Below is a review of the posts on Facebook and LinkedIn from the past week. You can check out the full posts by clicking on the links.
NOTE: remember that we now post every other day.
The posts on Monday 12/8/2025, here and here, noted HOAs are not properly funding reserves. With or without a statutory requirement, what is the status of reserves in your condo or HOA?
The Community Associations Institute (CAI) is the national organization that serves community association living throughout the nation – there are chapters in most if not all states. CAI provides education, resources and networking opportunities for community association homeowners, board members and managers. Let’s talk about budget time for associations.
The community managers, treasurers and finance committees for hundreds of associations review their finances as part of developing a budget. Some states require associations to establish adequate reserves, funded on a reasonable basis, for the repairs, replacement and restoration of the major components of the common elements and any other portion of the community that the association is obliged to maintain, repair, replace or restore. Many do not define “adequate” or “reasonable”.
Also some states require that on an annual or other periodic basis associations must review the results of their reserve study to determine whether their reserves are sufficient and to make any necessary adjustments to the association’s funding plans which the board deems necessary to provide adequate funding for the required reserves.
Sounds simple. Sounds direct. And requires the existence of a reserve study (which some states do not require).
Some states (including Nevada) have governmental agencies that have various jurisdictions; some collect complaints and can predict trends. From that a very disturbing pattern has appeared: Associations are not properly funding their reserves. The complaints and trends show that associations are failing to adhere to requirements to prepare budgets or never doing a reserve study and the other things listed in the post.
In those states with a governmental agency that has the authority to resolve or remedy complaints, there have been decisions that require an association to hire a community manager until the association is at least 75% funded in its reserves and is current with all of its maintenance obligations and the other things detailed in the post.
So what is one big failure of an association that is not properly funding its reserves? Borrowing from reserves and not repaying that “loan to self”. One example of how or why that might occur is where the association had a major improvement that drained significant funds from its reserves. A possible backstory to this type of underfunding is discussed in the post.
Another example how reserves become underfunded is the reluctance of association boards to increase monthly assessments to meet their anticipated reserve balances. Some even “pride” themselves for never increasing monthly assessments. Others are hesitant to increase assessments for the reason discussed in the post.
Whatever the reason, reserve funding continues to decline and, in some cases, the balance of the loan from reserves increases. What some boards do in this situation is essentially to stick their heads in the sand. What that means in the community association context is described in the post.
Another way to “deal with” underfunded reserves is to move items around on the financials. That could lead to problems, though, and one example is in the post.
So how can a board avoid surprising the membership that a major increase will be due in 2026? Be transparent with your numbers. Discuss the financials at Board meetings – don’t just approve the report. And consider going further as suggested in the post. Appoint a finance committee (especially if required by the governing documents) and have it act as described in the post. That will help remove the “surprises” when there is a major increase in assessments or even a special assessment specific to the reserves.
TAKEAWAY: Assessments that remain at the same rate year after year is not a good sign; the cost of everything goes up constantly and not increasing assessments will quickly spend down operating funds and put reserves for future capital projects at risk. Work with a community association attorney and a reserve specialist.
The posts on Wednesday 12/10/2025, here and here, taught us that Black worker’s use of anti-Black slur not protected under Title VII, judge holds. Let’s look at the facts.
A Pennsylvania federal court judge recently held that a Black former Verizon Wireless store employee who was fired after he twice used an anti-Black slur at work did not have a viable discrimination claim against the company. Verizon allegedly fired Murray for using the slur under his breath in the situation noted in the post. An African-American co-worker reported the incident to an HR representative, as did Murray. Verizon cited his use of the slur as the reason for the firing. Murray alleged that his firing was wrongful termination and race-based discrimination under Title VII of the 1964 Civil Rights as well as under Pennsylvania law. The judge agreed with Verizon, holding that Murray had not carried his burden (i.e., he did not show what he was required to as described in the post).
The judge noted the Murray did not allege that the decision-makers behind his termination made racist comments, treated employees of one race better than another or harbored other prejudiced beliefs. Rather, what Murray did allege is noted in the post. In ruling on those differences, the judge said that Title VII does not require an employer to treat all employees the exact same way, but only that any differences in treatment cannot be based on a protected attribute.
The judge also addressed Murray’s claim that Title VII permits employees to use any slur that applies to their own protected characteristics. How the judge ruled, and the basis, is in the post.
Recent case law has produced mixed results for employees who allege discrimination over the use of racial slurs by others in the workplace. In 2024, a Louisiana federal court held that a plaintiff’s alleged overhearing of one co-worker calling another a racial slur did not rise to the level of harassment (in part for the reason noted in the post). And earlier this year a Michigan federal judge ruled in a case involving a manager’s use of a single ethnic slur – see the post for more on that. On the flip side is a 2022 decision from the federal 5th Circuit Court of Appeals. See the post for the holding there.
TAKEAWAY: When dealing with a single statement, or, as here, a single racial slur, it cannot be looked at in a vacuum, but in light of all relevant facts. Discuss the entire scenario with an employment lawyer.
The posts on Friday 12/12/2025, here and here, were HOA and condo Q&A: Can a property manager remove records from the website without authorization? This should be simple, right? Do you know the answer under PA law?
The answer to the question is (as it often is) “it depends”. On what an association’s governing documents provide relative to records retention. And what applicable state law requires.
Statutory requirements vary among the states, but they usually include what records an association must maintain, for how long, and who has access (and in what manner). One example under Florida law is in the post.
In Pennsylvania, the answer might be found in more than one place: the condominium or Planned Community Act and (usually) the non-profit corporation law. And don’t forget about the governing documents too …
TAKEAWAY: Records retention is important to satisfy legal requirements and also so that the association can respond to any records review/inspection requests (which often also have a statutory basis). Discuss with a community association lawyer your condo or HOA’s legal compliance in this area.