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Roofing Decision
To Roof or not to Roof ?
Question: Our board is split on whether to borrow funds to complete a roofing replacement program. Some of the directors think a bank loan is anathema, others feel that it will reduce the interior damage the homeowners are experiencing and well worth the interest charge. The opponents figure that the owners have waited several years for relief and a few more years won’t hurt. I feel that they should bite the bullet and borrow the money. A former president is dead set against the concept of borrowing money and has convinced several board members that they'd be breaching their fiduciary duty if they went to a bank.
Answer: If there is ongoing damage to the buildings, it is imperative that the it be repaired as soon as possible to prevent further damage. If the association lacks the funds, either a special assessment must be passed or consideration given to a bank loan. It is not uncommon for associations to borrow for large projects since getting the whole job done now, rather than later, will usually save a pile of cash. This sounds like a time to bite the bullet. THAT’S the board's fiduciary duty.