Cost-cutter

Leading a condo or homeowner association back to financial health can be a rewarding and challenging experience for any Board of Directors. Ultimately, as costs continue to rise, they will have to decide if the owner fees should be increased or if amenities and services should be reduced. A more desirable option is to do neither and eliminate spending waste.

An organized cost reduction effort can be a very effective tool in identifying this waste and taking the necessary steps to eliminate it. This guide provides a BoD a detailed plan of attack for implementing such an effort. It incorporates “best practices” from similar business settings in both content and implementation methodology

Guide Features

A step-by-step guide on how to reduce your current association cost structure now and to control on-going costs in the future.

A clear and concise plan of action that is founded in best practices, proven results, and does so in a manner that most effectively uses your valuable time.

Freedom to follow different degrees of cost reduction aggressiveness and to make any changes that may be needed to fit your unique situation

A recommended “Top 10” list of most likely candidates for immediate cost reduction

The means to control your association costs on a day-to-day basis through the use of sound financial business practices and management processes.

Over 170 pages of sample documents of all the necessary forms, templates, and instructions needed to implement a comprehensive cost reduction effort. These documents are Microsoft® Office Word-based documents that can be used directly or easily modified to suit your particular needs.

Active links allow you to quickly move from one section to another or to reference material with a minimum effort

Why Would I Need This Guide?

When a large for-profit company experiences a particularly difficult problem or lacks the necessary time or expertise to bring about a desired change, it often relies upon the services of a management consultant. A good management consultant provides external and objective advice that can often bring a new perspective to an old problem. They have the benefit of experience working on similar problems in a multitude of business environments.

When a condo or homeowner association Board of Directors is faced with the difficult choice of either raising fees or reducing services due to increased costs, it often does not have the luxury of relying upon such a person. They are forced to go it alone equipped with only the knowledge and experience of its members. Even if they utilize the services of a Management Company, they are often ill equipped to provide viable solutions.

This guide provides you with another alternative -- a sort of management consultant in-a-book. It offers senior management consultant guidance on how to most effectively reduce your condo or homeowner association costs now and in the future. It draws upon best practices for the most efficient (least amount of effort) and effective (best results) way of reducing your costs, based on repeatable techniques that have proven themselves over time for large numbers of people..

How Will It Help Me?

It saves you time and effort! If you have never led a focused cost reduction effort, you may not know what to do or how to do it. You can first expect to spend countless hours researching and organizing such effort that in the end, may not deliver the results that you are seeking. Or, you can rely upon this step-by-step guide to show you the way. It is grounded best practices and many years of practical experience in the business world that has a proven track record of reducing costs. It provides you with a simple implementation process, important reference information, and all the written documentation that you will need to orchestrate cost reductions for your association.

It saves you money! If you are serious about reducing your association costs, this guide will tell you where to look and how to go about it. It will save you money! By eliminating waste and streamlining your operations, you will be able to do more with less. It will not only provide short term savings but also prevent long-term “cost creep.”

It makes your Board look good! Your Board will come across as competent and qualified leaders who know how to properly manage the finances of the association. They will become known for proactively reducing costs and doing everything possible to prevent/minimize association fee increases or reducing services.

The financial management of every condo or homeowner association is ultimately the responsibility of its Board of Directors (BoD). It is up to them to act and react to a tougher economic environment brought on by rising operating costs, increases in foreclosures and payment delinquencies, rising taxes, aging capital assets, and a host of other things that eat away at their budget. Most respond by either raising fees or cutting services. Either of these very unpopular actions will almost always be met with strong resistance from its members. There is however, another alternative – reduce and control the association cost structure and eliminate waste.

This guide provides proactive Boards with the tools and techniques to help keep their fees down and enhance their properties' value without comprising quality of life. It draws upon learning’s from the corporate business environment and applies it to the world of condo and home owner associations.

This guide is not meant to provide you with volumes of background information or intended to make you an expert in the area of condo or homeowner association cost reduction. It will however, provide you with a good working knowledge of the subject along with the following:

A step-by-step guide on how to reduce your current cost structure now and to control on-going costs in the future.

A clear and concise plan of action that is founded in best practices, proven results, and does so in a manner that most effectively uses your valuable time.

Freedom to follow different degrees of cost reduction aggressiveness and to make any changes that may be needed to fit your unique situation

A recommended “Top 10” list of most probable candidates for immediate/future cost reduction

The means to control your association costs on a day-to-day basis through the use of sound financial business practices and management processes.

Sample documents of all the necessary forms, templates, and instructions needed to implement a comprehensive cost reduction effort.

This guide is specifically targeted towards anyone who has financial management responsibility for a non-profit condo or a homeowner association including; BoD member, Treasurer, President, or Management Company Agent/Manager. It can be used by any size association. You will find that it contains no fluff or filler. No theoretical discussions, no business school jargons. Just a practical and useful method for reducing your association costs.

ABOUT THE AUTHOR ............................................................................. 2

TABLE OF CONTENTS ........................................................................... 4

Warning and Disclaimer .........................................................................6

PREFACE ................................................................................................ 7

BACKGROUND ........................................................................................ 8

HOW TO USE THIS GUIDE ......................................................................12

TOP 10 COST REDUCTION AREAS ......................................................... 14

1.Arrear Payment Collection ...........................................................14

2.Management Company Services ................................................. 14

3.Administration ............................................................................. 15

4.Utilities ........................................................................................ 15

5.Insurance ..................................................................................... 15

6.Purchased Materials & Services .................................................. 16

7.Litigation ..................................................................................... 16

8.Preventative Maintenance ........................................................... 16

9.Reserve Funding .......................................................................... 16

10. Property Taxes ............................................................................ 17

ON-GOING COST CONTROL MECHANISMS ............................................. 18

A)Financial Management ................................................................ 18

B)Financial Risk Management ........................................................ 18

NO-FRILLS IMPLEMENTATION APPROACH ............................................. 19

COMPREHENSIVE IMPLEMENTATION APPROACH .................................. 23

SUMMARY .............................................................................................. 52

INDEX ..................................................................................................... 53

Terms & Conditions of Use Agreement ................................................... 54