How the Association forms its annual budget
It’s only August but the work of creating the Association’s 2021 Budget is already in full swing. Have you ever wondered how the budget process works? It’s a huge undertaking and involves a collaboration between Association management, the Finance Committee and the Board.
Here are the steps:
- In July and early August, Association management provides projections for budget line items for the following year to the Finance Committee, which is made up of homeowner volunteers.
- In August and September, the Finance Committee reviews each budget category: Gates, The Club at Town Center, General Common and Town Center/Commercial. The committee also scrutinizes contract allocations and financial updates to the reserves. Board members attend these meetings and provide input. Homeowners are welcome to sit in on budget meetings. Find a budget workshop schedule here.
- Once the Finance Committee completes the review process, it creates a tentative budget and presents it to members. The presentation is a snapshot on the Association’s financial health and includes the committee’s recommendations on monthly assessments for the following year. The 2021 Budget Presentation is scheduled for 4 pm on Wednesday, Oct. 7.
- The Board then reviews the budget in advance of its October meeting, when budget adoption is on the agenda. This year, that meeting is set for 5:30 pm on Wednesday, Oct. 14.
- Once the Board adopts the budget, the Association mails the budget and supporting documents to homeowners for ratification. If a homeowner has elected to receive notifications digitally, the packet is sent via email. This year’s budget mailing is set to go out on Friday, Oct. 16. (Information about candidates for open Board seats and Board Election ballots are also be included in this packet. This year there are three open Board seats.)
- Finally, the budget is ratified during the Annual Members Meeting (4 pm on Monday, Nov. 16). Budget ratification is almost certain at this point because in accordance with Nevada law, NRS 166.31151 (3), “Unless at that meeting a majority of all units’ owners, or any larger vote specified in the declaration, reject the proposed budget, the budget is ratified, whether or not a quorum is present.” As you can imagine, it is an improbable scenario that a majority of owners would attend the annual meeting and all vote against the budget.
- Coupon booklets for the next year’s assessments are mailed once the budget is ratified – usually in mid-December.