Condo Law Series: Financial Management for Lawyers

According to the Community Associations Institute, approximately 21% of Americans live in a condo, cooperative or other housing type governed by a homeowners or community association. What makes condominium associations particularly interesting to lawyers is that buildings worth tens or hundreds of millions of dollars, with revenues of several million dollars, are governed by volunteer boards with little or no experience in corporate governance, finance or the many other issues that must be decided by the boards. Management companies typically focus primarily on the management of the physical plant, receiving the association dues and preparing budgets, referring most of the other issues to legal counsel. In this session, attorney Marcia Harris will focus on the financial management issues attorneys representing condo associations will likely encounter. These include special assessments, bank loans, contracts with management companies, collection of unpaid assessments and related issues of liens and foreclosures, homeowners' reverse mortgages, selection of tax status under the IRS optional designation and the imposition of fines on homeowners for violations. Other issues may include questions of authority for decision making and financial transparency in budget documents provided to unit owners. Examples of these and relevant case law decisions will also be covered.