Did your Board illegally borrow from Reserves?

There are very strict requirements if your Board borrows from reserves:

1. Was the borrowing listed as an agenda item for an Open Meeting? The agenda needed to be posted 4 days in advance of the meeting.

2. Did the Open Meeting notice include the following:

   1. Why borrowing was needed?

   2. How borrowed money will be repaid?

   3. Will it need to be repaid with a special assessment?
      

3. Was the borrowing documented in the minutes? Minutes must include:

   1. Why the borrowing was required?

   2. How and when this money will be paid back to the reserve fund?
      

4. Did the borrowed money get put back into the reserve account within 1 year? The 1 year requirement can be extended if the Board follows the same steps above.

If the answer to any of the above is NO, your Board has illegally borrowed from reserves.

Resources:

Civil Code 5515