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7.1.F. - Page 83 <br /> 4.2. Purpose of Assessments: The Assessments levied by the Association shall be <br /> used exclusively to promote the economic interests, recreation, health, safety, and welfare of all the <br /> Owners and other residents in the Project and to enable the Association to perform its obligations <br /> under this Declaration, including, without limitation, the maintenance of all Common Area <br /> improvements in good condition at all times. The allocation of the Common Expenses of the <br /> Project are divided into different components with certain of such Common Expenses being <br /> allocated to both the Residential Units and the Commercial Units as General Use Common <br /> Expenses under Section 4.5.B, and certain portions of the Common Expenses being allocated <br /> under this Declaration only to the Residential Units as the Residential Common Expenses under <br /> Section 4.5.C. Common Expenses for the Garage are established and allocated to Owners that are <br /> assigned use of Parking Spaces in the Garage as Garage Common Expenses under Section <br /> 4.5.D. <br /> 4.3. Assessments: <br /> C. Regular Assessments: The Board shall establish and levy Regular <br /> Assessments in an amount that the Board estimates will be sufficient to raise the funds needed to <br /> perform the duties of the Association during each fiscal year. Regular Assessments shall be made <br /> for a one-year period and collected in monthly installments. <br /> The Regular Assessment shall include a portion for Reserves in such amounts as <br /> necessary to fully fund Reserves to meet the costs of the future inspection, repair, replacement or <br /> additions to the Major Components and fixtures that the Association is obligated to maintain and <br /> repair. Reserve Funds shall be deposited in separate accounts and the signatures of at least two <br /> (2) persons who shall either be Members of the Board or one officer who is not a Member of the <br /> Board and a member of the Board shall be required to withdraw monies from the Reserve account. <br /> The Board shall establish three (3) Reserve Accounts; one for General Use Common Expense <br /> Reserve items; one for Residential Common Expense Reserve items and another for Garage <br /> Common Reserve items. <br /> D. Special Assessments: The Board, at any time, may levy a Special <br /> Assessment in order to raise funds for unexpected operating or other costs, insufficient operating or <br /> Reserve Funds, or such other purposes as the Board in its discretion considers appropriate. <br /> Special Assessments shall be allocated among the Units in the same manner as Regular <br /> Assessments, except in the case of an Assessment levied by the Board against a Member to <br /> reimburse the Association for costs incurred in bringing a Member into compliance with provisions <br /> of the Governing Documents, or to replace insurance proceeds pre-empted pursuant to Section <br /> 8.2.A. <br /> 4.4. Restrictions on Increases in Regular Assessments or Special Assessments: <br /> C. Approval of Members for Certain Assessments. Except as provided in <br /> Section 4.4.B, without having first obtained the approval of such action by the vote or written <br /> assent of Members casting a majority of the votes at a meeting of the Association at which a <br /> quorum is present, the Board may not: (1) impose a Regular Assessment on any Condominium <br /> which is more than twenty percent (20%) greater than the Regular Assessment for the immediately <br /> preceding fiscal year or (2) levy a Special Assessment to defray the cost of any action or <br /> undertaking on behalf of the Association which in the aggregate exceeds five percent (5%) of the <br /> budgeted gross expenses of the Association for that fiscal year. For purposes of this Section 4.4, <br /> a "quorum" means Members constituting more than fifty percent (50%) of the voting power of the <br /> Association. Any meeting of the Association for purposes of complying with this Section 4.4 shall <br /> be conducted in accordance with Chapter 5 (commencing with § 7510) of Part 3, Division 2 of <br /> Title 1 of the California Corporations Code and § 7613 of the California Corporations Code. The <br /> right of the Board to increase Regular Assessments by up to twenty percent (20%) over the <br /> Regular Assessment for the immediately preceding fiscal year is subject to the Board having <br /> complied with the provisions of Civil Code § 5605 or having obtained the approval of such <br /> increase by the Members in the manner set forth above in this Section 4.4. <br /> 20 <br /> [DRAFT][05.03.14] C:\Program Files\Neevia.Com\Document Converter\temp\4056.doc <br />