› Flat Chat Strata Forum › Strata Committees › Sinking Fund Plans › Current Page
I’m going to look ahead to the laws that come in in NSW on November 30. But first, there are no penalties attached to not creating an estimate or, indeed, not funding the estimated amounts.
However, ECs and owners corps leave themselves open to individuals taking action at NCAT if neither is done. Those actions could range from seeking orders to comply with the law to seeking the replacement of the EC and Owners Corp with a strata manager.
OK, here is the legislation as it will apply from November 30. NB The “sinking fund” will thenceforth be known as the Capital Expenditure Fund.
80 Owners corporation to prepare 10-year capital works fund plan
(1) An owners corporation is to prepare a plan of anticipated major expenditure to be met from the capital works fund for a 10-year period commencing on the first annual general meeting of the owners corporation.
(2) An owners corporation is to prepare a plan for each 10-year period following the 10-year period to which the first plan applied. The plan is to be prepared for the annual general meeting at which the period covered by the previous plan expires.
(3) An owners corporation may, by resolution at a general meeting, review, revise or replace a 10-year plan prepared under this section and must review the plan at least once every 5 years.
(4) A plan under this section is to include the following:
(a) details of proposed work or maintenance,
(b) the timing and anticipated costs of any proposed work,
(c) the source of funding for any proposed work,
(d) any other matter the owners corporation thinks fit,
(e) any other matter prescribed by the regulations for the purposes of this section.
(5) A plan under this section is to be finalised by the end of the next annual general meeting of the owners corporation after the annual general meeting for which the plan is prepared.
(6) An owners corporation may engage expert assistance in the preparation of a plan under this section.
(7) An owners corporation is, so far as practicable (and subject to any adjustment under this section), to implement each plan prepared under this section.81 Owners corporation to set contributions to administrative and capital works funds
(1) The owners corporation must determine the amounts to be levied as a contribution to the administrative fund and the capital works fund to raise the amounts estimated as needing to be credited to those funds.
(2) That determination must be made at the same meeting at which those estimated amounts are determined.
(3) The owners corporation must levy on each person liable for it such a contribution.
(4) If the owners corporation is subsequently faced with other expenses it cannot at once meet from either fund, it must levy on each owner of a lot in the strata scheme a contribution to the administrative fund or capital works fund, determined at a general meeting of the owners corporation, in order to meet the expenses.
(5) A contribution is, if an owners corporation so determines, payable by the regular periodic instalments