What to ask for
Wanting to examine a condominium corporation's documents can be like a
thirsty alcoholic being let loose in a liquor store. There is so much
there and all of it looks promising so where do you start?
Here are some ideas on what records to ask for so you will use your
time wisely and you will not get bogged down hunting where there is
little of value to be found.
Board meetings
I would ask to examine all the board meeting minutes since the last
AGM. Often there is not much in the minutes and at some condos much of
the minutes are redacted. Everyone thinks they are now working for Kim Jong-un's rocket program and
everything they do is a corporation "secret".
Budget
If the board hasn't sent out a copy of the new budget at the start of
the new fiscal year, then ask to examine it. A budget is an important tool to
evaluate the board's competence.
Plumbing,
drywall and painting invoices
You
want to see if these costs are high because the building has
multiple water leaks due to pin holes in the risers or standpipes that
should be replaced but
instead are just being patched. High plumbing, drywall and painting
costs will give you a good idea of the shape the building is in.
Utility bills
I
urge you to ask to examine the
utility bills as the utility bills
make up a very large percentage of the operating costs. The previous
three months should do.
You want to see
if the bills have been paid in full every month or if the condo is
skipping months or just paying a portion of the monthly utility bills.
The interest charges on unpaid utility bills can run into tens of
thousands.
Unpaid utility bills
are no joke
At one large condo, the administrator and property manager were not
paying the monthly water bills in full so the owners were being charged $2,000
a month in late penalties.
At a Scarborough condo, the president bragged that all bills were being
paid on time. Horse piss! The electrical bill hadn't been paid for the
previous three months. The man was a lier.
If the water and sewage bills don't get paid, the city could have the
water bills added onto the unit owners' property taxes. If the
corporation is not paying its electrical bill, Toronto Hydro will
wait till summer to disconnect the electricity.
Reserve Fund
Study
I suggest that you look at the current Reserve Fund Study and the
previous study. Ask for the full studies, not just the table of
income and expenses that are listed in the back.
You want to see if major repairs that the engineers suggested be done
in the
prior study have been pushed out further out in the present study.
I seen one study state that expensive roof replacements and
underground repairs needed to be done in 2012 and the new study pushed
the
work out 12 to 20 years into the future.
At a small tower of 90-units, the 2014 Reserve Fund Study stated
required garage repairs should be done in two stages: Stage I in 2014
and Stage II in 2017 for a total cost of $750,000.
Instead the board had the work rescheduled in a 2016 Reserve Fund Study
to have the work done in two stages: Stage I in 2018 and Stage II in
2025 for a total cost of $1.5 million. Double the price.
Inspections
Ask
for the annual Fire Inspection and Sprinkler Inspection Reports for the last two years. See if there
are any fire code violations. The reports may shock you.
Anything else?
You may be aware of a particular issue that you are concerned about. If
so, add it to your list. Otherwise, don't ask for too much. It does no
good and adds extra unnecessary costs.
top contents chapter
previous
next