Capital Fund – receives a designated portion of monthly owner assessments and disburses monies to acquire new assets which are not replacement items and do not qualify as Reserve Fund expenditures. The Capital Fund accrues funds for capital improvements that are reasonably anticipated to occur during a fiscal year as established in the Annual Budget. Additionally, funds may be accrued to cover expenses associated with the Master Plan. The maximum annual spending for capital improvements, as set forth in Article 4, Section 4.6(B) of the CC&Rs is 5% of budgeted gross expenses for that fiscal year. All single item expenditures in excess of this limit, must have the approval of the ownership by a vote of a majority of the quorum established in our governing documents. The Board of Directors may also make disbursements or borrowings from the Capital Fund for unexpected or emergency items. Any borrowing must be paid back in the same year or through a payment plan not to exceed three years. Interest Earned – any interest received on each of the separate bank accounts will be credited to the Fund account for which the interest was earned. Investment Policy Monies in excess of the amounts reasonably projected for disbursement under the Annual Budgets will be managed by the Controller according to the following investment policy. All additional funds will be invested with a primary objective of capital preservation and a secondary objective of income generation. Such funds will accordingly be invested in Certificates of Deposit issued by institutions having offices located within the State of California, County of Riverside, and in amounts that qualify for FDIC protections. Any recommendations to modify this policy must be reviewed by the General Manager, Treasurer, and the Controller prior to submission to the Board of Directors for final approval.
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