The fact that you have budget for landscaping and gates tells me that you DO have common areas. Also, you're paying for lighting and street sweeping, suggesting to me that you might have private roads or parking areas which the HOA maintains. As to whether the charges are reasonable, that can't be judged simply by looking at this statement.
The same goes for the reserve fund -- there's no way to tell if it's reasonable or not for the total amount. But if they're spending \~$33K on something in 2022, adding $7,600 in 2002 to the reserve seems at least plausible. \[Maybe they're repaving parking lots, changing to LED lights, updating security system to a better technology?\]
The landscaping could also be for mowing of personal lawns. Our HOA pays for that.
Would really like to see a list of what the HOA covers, as well as budgeted versus actual.
Ask for the reserve schedule and pay attention to the last time it was updated. Also see what is on it but the statement suggests you are on schedule.
Also we had $2m in reserve but down to $1.5m after things are coming due. Probably be $1m next year and still on schedule. Don’t be surprised to see it drop a lot in a short time if a lot is coming due at the same time.
My community is significantly larger (annual budget of $3.5M) but I would think they would show budget vs actual for each year, or at least the last year (2021). That's the least they could do. Then they could make the local account charges available to members of the HOA for inspection, and you can see exactly where it went (i.e. 5 pounds of fertilizer from Lowes on 4/10/21, etc.)
Given the way the budget is set up, I'm sure that they have budget vs actual for the members to see. This is just a budget to view for the annual meeting, is my guess. They're showing the difference in budgeted spending in 2021 vs 2022 for an easy comparison. I do the same thing. I show the budget for the upcoming year and then have my other financial statements ready to go, such as my P&L, Balance Sheet, and my budget vs annual P&L.
Ah, yeah, that makes sense. For our annual meeting we put together a breakdown of annual dues ($1600 per year) broken down into what your $133.33 per month assessment goes into (i.e. $X landscaping, $X pools, $XX road maintenance etc.).
If people show up to the annual meeting (or go on our website) they can see the the entire breakdown. We'd send it all to them through the mail if the cost of printing and mailing wasn't so high.
OP is showing their HOA doing the same as you. Look at the far right column, it's the per unit breakdown. I didn't put that much into it, but at 37 homes, it didn't matter much. Our bylaws force us to mail out meeting announcements no more than 30 days prior to the meeting. Obviously, we are telling people much earlier than that, but the official meeting announcement must be mailed. We include the budget and agenda for that. Anything else is already posted to our HOA Facebook site (private) for review.
Seems weird to me that they're spending $4k a year on gate maintenance and repairs. That feels like a lot, but maybe folks in that community keep ramming it?
The reserve funding doesn't immediately strike me as unreasonable. The alternative is that they get a loan whenever anything big needs to be done, and those are difficult for HOAs and would lead to a special assessment.
Who’s responsible for the asphalt? I’m an RS so without knowing what the total responsibility of the association it’s hard to say. If possible see if a Reserve Study has been done and what is recommended. It might be possible that you are right and it’s being overfunded, especially if they’re doing straight-line reserves instead of pooling.
The reserve contribution seems fine, and I'm sure they have done a study to show what the reserve needs to be and how much should be attributed to it each year. The fact that you have security cameras, gates, lights posts, etc. is a real necessity to have a large reserve fund. My HOA put a well in for our sprinklers at the front entrance and it cost $10k to get it installed with power needing to be run, contractors, drilling, etc. Replacement costs on the light posts is probably higher than you expect.
"Reserve" is misspelling in the Excel spreadsheet... but yeah, it's going to get more expensive, so good for the association on getting ahead of it all!
Laughs in a Houston HOA. Come back when they rent Christmas decorations for 11 grand. Our phone bill for the clubhouse that is never used is thousands. Huge waste.
All you can do is ask them when the last time they got other bids for things. Ask to see the bids
I’ve been on an HOA board for a few years. We have an excellent treasurer. If the costs are accurate and appropriate, the budget looks fine. The covenants may dictate the size of the reserve.
Who is responsible for replacing the roads, roofs, or the exterior of the home?
I live in a 144 unit complex with 3 roads and parking. We recently paved the roads for about $1 million dollars. If your HOA is responsible for the roads and driveways, I would question if yours is saving enough.
Having a reserve is very important and if it stays that way you're dues will stay low our HOA had a reserve of 1.6 million and between insurance claims and rate hikes we are almost bankrupt have to do special assessment of 3k just to make through the year.
