Petition To Change By-Law

We are a self-managed HOA with less then 70 homes. Once the developer turned over the Association to homeowners, one of the first things that the newly installed board did was to terminate the services of the management company. This was apparently done without the knowledge of the entire community. No, a special meeting was not called. I made a point of attending all meetings to keep abreast on what was happening in the community. During the course of two years, this board was grossly inconsistent with the number of meetings it held with the members. When meetings where held, all members where not informed. Flyers where placed in certain members mailboxs (which happens to be illegal). Not only was this board not managing the community as it should, they had their own agenda. The board made a decision not to enforce any of the by-laws, because most where in direct conflict with them. I got involved due to the lack of communication and accountabilty of funds. I approached the treasurer and requested a copy of the annual operating cost. My request was ignored. I wrote an open letter to members of the association, asking if they shared my concerns. The response was overwhelming, and suddenly I was not alone. There's so much more to this story, so I will try to summarize as much as I can. We actually voted in a new President and Vice President. Unfortuately, we still had a few of the old members actively voted in again on the board. This made it extremely difficult to keep board meetings private. The ex-members set out to poison and sabotage all efforts the new board attempted with the inside information they were being fed. An Architectural Committee was appointed by the board to enforce the By-Laws of the Declaration Of Covenants. This sub committee worked hard with the implementation of infractions as it relates to the covenants. They communicated with homeowners, and conducted monthly walk arounds to observe and ensure consistency within the community.

Considering that the rules often conflicts with the desires of an individual owner but exist for the general good of the entire community. The board had to contend with an indvidual homeowner who went door-to-door seeking homeowners to sign a petition that would be benenficial only to the individual. The individual was successful in securing enough signatures; however, the signatures are not binding. The HOA requires a 75% vote (not petition) to change a by-law. A special meeting was conducted, and the Association Attorney was present at the meeting to interpret and clarify what the requirements are to change a by-law(s). Sadley, this has done little to improve relationships in the community. One last thing, some of the homeowners do not trust the HOA treasurer, but that's a whole different story. However, I'm seeking advice for the following questions:

1. Should the annual operating cost and reserves by kept separetly;

2. If so, shouldn't the reserve be invested? Is it okay to only have one signature requirement to write checks for the Association;

3. Can we hire an Accountant to invest the reserve funds?

I would appreciate your advice.

PatriciaB, here are my thoughts on your 3 questions.
1. Yes. This is an IRS requirement.

2. Yes. Read my comments on investing reserve funds.
Yes. Some associations require two signatures, particularly for large or unusual expenditures. However, in Colorado only one signature is used by banks for checking accounts.

3. Yes, but why? It remains the responsibility of the Board to make investment decisions and I'm sure for the type investments HOAs make you have capable members. Read my example Rule and Regulation on reserve funds.