Condo Line

Reserve funds need proper accounting

 

CAMquestion@cfl.rr.com

Q: Our HOA is in the process of approving the budget. There is the question of “cash flow funding” or “fully funding” the reserves. In either case the reserve schedule contains 17 accounts of which only eight have indicated life spans and years remaining. The rest of the accounts are noted as variable.

I thought that if you use either of the methods of reserve, the reserve study should include a life span for all accounts listed. How else would you know when the funds would be needed? I feel we are headed for a special assessment down the road. Is this in compliance with FS-720? Your thoughts are appreciated.

F.P., Clearwater

A: Homeowner associations are not governed as strictly as condominiums when it comes to budgets and reserves. The Florida Department of Business and Professional Regulations has published a manual called “Budgets & Reserve Schedules.” This manual is primarily for condominiums and cooperatives; however I do recommend that homeowner associations follow the guidelines outlined in it. You can download the 86-page document from this website: www.myfloridalicense.com/dbpr/lsc/documents/BudgetsandReserves.Master06092010.pdf.

As to your question about years of useful life versus variable years of life, a proper budget would indicate the years remaining. You are correct that if the reserve budget is not properly scheduled, you may find special assessments will be needed in future years.

Q: We live in a 55+ condominium community. The bylaws and rules and regulations have no minimum age. Is there a state or federal rule or law on minimum age and if so where can I find it? I have looked thru FS 718 and housing for the elderly. I have been told it is 18 but no hard proof.

B.G., Stuart

A: Whenever federal laws are passed you will find the details in the Federal Register. The section that refers to the Housing for Older Persons Act of 1995 is Federal Register Part IV Department of Housing and Urban Development, 24 CFR Part 100, dated April 2, 1999. You can download this Federal Register at: http://talkwithcam.com/wp-content/uploads//FedReg%2055Adult.pdf or from other agencies.

Yes, you are correct that adult communities, 55+, must have one person living in the unit who is 55 years of age or older and all other occupants must be 18 or older. To comply, the 55-year-old does not have to be an owner, but can be a renter or family member.

To confuse matters, 80 percent of the homes in the community must comply with this age requirement. The exception would be when the 55-year-old dies and the home is passed to a younger person, perhaps a surviving spouse, son or daughter. The 20 percent exception was designed so the surviving spouse or other person would not be forced to sell and move from the community.

The adult community law was not established so that all residents would be 55 or older but to ensure that young families were not living in the community. In other words, an exemption from federal and state age discrimination laws. It’s often confusing and many boards do not fully understand the law. For that reason I would suggest that the association attorney be consulted on any age requirement that comes to question.

Q: I live in a gated community and often hear the term “controlled access.” Although I have researched this term I cannot seem to find an accurate and appropriate definition. Can you help?

Secondly and along those lines, if a gated community does not have a security guard but the residents have entry access via a transponder — the gate opens automatically for whomever upon approach — is this type of “security” considered controlled access? If a security camera is installed to monitor traffic activity is that considered controlled access?

D.B., Lady Lake

A: There are two basic kinds of communities. One has private roads and the other public roads. Public roads are usually maintained by the county or city and these roads cannot be closed to the public. The community that has private roads, maintained by the community, may have the right to restrict entry by nonresidents. There are different degrees to control or restrict entry. There are different security systems that the communities may install to control entry.

What the community uses to name the system is primarily dictated by the liability that the community will accept. The words controlled access or access control are used to limit liability rather than using words like security systems. The same is true when you use the names of gatekeeper or security guards to define persons performing security duties.

Residents in these communities that have security systems or access control or guards may falsely feel that they are safe. They may be safer than communities without such systems, but a security system does not necessarily ensure total security. In the end each resident is responsible for their own safety.

To answer your question, access control it is strictly terminology that is recommended to limit the liability of your community.

Write to Condo Line, Richard White, 6039 Cypress Gardens Blvd., #201, Winter Haven, FL 33884-4115, or e-mail CAMquestion@cfl.rr.com. Include name and city.

Read more Plant Clinic stories from the Miami Herald

Miami Herald

Join the
Discussion

The Miami Herald is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere on the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

The Miami Herald uses Facebook's commenting system. You need to log in with a Facebook account in order to comment. If you have questions about commenting with your Facebook account, click here.

Have a news tip? You can send it anonymously. Click here to send us your tip - or - consider joining the Public Insight Network and become a source for The Miami Herald and el Nuevo Herald.

Hide Comments

This affects comments on all stories.

Cancel OK

  • Marketplace

Today's Circulars

  • Quick Job Search

Enter Keyword(s) Enter City Select a State Select a Category