Condo Media - December 2014 - 16

by Gary M. Daddario, Esq.

C A I

R e g i o n a l

N e w s

NEW HAMPSHIRE

Look Ahead to Avoid Falling Behind
Proper Planning Will Help to Accomplish Goals

s I sit writing this column, I
truly cannot believe it's October. It is borderline frightening (slight tip of the hat to
Halloween this month) that by the
time you read this it will be December. At the risk of sounding cliché, I
can only wonder where did another
year go? Of course, this type of reflection catches many of us toward the
end of the year. The greater problem,
however, is that our "how this year
flew by" realization means we're actually endangering next year. You see,
absent getting a handle on our affairs
and taking some time to properly plan
for next year, we run the risk of seeing it fly by without the accomplishment of our goals. Thus, this month's
focus is on proper planning.
Within CAI, proper planning is a
necessity. Work on next year's events
is already well under way. Without
it, CAI would not be able to secure
the desired venues and dates along
with the speakers, refreshments, etc.
that make the events so valuable to
attendees.
Moreover, proper planning of events
is what allows sufficient time for the
organization to communicate the
event schedule to potential attendees.
Another example comes via the
New Hampshire Legislative Action
Committee. With several hot topics,
including property manager licensing and a condo dispute resolution
board, potentially looming in the next
legislative session, the NHLAC has
already begun meeting to discuss the
important issues and action items for
the remainder of 2014 and for 2015.
So, how does an association board
engage in proper planning? One of the

Condo Media * December 2014

more useful tools is a reserve study.
At the high end, such studies are
accomplished by utilizing engineering
and accounting services so that an association's facilities may be accurately
analyzed and future financial needs
can be most accurately predicted.
Such studies tend to be well worth
the cost because they allow proper
financial planning over the timespan
afforded by the lifecycle of the association's facilities. This allows an
association to build financial resources
steadily and to avoid sudden, large
increases in condo fees and, worse
yet, special assessments.
Another element of proper association planning is budgeting. The
association's budget leads to the
unit owners' financial obligations
for the year, which, in turn, leads to
the association's ability to conduct
operations in a fiscally responsible
manner. Boards should be reasonable
and realistic in creating the annual
budget. Utilities tend to be on the
rise. Similarly, vendors seem to charge
more, not less, for their services as
time marches on. In short, just as we
experience on a personal level with
our household budgets, association
operations suffer an increasing "costof-living" pattern over time.
Associations need to plan for this
and make minor year-to-year adjustments in condo fees accordingly. The
failure to do so typically results in an
inability to meet financial demands.
This manifests itself in underfunded
reserves, special assessments, and delayed maintenance projects. Smaller,
consistent increases in the budget
are more easily accepted by the unit
owners.

On the issue of maintenance
projects, this is another area ripe for
proper planning. Boards should avoid
underestimating the time involved in
setting specifications, collecting bids,
selecting a vendor, and negotiating
a contract. This is especially true for
projects requiring a particular season
in order for vendor services to be performed. Beginning the process well in
advance of the time for performance
of services is the best way to ensure
the project will begin and end on
schedule.
Finally, a subject near and dear to
me, legal matters. Although commonly misconceived as "crises" to
be dealt with when an association's
hand is forced, it is possible to lessen
the blow of legal matters with proper
planning. This can be achieved by creating and maintaining proper records
with respect to troublesome events.
Evidence (e.g., documents, communications, photographs, etc.)
should be preserved before it is lost.
Witnesses should be secured in a
timely fashion and prior to the fading of memories. Sometimes, early
consultation with legal counsel may
allow an association to sidestep a legal
dispute through strategic action and
not merely "deal with" the problem
when it "blows up." In such cases,
the expense of strategic advice may
be far less than the expense associated
with even successful prosecution or
defense of a lawsuit.
Here's to planning and the resulting
Happy New Year!
Gary M. Daddario, Esq., is a
partner with the law firm of Winer
& Bennett.

Condo Media - December 2014

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