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On 30th August 2008 the regulations changed for Committee expenditure, the Relevant Limit for Major Spending and Improvements to Common Property.
Additional information on the following expenditure limits can be found in the following sections of the BCCM (Standard Module) Regulation 2008:-
- Committee Expenditure Limits and the Relevant Limits for Major Expenditure - Chapter 7 (Part 7) Control of Spending - Sections 151, 152 & 153 and Section 4 of the BCCM Dictionary; and
- Improvements to the Common Property by the Body Corporate and by an Owner of a Lot - Chapter 8 Property Management – Part 2 Common Property - Sections 163 & 164 and Section 4 of the BCCM Dictionary.
All amounts noted below are inclusive of GST
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Relevant Limit for Committee Expenditure |
Authorization Required |
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The amount last set as the relevant limit for committee spending by an ordinary resolution of the body corporate at a general meeting: or The amount worked out by multiplying $200 per lot x times the number of lots in the community titles scheme. For a principal scheme in a layered arrangement of community titles schemes, the amount worked out by multiplying $200 (incl. GST) per lot x number of layered lots for the scheme. Example of committee expenditure limit for a principal scheme in a layered arrangement:-: Principal scheme - 4 lots Total number of lots in the layered schemes (individual bodies corporate) is 150 lots. Committee expenditure limit of $200 per lot x 154 lots would be $30,800 |
Committee |
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Spending above $200 per lot if approved previous to or after 30th August 2008 by an ordinary resolution at a general meeting. Once approved at a general meeting the committee expenditure limit will remain current until otherwise resolved at a general meeting. (Prior to 30th August 2008, a scheme registered in the accommodation module could approve at a general meeting, an amount for the relevant limit for committee expenditure up to $450 per lot) There is no cap on the amount of the committee expenditure limit which can be approved at a general meeting. Examples of committee expenditure:-
Pool maintenance contract |
Committee |
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For committee expenditure that is more than the relevant limit for major expenditure but within the relevant limit for the committee expenditure, two quotations must be obtained and included in the minutes of the respective meeting. Example:- 100 lot building with committee expenditure limit of $200 per lot = $20,000 100 lot building with a relevant limit for major expenditure of $150 per lot = $15,000 If the cost of the repairs and maintenance item is $16,000, the committee can approve this expenditure provided that two quotations have been obtained. |
Committee Approval providing two quotations are obtained |
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Relevant Limit for Major Expenditure |
Authorisation Required |
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The amount last set as the relevant limit for major spending by an ordinary resolution of the body corporate at a general meeting: or At any time that there is no amount set, the lesser of the following amounts:- (1) An amount worked out by multiplying $1,100 by – (a) for a principal scheme in a layered arrangement of community titles scheme – the number of layered lots for the scheme; or (b) for another scheme – the number of lots in the scheme. (2) $10,000 The relevant limit for major expenditure can be increased by an ordinary resolution of the body corporate at a general meeting and will remain current until otherwise resolved at a general meeting. There is no cap on the amount of the relevant limit for major expenditure which can be approved at a general meeting. Prior to the 30th August 2008, the relevant limit for major expenditure for bodies corporate that did not approve to increase it a general meeting was $250 per lot. This in turn meant that for most schemes the amount of $250 per lot was in force for 10 years. Taking into account the increase in prices over the past 10 years, it would be prudent for bodies corporate to consider maintaining/ increasing the relevant limit for major expenditure amount of $250 per lot. Examples of Major Expenditure:-
Please note that the relevant limit for major expenditure does not apply to Improvements to Common Property. See following the relevant statutory regulations for this type of expenditure. |
General Meeting Ordinary Resolution Two Quotations
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Improvements to Common Property by the Body Corporate |
Authorisation Required |
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If the cost of the improvement for the entire project is not more than $300 x the number of lots in the scheme. This is referred to in the regulations as the basic improvement limit. Committee approval is also subject to the Committee’s relevant expenditure limit. i.e. if the Committee’s expenditure limit is under $300 per lot, this will be the basic improvement limit to be used by the Committee for improvements to common property. The basic improvement limit for a principal scheme is $300 (incl.GST) x the number of layered lots for the scheme. Example:- 100 lot building - basic improvement limit - $300 x 100 = $30,000 New tiles to entrance at a cost of $10,000 |
Committee |
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If the cost of the improvement is higher than the ‘basic improvement limit’ but not more than $2,000 x the number of lots in the scheme. Only one (1) resolution of this type is allowed in a body corporate financial year. Example:- 100 lot building - expenditure limit - $2,000 x $100 = $200,000
Foyer upgrade $150,000 |
General Meeting Ordinary Resolution |
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If the cost of the improvement is higher than the ‘ordinary resolution improvements range’ ($2,000 per lot x the number of lots in the scheme): or If the body corporate has already passed a resolution in the financial year within the ordinary resolution range. Example:- 100 lot building - $2,000 x 100 = $200,000 i.e. the following expenditure is higher than $2,000 per lot
Painting of the exterior of the building where the colour is changed – cost $300,000 over five (5) years |
General meeting Special Resolution |
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Improvements to Common Property by a Lot Owner |
Authorisation Required |
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Minor Improvement The Committee may, if requested by an owner of a lot, authorise the owner to make an improvement to the common property for the benefit of the owner’s lot if the improvement is a minor improvement with an installed value of less than $3,000 and it does not detract from the appearance of any lot included in, or common property for, the community titles scheme. Example:- Tile exclusive use courtyard by lot owner at a cost of $2,500 |
Committee |
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Major Improvement A major improvement is an improvement to the common property for the benefit of the owner’s lot with an installed value of more than $3,000. Example:- The installation of a roller door and enclosure of an exclusive use common property car space at a cost of $20,000 |
General Meeting Ordinary Resolution |
