Toronto condo owners shocked by a ‘special’ $70K fee to fix parking garage—even owners without parking got the bill. Here’s what happens if they refuse to pay

“No one has $70,000 lying around, so it’s hard to even fathom what we have to do,” said unit owner Augustine Ogditi, about the prospect of paying a five-figure bill.

Ligeng Guo, another unit owner in the building, was more blindsided by the timing and the size of the special assessment fee, telling CTV News: “$70K is a lot of money. It makes me very nervous and stressed out of nowhere for this huge debt to come in,” adding that he doesn’t even have a parking spot.

Here’s what happened — and how to approach an eye-watering special assessment fee if your condo has a problem like this.

What are ‘special assessment’ fees?

Are one-off bills of this size even legal? The short answer is yes.

According to the Condominium Authority of Ontario, a special assessment is a one-time fee that condo owners pay in addition to regular fees to address budget shortfalls by unexpected events, like a dangerous parking garage leak.

It is worth noting the rarity of these fees. As a condo investor, you may never have to incur one. But in the scenario that extra funds are needed, a special assessment provides crucial financial reinforcement when other options run dry.

Typically, reserve funds are sufficient to pay for repairs and other unforeseen costs, but if costs exceed what is held on hand, the special assessment fee, subsidized by condo owners, can secure the critical funding necessary to rectify the gap.

Another option is to take out a loan, although this has downsides, like accruing interest and getting into debt, potentially negatively affecting the fiscal health of the community’s stakeholders. Additionally, under-budgeting and litigation are other reasons special assessment fees are occasionally needed.

What if you don’t pay your special assessment?

Condo unit owners are legally obligated to pay special assessment fees, if needed. Refusal to pay them may result in fines and other legal problems, although condo boards are required to provide clear information on why the fee is required.

Lastly, special assessment charges vary significantly, depending on a multitude of factors. According to Insight Law Professional Corporation, they can range anywhere from a few hundred bucks to tens of thousands.

In the case of Wilson Avenue, the board members emphasized the need to prioritize the building’s safety over the owners’ frustrations, stating it is their “primary duty to keep the property safe.”

However, the board did extend an olive branch to owners by postponing the vote on the matter to allow time to assess different options for the repair, including the possibility of taking out a $7-million loan.

Adam Lipowitz, a condo owner in the building, rejoiced at this news, telling CTV: “What we are hoping for is a little more transparency, a little more time, and a little more options.”