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Budget approval

Started by GlenM4 • 12 replies • 626 views

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GlenM4 (Tennessee)
Posts: 141
Posted:
If a budget was approved for say a fall party. Near fall the committee has decided on a cost. It's under the budget, does it still need to be approved to spend the money? Or once the budget was approved there is no longer a need to approve again?
GeorgeS21 (Florida)
Posts: 3,808
Posted:
If it was approved as part of the budget, and it doesn’t bust the budget, I believe no additional vote is required.

Some HOAs have language that provides for a 10% or so buffer, as well. The point is usually to negate the need to meet and vote on something that has already been approved.
DouglasK1 (Florida)
Posts: 2,046
Posted:
Generally I'd say it is up to the board. In our association, we would still vote to approve spending funds. From our point of view, a budget is just a financial plan, it is not an authorization to spend. Say we budgeted 2500 for tree trimming. We'd still get bids and vote on which one to accept. Our only exception to this is regular recurring expenses such as electricity and phone, or things we have on-going contracts for, such as lawn maintenance.

We don't have association funded social events, but if we did, we would have a motion to allow spending up to a certain amount, and designate who has the authority to make the specific spending decisions (probably the committee by majority vote).
Escaped former treasurer and director of a self managed association.
BillH10 (Texas)
Posts: 1,217
Posted:
I agree with Douglas, the process he describes is followed by the association in which we reside as well as in those we manage.

Conversely, boards sometimes gree to not expend funds which were budgeted: they may not be needed, such as for tree trimming or similar activities or even an association social gathering because circumstances have changed and the gathering is no longer possible or desirable.
KerryL1 (California)
Posts: 14,550
Posted:
As part of the budget-formation process, our board approves a annual limit for the Social Committee. Per their charter, It's up to them how & when they spend it. I don't see any need, as seems to be the cease in Glen's scenario, for the board to meet again because the S.C. didn't need as much bratwurst as they thought they would for Oktoberfest.

but maybe I'm reading this wrong.
DouglasK1 (Florida)
Posts: 2,046
Posted:
Quote:
Posted By KerryL1 on 09/18/2018 9:35 AM
As part of the budget-formation process, our board approves a annual limit for the Social Committee. Per their charter, It's up to them how & when they spend it. I don't see any need, as seems to be the cease in Glen's scenario, for the board to meet again because the S.C. didn't need as much bratwurst as they thought they would for Oktoberfest.

That's certainly a valid approach since you have a standing committee with a charter. The important thing is that it is well defined who makes the spending decisions. If you budget $1,000 for a party, you don't want three or four people thinking they are solely in charge and spending 1k each.
Escaped former treasurer and director of a self managed association.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Any non-essential expense should be reviewed at time of spending, even if pre-approved, to be sure the budget can still afford it.
KerryL1 (California)
Posts: 14,550
Posted:
Glen, I think, is saying the expense will be LESS than the approved budget, JohnC.

JohnC46 (South Carolina)
Posts: 14,265
Posted:
Quote:
Posted By KerryL1 on 09/18/2018 2:05 PM
Glen, I think, is saying the expense will be LESS than the approved budget, JohnC.


I understand but also I would want a final OK especially if the budget is tight for that year. A non-essential event could be scaled back or cancelled for budget reasons.

KerryL1 (California)
Posts: 14,550
Posted:
Sounds like a very unpleasant way to treat volunteers for social events. This is especially so since they might not even be able to hear the board's reasons.

Certain kinds of landscaping certainly is non-essential too. It sounds to me like more needs to be budgeted to your Contingency line item if, say, $40 or $200 one way r the other is going to be a problem.
PaaN
Posts: 219
Posted:
???!!! $40 !!!???

OMG, $40

Can't we use TP instead of paper napkins?

Sounds juuuust like MY senile demented 55+ HOA

( iknow, iknow, MOOOOOVE )

GeorgeS21 (Florida)
Posts: 3,808
Posted:
In this limited circumstance, and even after reading everyone's comments, I believe the funds have already been approved and the cost of the event is LESS than the approved funding ... why would the Board want to revisit something like this?
KerryL1 (California)
Posts: 14,550
Posted:
That's what I've been trying to get at, George!!!!

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