KrystaT
(Florida)
Posts:56
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| 08/12/2008 10:26 AM |
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| Hi, I'm the pres. of a board, and the board wants to make a purchase of a computer, but it's not in the budget. We have the cash, and don't need a special assessment. I know you have to get homeowner vote for expenditures outside of budget, but can anyone tell me the statute where it covers that? |
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JohnK3
(Pennsylvania)
Posts:565
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| 08/12/2008 10:48 AM |
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Krysta,
What makes you think the Board can't spend on non-budget items w/o Membership approval? Our ByLaws don't even require a budget; rather, suggests we "may" make one. And we have broad spending powers.
I'd imagine most Boards run into spending issues not forseen in budgets then make them for the benefit of the HOA.
What's the computer for? Is having one a "reasonable" double-plus good for the HOA? If so, and it's affordable, I don't see a problem. |
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KrystaT
(Florida)
Posts:56
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| 08/12/2008 10:55 AM |
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Isn't that misappropriation of funds? To take money that was supposed to be used for something, and spend it on something else? I asked our attorney, and agreed that according to the statutes you need homeowner vote to approve any spending not specifically asked for on the budget. Also noted that if it was over $1000 we need 3 bids on different computers.
I need to know the proper statute number for my reference in our upcoming meeting.John, are you in FL? |
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GeraldT4
Posts:934
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| 08/12/2008 11:05 AM |
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| KrystaT - You've received the advise of your attorney, why not ask him/her for the statute? |
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JohnK3
(Pennsylvania)
Posts:565
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| 08/12/2008 11:08 AM |
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Krysta,
HOATalk says I'm in PA, so I'll stick with that call!
Anyway, budgets are simply guidelines to give all of us a running scorecard on spending and receipts.
If you have a $$$ number that requires Membership approval - our ByLaws only require same if we want to borrow more than $20K - then you have to abide by that.
But if you have X # of $$$ for spending, with or w/o a budget, and a "need" arises to transfer from one proposed line item to another, I still don't see a problem. It's not misappropriation; it's doing what needs to be done.
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KrystaT
(Florida)
Posts:56
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| 08/12/2008 11:14 AM |
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| I was going to ask the attorney, but at $200 an hr. I was trying to save us a little cash, instead of spending it on him looking it up specifically for me. I've tried looking throught the statutes, but unsure whether it's in the 720 or 617. |
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GeraldT4
Posts:934
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| 08/12/2008 11:14 AM |
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| JohnK3 - It seems Florida law has a requirement that anything outside the budget needs membership approval. That's what would make Krysta think approval is required. |
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AnnaD2
(Florida)
Posts:386
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| 08/12/2008 11:16 AM |
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KrystaT, what exactly do you plan on doing with the "association" computer. Do you already have a management company that keeps the association records on file?
Who is going to have posession of it once it is purchased? Is it going to be in someone's home? Or will it be in a safe and secure location where all board members can have access to it?
One of our past boards purchased a laptop for the association. It was kept in a board member's condo. Nobody saw it for two years. After the board member resigned she refused to turn it over for another six months. When she finally did turn it over (surprise) it was an older, cheaper model and no one could get access to anything on it. She claimed to have "misplaced" all the paperwork belonging to the computer and dared the board to PROVE it wasn't the same one.
Needless to say, our current board is much more "protective" of our purchases and our policies. |
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KrystaT
(Florida)
Posts:56
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| 08/12/2008 11:21 AM |
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Anna, that's what I'm scared of...along with alot of other things that could be done with a computer...
But we are self run, and our tresurer wanted a computer for bookkeeping. It's a great idea, b/c I would like to have it to keep electronic files instead of piles of paperwork printed out every month.
We haven't sorted out the specifics of the computer, but it would be kept at whoever's house needs it I guess. I'm having a little problems with other board members because they don't want to put it for the homeowners for a vote. I'm trying to follow the law and our covenants and do the proper thing. |
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JohnK3
(Pennsylvania)
Posts:565
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| 08/12/2008 11:21 AM |
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Gerald,
If that's the case, I'll count myself fortunate to be here in PA.
$100 budgeted for postage? Turns out $110 is needed?
Man, I can't imagine. Well, I can, but pity the poor HOA Boards of FL! |
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SusanW1
(Michigan)
Posts:2316
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| 08/12/2008 11:23 AM |
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Can the board can vote to move funds from one category to another: office supplies to administrative costs?
Or, if this is an emergency, take it out of emergency funds?
You must have this piece of equipment for financial record-keeping. It's not an option, rather a needed expenditure.
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AnnaD2
(Florida)
Posts:386
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| 08/12/2008 11:32 AM |
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KrystaT I'm not sure if you get much of a turnout at your Board Meetings but I would suggest you put it on the agenda for the next meeting. I would make it agenda item very clear: Board Discussion to Purchase Computer.
You may get some helpful feedback from owners and you'd also (I'm sure) get a lot of questions and concerns about it. That would give you an idea of how the members feel about such an expendiature.
