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Back to the BasicsApr 13, 2007


Sometimes in situations like these it's best to get back to the basics and see if the Board is in compliance with governing documents and applicable law.

Maintenance of common areas is one of the Board's major responsibilities. It seems that the "minor" repairs, especially those to keep out vermin, are unavoidable. There could even be code violations there. Not repairing these areas could be putting the building at risk in a number of different areas. A Board that does not act could open itself to fines and/or lawsuits.

Regarding the facelift, again, the Board has fiduciary responsibility to the owners. Is the facelift in the best interest of the building? Can the Board's decision stand up as "prudent business judgment."

Otherwise, think about a vote by all shareholders. There may even be a clause in your governing docs that requires a vote if capital expenses exceed a certain amount. If you go that way, make sure the shareholders know the impact the costs would have on the building’s finances.

Where are you in the lifespan of the building's major components? Will your building be able to recover the cost of the facelift before it's reasonable to expect, say, an elevator or boiler replacement?

Finally, maybe you can get some compromises to reduce the costs of the facelift.



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