They say the only two inevitable things in life are death and taxes. Well, for condo and co-op owners you can add a third—maintenance fees.
As long as roofs are going to have to be repaired, snow is going to have to be plowed, and grass has to be cut, unit owners and shareholders are going to have pay for their share of the cost for maintaining the property where they live.
For the most part, HOA owners know that maintenance fees—and maintenance fee increases—are part of condo and co-op life, and rarely go about staging a coup when the board raises fees. However, boards should take proper steps when increasing fees, keeping their community members informed of fee increases and making clear what the money is for.
According to Jules Frankel of Wilkin & Guttenplan, an accounting firm in East Brunswick, monthly maintenance fees cover three things: operating expenses for the year (including snow removal and landscaping), management fees, and insurance.
In addition to those purposes, Frankel says associations often set aside additional money in case the association goes over budget. This is known as a replacement or reserve fund, and is used, for example, to cover snow removal during a particularly tough winter.