As a side not we planned to use a line of credit from the same lender as the down payment. 

What are your thoughts on using a line of credit for another property today?

Also have to wonder is\f the OP has been advised that the unit is so old and in such shape as to be unrepairable and needs to be replaced, and is sending in a line of repair persons until she finds one who is willing to try to repair it; but it hasn’t worked? 

I specifically asked in the beginning of the process if it was a line of credit, cash or personal credit cards.

Then start researching resources to potentially obtain a Line of Credit with the rental portfolio as the backing. 

I don't know him or his system at all but I've seen enough of these to know that there's a 99.9% chance he's selling you a line of crap.

Stacks of chair pads, et. al., in corners of rooms4.

It's very similar to Birmingham, AL in that respect. 

In future years’ budgets, the association should consider budgeting for an Operating Contingency (funds not earmarked for any specific expense) or should consider creating a line item specifically to fund Prior Year Equity in order to bring the balance into the 10-20% range.If the board doesn't know what it is doing financially then they need a management company that does along with an accountant that understands how HOA's work.

I dont know that I would give up the liquidity unless you also plan to recast the mortgage to lower your monthly payment (or can get a line of credit on the property to pull out the 60k equity from the cash).