One of the first challenges of a new condominium board of directors is the survival of the first fiscal year on a budget set by the builder. When there is a shortfall between this first-year budget and the actual operating expenses incurred by the corporation during that first year, condominium corporations can turn to the declarant.
The Condominium Act requires the declarant to prepare a disclosure statement for every purchaser. This disclosure statement includes a copy of the budget statement, which includes the budget for common expenses for the first year following the registration of the declaration. This budget lists the proposed amount expected for each expense line item. One of the purposes of this disclosure statement is to enable individuals contemplating the purchase of a condominium to have a full understanding of the cost of owning the condo they are about to purchase. Indeed, purchasers rely on this information to do their own personal budget.
