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Subject: HOA Annual Maintenance Assessment Increase
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DavidB48
(Oklahoma)

Posts:3


12/19/2018 9:27 AM  
Sorry if there is a similar post to this. I live in Oklahoma and our neighborhood voted to increase our annual maintenance assessment (HOA dues) to $50 per year instead of $10 per year. We had a quorum and then had the 2/3 required votes for the increase and mailed the notice about 21 days ahead of time (15 days required by CCR's) about the meeting date, time, etc to vote yes/no on the increase. I copied and pasted the language from our CCR's in order to give you the context. For easy calculation we have 164 houses. We needed 82 members either by their presence or proxies to meet the 50% for the quorum. Then, we needed 55 yes votes (82 X .67 = 54.94) out of those 80 members to pass the increase is the way I understood the wording in the CCR's. We had 134 people vote yes including physical presence and by proxy at the meeting. We have 1 owner threatening to sue the HOA when we raise the dues and send out the notices. I don't think he has a good argument since it was all done according to the CCR's, but I'm wondering if I'm missing something. Does he have a case? My other question is I think we need to file an amendment to the CCR's to include the $50 amount where it mentions $10 in the CCR's. It talks about the duration of the CCR's in a general provision section which I also pasted below. I'm wondering if we will have issues amending the CCR's to show the new $50 amount or if the duration section refers to amending stuff like building materials, trash cans, antennae/satellite dishes, etc that are mentioned in the CCRs. It seems like the sections contradict each other because one says the annual maintenance assessments can be increased, but then the duration section of the whole CCR states nothing can be changed for 21 years. I'm assuming we would file an amendment to show the updated assessment. Sorry for the long post.


Section 5.5. Change in Basis and Annual Assessments. The Association may change the annual maintenance assessment or the basis of the maintenance assessments fixed by Section 5.3 hereof, or both, prospectively for any one year period and at the end of such one year period, for each succeeding period of one year, provided that any such change shall have the assent of two-thirds (2/3) of the vote of the Members who are voting in person or by proxy, at a meeting duly called for this purpose, written notice of which shall be sent to all Members at least fifteen (15) days in advance and which shall set forth the purpose of the meeting, and subject to the quorum provisions of Section 5.6, below.

Section 5.6 Quorum for Any Action Authorized Under Section 5.4 and 5.5. The presence at the meeting of Members, or of proxies, entitled to cast fifty percent (50%) of all the votes of the membership shall constitute a quorum.


Section 9 .1 Duration. The covenants and restrictions of this Declaration shall run with and bind the land, and shall inure to the benefit of and be enforceable by the Association, or the Owner of any land subject to this Declaration, and their respective legal representatives, heirs, devisees, personal representatives, trustees, successors, and assigns, for a term of twenty-one (21) Years from the date this declaration is recorded, after which time said covenants shall be automatically extended for successive periods of ten (10) years unless an instrument signed by the then-Owners of two-thirds (2/3) of the Lots has been recorded, agreeing to change said covenants and restrictions in whole or in part; provided that no such agreement to change shall be effective unless made and recorded six ( 6) months in advance of the effective date of such change, and unless written notice of the proposed agreement is sent to every Owner at least ninety (90) days in advance of any action taken.
DouglasK1
(Florida)

Posts:1307


12/19/2018 11:16 AM  
Having the assessment amount set in the CCRs would be unusual, in most cases annual assessments are set year to year based on the budget for the year. Any body can sue anybody for anything, but realistically a lot more people threaten to sue than actually do it. From what you have written, I think you are on good ground, but ideally an attorney would review the entire set of docs and give an opinion. Since your dues appear to be ridiculously low, that might be an option for you.

Escaped former treasurer and director of a self managed association.
DavidB48
(Oklahoma)

Posts:3


12/19/2018 12:32 PM  
I'm not sure if this makes a difference. It's CCR's for a residential neighborhood with houses, not condos. There is a huge common area that I think most residents hope will be made into a park, walking trail, etc (I know it would have to be voted on). The dues are set in the CCR's. I forgot to include the section in the original post. Most neighborhood around us pay over $250-$500 depending on the amenities. I looked at some other neighborhood CCR's that are in the area and some of those have the amount in their CCR's too. Maybe it's an Oklahoma thing.


5.1.1 The Declarant, for each Lot owned by it within The Properties, hereby covenants, and, except as provided in Section 5.12, below, the Owner of any Lot by acceptance of a deed therefor, whether or not it shall be so expressed in any such deed or other conveyance, shall be deemed to covenant and agree to pay to the Association: (1) annual maintenance assessments, which are initially set at $10.00 per year per lot payable on January 1 of each year. The annual maintenance together with such interest thereon and costs of collection thereof as hereinafter provided, shall be a charge on the land and shall be a continuing lien upon the property against which each such assessment is made. Such lien shall be paramount and superior to any homestead or other exemption provided by law. Each such assessment, together with such interest thereon and cost of collection thereof as is hereinafter provided, shall also be the personal obligation of the person who was the Owner of such property at the time the assessment became due.

Another section also mentions $10

Section 5.3 Basis for Annual Assessments. The initial annual maintenance assessment shall be $10.00 per Lot. The annual maintenance assessment may be increased by a vote of the Members as hereinafter provided in Section 5.5. The Board may, after consideration of current maintenance costs and future needs of the Association, fix the actual maintenance assessments at a lesser amount.
SueW6
(Michigan)

Posts:402


12/19/2018 12:41 PM  
How old are your CCRs? They read like you are still under Declarant control.

Was there a turnover to an owner- run HOA? You said your “neighborhood “ voted...
DavidB48
(Oklahoma)

Posts:3


12/19/2018 12:44 PM  
The CCRs were filed back in 2008. I'm not sure what you mean by a turnover. The builder turned over and deeded the common area to our HOA which is run by owners who live in the neighborhood. We, the owners/members in HOA, voted to increase to the $50 per year.
TimB4
(Virginia)

Posts:16091


12/19/2018 5:45 PM  
David,

Keep in mind that many threaten to bring legal action but few actually do.
They likely talk to an attorney, find out how much it will be or that they likely won't win and they grumble and complain.

Nobody can say if there is a case or not until you see what the legal action is and on what grounds they are bringing the legal action.

Personal opinion, don't worry about it until it actually happens.
JohnC46
(South Carolina)

Posts:7927


12/19/2018 7:26 PM  
David

So one old, cranky, threatening owner has you all wetting yourselves. Tell him to bring the law suit on.
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Forums > Homeowner Association > HOA Discussions > HOA Annual Maintenance Assessment Increase



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