Strata Corporations are self-funded entities and at this time there is no government relief funding available for them to assist in the management and cashflow of their funds.
A Strata Corporations has a statutory duty to repair and maintain its common property in a good and structurally sound condition, which includes cleaning of common areas, maintain adequate insurance policy and provision of essential services (i.e. lifts, security, electricity, gas, and water).
To ensure a Strata Corporations is able to meet its financial obligations, Owners are still required to pay their levied contributions, as approved at a General Meeting.
In some instances, the Strata Corporations can review ways to reduce their expenditure during these times of uncertainty and to assist cashflow requirements.
It is suggested that any non-urgent sinking/capital works should be placed on hold and consideration be given to temporarily cutting the sinking/capital works levy if owners require levy relief (further noting that this will not be possible unless a scheme has adequate savings, and if any works are able to be placed on hold). We recommend that the Strata Corporations undertakes a revision of their Capital Works Fund Plan, to defer all non-essential works for another 2-3-year period. This will provide for an opportunity to catch up, as well as maintain their legal requirements under the Act.
Generally review your contracts, as sometimes a contract is on a rollover, and if the service is non-essential, it may be able to be suspended or services limited if possible. Click here to continue
Author: Andrew Terrell, Bright & Duggan Hunter Branch Manager