Capital Works Budget | Strata Committees | Flat Chat Forum: Your Questions Answered




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Capital Works Budget
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ficitonarchitect
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15/05/2018 - 12:37 pm
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We recently received the minutes for our upcoming AGM. In the budget and proposed capital levy for next year, the strata manager has but $20K (total, to be split between the 6 units). We had high capital budgets the last few years due to some upgrade works but nothing planned for the next year.

Can I vote to have this amount reduced, or is there a minimum amount a strata must hold in their capital funds?

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JimmyT
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15/05/2018 - 1:34 pm
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You are required by law to have a 10-year forward maintenance plan (revised every five years) and to have enough funds in the kitty to service it.

That’s your stating point – do you have more money than you need in your maintenance (formerly ‘sinking’) fund?

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Sir Humphrey
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16/05/2018 - 6:35 pm
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I agree with JT. The key is the plan. You should have a plan that anticipates various irregular, possibly large, maintenance costs plus, ideally, a contingency margin, and matches that with regular, even, annual payments. The point is fairness. Everyone who is an owner in any year contributes a manageable amount that stays about the same to cover the inevitable occasional large expense. 

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