Working Out What Owners Should Pay
Summary: Setting levies is one of a building’s key decisions. This article looks at how Aregnum helps an apartment building set its levies on sound information.
Setting the levies owners pay is one of the key decisions an apartment building makes each year, because the levies fund everything the building does. Levies must cover the building’s costs, provide for its needs, and be set fairly, which requires working out what the building actually needs to raise. A building that sets its levies on sound information about its costs and needs sets them fairly and adequately, while one that sets them on guesswork risks shortfalls or overcharging. Setting levies on sound information is central to getting this key decision right.
The foundation of sound levies is knowing what the building needs to fund, which requires understanding its costs. Levies should cover the building’s actual costs and needs, so setting them soundly depends on understanding what the building spends and requires. Because Aregnum’s financial module tracks the building’s expenses and finances, the building has the information about its costs to inform the levies, rather than setting them by guesswork, which allows the levies to be based on the building’s actual financial needs.
Providing for the building’s larger and future costs is part of setting adequate levies. Levies should provide not just for routine running costs but for larger and future needs, so the building can meet major costs when they arise. For buildings with reserve planning, the platform’s support for reserve fund planning helps the building provide for major future costs in its levies, so the levies are adequate for the building’s longer-term needs rather than covering only its immediate expenses.
Setting levies fairly across owners is supported by accurate records of the building’s units and their owners. Levies are apportioned among owners, and doing this fairly requires accurate information about the units and their owners. Because the platform holds the building’s records of its units and owners, the building can apportion levies on accurate information, supporting fairness in how the levies are divided among owners, which matters because owners are sensitive to being charged fairly relative to one another.
Presenting the levies transparently supports owners’ acceptance of them. Owners accept levies they understand, so presenting the levies and their basis transparently helps owners accept them. Because the levies can be based on the building’s actual financial information, they can be presented transparently, showing owners what the building needs and why the levies are set as they are, which helps owners understand and accept the levies rather than resenting an opaque charge.
Levies set on sound information are easier to manage against through the year. Once levies are set to fund the building’s budget, the building manages against that budget, and levies based on sound information provide a realistic basis for this. Because the platform tracks the building’s finances, the building can manage its finances against the budget the levies fund, which supports the building’s financial control through the year, keeping it on track against a realistic plan.
Setting levies soundly also reduces the friction and disputes that levy-setting can otherwise generate, because owners accept levies they can see are fairly and sensibly set. Levy-setting is often contentious, as owners resist increases and question the basis of what they are asked to pay, but levies set on sound information and presented transparently give owners far less to dispute, because they can see that the levies reflect the building’s genuine needs and are fairly apportioned. This reduction in friction is a real benefit of setting levies soundly, because it makes one of the building’s most contentious decisions less fraught, supporting the harmony of the building by giving owners levies they can understand and accept rather than resent and dispute.
Setting levies is one of a building’s key annual decisions, funding everything the building does, and sound levies rest on understanding what the building needs to raise. Aregnum helps an apartment building set its levies on sound information through its tracking of the building’s costs, its support for reserve planning, and its accurate records of units and owners. For a building setting its levies for the year, basing them on sound information rather than guesswork is what allows it to set them fairly and adequately, and to present them transparently so owners understand and accept what they are asked to pay.
Frequently Asked Questions
Why is setting levies a key decision?
The levies fund everything the building does, so they must cover the building’s costs, provide for its needs, and be set fairly. Setting them on sound information sets them fairly and adequately, while setting them on guesswork risks shortfalls or overcharging.
How does Aregnum help set levies soundly?
Its financial module tracks the building’s expenses and finances, so the building has the information about its costs to inform the levies rather than guesswork, letting the levies be based on the building’s actual financial needs.
Do levies provide for future costs?
They should provide not just for routine running costs but for larger, future needs. For buildings with reserve planning, the platform’s support for reserve fund planning helps the building provide for major future costs in its levies, so they are adequate for longer-term needs.
How does the platform support fair and transparent levies?
It holds accurate records of the building’s units and owners, supporting fair apportionment of levies, and because the levies can be based on actual financial information, they can be presented transparently, helping owners understand and accept what they are asked to pay.
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