Board as a whole decides who has access to association records
Q. There is an on-site office at our association where the association’s books and records are stored. Due to a history of misplaced records, the lock on the office door was changed. However, the board president has decided on their own that only the president should have a key to the office. The secretary of the board asked for a key, and the president denied the request. The president said that he should be contacted if another board member needs access to the office. Should the president be making this decision alone?
A. The decision as to which board members should have a key to the office is one to be made by the board at a board meeting. Different associations handle this issue differently. Some provide a key to all board members; others provide a key to the officers. In any event, the board should adopt a strong policy concerning removal of and books and records from the office. For example, a policy could provide that no books and records are to be removed from the office, without approval of the board. Or, a policy could provide that no books and records are to be removed from the office; however, a copy can be made and removed. In such a case, a copier should be located in the office.
Q. Does the board of a common interest community association have a fiduciary responsibility to follow the reserve contribution recommendations of a reserve study?
A. The board of a common interest community association has a fiduciary responsibility to fund a reserve account. However, a reserve study is only one of the items that a board of a common interest community association needs to consider in determining contributions to a reserve fund. Unlike the Illinois Condominium Property Act, the Common Interest Community Association Act does include the items that the board needs to consider in establishing a reserve account. Nonetheless, the language in the Condominium Property Act can be instructive on this issue of what to consider when funding a reserve account.
As such, borrowing from the Illinois Condominium Property Act, “(t)o determine the amount of reserves appropriate for an association, the board of managers shall take into consideration the following: (i) the repair and replacement cost, and the estimated useful life, of the property which the association is obligated to maintain, including but not limited to structural and mechanical components, surfaces of the buildings and common elements, and energy systems and equipment; (ii) the current and anticipated return on investment of association funds; (iii) any independent professional reserve study which the association may obtain; (iv) the financial impact on unit owners, and the market value of the condominium units, of any assessment increase needed to fund reserves; and (v) the ability of the association to obtain financing or refinancing.”
Q. Our 12-building condominium complex in the Northwest suburbs continues with Zoom board meetings. This is a remnant from COVID. Is this practice still permitted?
A. Yes, the board can hold its board meetings via video, like Zoom. Section 18(a)(9)(B) of the Condominium Property Act provides “that board members may participate in and act at any meeting of the board of managers in person, by telephonic means, or by use of any acceptable technological means whereby all persons participating in the meeting can communicate with each other; that participation constitutes attendance and presence in person at the meeting.”
It is a practice that is also permitted in other types of homeowner associations that are incorporated as an Illinois not-for profit corporation.
• David M. Bendoff is an attorney with Kovitz Shifrin Nesbit in the Chicago suburbs. Send questions for the column to him at CondoTalk@ksnlaw.com. The firm provides legal service to condominium, townhouse, homeowner associations and housing cooperatives. This column is not a substitute for consultation with legal counsel.