At our annual condo association meeting in August, the condo board presented the next year's association budget. We
have 32 owners. The income was $23,000 more than the expenses. The board said
this excess will be added to our "savings" to be available for "whatever may
come up."
All of our roofing needs to be replaced in 5-7 years. (In 2007 the
estimate for that was $88,000.) No estimate was given for that future cost. I wanted a reserve account set up for this. This board said no.
The condo board does not
want to "tie up" our savings in any reserve accounts specified for any
particular purpose. Our master condo association insurance policy deductible is increasing from
$1,000 to $10,000. The condo board wants to be sure money is available in case there
is a loss. I wanted to see a reserve account set up for this. The board said no.
We have not had a reserve study done since 1994 either professionally or on our
own. I don't want my savings floating around with no purpose so the board can
spend it on anything they want without telling the owners first. Do other condo
associations have one or many more specified reserve accounts, and if so, what
are they designated for? (We do have two months worth of operating expenses set
up in a separate designated CD account as per our Bylaws, so at least we have
done that right.)
