Each of the following are key characteristics of community associations EXCEPT: a. Mandatory lien-based economic charges or assessments are levied on each owner in order to operate and maintain the community association. b. Membership in the community association is mandatory and automatic for all owners. c. A requirement of community association ownership is serving on the board of directors. d. Certain documents bind all owners to be governed by the community association. - Answer- c. A requirement of community association ownership is serving on the board of directors. This is one of the three key characteristics common to all community associations. Members of an association are not legally required to serve on the board of directors; however, the overall success on the community is dependent upon the members' involvement its affairs. True or False. The primary purpose of a community association is to provide for the governance, business, and communal aspects of the association. - Answer- True Providing for the governance, business, and communal aspects of the association is achieved by administering, maintaining, and enhancing a residential real estate development, and through the establishment of a system of property rights, binding covenants and restrictions, and rules and regulations. Each of the following are basic types of residential community associations EXCEPT: a. Planned community b. Townhouse c. Cooperative d. Condominium - Answer- b. Townhouse While many community associations are indeed townhouse communities, not all such developments are necessarily associations. A community association is defined in terms of ownership rights—not architectural style. Adoption of the annual budget is an example of which of the following type of resolution? a. policy resolution b. administrative resolution c. special resolution d. general resolution - Answer- d. general resolution General resolutions involve routine events such as adoption of the annual budget. True or false. The purpose of a community association's governing documents is to provide for the legal structure and operation of the community. - Answer- True The governing documents define the rights and obligations of both the community association and its owners, create a binding relationship between each owner and the community association, and establish the mechanisms for governing and funding the community association's operations. True or false. According to the general hierarchy of authority for governing documents, the bylaws would control in a conflict with the recorded map, plat, or plan. - AnswerFalse As a general rule, documents lower in the hierarchy of authority cannot conflict with or change the terms of those above them. The recorded map, plat, or plan is above the bylaws in the hierarchy, and therefore would prevail in such a conflict. Complete the following sentence: A __________ state statute is one that applies only to one or more types of community associations. a. general b. complex c. specific d. uniform - Answer- c. specific A specific state statute is one that applies only to one or more types of community associations. For example, most states have a condominium act which provides for the establishment and operation of condominiums as legal entities. These acts vary in terms of their complexity—the simplest ones just allow for the creation of condominiums. True or false. A proprietary lease or occupancy agreement in a cooperative defines the member or stockholder's rights and obligations in relation to the living unit. - AnswerTrue In a cooperative, the proprietary lease or occupancy agreement serves generally the same purpose as the declaration, CC&R, or master deed in other community associations. Among other things, the proprietary lease or occupancy agreement identifies the premises that the stockholder is permitted to occupy exclusively, defines the term of the lease and the rent that is payable by the stockholder, and establishes the powers and obligations of the cooperative's board of directors, including assessment rights.