” refers to the monthly contribution made by all unit owners towards the common expenses of the condo association. Typically, the fee covers expenses such as insurance, utilities, landscaping, snow removal, management, legal, Reserve Fund contribution and more. These expenses are shared with the entire association and are developed by looking at the approved Annual Budget and then applying the “per centage of unit ownership” rule as outlined in the association’s governing documents. The per centage of unit ownership takes many factors into consideration, such as square footage, desirability of location, etc. to determine who pays what per centage of the common expenses. Generally speaking, that is it for common fees. However, in associations that also offer extra amenities and restaurants, it is possible to have extra fees for everything from golf club use to required contributions to the club house restaurant. It is also possible to have clubs within the association where the fee for the club might also be paid along with the common fee. This is less common but I have seen it done.

Fines are another issue altogether. Fines are the penalties assessed to a unit owner when a rule or by-law is broken that carries a fee for breaking the rule. There is no hard rule about how much these fines can be so they vary by association. Generally speaking, fines are levied only after a warning has been issued and the unit owner has had a chance to appear before the Board to state their defense for why the rule was broken. In most cases, the Board doesn’t care why the rule was broken and will issue the fine just to maintain order within the community. I have seen fines as low as $5 (a little slap on the wrist) and as high as hundreds of dollars (usually for repeat offenders and for larger violations like parking in fire lanes or prolonged violations), The whole idea of the fine system is that unit owners will voluntarily comply with the rules they agreed to abide by when the entered the community. Fines that are ineffective at correcting the offensive behavior often lead to lawsuits between the association and the unit owner. In that case, if the association wins the case, the financial damages could be quite significant against the unit owner. This happens most often in architectural compliance cases where a unit owner does something without the Board’s prior approval such as installing a deck or replacing sliders with French Doors (I’ve seen both!). In those cases, the unit owner had to remove the improvement, pay to have the unit restored to its previous condition, and pay a fine for breaking the rules. Ouch!

Thanks for the question. I hope I gave you an answer you can use.

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