Special Agenda Item #1 is a vote on a larger than CPI annual assessment increase for the balance of 2025 and to set a new base level for 2026. The proposed increase will raise the 2025 monthly assessment for a 1 bedroom unit to $279.62 and a 2 bedroom unit to $372.82 beginning on August 1 2025. These monthly assessment amounts will then be used as the base from which to calculate annual assessments for 2026. The purpose of the annual assessment increase is to allow the Association to continue funding necessary repairs and required maintenance (including critical safety issues). Items that need attention now and in the coming years include the following: roofs, gutters, parking lots, windows, sliding doors, decks, property lighting, sidewalks, exterior siding and doors, drainage problems, and landscaping.
Currently, the Board (without a vote of the Membership) may increase annual assessments no more than the percentage increase reflected in the Consumer Price Index (CPI) for the twelve-month period preceding October 1. For 2025 assessment purposes that number is 2.2%. The above proposed increase is higher than the 2.2% threshold. Therefore, the increase proposed in Special Agenda Item #1 will require 67% of the membership to approve (25 FOR votes). If approved, the increase will become effective August 1, 2025. Your Board of Directors highly recommends a vote in favor of this 2025 annual assessment increase.
Inflation (and thus CPI) is currently running higher than normal. Historically, the CPI maximum assessment increase allowance has been only an average of 2.8% over the last 10 years, and 2.6% over the last 20 years. These rates of increase are insufficient for maintaining our aging infrastructure.
Approval of the above assessment increase is absolutely critical in order to provide the Association the means to continue conducting necessary repairs and improve our overall financial health. Approval of the assessment increase will help significantly, but is not a long term solution. Even if the Association secures the above proposed assessment increase for the balance of 2025, some repairs will continue to be delayed as we build toward the required funding.
Currently our Reserve Fund is far below what it needs to be to fund projected major repair expenses over the next ten years (such as new roofs which may be required as soon as 2028). If this proposed increase fails, the Board will likely need to explore other alternatives to improve our financial position.