Proposals from Vendors for the yearly budgets, here are some of the things to consider

Posted: Apr 04, 2024
By: Royale Management Services
Comments: Comments Off on Proposals from Vendors for the yearly budgets, here are some of the things to consider

As Board Members are asking for Proposals from Vendors for the yearly budgets, here are some of the things to consider.

BY ROYALE MANAGEMENT

Budgets take time for any Condo and HOA Community, each year many of the services paid for by these associations come under review at budget season. While its nice to think about cost savings we feel it is much more important to look at workmanship, licensing, scope of work and then Costs. SFPMA and our Members are here for every community, on our Directory finding everything from Services to the businesses that keep your operations up and running to the Legal Experts safely protecting Condo and HOA’s from disputes and Litigation.

Search our members directory, Find a Company Ask for and Request an RFP – Request for Proposal for your buildings Budget.

HERE IS A LIST OF THINGS NO VENDOR CONTRACT SHOULD CONTAIN:

1) An automatic renewal clause. While it’s ok for an agreement to continue on a month to month basis it’s wrong to saddle future board with an obligation to track and cancel an agreement on a certain date or between certain dates to keep it from automatically being extended for an additional term.

2) A right of first refusal. This allows an existing vendor to match the price and terms of any new vendor proposal and thereby force the association to keep them. Most often an association gets proposals from new contractors because they are unhappy with more than the price and terms and giving a vendor a right to stay because they agree to match price and terms, does not solve the problem and can only lead to litigation.

3) Contracts with unnecessarily long terms. While a vendor that has upfront cost for things like equipment like a laundry vendor bringing in new equipment who needs to recover the equipment cost agreement terms should be kept as short as possible. Five years might be ok for the laundry contract but would not be for a landscaping contract in this case a one year term would long enough.

4) Cancellation only for “cause” clause. Proving cause only makes the lawyers richer and can be hard to do. The best solution is to build in a “cause free” ability to cancel with a 30-day notice.

Royale Management Services, Inc

Phone: (954) 563-1269

Full-service, CAM (Community Association Management) licensed, residential property management company, specializing in management, consulting and accounting for Condominium Associations and Home Owners Associations.

According to firm president, Steven J Weil, PhD, EA, CAM,

“The expansion into Community Association and Home Owner’s Association management was a natural move after a number of our clients serving on condo boards asked for our help with their associations accounting, budgeting and management, due to increasing operating cost and sloppy accounting records maintained by their current bookkeepers and managers.”

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