Does your treasurer have a personal computer now? She can easily transfer all the files onto a disc and hand it over to whomever becomes the treasurer the next time.
But for the association to purchases a computer for only ONE person to have posession and or access to is (IMHO) a risky thing to do. Members may ask you how such a purchase will benefit the entire association.
At best, for right now, I'd discuss this out in the open at a Board Meeting. I'd certainly not do it unless it's first discussed in front of everyone. |
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KrystaT
(Florida)
Posts:56
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| 08/12/2008 11:32 AM |
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John, from my understanding it's not a big deal to move money from one column to another in case of needs or emergencies. That can be done with board approval. But, to spend budget monies on something that ins't specifically asked for in the budget is the problem. We can't go buy a computer, then come up short for landscaping, or not do any landscaping improvements at all because we spent the money on a laptop.
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DonnaS
(Tennessee)
Posts:2948
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| 08/12/2008 11:40 AM |
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Krysta,
You need to tell us where is this extra cash right now? Is it in a line item or just a slush fund or what?
Before you purchase the computer, you do need to sort out who will be it's keeper and what will it be used for.
But I know of no Statute that says that a membership vote is needed to purchase items that make the association and Boards job easier. Unless it is a large amount of your budget, you certainly can purchase a computer. All Boards need operating cash and usually there is a line item for office expenses which is where this could be listed under.
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KrystaT
(Florida)
Posts:56
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| 08/12/2008 11:41 AM |
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Anna, I feel the same way, it's should be public knowledge. Other board members do no feel the same way. I think it's everyone's money, everyone should know what it's getting spent on. Another issue is the treasurer wants a specific computer for $1400-1500. Myself and 2 other board members(out of 5) think we can get one for half of that price, but the treasurer doesn't want to comprimise. He's now saying he'll vote against the computer all together. (after I've already set up the meeting and sent out the agenda with laptop proposal on them) There's alot of drama....I don't want to discuss on the internet. I want to do what's the best for everyone not a couple people.
I think the homeowners won't have a problem if we present the proposal in a way where it shows how we're saving money instead of having an expensive management co. Also if we purchase an affordable computer for around $500-700 instead of $1400. |
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JohnK3
(Pennsylvania)
Posts:565
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| 08/12/2008 11:44 AM |
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Posted By KrystaT on 08/12/2008 11:32 AM
John, from my understanding it's not a big deal to move money from one column to another in case of needs or emergencies. That can be done with board approval. But, to spend budget monies on something that ins't specifically asked for in the budget is the problem. We can't go buy a computer, then come up short for landscaping, or not do any landscaping improvements at all because we spent the money on a laptop.
Krysta,
I agree. Though now it seems we're not debating Can, but rather Need and Want/Don't Want. That's up to you and your fellow BOD members.
Personally speaking, and echoing other posters, sounds a trifle fishy.
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GeraldT4
Posts:934
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| 08/12/2008 11:45 AM |
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DonnaS - Your wrote, "But I know of no Statute that says that a membership vote is needed to purchase items that make the association and Boards job easier.".
Who said that such a statute was ever written? This post is about an item that is outside of the budget, plain and simple. So the question is, is there a statute that requires membership approval for items that are not in or contemplated in the adopted annual budget? |
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SusanW1
(Michigan)
Posts:2316
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| 08/12/2008 11:50 AM |
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Bring in the bids . . . and a consultation from an expert on just what kind of program you need. We use Quickbooks. Cost: about $300. Invoices, tracks dues, does reports, etc. etc.
Consider:
new computer with new program
upgrading existing computer with new program
used computer with new program
REMEMBER: the treasurer does NOT have to do all this work - he/she just has to make sure that the work gets done. Someone else who has the proper machine, programs, etc. can enter the transactions. The Treasurer gives the report to the board.
I don't like it that the Treasurer is dictating what kind of computer he must have to do the job, then threatening to abstain from the vote when he can't get what he wants.
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DonnaS
(Tennessee)
Posts:2948
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| 08/12/2008 11:57 AM |
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Gerald, Gerald,
In response to Krystas very first post,----" but can anyone tell me the statute where it covers that?"
My response is--no statute that I know of. |
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AnnaD2
(Florida)
Posts:386
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| 08/12/2008 11:59 AM |
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So the treasurer says that he/she wants a certain computer??? When did this become that person's personal computer? See? This is exactly how it will be perceived by some.
Does this person think they'll be treasurer forever and ever? That person would have an awfully hard time deleting all their personal e-mails, games, etc. if they had to turn it over at the end of their term.
Christmas is coming, perhaps your treasure could ask Santa for the computer he/she really wants. |
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GeraldT4
Posts:934
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| 08/12/2008 12:02 PM |
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Posted By DonnaS on 08/12/2008 11:57 AM
Gerald, Gerald,
In response to Krystas very first post,----" but can anyone tell me the statute where it covers that?"
My response is--no statute that I know of.
Donna, Donna,
You wrote, "But I know of no Statute that says that a membership vote is needed to purchase items that make the association and Boards job easier.".
Did you not? Yes.
Krysta's very first post doesn't say anything about making the association and Board's job easier.
