Association finances are usually on the top of the list when homeowners are asked about what concerns them the most about their HOA. Since the only way that most association boards believe they can generate revenue is through assessments, annual increases in dues and the levying of special assessments have become the norm. However, there are some ways for an association to generate additional income that many may have not thought about.
Renting or Leasing Community Property
If your community has a clubhouse, lakefront dock, or other community owned property that might be utilized for social or recreational purposes, consider renting or leasing that space for additional revenue. While some planning will need to take place and legal counsel should be consulted with, a great way to utilize community owned property to generate revenue is through renting or leasing.
Sell Space in the Community Newsletter to Advertisers
One very underutilized asset is a community’s regular newsletter. If your community has a newsletter that it publishes regularly, consider reaching out to local businesses to determine any interest in advertising services in your community. While the size of your community will likely be the biggest factor in determining if this is a worthwhile venture, some local area businesses might still be interested in a smaller, but targeted demographic to advertise to.
Charge a Facilities Fee
Things like swimming pools, spas and related facilities cost money to operate and maintain. Quite frequently, these amenities are not used by every single member of the community. If this is the case in your community, your board may want to consider instituting a facilities fee for access to certain amenities. The idea behind this is that the cost of operating and maintaining these facilities would be paid for by those using them, which may be considered a more fair way to pay for those costs, rather than raise dues or impose a special assessment as those costs increase, which may affect everyone in the community, whether or not they regularly enjoy those amenities.
Investment of Reserves
While this approach will most certainly require the involvement of professional services, the Colorado Common Interest Ownership Act contemplates that boards may invest association funds. As such, section 38-33.3-209.5(1)(b)(VI) requires associations to have an “investment of reserve funds” policy. Look at your community’s policy to determine how viable investment of association funds may be for your neighborhood.
Cut Costs
Ok, this one isn’t really a way to generate additional revenue, but it is worth reminding yourself that a trim budget can make all the difference when it comes to association finances. By creating a budget that best serves the community while eliminating wasteful, redundant or excessive spending, an association’s board can have a tremendous impact on the health of it’s community’s finances.