What happens if the strata budget is not approved at the AGM?

Last reviewed November 10, 2026, against the current Strata Property Act, Strata Property Regulation and Standard Bylaws on BC Laws.

What section 104 says

Three things happen automatically when a budget fails.

1. A new budget within 30 days. The strata corporation must prepare a new budget and place it before a special general meeting for approval by majority vote. The 30 days can be extended only by a resolution passed by a 3/4 vote at the same AGM.
2. Fees continue. If the fiscal year to which the old budget relates ends before a new one is approved, owners must continue to pay the same monthly strata fees they paid under the previous budget.
3. Spending is capped. Until a new budget is approved, the strata may spend from the operating fund only as section 98 allows, or on the type of expenses set out in the previous budget that usually occur once a year or more often, up to the maximum amount set out in the previous budget for each category.

So the lights stay on and the insurance is paid. What the strata cannot do is start new spending.

Try amending before it fails

A budget does not have to pass or fail as printed. The proposed budget may be amended by majority vote at the AGM before the budget itself is put to a vote (section 103). If the objection is to one line, such as a landscaping increase or the size of the contingency reserve contribution, the chair should invite a motion to amend that line. A budget amended on the floor and then passed is far better than a second meeting.

One limit: the contribution to the contingency reserve fund must be at least 10% of the total budgeted contribution to the operating fund (Regulation 6.1). An amendment cannot take it below that.

If it still fails

1. Record the result in the minutes with the count, and any 3/4 vote to extend the 30 days.
2. Find out why. Ask at the meeting, and ask owners afterward. A budget rarely fails for one reason.
3. Prepare a revised budget. It must contain the information the Regulation requires, like the first one (Regulation 6.6).
4. Give notice of the SGM. At least two weeks' written notice, with the new budget. Counting delivery time, notice needs to go out about ten days after the AGM to meet the 30-day limit.
5. Hold the SGM. The budget is approved by majority vote, and can again be amended by majority first.
6. Inform owners of their fees within two weeks of the meeting at which the budget passes (section 106).

Spending in the meantime

Council should read the previous budget category by category. The cap is per category, not overall. If last year's budget had $6,000 for snow removal, that is the ceiling for snow removal until the new budget passes.

Beyond the old budget, section 98 still applies:

• small unapproved expenditures, below the amount set in the bylaws or, if the bylaws are silent, below $2,000 or 5% of the total contribution to the operating fund for the current year, whichever is less, counted together with all other unapproved expenditures that year, and
• emergency expenditures where there are reasonable grounds to believe an immediate expenditure is necessary to ensure safety or prevent significant loss or damage.

See council spending limits.

If the second budget fails too

The Act does not set out a third step. The practical result is that fees and spending stay frozen at the old budget's levels while council keeps working toward a budget owners will pass. A strata that cannot pass a budget for a long period will eventually be unable to meet rising costs such as insurance. At that point owners or council may apply to the Civil Resolution Tribunal or the Supreme Court, and in serious cases a court may appoint an administrator.

How to avoid a failed budget

• Explain the big changes in a covering note with the notice: what rose, by how much, and why.
• Show the alternative. If insurance rose 20%, say so. Owners accept facts more readily than totals.
• Hold an information meeting before the AGM for a difficult year.
• Tie the reserve contribution to the depreciation report. See the contingency reserve fund.
• Collect proxies from owners who support the budget but cannot attend.

Questions councils and owners ask

Do strata fees stop if the budget is not approved?

No. Owners continue paying the same monthly fees as under the previous budget until a new budget is approved.

How long does the strata have to present a new budget?

Thirty days from the AGM, unless a longer period was approved by a 3/4 vote at that meeting.

What vote is needed to approve a strata budget?

A majority vote at the annual general meeting, or at the special general meeting held after a failed vote.

Can owners change the budget at the AGM?

Yes. The proposed budget may be amended by majority vote before the budget is put to a vote.

Can council just adopt a budget itself?

No. The budget must be approved by the owners at a general meeting.

This page is general information for BC strata corporations, not legal advice. Your strata's own filed bylaws may differ from the Standard Bylaws. See the current text of the Strata Property Act and the Strata Property Regulation on BC Laws.

Related guides

Annual Budget
Strata Fee Increases
How to Call an SGM
Financial Statements
AGM Order of Business
Council Spending Limits