Condo Media - July 2022 - 44

The Region NEW HAMPSHIRE
Note that the statutory definition of
" emergency " for purposes of an emergency
assessment is limited to issues
involving:
1. Structural integrity;
2. Life and safety; or
3. Orders of courts or similar
administrative proceedings.
What a State
of Affairs!
What Constitutes Proper Financial
Management in New Hampshire
[By Gary M. Daddario, Esq., CCAL]
Right about now, given the general
state of the economy, the number
of people leaving the workforce, the
lingering impacts of COVID, the historic
high inflation, the supply chain
issues (I could go on, but this is getting
sad), financial planning has become
both trickier and more critical. I will
discuss proper financial management
for New Hampshire associations by
first reviewing some key points of the
condominium law and then discussing
some general advice.
NEW HAMPSHIRE STATUTE
The New Hampshire Condominium
Act (RSA 356-B) speaks to financial
matters, specifically, in several
provisions.
l RSA 356-B:40-c, speaks to the
budget approval process.
It is now required that boards:
1. Pass a proposed budget among
board members;
2. Provide that budget (or a summary)
to all owners within 30 days;
44 CONDOMEDIA July 2022
3. Provide (along with the budget)
a meeting notice for a meeting
to take place not less than 10 nor
more than 60 days out; and
4. Ratify the budget if it is not rejected
by two-thirds of the community
at the meeting.
Note that the information provided
on the budget must include the reserves
and a statement of the basis for the
calculation of reserves. If a proposed
budget is rejected, the association must
continue with the last approved budget.
l RSA 356-B:40-c, III, speaks
to " emergency " assessments.
This process requires:
1. A two-thirds vote of the board members
that the assessment is necessary
to respond to an emergency;
2. Prompt notice to issue to all
owners regarding the emergency
assessment; and
3. That the funds collected may
only be used for the stated
emergency purpose.
l RSA 356-B:37-e, speaks to preparation
of certain financial reports.
It requires boards to:
1. Create annual profit and
loss statements;
2. Maintain a consistent format
of the profit and loss statement
from year to year;
3. Provide the profit and loss statement
to owners at least thirty days
prior to the annual meeting or, if
the annual meeting occurs prior to
the end of the fiscal year, provide
year-to-date figures. Once final
year-end statements are created,
they must be provided to owners
within 90 days.
BEST PRACTICES - RESERVES,
SPECIAL ASSESSMENTS,
AND BANK LOANS
Now, in terms of practical advice,
given present circumstances, I offer
associations several points to consider.
Reserves
First, unfortunately, even those who
did the right thing and obtained
reserve studies previously, will likely
need to have those studies updated in
order to account for the astronomical
increases in the costs of materials and
construction work. Those who haven't
had reserve studies completed previously
really need to get one now. My
personal belief is that without professional
guidance, nobody has any real
chance of predicting major capital expenses
accurately. At this point, most
folks not involved in the construction
or related industries on a professional
basis simply cannot imagine what projects
now cost (if you can get a vendor
to appear and that vendor actually
Condo Media - July 2022

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