Residents of Peregian Springs who have been locked out of an AGM.
Residents of Peregian Springs who have been locked out of an AGM.

Residents fear fee rise to repay body corp budget black hole

EXCLUSIVE:

A BUDGET shortfall denied by the body corporate of a major Sunshine Coast residential community has to be paid off in its upcoming 2019-20 budget.

The order to pay off the deficit has some residents concerned they may be slugged extra fees as part of a special levy to recoup the money.

The order was made of the Principal Body Corporate for Ridges Peregian Springs, after a push by residents of the estate to have the deficit declared and repaid.

The Principal Body Corporate for Ridges Peregian Springs must make provision in its administrative fund budget to pay off a deficit remaining from its 2015-16 and 2016-17 financial years.

The order to do so was made by the Office of the Commissioner for Body Corporate and Community Management in early-December, after a push by a number of residents from subsidiary body corporates within the estate to have the deficit first declared and then repaired.

The deficit first emerged in 2015-16 and rose to more than $350,000 in 2016-17.

The Principal Body Corporate, of which FKP Residential/Aveo was understood to hold majority support in the seven-member voting bloc, said the deficit was due to decline to about $139,000 when the current financial year ended on January 31, 2019.

The Principal Body Corporate also submitted that its administration fund was set to have a surplus of about $595,000 for the 2019-20 financial year, enabling it to pay out the current deficit and deliver a surplus of $450,000, as a result of more lots being made available in the development.

The body corporate commission adjudicator didn't endorse the principal body corporate's plan to deliver a surplus in 2019-20 when making the deficit pay-off order.

East Village Ridges Body Corporate chairman Roger Cook said it had taken two years "and a lot of work" to get the ruling and they were now watching closely to find out whether they would be slugged with extra fees to cover the deficit.

He said residents expected FKP Residential/Aveo to cover the deficit or reduce recreation club access fees to offset any new levy.

Mr Cook said they also wanted developer-appointed body corporate committee members who oversaw the deficit to step down.

"Clearly we (residents) don't want to have to pay for it," he said.

He added they would consider taking court action if any deficit solution added financial burden to Peregian Springs residents

The budget black hole had previously been described as a "misconception" by Principal Body Corporate chairman Doug Merritt.

A member of the Principal Body Corporate said there was a margin building up as each new block was registered, but it would abide by the adjudicator's decision and "fix it up".

He said the Principal Body Corporate would be "reluctant to lift the fees" on residents.