Education…Glossary
Administrative fund
Levies are paid into this fund to cover day-to-day expenses of the owners corporation, i.e. electricity, gardening, insurance, routine repairs and maintenance of common property.
Common property
The area of land and building in the strata scheme which do not form part of any lot
Executive committee
Elected representatives of the owners. Election takes place at each annual general meeting. The powers of the Executive Committee are limited under the Strata Schemes Management Act 1996 but the owners corporation may also impose additional restrictions.
General meeting
A meeting o owners and other interested parties (as noted on the strata roll) who have been advised by notice of a proposed meeting. The owners corporation is required to convene and hold a general meeting once a year. This must be held on a date not earlier than one month before nor later than one month after each anniversary date of the First Annual General Meeting.
Levies
Contributions paid by owners to the owners corporation to cover expenditure and allocation for capital expenditure. These are usually paid quarterly and the amount is based on unit entitlement.
Lot
In a strata scheme, a unit is referred to as a "lot". Car spaces, garages, laundries, marinas can also form part of a lot or be a separate lot.
Owners corporation
The owners corporation is the body made up of all the owners in the strata scheme. Each lot owner is part of the owners corporation and has a right to participate in the corporation's decision making. The owners corporation comes into existence immediately a strata plan is registered
At first it may only be made up of the original owner (usually the developer) but as individuals buy into the scheme, the owners corporation gains more members. The owners corporation has an executive committee which can make many of the necessary decisions on its behalf. The executive committee can have no more than nine members. It has a chairperson, secretary and treasurer. An owners corporation may also employ a strata managing agent and/or caretaker to carry out some or all of their functions.
The owners corporation has responsibility for:
- maintaining and repairing the common property of the strata scheme
- managing the finances of the strata scheme
- taking out insurance for the strata scheme, and
- keeping accounts and records for the strata scheme.
For more information on these responsibilities please visit www.fairtrading.nsw.gov.au
Sinking fund
Levies paid into this fund cover renewal and replacement of fixtures and fittings, eg painting, stairwell carpets.
Special levy
Lump sum contribution to cover either unplanned or underestimated expenditure.
Term
The term of the loan period.
Unsecured Loan
A loan which requires no security such as property.