Condo Smarts May 29, 2023
Types Costing Allocations

Dear Tony: We have an ongoing dispute in our strata corporation about the fairness of cost allocations for utilities. In our building, only the penthouse units have gas fireplaces and gas cooking ranges and barbeque connections. The remainder of the owners believe this is unfair as we do not have any benefit of the utility in the same way and we are subsidizing their benefits without any additional cost. Is there any method we can consider of calculating this differently. Christina W.

Dear Christina: The Strata Property Act makes allowances for these types of exclusive provisions. They are referred to as “types of strata lots” and they apply to only operating expenses that are either exclusive to specific strata lots and identified in a bylaw, or they are an operating expense that is exclusively limited common property to specified units. The deciding element is whether the gas use is exclusive or not. In your situation, the utility is not limited common property, and it would require a bylaw of the strata corporation to allocate the gas cost to the penthouse units; however, this can only apply if the use of gas is exclusive to the penthouse strata lots identified in the bylaw. For example, if your strata corporation has gas fuelling hot water boilers, make up air units, or back up generators, then the use is not exclusive and may not be allocated in a bylaw. Another example is the sharing of limited common property (LCP) exclusively for identified strata lots such as recreational facilities. A penthouse pool that is LCP and only accessible by the penthouse strata lot(s), would apply in this situation. The annual cost of operations of maintenance of the pool can be allocated solely to the LCP identified strata lots. There are also separate elevators allocated to penthouse units that are LCP and those can have separate maintenance contracts. While the allocation of exclusive expenses appears obvious, it is often not enforceable when strata corporations attempt to segregate cost allocations. Unit entitlement or allocation of common expenses cannot be changed by method of a bylaw. For your building, the gas must be exclusive to the penthouse units. The gas contract includes other common appliances such as hot water for the building and the gas heating for the make up air system. Operating expenses are those within the annual budget that occur once a year or more frequently.
Tony Gioventu, Executive Director CHOA
Kindly note CHOA is a member-based, non-profit association. If your strata is not currently a CHOA member please consider joining – membership details are posted on our website at: https://www.choa.bc.ca/about-choa/join-choa/

COVID-19: To prevent the spread of COVID-19 CHOA staff may be working remotely. During this time we are online and available by phone and email to assist with your strata questions. Please stay safe and healthy.

CML Properties
272 Lansdowne Street
Kamloops, BC, V2C 1X7

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