Can you Reserve for “Annual” Projects?
April 24, 2019 No Comments
In a word, “yes”. There is no minimum (or maximum) Useful Life stipulated in National Reserve Study Standards.
In a word, “yes”. There is no minimum (or maximum) Useful Life stipulated in National Reserve Study Standards.
Sometimes, the answer is no. Yesterday a former client asked about their Reserve Study which we completed back for their 2010 Fiscal Year.
Great question! A reader asked this yesterday, describing their association as a residential association with many private homes along a common street, with little other common area assets (a gate system and a tot lot).
Boards are free to choose how to fund Reserves. Typically Governing Documents require the Board to collect “adequate” or “sufficient” Reserves to care for the association’s common areas.
Life is full of risks. You may be stuck with your current circumstances, but you have surprising power to influence many future risks.
A California client asked a very interesting question. California law (Civil Code 1366.1) specifically limits associations from collecting assessments in excess of the actual costs for which the funds are being collected.