Authority to levy Emergency Assessments
Except for the voluntary nature of these Assessments created in Section 6.05.1, which is not explicit, there appears to be no such authority for the Board to levy them. Indeed, if such authority existed, regular Dues would be mandatory. Since mandatory Dues would encumber all Owners, the appropriate place to create this authority would be in the Covenants, which are silent on Dues. Changing the Covenants would require a vote of the Owners of a majority of lots, who have rejected mandatory Dues in each of the last two attempts.
It is recommended that the Board revise Section 6.05.1 to make explicit the voluntary nature of these assessments. Likewise, Section 6.05 (Dues) should be similarly revised.
Authorization of Expenses
Section 5.04 states that funds may be withdrawn from Association Bank Accounts only ?“in accordance with proper authorization of the Officers.?” A review of the invoices for major legal expenses and associated meeting minutes indicated that either specific authorization of expenses payment was not routinely conducted or that it was conducted and routinely omitted from the minutes.
It is recommended that the Board regularly conduct a review and authorization of payments of Association expenses and that these be included in meeting minutes.
Financial Reporting and Budgeting
Section 2.10 requires the Treasurer to ?“make regular reports at each meeting of the Members and such other reports as required by the Officers.?” However, nowhere is there a requirement in the Bylaws for the Board to prepare an annual budget.
For the General Meeting minutes available (about half were available), financial report was always included in compliance with the Bylaws. However, a review of Board minutes indicated that while, at times, concerns were expressed over the state of available funds in the Association account, rarely was there mention of an account balance or of expected expenses relative to specific amounts of funds available. Again, either the Board did not routinely request a financial report at its meetings or they were reported and omitted from the minutes. The financial status of the Association must always be apparent to the Board so it can act, as necessary, to maintain financial viability.
Three actions are recommended, here. First, that a financial report be included at every meeting, whether of the Members or of the Board, and that Section 2.10 be amended to clearly state such requirement. Second, that Section 2.10 includes an annual budget requirement to be approved by the Board, which will assist in determining Dues adjustments and needs. Finally, that an annual report documenting income from Dues and other sources, including loans, and expenses be made available to the Members.
Except for the voluntary nature of these Assessments created in Section 6.05.1, which is not explicit, there appears to be no such authority for the Board to levy them. Indeed, if such authority existed, regular Dues would be mandatory. Since mandatory Dues would encumber all Owners, the appropriate place to create this authority would be in the Covenants, which are silent on Dues. Changing the Covenants would require a vote of the Owners of a majority of lots, who have rejected mandatory Dues in each of the last two attempts.
It is recommended that the Board revise Section 6.05.1 to make explicit the voluntary nature of these assessments. Likewise, Section 6.05 (Dues) should be similarly revised.
Authorization of Expenses
Section 5.04 states that funds may be withdrawn from Association Bank Accounts only ?“in accordance with proper authorization of the Officers.?” A review of the invoices for major legal expenses and associated meeting minutes indicated that either specific authorization of expenses payment was not routinely conducted or that it was conducted and routinely omitted from the minutes.
It is recommended that the Board regularly conduct a review and authorization of payments of Association expenses and that these be included in meeting minutes.
Financial Reporting and Budgeting
Section 2.10 requires the Treasurer to ?“make regular reports at each meeting of the Members and such other reports as required by the Officers.?” However, nowhere is there a requirement in the Bylaws for the Board to prepare an annual budget.
For the General Meeting minutes available (about half were available), financial report was always included in compliance with the Bylaws. However, a review of Board minutes indicated that while, at times, concerns were expressed over the state of available funds in the Association account, rarely was there mention of an account balance or of expected expenses relative to specific amounts of funds available. Again, either the Board did not routinely request a financial report at its meetings or they were reported and omitted from the minutes. The financial status of the Association must always be apparent to the Board so it can act, as necessary, to maintain financial viability.
Three actions are recommended, here. First, that a financial report be included at every meeting, whether of the Members or of the Board, and that Section 2.10 be amended to clearly state such requirement. Second, that Section 2.10 includes an annual budget requirement to be approved by the Board, which will assist in determining Dues adjustments and needs. Finally, that an annual report documenting income from Dues and other sources, including loans, and expenses be made available to the Members.
