So, I’m in northern Michigan, taking care of an ailing parent – a place where the discussions usually revolve around health and the weather – never about my business. I decided to drop in on the local AmVets post, to “ease some stress”, and give them an medical update, when one of the patrons looks at me and says, “Aren’t you that guy who knows something about condo’s?”  Not being sure if he’s looking for a fight or just being inquisitive, I quietly replied, “Yeah, a little.”   And the following conversation ensued:

Him: “I just got back from my association’s board meeting, and they said it looked like they were going to have to raise the assessments for next year!”

Me:  “Uh-huh…”

Him:  “How can they do that?  Don’t they know how horrible the economy is?”

Me: “Well, since they’re living in it, I would guess that they have some idea of what’s going on.”

Him:  “Don’t they know that my condo is only worth half of what is what worth three years ago?”

Me:  “I’m pretty sure there’s is too.  Besides, assessments aren’t like taxes, they aren’t tied to the value of the unit.”

Him:  “Well, they oughta be.

Me:  “Well, if that was the case, your assessments would have gone up a lot back when the value of your unit was increasing.  Did they go up a lot back then?”

Him:  “Well, no, but don’t they know that it’s really getting hard to make ends meet?  After all, most of us are retired and on a fixed income, and watching our nest egg disappear.”

Me:  “Look, did any of your personal costs go down over the past few years?  Are you paying any less for gas, groceries, electricity, insurance, etc.?”

Him:  “No”

Me:  “Well, costs haven’t gone down for your condo either.  All of the people who provide services to the association have had to deal with the same rising costs and to the extent they can, pass them along to their customers.”

Him:  “Well, then we need to cut back on our costs!”

Me:  “Where do you think the board should cut?  Should they pay the snow removal guy less? He probably wouldn’t get to your condo as fast or as often as he has.”

Him: “He was already too slow last year!”

Me:  “That’s probably because the board already asked him to take a cut last year and now you want him to take another one?  How many can he handle before he goes out of business?

Him:  “That’s not my problem!”

Me: “If he’s forced out of business and you have fewer snow plowers around, how is that going to reduce your costs?”

Him: “I don’t know, but it should”

Me: “Do you have any owners who are behind on their assessments or in foreclosure?”

Him: “One – he got laid off and he’s really in a bind”

Me:  “What did he do?”

Him:  “Had a landscaping/snowplowing company.”

Me: (ignoring the irony): “Well, the association was counting on him contributing to the assessments when they developed the budget.   Now it’s going to be short, so, they have to spread the shortfall around until they can find a way to fix it.”

Him: “That’s not fair!”

Me:  “No, it isn’t.  but unfortunately, that’s the way things are.  The board has to make do with what they have.”

Him:  “I still think we need to cut the budget.”

Me:  “Well, talk to the board, and your neighbors.  See what services they would be willing to give up and tell the board what you, personally would be willing to give up.  Just remember, everyone will have their own idea of what is, or isn’t, important, so you may not get your way.  The board has take everyone’s interests into account, as well as what they are legally required to do, like fund the reserves.”

Him:  “Just so long as the assessments don’t go up!  If they do, they’ll have a real problem with me.”

Me:  “Welcome to democracy in a bad economy.”