Property Management
In Hawaii, what is an 'operating reserve' fund in condominium management?
AA. Funds reserved for the board members' operating expenses
BB. A reserve fund for day-to-day operating expenses and small repairs not covered by the annual budget✓ Correct
CC. The same as a capital reserve fund
DD. A fund reserved for legal disputes only
Explanation
An operating reserve covers unexpected operating shortfalls or small repairs during the year, ensuring the association can meet its obligations without special assessments for routine items.
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