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DonnaS
(Tennessee)
Posts:2948
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| 08/12/2008 12:09 PM |
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Gerald,
I did state that and will rescind the-- "that makes the association and Boards job easier." I stand corrected. It was meant for a following sentence and never got that far. Thanks
But there is no Statute that requires a membership vote for an office item outside of the Budget unless it is capital expenditure. |
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JamesS10
(Tennessee)
Posts:2
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| 08/12/2008 12:12 PM |
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Krysta
Another option that our association has found extremely useful is having an association website built by the builders of HOATALK.com, that being Community123.com. We have an archive section for electronic storage of association documents and records. These can be readily accessed/viewed by other board members.
We also have a section for Working Documents where we store documents that will be updated from time to time such as fiscal year to fiscal year. These documents can be downloaded by any board member, updated with current information, and then uploaded back into both the archives and working docs folders.
This option would only work if the board members have personal computers at home, and many people do these days. If your board members have home computers, then using the website as your record of reference eliminates the need to purchase an association PC as well as the associated need to safeguard what junk can be put on PC's when you have multiple users. |
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KirkW1
(Texas)
Posts:1190
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| 08/12/2008 6:45 PM |
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Krysta,
The problem may be that you don't understand the nature of the beast. There is nothing to state that you must put the computer as a line item on the budget. Now you may have some policy that would dictate an amount above which something becomes a capital expense requiring special treatment. If so, then you would need to keep the computer under that figure (or break up the purchase in creative accounting). Seriously, I would classify the computer as "office supply."
Now for advice from someone who is in IT as a profession:
In the purchase you should include thought of warranty work. If you will be hurting should the computer be down for three days, then make sure you have next day service.
To be honest, I hate working on el cheapo computers because the drivers are often more problematic then those from more established computer companies. As for the bidding process, unless you are looking at different vendors for the same hardware it is a very flawed idea since you will not be comparing apples to apples.
I also recommend that an HOA purchase license to allow two (or more) Board members to have the software on their computer. Then make sure that the keeper of the records regularly provides a data backup to the other members. In a crunch you can then fall back on the other person's copy.
At any rate, I highly recommend that you keep "off site" backups. This simply means that you back the data up and keep the backup in a different building. This can be as simple as keeping the backups at a different Board member's house. |
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MaryA1
(Arizona)
Posts:2498
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| 08/13/2008 7:48 AM |
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Posted By KrystaT on 08/12/2008 10:26 AM
Hi, I'm the pres. of a board, and the board wants to make a purchase of a computer, but it's not in the budget. We have the cash, and don't need a special assessment. I know you have to get homeowner vote for expenditures outside of budget, but can anyone tell me the statute where it covers that?
Krysta,
I think the technicalities are getting a little out of hand. Donna answered your basic question: there is no FL state statute which prevents a BOD from purchasing an item not budgeted for. So, if your BOD can agree on the cost, etc. there is nothing preventing them from purchasing this computer. A vote of the members is not required, nor should it be necessary. The BOD can still be open about this expenditure w/o putting it to a vote of the members! Frankly I don't agree bids are necessary. Common sense would dictate purchasing from the store that offers the best deal on computers. Just check out the Sunday newspaper ads!!
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GeraldT4
Posts:934
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| 08/13/2008 8:02 AM |
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| MaryA1 - Just because there is no state statute preventing a BOD from purchasing an item not budgeted for doesn't mean that KrystaT's HOA is relieved of the requirement. Her docs may have a cap on BOD expenditure, and she states, "...you have to get homeowner vote...". Clarification from KrystaT on that is necessary for our understanding, don't you think? |
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MaryA1
(Arizona)
Posts:2498
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| 08/13/2008 8:06 AM |
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Posted By GeraldT4 on 08/13/2008 8:02 AM
MaryA1 - Just because there is no state statute preventing a BOD from purchasing an item not budgeted for doesn't mean that KrystaT's HOA is relieved of the requirement. Her docs may have a cap on BOD expenditure, and she states, "...you have to get homeowner vote...". Clarification from KrystaT on that is necessary for our understanding, don't you think?
Gerald,
Because Krysta was only concerned with state law, I took it to mean her docs do not require it. But, yes, if the docs say a vote is required then a vote is required. I understood her to say she thought h/o vote was required per state statute.
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DonnaS
(Tennessee)
Posts:2948
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| 08/13/2008 11:31 AM |
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Mary,
Two great minds think alike. I also understood that Krysta wanted to know if there was a State Statute requireing a members vote to purchase any item not included in the Budget. Answer??? NO Statute. Of course the old--check your documents always is present.
(We should create a code or symbol for "CHECK YOUR DOCS") It would be easier to use one than to write it out each time. |
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KirkW1
(Texas)
Posts:1190
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| 08/13/2008 12:26 PM |
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...(We should create a code or symbol for "CHECK YOUR DOCS") ...
CYD?? |
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DonnaS
(Tennessee)
Posts:2948
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| 08/13/2008 12:32 PM |
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Hmmmm, Not Bad |
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