Dear Tony: Our recent annual general meeting held electronically had 17 resolutions on the agenda for upgrades and repairs to our buildings. Our meeting dragged on for almost five hours and in the end, every resolution passed.
There were four special levies and 13 majority-vote resolutions to approve items recommended in our depreciation report. The notice package and resolutions were written by our strata manager and other than the president, the remainder of council did not have a chance to approve or review the content or agenda.
By the time we reached the election of council after four hours, more than half of the voters had left the meeting, and we barely managed to elect a new council. Several owners asked why we did not bundle the resolutions to make this quicker and the manager advised they had to be separate.
Is there an easier method of addressing these types of resolutions to reduce the impact on our owners?
Darla D., Richmond
There is no requirement to separate resolutions for expenses either by majority vote or three-quarter vote for a special levy. If a strata corporation is expecting challenges with approving a resolution, it may be helpful to separate those specific resolutions to avoid the failure of the remainder.
The resolutions and business on the agenda are approved at a council meeting by majority vote of council unless the council by majority vote had delegated that authority to a specific council member, such as the president. Either way, those decisions are recorded in the minutes of the meetings.
Also of importance is the writing of the resolutions. Under the Legal Professions Act in B.C., the writing of resolutions or bylaws for a corporation or association, and charging a fee, is a practice of law.
While strata corporations often pressure their managers to write the resolutions to avoid the costs, everyone pays when there is conflict from a defective resolution.
Majority-vote resolutions that approve repairs, maintenance and renewals as part of the depreciation-report recommendations can easily be itemized into a single resolution. However, the specific allocated funds and scope of work for each item should still be detailed within the resolution to ensure the council has the authority to proceed with the work and spend the funds.
Special levies are often addressed separately, as they can result in unanticipated higher costs, involve projects that require a higher level of detail and accountability, and can result in collections from owners who fail to pay their special levies.
Your special levies for the recommended upgrades were low, and with all four in one resolution, the total for the largest unit would have been only $705. On checking your management service agreement, there is a $10-per-unit levy fee being charged, which in your strata corporation totals a $4,800 cost that could have been reduced to $1,200 with a single resolution.
At a recent strata meeting I attended, a strata corporation with more than 300 units passed a single resolution for its planned depreciation resolutions by majority vote for a total of $1.8 million.
The resolution was detailed to match the depreciation report and it took 10 minutes to approve the resolution. The meeting was completed in 45 minutes, including annual budget and council elections.
None of us wants higher strata fees, but it is much more economical to contribute higher amounts in the reserve funds each year than to wait for special levies. Special levies are simply deferred strata fees, because our communities are not implementing and reviewing depreciation reports effectively — they are often the last resort of a deferred maintenance program.
From experience and case studies, we know deferred maintenance and repairs result in unpredictable costs of 30 to 50% higher, breakdowns, higher insurance costs as the frequency of claims increases, emergency repairs that are significantly costlier and often do not resolve the root causes, and disruption to the use and enjoyment of common property and strata lots.
A scheduled council meeting to discuss and approve your agenda and resolutions prior to notice being issued is a valuable exercise to avoid many of these pitfalls.
Strata councils are not a single person. They are a collective of elected voting owners who determine the scope of business and administration for your community and the enforcement of the bylaws and rules of the strata corporation.
Tony Gioventu is executive director of the Condominium Home Owners Association
Covid-19 Notice: As a precautionary measure to prevent the spread of COVID-19 CHOA staff are working remotely and our offices are temporarily closed. We understand these are challenging times for strata corporations and we are here to help. Even though CHOA advisors are working remotely we are only a phone call or email away and able to assist you with hosting meetings and notice preparation.
Tuesday Lunch & Learn Live with CHOA: CHOA is hosting a series of webinars once a week, for the next few months. Join us each Tuesday as we bring together industry experts to discuss the many issues affecting BC’s strata community. For more information visit our website at: https://www.choa.bc.ca/seminars/
