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We often have Paper SC Meetings to ratify the decisions already taken & approved by the Committee to do many works, not to decide on any new projects or works.We chose Paper SC Meetings as hardly 2-3 owners turn up for the face to face meetings.
Yes, Strata is indeed a big business ( but without a profit motive for the members running it ) when you are talking about a large strata with over 200 units. We spend about $1.5 million every year and about $900,000 are recurring fixed expenses.
Rest of the amount requires a lot of thought. In our Strata, we examine expenses line by line and see what can be done to reduce and where it can be increased to improve building’s attractiveness for prospects buyers.
All contracts must be reviewed periodically and competitive quotes obtained from equally or more reputed service providers giving longer terms for better quotes.
Over the last 7 years we were able to keep strata levy increases to 2% per year as a result of these efforts despite spending large sums under CWF as per 10 Year CWF Plan.
This year is a disaster for us as a result of very high building insurance premium following large insurance water ingress claims after 2020 February storms but owners understand the reason for the levy increase.
We entered into a 3 year energy futures contract with Energy Australia in 2020 when there was panic plunge in energy future prices following Covid19. As a result we now pay average 5 cents per kWh and saved $40,000 per year till end of 2024.
We saved another $15,000 per year after installing solar panels on our roofs in 2018. Saved another $30,000 per year by changing the Building Manager company.
Saved another $20,000 by making prospective strata managers quote strata fees and other expenses per lot and asking them to send meeting notices by post at owner’s expense if email is not given.
Hope this helps others to give better services in their communities.
- This reply was modified 1 year, 4 months ago by .
Our Strata passed the budget at the AGM last year,2019. Usually, we hold the AGM in July / August and the levies for March & June quarters are the same as those for September & December Quarters.
Now my question is : what happens if we do not hold the AGM in July or August or even later say up to December end. Strata Act allows AGM to be held any time during the FY up to end of February literally.
So in the absence of AGM in July / August on account of COVID-19, can the levy collected in June be repeated for September & December quarters without any advice or action ?
We have a more pleasant experience while changing Strata Manager. Current & prospective SMs acted professionally barring a few minor hitches that were a carry-over of old practices.
I appeal to the Owners Corporation, NSW Fair Trading and Strata Community of Australia to prepare a CHANGE-OVER protocol acceptable to SCA to avoid the transition pain.Following suggestions may be considered :
Documents ( hard & soft copy in a USB with password to access ) to be handed over to be listed , period for which they must relate to, ALL PLAN documents of birth, revisions up to date.
Latest financial statements of Strata Plan including outstanding creditors,debtors,levies in arrears, levies paid in advance, any special funds held for a specific purpose. If Strata Plan has funds invested in Fixed Deposits, they may be transferred on maturity to new SM if acceptable to Owners Corporation.
Trust Account bank account balance to be transferred through digital means AFTER new SM gives proof of Trust Account opened with an approved bank showing Strata Plan Number besides BSB & Account Numbers to current SM for electronic transfer. Now SMs transfer amounts through cheque which is susceptible to fraud ( cheque payable to XYZ can ostensibly be endorsed by XYZ to ABC and deposited in ABC’s account and the paying bank has no means of verifying the authenticity of the endorsement by XYZ and pays as a matter of course to ABC through ABC’s bankers ) besides delays,handling,depositing and funds clearance.
All contract documents relating to ALL current service providers.
At the moment there is no standard practice on transfer barring a bland statement about cooperation between SMs for transfer.
We recently invited bids from 3 Strata Managing Agents for 3 years with following conditions :
All invoices must be paid within 5 business days AFTER receipt of due approval subject to availability of funds in trust accounts.
Fixed SMA commission with a fixed annual hike, say 3%, given in $ per lot per annum.
All other charges including Schedule A or any other including postage,phone calls,printing fixed given in $ per lot per annum.
SM Visit charges for attending AGM and other Strata Committee meetings fixed in $ per hour or part thereof.
We expect savings of over 30% compared to last year.
One Strata Management Agency we deal with is levying charges in units of time like lawyers. Hence we put these new conditions. And it worked.
Also I request all treasurers to check payments once a day.It takes only 5 minutes.It tells you how lazy or active is your SM in paying approved invoices ; faster invoice payment improves service providers’ loyalty to the Strata ; helps detect over or short payment , double payments. Most SMA Accounts staff are handling more work than they can and are thus prone to make unintended mistakes.
Be gentle when you find mistakes. Above useful for large strata with over 75 lots.
You said what I had in my mind : strata management licence is a licence to print money.Neither NSW Fair Trading nor NCAT will really help when you have problems with SMs though they are mandated to help.