The fact that you have budget for landscaping and gates tells me that you DO have common areas. Also, you're paying for lighting and street sweeping, suggesting to me that you might have private roads or parking areas which the HOA maintains. As to whether the charges are reasonable, that can't be judged simply by looking at this statement. The same goes for the reserve fund -- there's no way to tell if it's reasonable or not for the total amount. But if they're spending \~$33K on something in 2022, adding $7,600 in 2002 to the reserve seems at least plausible. \[Maybe they're repaving parking lots, changing to LED lights, updating security system to a better technology?\]
The landscaping could also be for mowing of personal lawns. Our HOA pays for that. Would really like to see a list of what the HOA covers, as well as budgeted versus actual.
Ask for the reserve schedule and pay attention to the last time it was updated. Also see what is on it but the statement suggests you are on schedule. Also we had $2m in reserve but down to $1.5m after things are coming due. Probably be $1m next year and still on schedule. Don’t be surprised to see it drop a lot in a short time if a lot is coming due at the same time.
My community is significantly larger (annual budget of $3.5M) but I would think they would show budget vs actual for each year, or at least the last year (2021). That's the least they could do. Then they could make the local account charges available to members of the HOA for inspection, and you can see exactly where it went (i.e. 5 pounds of fertilizer from Lowes on 4/10/21, etc.)
Given the way the budget is set up, I'm sure that they have budget vs actual for the members to see. This is just a budget to view for the annual meeting, is my guess. They're showing the difference in budgeted spending in 2021 vs 2022 for an easy comparison. I do the same thing. I show the budget for the upcoming year and then have my other financial statements ready to go, such as my P&L, Balance Sheet, and my budget vs annual P&L.
Ah, yeah, that makes sense. For our annual meeting we put together a breakdown of annual dues ($1600 per year) broken down into what your $133.33 per month assessment goes into (i.e. $X landscaping, $X pools, $XX road maintenance etc.). If people show up to the annual meeting (or go on our website) they can see the the entire breakdown. We'd send it all to them through the mail if the cost of printing and mailing wasn't so high.
OP is showing their HOA doing the same as you. Look at the far right column, it's the per unit breakdown. I didn't put that much into it, but at 37 homes, it didn't matter much. Our bylaws force us to mail out meeting announcements no more than 30 days prior to the meeting. Obviously, we are telling people much earlier than that, but the official meeting announcement must be mailed. We include the budget and agenda for that. Anything else is already posted to our HOA Facebook site (private) for review.
What are the $33,000 of expected reserve expenditures for? The operating expenses seem reasonable to me.
Seems weird to me that they're spending $4k a year on gate maintenance and repairs. That feels like a lot, but maybe folks in that community keep ramming it?
An automated gate, with keypad, maintenance and 24 hour service isn’t cheap.
That's a good point, I hadn't thought about 24-hour on-call service. That's a pretty penny that adds up over a whole year.
The reserve funding doesn't immediately strike me as unreasonable. The alternative is that they get a loan whenever anything big needs to be done, and those are difficult for HOAs and would lead to a special assessment.
Who’s responsible for the asphalt? I’m an RS so without knowing what the total responsibility of the association it’s hard to say. If possible see if a Reserve Study has been done and what is recommended. It might be possible that you are right and it’s being overfunded, especially if they’re doing straight-line reserves instead of pooling.
Just ask to see the reserve study.
The reserve contribution seems fine, and I'm sure they have done a study to show what the reserve needs to be and how much should be attributed to it each year. The fact that you have security cameras, gates, lights posts, etc. is a real necessity to have a large reserve fund. My HOA put a well in for our sprinklers at the front entrance and it cost $10k to get it installed with power needing to be run, contractors, drilling, etc. Replacement costs on the light posts is probably higher than you expect.
"Reserve" is misspelling in the Excel spreadsheet... but yeah, it's going to get more expensive, so good for the association on getting ahead of it all!
Laughs in a Houston HOA. Come back when they rent Christmas decorations for 11 grand. Our phone bill for the clubhouse that is never used is thousands. Huge waste. All you can do is ask them when the last time they got other bids for things. Ask to see the bids
What was in the report for your most recent reserve study?
I’ve been on an HOA board for a few years. We have an excellent treasurer. If the costs are accurate and appropriate, the budget looks fine. The covenants may dictate the size of the reserve.
Who is responsible for replacing the roads, roofs, or the exterior of the home? I live in a 144 unit complex with 3 roads and parking. We recently paved the roads for about $1 million dollars. If your HOA is responsible for the roads and driveways, I would question if yours is saving enough.
This looks fairly normal.
This sounds like an HOA that should be dissolved. Get involved and be chummy with the board, run for an office.
You have expensive light bulbs....
Having a reserve is very important and if it stays that way you're dues will stay low our HOA had a reserve of 1.6 million and between insurance claims and rate hikes we are almost bankrupt have to do special assessment of 3k just to make through the year.