Spending Road Maintenance Fees on Insurance and Collections

Hello wise ones! Our POA ONLY collects Road Maintenance Fees (RMFs). Nothing else. We are about 4 years old as an assoc. and the D&Os are trying to get our ducks in a row but it seems we are working at cross purposes. We MUST get insurance on our road (state law + common sense of 2 out of 3 BOD agree). We do not have any. 1 BOD (actually our Pres.) believes we do not need insurance. She is also vocal in her position that RMFs may only be spent on literally maintaining the road (snow plow, gravel, etc.).

We are meeting with a real estate attorney in a few weeks (at 2 BODs' personal expense since the POA only collects RMFs...) but in the meantime, what do you all think?

Can RMFs be spent on liability insurance for accidents on the road?

Also, can RMFs be spent on small claims court fees to collect RMFs that haven't been paid, since once the claim was settled the lot owner in arrears would be responsible for those fees? Then the RMFs spent would eventually be repaid to the RMF fund.

Also if you have to sue, file a lien etc. to get someone to pay up; those fees's can be charged to the homeowner, so that money at least would just be a loan from your RMF until re-paid.

Not knowing this POA, i can't speak for it, but it is possible that the only common areas an HOA/POA may have are roads.. thus, the only things needing insured are those common areas, roads.

Some general liability insurance (depending how many people are using it and if it gets public use) should do.

Thanks Susan. We have 4 quotes for the liability insurance we need. The problem is that our president believes that RMFs can literally be spent only on literal maintenance of the road, like gravel and snow plowing. Most members think she's wrong and I wanted to see what you all thought on that issue.

Brian,
She is also wrong because of the Boards mandate for a non-profit corpoartion. Money should be raised by dues assessments to build a reserve to protect the property. There should be an operating budget to insurance communication to owners, to maintain records of members, for liability insurance on Board, for any signs needed, for repainting curbs. Anything that is an action by the Board has to be recorded and records kept. To assume because you have minimal expenses and this somehow dictates you dom't have to follow corporation law is flawed, you may be a small one with little money, but if if you are an HOA registered at the court house and have a state license, you must have an administration, keep accounts and write checks and have meetings.