Reserve Funding Question
Is it legal for an HOA treasurer to unilaterally withhold monthly contributions to the reserve fund account if those monthly contributions had been voted on by the Board when the budget was passed? Since August, our treasurer has made NO monthly contributions to HOA reserve fund account.
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Janet,
The board acts as a body, and no individual board member has the authority to take any action in opposition to the position of the board. For the treasurer to stop making reserve account contributions as established in the budget, the board would have to vote to take that action. This is a frequent occurrence because an unexpected expense comes up, and rather than ask the homeowner for more assessments to address those expenses, the board withholds expected reserve account funding. This is wrong but not currently illegal. Without funding reserve accounts as planned in the budget, the homeowners are getting short-changed and betrayed. The board should look to other cost-cutting measures other than defunding the reserves. I will look to pass legislation to make this action illegal.
Dennis