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Q&A: Voluntary Donations?

Q I am the secretary of a recently formed condo association board in a mid-sized  building. Due to circumstances I'm sure are common, what money we have is  barely sufficient to manage the status quo, including contributions to the  reserve fund.  

 Nevertheless, we are fortunate to have owners who are enthusiastic about  improving certain aspects of the building. So, the question is: Can the board  accept voluntary contributions of money and/or labor from willing owners to  accomplish projects for which there is no money in the budget, such as  re-painting the fitness room and replacing a shabby piece of lawn around the  front entrance to the building, without creating a second class of owners  and/or liability issues?  

 — Helpful in Hanover  

A Attorney Jack Facey of Kenlan, Schwiebert, Facey & Goss, PC in Rutland , VT, says, “A condominium executive board can accept voluntary contributions of money and  labor from willing owners for the types of projects that you describe; that  said, I’m not sure what you mean by “creating a second class of owners” and there are, of course, potential liability issues. I’ll discuss all three concepts in a little more detail.  

 “Usually, the question of volunteer labor comes up in the context of an owner who  doesn’t have sufficient funds for his dues and wants to contribute in-kind labor.  States that have adopted  

 UCIOA [the Uniform Common Interest Ownership Act] (and, no doubt, states that  have not), require that assessments be assessed in accordance with the  percentage ownership of each owner. You cannot substitute volunteer work for  the money that is required to run the condominium common areas and facilities.  

 “In my experience, this issue comes up more often with associations who are  self-managed as opposed to those that have professional management.  Self-managed associations often have committees who actually do work that would  cost dollars if that work was being done by a professional manager.  

 “That said, the board can accept voluntary contributions of money and donations  of labor from owners who wish to contribute over and above the dues  requirement. Perhaps in some minds this will create a second and ‘lower’ class of owners for those owners who don’t both pay their dues and contribute additional money or time but, in my  opinion, that is not a legal issue and don’t believe it’s a reason not to accept truly ‘voluntary’ donations and labor.  

 “Be careful, however, that you aren’t accepting voluntary labor in cases where the persons performing that labor are  supposed to be licensed or insured. Also, the association’s insurance agent should be aware that association members are performing voluntary labor so that there are no  questions about whether or not someone might be covered under the association’s policy or whether workers’ compensation is an issue.  

 “You should also be aware that, as with a lot of situations involving volunteers,  volunteers can get jaded, asking ‘why are we doing all the work when nobody else is’?”  

 
 

Comments

  • I’m on the BOD of two condo boards in Williams Island in North Miami. My question is can residents voluntarily donate money toward various improvement projects like landscaping?