(1) The scheme operator must adopt a budget for the maintenance reserve fund
(a
"maintenance reserve fund budget" ) for each financial year that—
(a)
complies with subsection (3) and section 113AA ; and
(b) subject to
subsection (2) , is consistent with, and implements any recommendations in,
the quantity surveyor’s report obtained or updated under section 98(1) .
Penalty—
Maximum penalty—200 penalty units.
(2) Subsection (1) (b)
does not apply to the scheme operator to the extent of any part of the
maintenance reserve fund budget that has been agreed to by the residents by
special resolution at a residents meeting.
(a) allow for raising a reasonable
amount for maintenance and repairs to—
(i) provide for necessary and
reasonable spending from the maintenance reserve fund for the financial year;
and
(ii) reserve an appropriate proportional share of amounts necessary to be
accumulated to meet anticipated major expenditure over at least the next 9
years after the financial year; and
(b) fix the amount to be raised by way of
contribution to cover the estimated recurrent expenditure mentioned in
paragraph (a) .
Example—
Painting of village property is anticipated to be
necessary in 3 years time at a cost currently estimated at $3,000. The
contribution amount for the maintenance reserve fund in the budget for the
financial year must therefore include the annual proportional share for
painting of $1,000. Next year, the estimated cost has increased to $3,400 and
so the second year levy will be $1,200. The estimated cost in the third year
is $3,500, so with the $2,200 accumulated, a levy of $1,300 is necessary to
meet the cost.
(4) If, at the end of a financial year for which a budget
for the maintenance reserve fund is adopted, there is a surplus or deficit,
the surplus or deficit in the maintenance reserve fund must be carried forward
and taken into account in adopting the budget for the next financial year.