One of our schemes wants to apply to CSOS for exemption from the requirements of the Reserve Fund. They will be doing a big maintenance project this year and will have to increase the Maintenance Reserve levy by a big margin to replenish the funds in the Reserve Fund. Is it possible to get an exemption?
Quote from the STSM Act:
If you look at the requirements in the STSM Act there are three places that deals with the Reserve Fund.
- The Act itself in Section 3 (1) (b) that states that a Reserve fund must be established
- The Prescribed Management Rules (PMR) – PMR 22 that talks about the 10-year Maintenance plan and the contributions to be placed in the Reserve fund; PMR 24 talks about contributions and withdrawals to the Reserve fund
- Regulation 2 that talks about minimum amounts for the Reserve fund
So even if – by unanimous resolution – the Body Corporate amends the PMRs it is still a requirement of the Act itself to have a reserve fund and a requirement of the Regulations as to what minimum amounts needs to be paid into the Reserve fund.
CSOS cannot give exemption on something that is required by the Act.