How much of your board meeting time is consumed with discussion of condominium association dues collections? Most will respond “too much!”
What are some things that can be done to increase dues revenue and on a timely basis?
- Provide a copy of the documents to the owners. While it may seem obvious, make sure all the owners know there are dues owing! Some of the members in your association may be first-time condominium residents, and may incorrectly believe assessments paid at the closing were one-time fees. These individuals may not be aware that assessments are a recurring expense to cover maintenance of the building and grounds outside of their unit over time. Make sure members have a copy of the current community documents, such as the Declaration, Articles of Incorporation, and Bylaws, for reference to learn and understand the nature of assessment charges.
- Communication is key. Regularly update owners on maintenance accomplishments – don’t let their dues contributions be invisible. Did the assessments cover the costs for the new landscaping, or the cost for the south parking lot to be repaved? Tell your members! Busy owners who are preoccupied with their own routines may not notice the upgrades or maintenance around the community; help show them that their dollars are important and work hard.
- Provide notice of future projects. Use all your communication tools to keep owners apprised of upcoming maintenance efforts. If it is important to them, they are more likely to pay their dues. Keep them well-informed of projects scheduled for the next 12 months.
- Thank your members who remain current on assessments. While it may seem counterintuitive to thank someone for fulfilling their responsibility, do it anyway. It builds good will and shows members that their cooperation is appreciated.
- Owner landlords/investors need special handling.Statistically, landlords/investors are less likely to pay condo association dues. They are off-property and don’t see the rewards of dues payments. Communicate how a well-maintained community contributes to property values. Additionally, the Association may demand the rental revenue if a rented unit is delinquent (see Section 718.116(11)(a), Florida Statutes).
- Make it easy to pay dues.Send reminders and set up an easy-to-use portal or payment method for owners to remit payment online. Most merchant accounts enable you to recover payment processing fees at the time the transaction is made, so your community can ease the payment process without added expense.
- Establish a collection policy. Adopt and publish a collection policy to be enforced consistently and fairly. Review this policy carefully to avoid unnecessary and costly legal/collections fees and obtain input from your counsel for ways to maximize collection efforts with minimal delays and expense.
- Maintain accurate records. Review your Accounts Receivable/Accounting practices to ensure receipts are being posted accurately. Inaccurate records can lead to unnecessary legal fees and irritate your members.
- Consider using a third party for collecting the debt. Because board members are often residents, we encourage the use of a third-party for collections, to avoid any confrontation on the property or awkward encounters. Make certain your collections agent is well-versed with Florida Statutes Chapter 718 (Florida Condominium Act) and the Fair Debt Collection Practices Act.
- Hire counsel to carry collection matters from pre-litigation to ligation. One of the advantages of having an attorney handle collection is that should the situation escalate to litigation, the documentation to file suit is already in hand. This minimizes delays and encourages owners to expeditiously take care of their debts.
- Monitor results and adjust your policy as needed. The board should be encouraged to regularly review collection policies vis-a-vie results and confer with legal counsel on how to improve outcomes.