COA pres says Condo Act revisions don’t go far enough
The Condo Act’s severe shortfalls have been recognized almost since it came into effect in 1998. Last year former Premier Dalton McGuinty announced a process to update the legislation and provide long-overdue changes to the rules that govern condo ownership and management. Last fall a series of public discussions took place including a meeting in Mississauga attended by more than 200 people, the largest public gathering in the province. density living is increasingly common. Almost half of the 393 homes sold in Mississauga last December were condo apartments or townhouses. Charles Sousa, finance minister in Premier Kathleen Wynne’s new government and MPP for Mississauga South, made the condo act revision a key platform in his campaign to become Liberal leader so he is expected to support pressing ahead with the revision.The Public Policy Forum, which has been hired to conduct a public process to recommend improvements to the act, released an interim report last week suggesting changes in five areas: *Dispute resolution – More effective means to enforce existing rules in the act and creation of an independent agency to oversee development of dispute resolution tools and processes*Financial management – Rules to ensure adequate funding and reporting of each building’s reserves*Consumer protection – Supply of adequate, accessible and transparent information about costs to enable consumers to make informed decisions*Condominium management qualifications – Mandatory knowledge for and possible regulation of property management companies and the managers they hire to oversee individual buildings*Issues beyond the Condo Act itself – Participants in discussions on new legislation raised a number of associated issues, including property taxes, condo conversions, insurance rates, tenants rights and responsibilities and trends and “power imbalances” in the condo sector that were beyond the act itself
Among the most important issues Pinizzotto wants toughened up is for property management companies, not just managers, to be certified or licensed to ensure that they meet higher standards. The Public Policy Forum said it “may require” government regulation of the industry.
“Property managers are only employees, the accountability has to be with the management company,” she said.
She also called for formal government licensing or certification of management companies so that consumers have recourse against companies and managers who do not act in the best interest of owners.
The current act is so weak that unhappy owners have little recourse to protect themselves against management or condo boards that fail to behave responsibly.
It is not unheard of for condo boards and/or managers to corrupt proxy voting to install new members on the board that are friendly to the existing board, she said. Since management companies are hired by, and report to, condo boards, even though they are supposed to work on behalf of the condo corporation and all owners, responsible governance is not always forthcoming.
“A large condo can easily have $100,000 to $200,000 annually going into its reserve fund,” Pinizzotto said. “That’s big money and the corruption that you can see going on with some of these boards is outrageous.” In some cases, she said boards, acting with the assistance of their managers, will issue false proxies to ensure that votes go in the direction that they want, she said.
“The corruption that’s going on with some of these boards of directors is terrible because there is no enforced accountability,” she said. “And the property manager won’t move a muscle for fear of making the board that hired it unhappy.”
She knows of a building in which owners asked to see the proxies submitted that overturned a vote that took place by owners attending a building’s annual general meeting. ‘
The board refused to show the unhappy owners the proxies they claimed to have and the owners had no recourse to challenge the board’s decision.
“It’s common for boards that want to make changes to bylaws or something, to get their friends on the board by forging proxies,” she said.
The public is invited to comment on the Public Policy Forum’s findings by March 11, at email@example.com By fall, final recommendations that include input from the responses to the current report are expected to be ready to go back to the provincial government.