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Condo association assessed for reserves, but spent on condo fees

Posted on Tue, Jul 13, 2010 @ 06:46 AM
  
  
  
condo assessmentsLast year, all owners in our condo association were assessed to pay the dues, and electric bills of a unit that was in foreclosure. The owner had moved out, leaving the place empty. The bank has settled and the condo unit has now been sold. Our condo board has decided, instead of reimbursing each unit owner their money, they are going to put the money toward one month of our dues. Those who have pre-paid for the entire year, will have to deduct from the first month dues in 2011. It is my understanding a reimbursement of assessment money was to be given back to owners, or put into a special assessment reserve, to be used toward other assessments. Can the board put the money toward our dues with, or without our approval? I would also like to know if the board can assess unit owners for the purpose of balancing the budget?
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COMMENTS

You should receive the money...However it is my experience that the Board can do whatever they want unless you get your attorney....I have tried to request State Attorney General intervention to no avail......there should be a governing State body one could appeal to rather than having to pay for your own attorney.

posted @ Tuesday, July 13, 2010 7:46 AM by Ruth Oloughlin


First of all, they shouldn't reimburse the unit owners. That would set a bad precedent, and the facts that you have given reveal that it wouldn't be a good idea. 
Similarly, the one month credit doesn't sound prudent, either. It will further complicate the association's accounting, and may violate the association's governing documents. 
It sounds like your association is woefully underfunded; a well-planned budget would have some cushion for bad debts and be putting some money aside, on a regular basis, for reserves. 
Whether or not your association needs reserves will be dependent upon your governing documents and state law. Nonetheless, even if they're not mandated, they are advisable.

posted @ Tuesday, July 13, 2010 7:49 AM by Lincoln Hobbs


Assessments can only be used for what they were determined. Bad precedent is collection of monies for one thing and using it for another.

posted @ Tuesday, July 13, 2010 9:08 AM by Ruth OLoughlin


With all due respect, I disagree. Assessments are collected to fund the association's operations. The decisions respecting an association's operations are almost always at the discretion of the board. One of the board's duties is to prepare and administer an adequate budget, and that doesn't include running a hand-to-mouth operation that takes and returns money to the owners.

posted @ Tuesday, July 13, 2010 10:16 AM by Lincoln Hobbs


MAYBE THE PHRASE SHOULD HAVE BEEN, "SPECIAL ASSESSMENT". THAT SPECIAL ASSESSMENT WAS FOR ONE PARTICTULAR PURPOSE. I AGREE WITH RUTH. IF THE BOARD ASKED FOR MONEY FOR A SPECIAL PROJEC, IT SHOULD BE USED FOR THAT AND NOTHING ELSE. FLORIDA'S BY-LAWS STATE, IF THERE IS MONIES LEFT FROM A SPECIAL ASSESSMENT, IT SHOULD BE RETURNED TO THE OWNERS, NOT USED FOR EVERYDAY OPERATING EXSPENSES.

posted @ Tuesday, July 13, 2010 1:45 PM by N. GIORDANO


It is my understanding that 
 
money for special assessments must be used for the purpose the board specified when asking for the money. If all the money is not used, the board must return the excess money to the owners, or put it into an "assessment reserve" to be used for other assessments that may come up later. It can not be put into any other reserve.

posted @ Tuesday, July 13, 2010 2:35 PM by kenneth naill


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