In a Rhode Island condominium the board writes the budget, but the owners get a chance to reject it. The process is set by the Rhode Island Condominium Act, and boards that skip a step can end up operating on last year's numbers.
How budget ratification works
- The executive board adopts a proposed budget.
- Within 30 days after adopting it, the board sends a summary of the budget to every unit owner.
- The board sets a meeting of owners to consider ratifying it, not less than 14 nor more than 30 days after the summary is mailed.
- Unless a majority of all unit owners (or a larger vote the declaration requires) rejects it at that meeting, the budget is ratified, whether or not a quorum is present.
- If owners do reject it, the last budget they ratified stays in effect until a new one is ratified.
Source: R.I. Gen. Laws § 34-36.1-3.03.
Because rejection takes a majority of all owners, not just those who attend, budgets rarely fail. That puts the burden on the board to get the numbers right, including the reserve contribution, before the summary goes out.
The annual meeting
The association must hold a meeting of owners at least once a year. Notice goes out no fewer than 10 and no more than 60 days before any meeting and must state the date, time, place and agenda, including the general subject of any proposed change to the declaration or bylaws, any budget changes, and any proposal to remove a director or officer (§ 34-36.1-3.08). Many boards hold the budget ratification at the annual meeting to keep it to one gathering.
Owners' right to see the books
The association has to keep financial records detailed enough to support the resale certificates it issues, and its financial and other records must be made reasonably available for any owner to examine within 30 days of a request (§ 34-36.1-3.18). Monthly reports to the board, and a clean year-end package, make those requests easy.
A practical calendar
- Three months before the fiscal year: review actual spending, vendor contracts and the reserve plan.
- Two months before: board adopts the proposed budget and mails the summary with notice of the meeting.
- Two to four weeks later: owners' meeting to ratify.
- New fiscal year: updated condo fees take effect.
This guide is general information, not legal advice. Your association's declaration and bylaws may add their own requirements, and the statute can change; the linked sections on the Rhode Island General Assembly's site are the current text.