Budgeting in a Recession

It's time for our association's annual budget review - Any suggestions on how your HOA is saving money. These are the things we are looking at right now.
1. Review of the governing documents to determine if we can eliminate a few meetings by combining them ( such as the budget ratification meeting and the election)
2. Adding a line item for bad debt.
3. Signing up as many people as possible for electronic notification
4. Aggressive debt collection
5. Renegotiating contracts

What are you doing to stretch your HOA budget during the crunch time for the next 18 months?

Best~!
J

JS,

A good and timely topic you've raised. We've (our Board) just started our 2009 budget "discussion" process.

Our biggest, current single budget item is landscaping/care of our common areas, which is over 1/2 of our total dues. Some of our thoughts include:

1. Continue weekly mowing in April, May and June, then switch to every-other week for the rest of the season (as our grass grows more slowly then).
2. Skipping mulching our front entrance and retention area trees every year in favor of every-other year.
3. Only replacing "key" dead trees/shrubs. For instance: one on our main road into the subdivsion? Yes. A few others in the front enterance area that nobody would notice were simply gone? No.
4. Cutting back from 3 to 2 weed/fertilization treatments.

All of the above would fall under your #5 as our contracts are limited to a single year, though this year we're going to shop for bids, our current firm, though doing a good job, has had the business for years. While your #s1-4 might be of concern at your HOA, they aren't at ours = We have no bad debts, few meetings, and everybody is on e-mail.

We are currently running a surplus and our reserves are in good shape. But we're dreading September, when a pro is coming in to examine and propose a solution to the weed/algae issues in our 4 ponds. Hopefuly, the savings suggestions we're considering will cover some/all of that project.

Insurance and pond fountain electricity cost are pretty much static. This year we had our fountain re-rigged so we can handle removal/replacement rather than paying $1K for that service. A good $200 investment, that.

We are self-managed, but if you have a PM, consider less services in return for lower fees. Or, take a big leap and go self-managed yourselves if you have enough warm bodies to handle the work. That step saved us about 1/3 of our dues.

Our ultimate goal is to avoid dues increases while continuing to add to reserves.

SheliaH - Your newsletter is most likely not a requirement, rather a luxury. I doubt you need homeowner approval to reduce any expense surrounding that.

Here are some of the things I'm seeing associations carefully review:

Increase in insurance deductibles to lower premiums (rolling the dice, but????)

Doing an extra round of preventive maintenance instead of a scheduled replacement (i.e. patch and seal coating for asphalt roads and pushing back scheduled resurfacing) Don't just skip everything, only those that waiting a year or two won't do any harm or look bad.

Accepting donations - one association wanted to change to flourescent lighting (condo, outsides of buildings), but the initial outlay for the more expensive bulbs wasn't something they could handle - so they simply asked those owners who could afford it to to donate a bulb or two. The bulbs are trickling in, but every one helps. If you still have gas lights, many local utilities are providing help in replacing those. Other donations might include annuals or replacement plants/shrubs.

If you have any common watering system for the grounds, then a water management system often pays for itself the first year.

Using a sand/salt mix on roads during winter instead of just salt (northern issue in urban areas)

If you pay for water, emphasize drips, leaks, not removing the reducers in faucets - you might also see if someone can help those who can change a faucet washer. Often you are paying double for the same water, the water and sewage charges, so the less used, the faster the bill goes down.

Joe

Joe- Thanks for the eco-friendly suggestions. Our power utility gives away the new energy efficient light bulbs, and also has a grant program for weatherization, which is available to non-profits. Water department has rebates for retro-fitting lawns to conserve more water.

Regarding salt and sand mixture - and it has been a long time since I lived in the frozen north of Kalamazoo.... but - doesn't fertilizer provide a similar benefit on ice/snow, but without the salt burn? (but for this discussion, probably not as cost effective.)

Kirk - I am with you regarding the renegotiation line - If you don't ask you definately will not get it. What is the worst that can happen - I will be told no.