§1141.34. Adoption of budgets; special assessments

            A.(1) For planned communities consisting of more than twenty-five lots, the association shall submit, at least annually, a proposed budget for the planned community for consideration by the lot owners at a duly called meeting of the association. Not later than thirty days after adoption of a proposed budget, the board of directors shall provide to all lot owners a summary of the budget, including any reserves, and a statement of the basis on which any reserves are calculated and funded. Simultaneously, the board shall set a date, which shall be no fewer than ten days nor more than sixty days after the summary is provided, for a meeting of the association to consider ratification of the budget. A majority vote, or any greater vote specified in the declaration, is required to ratify the budget. If a proposed budget is not ratified, the budget last ratified at a meeting of the association continues until a subsequent budget is ratified.

            (2) Nothing in this Subsection requires a certain format for the annual submission of the proposed budget.

            B. The board of directors may propose a special assessment at any time. Except as otherwise provided in Subsection C of this Section, the assessment is effective only if the board of directors follows the procedures for ratification of a budget provided in Subsection A of this Section and the lot owners ratify the proposed assessment at a meeting of the association as provided in Subsection A of this Section.

            C. If the board of directors, by a vote of two-thirds of directors present and voting, determines that a special assessment is necessary to respond to an emergency:

            (1) The emergency special assessment becomes effective immediately in accordance with the terms of the vote.

            (2) Notice of the emergency special assessment shall be provided promptly to all lot owners.

            (3) The board of directors shall spend the emergency special assessment funds only for the purposes described in the vote.

            D. If the association has accumulated a surplus from prior years, the budget may propose any of the following:

            (1) The refund to the lot owners contributing to the surplus if created by a special assessment.

            (2) A reduction of assessments prospectively in the amount of the surplus.

            (3) The establishment of a reserve for future repairs, replacements, or operating expenses.

            Acts 2024, No. 158, §2, eff. Jan. 1, 2025.