Property Management Issues

October, 12 2018 Published by Toronto and Area Chapter - By JJ Hiew

Reducing Condo Costs Through the Electronic Delivery of Notices

From the Fall 2018 issue of the CCI Toronto Condovoice Magazine.

As a means of strengthening consumer protection, the amendments to the Condo Act have now introduced new mandatory notices and certificates that must be distributed to condo owners each year. These new certificates include the New Owner information Certificate (NOIC), Periodical Information Certificate (PIC), and Information Certificate Update (ICU). Additionally, the Ministry has introduced two new standardized notices that must be sent out prior to any meeting of owners, such as the Annual General Meeting. With all of these acronyms it is a veritable alphabet soup of certificates that are meant to keep owners informed about the financial health and status of their condominium.

Besides the time needed for corporations to complete these notices, the new Ministry mandates have increased the number of mailed notices that must go out each year. Whereas a condo could typically get by with a minimum of two mailings per year, they may now be required to mail up to eight notices per year. For many condos, mailing out one notice can cost thousands of dollars, so multiplying this figure eight times over will represent a significant line item in their budget. There are ways to combine some of these mandatory notices, but even with distribution of joint notices condos are still 'on the hook' to print and mail these packages out to owners. This can add up to a rather large expense for corporations.

So are there ways to cut this expense down?

Yes, there is a way! The solution is to use technology, but don't let that scare you, it's not really that high tech. Actually, it can be considered old tech - email. Email has become pervasive in everyday life. With every ping on our phones or computers we conduct business, take care of bills, shop, converse with friends and family, and are entertained. So if we use email and are online for everything else in our life why aren't owners receiving their condo notices online?

To get the ball rolling on distributing notices electronically condo corporations need to collect as many owner email addresses as possible. With an updated owner database of email addresses condo corporations can e-distribute meeting notice packages and the new certificates in place of traditional print and postage.

Is it that easy to save money printing?

Well, actually no. As per the Condo Act, notices can be served by "electronic mail or any other method of electronic communication if the owner agrees in writing that the party giving the notice may give the notice in this manner". If consent is not given, then email alone is not sufficient as a method to send notice, as the package must still be printed and sent via mail.

Fortunately, the Ministry has provided some guidance on what this consent looks like. On the Ministry of Government and Consumer Services website, you'll be able to find a document called the "Agreement to Receive Notices Electronically". It's a simple form where owners can agree to be served electronically by filling out their name, email address, and signature. Their consent to email notices has been given once the signed form is returned to the management office.

Great, so I'll ask all my owners to send me their agreements

Unfortunately, getting owners to complete the agreement and submit it back to the corporation is easier said than done. In an ideal world, owners would return forms to the management office in a timely manner. But, in the real world the biggest challenge to get the ball rolling on electronic communications is having owners respond to information requests in the first place. If your condo corporation doesn't collect email addresses as a matter of routine procedure then creating an owner database or updating an existing one can seem like a daunting task. There are a number of approaches you can take though, which are outlined below:

Get it when they move in / register - Whenever a new owner contacts the management office to register with the corporation, have them fill out their agreement to receive notices electronically too.

Make contact through the telephone or door-to-door - It's definitely time consuming and might be considered old-fashioned to pick up the phone and call owners, but a conversation with the property manager can be a meaningful way to connect with an owner and collect their emails and consents.

Incentivize your owners - If the personal touch doesn't result in more email consents, then you might consider offering an incentive to encourage your owners. We heard of one condo that offered a $5 gift card to a coffee shop as an incentive for owners to complete their agreements to electronic notices. This small reward was persuasive enough to get nearly every unit of a large condo corporation onboard for electronic communication, but consider contacting your legal counsel before employing this approach. Though the expense of purchasing all of those gift cards may be steep, the long-term cost savings from e-distribution will far outweigh this initial expenditure.

Use a governance service - If all of the above suggestions don't appeal to you because of the time, effort, and energy required to collect consents from your owners, then look into using a condominium governance service that does the work for you. Again, it's an upfront expense, but the long-term savings more than make up for it.

So what's next?

Once you have a database of email addresses and have collected consent from your owners, you can begin to distribute your notices by email. For smaller condos, you can utilize your preferred email client to send out these notices. For larger condos, it's time to utilize condo management software or electronic governance distribution services to send notices to your owners.

Try to ensure that the process of collecting email addresses and maintaining the database becomes a "common practice." The process of regularly updating your database may be tedious and time consuming, however, this is an exercise that once done properly, becomes systematic and provides enormous benefits. All members of the management and administration team must understand this in order to ensure long-term sustainability of the condo's operations. Serving notice and distributing meeting packages electronically can be a more efficient way of keeping owners informed and reminding your community about upcoming meetings, while keeping your notice distribution costs low.

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