One large Strata Management Agency gives a large political donation of about $100,000 ( this in 2017 as I discovered through Dun & Bradstreet Credit Report ) or more per year and more than all real estate bodies put together. So what can we expect from those who supervise them ? I think we are better served by going to a smaller,well run, SMA than a large well known SMA who don’t observe or deliver what they promise on their web site. We did exactly that now.
You are lucky. At least there is a work order, possibly work done and the invoice submitted for approval.
In our case when building defects work was going on, the SM paid a company owned by Strata Secretary ( as evident from the invoice ) a number of payments for TIME SPENT by Strata Secretary with lawyers / contractors without obtaining ANY approval from STRATA COMMITTEE Chairman & Treasurer or the AGM as stipulated under Section 25 of 1996 Strata Management Act.
And we couldn’t get any relief either at NSW FT or at NCAT. NCAT judge wanted us to engage a lawyer before I can even speak and no Strata lawyer was prepared to represent us because of conflict of interest.
I suggested to NSW Minister Matt Kean ( when he was looking after Strata ) to put a ceiling on number of large strata a SMA can manage.
He said it will be taken up at next review. Otherwise, we will have an oligopoly and no remedy for ANY grievance against SM.
Is it not possible to open a separate loan account with interest & principal accrued apportioned to Owners on the basis of their unit entitlement ? So if ABC has funds, ABC can pay cash in full and ABC will be out of the picture for liability under Strata Loan as well as interest thereon from the beginning.What do you think ?I agree with Austman on all points.
Flat Chat suggested MOVE IT OR LOSE it flyer helped us in getting such illegally parked cars to move but one must meticulously all the steps given in that Flat Chat post : using A4 sheet, writing offending car’s licence plate number, time and date, taking a picture of the Notice etc.
We had a similar problem : an illegally parked car in visitors for over a month. We checked with police. They said the car was reported as stolen by its owner. So Police towed it away next day to pursue criminal / fraud charges as the owner collected insurance money !
It is preferable to have electronic voting for single issue EGM where owners tick YES or NO.
Electronic voting is definitely not suitable for large Strata AGMs as the Owners present may propose amendment to motions on the AGM Agenda and those amendments too have to be voted. And this happens and can happen on the day of the AGM. Also at AGM Owners decide on number of Members on Strata Committee, then Owners can file their nominations in addition to those already filed before the AGM date. It’s for the Secretary to decide whether a particular General Meeting is suitable for electronic voting. There is a lot of to & fro at an AGM and hence electronic voting at AGM isn’t suitable while EGMs with one or two issues are.
We used Jimmy’s MOVE IT OR LOSE IT threat on an illegally parked car. It worked. Thank you, Jimmy
Our Secretary paid himself through his shell company a number of large sums for time spent with lawyers / contractors without these payments being mentioned in Strata Committee Meeting Minutes or getting it approved before payment at an AGM required as per Section 25 ( now 49 of SSMA ) of old Strata Act. No Strata-specialist lawyer was prepared to help us fight with the dominant strata management company at NCAT. At NSW Fair Trading, there was no help really. At NCAT, we were asked to get ourselves represented by a lawyer.The exorbitant fees ( demanded by the only lawyer prepared to represent us ) forced us to drop the case at NCAT.
A group of owners in our Strata discovered the incompetence and one-person 7-8 year dictatorial rule in our Strata too late when AF & CWF went into deficit. Yes, this person is very accomplished, knowledgeable, knows more about Strata law than the Strata Manager.
See where our Strata landed with so much knowledge ! Knowledge is not the solution for Strata woes. SC Members do voluntary work and they know it is unpaid work. Payment does not by itself attract good volunteers. What is important is sincerity and honesty in work, not interfering with SM’s or BM’s work ( in allowing BM to appoint contractors for various works, unless proven to be dishonest or incompetent ) and most importantly setting an example in simple ways.
Strata Committee must know the BM, the security guards and the cleaners ( last two on minimum wages, mostly ) are the eyes and ears of the building 24/7 and if they feel you are taking care of them in any way you can, Strata will be safe to live in, defects are discovered before they become a budget-busting headaches, living environment improves.
Begin improving conditions in the garbage rooms where the cleaners work : by painting all surfaces once every 5 years, chutes twice a year including fragrance mats in each garbage room on each floor, take interest in how they work, talk to them about their problems at work and how residents can improve their work conditions ( not throwing glass down the chute, not throwing newspapers, card boards down the chute that increases their work and often injures them ).
Also engage them for simple works that don’t need specialist skills to supplement their income so long as the work is better than before and payment lower than before. After 4 years of untrained SC Members , everything in our Strata improved : finances, happiness of owners / residents / cleaners / security guards and even contractors as their bills are paid without much follow up.
So training of SC Members is not the only solution without other things as stated above.