Amending CCR's to allow fine

My suggestions is to simply say in the Bylaws that the Board will develop a policy for dealing with violations, delinquencies and disciplinary issues.

Then a Committee can be formed to write them, and have them adopted by the Boaard with a majority vote, as a Standard Rule.

You don't want to start listing ALL that you want to do (that will change over the years) you only need to make sure the organization has the power to do something about violations.

JMHO

I am of the opinion that the Board NOT become a collection agency, or a lien holder and individual board members should not be in the middle of any of those actions (posting notices, delivering past due notices, etc.)

The liability there is huge - and serving as a Board member should not require you to be a bill collector.

So I think that there are certain areas - especially financial collections of late dues or assessment - that should be outsourced to a billing/collection agency who has experience.

Gloria:

Check with your state laws that govern HOA's first. If Georgia allows an HOA to bring an Owner to mediation/hearing 1st and then fines, you may not need to amend your CCR's. Remember state laws supercede governing documents.

By the way, good name!

Hi Gloria,
Yes, the ability to fine and the procedure to do so will have to be an amendment to your CC&Rs. Before you write the amendment, please check with the State of Georgia to see if they have any HOA statutes and if they do, is there any restrictions as to how you can fine.

In Florida, our State restricts us to $100.00 per day and not to exceed $1000.00 per continueing offense. If you have the time, go to "Florida Statutes 720" with a "google". It will show up as the first topic on the lists. That Statute has so many answers for States that have little or no laws for HOAs.

If you have a violator who does not satisfy their violation, then small claims court is next but that costs more than the fine, usually. I know that we in Florida cannot lien a property for fines that are not paid.What to do? I have no good answers but associations every day have to make up money for people who do not pay up. Failure to pay does remove the "member in good standing title and they lose rights to vote and to use any association property other than ingress and egress to their home.

Gloria - there are Federal debt collection laws to adhere to also. You can turn fines over to a collection agency, but the debtor can write the agency to stop contacting him/her and they must. It doesn't eliminate the fine of course, but they cannot continue to try to collect it either.
In Arizona, in addition to due process as spelled out in the law, to place a lien for an unpaid fine, you must first get a court judgment at your expense, and then file a lien based on that judgment. Your costs can be included in the lien, but you might wait many years before the property is sold and you recover your costs and the fine. We cannot foreclose on a lien based on fines.
In essence it is very difficult and time consuming to collect fines if the member doesn't want to pay. And many already know they don't have to. If there are no amenities to withhold, you are pretty much sunk trying to collect fines. Harold

"From what I have read in posts here, fines are non-enforceable, uncollectable, and cannot be liened towards foreclosure. Is that correct?" Gloria - it depends completely on your state laws. You must know them and abide by them if they conflict with your CC&Rs. Harold

Gloria:

i disagree with a previous post that said the BOD should not be in the business of collecting fines, filing liens, etc. In reality that is the job of all boards, some boards choose to outsource it other agencies, but they still must oversee it and are ultimately responsible for it. There is liability in waking up in the morning, so I really don't think that you are taking on any more risk. Know your laws, follow your docs and have good D&O insurance. With an HOA of your size I would question whether it is financially feasible to hire a management company or a collection service. Of course I am not familiar with your state laws so it may be more difficult to file liens than it is here.

Our President/Treasurer and another BOD Memmber have been charged with obtaining fees from several Mgmt Co's. We have a sparse carry-over of funds (only about $3,000.), and I have be adamant that we need to establish a Reserve fund with that because right now we have zero. The BOD decided that if the Mgmt Co. fees would put us over the established capital collected annually, then a vote to raise our Dues would come before the Membership at our Annual Mtg. Since a raise in Dues was voted down last year, I do not think it will pass this year. We could not hire a Mgmt Co. unless the Dues are raised...the previous poster was correct in that it just does not seem financially feasible.
I do think that some BOD Members believe that they will just hand everything over to a Mgmt Co. who will do all the work (sending Dues Notices & collection, monitor the landscapers, walk the neighborhood & issue Covenant violation notice & followup for compliance) then the BOD would have very little to do, just a few phone calls telling Mgmt Co what to do. I am not comfortable with that, and still believe that the BOD is ultimately libel and responsible for all that happens. IMHO, there needs to be supervision over the Mgmt Co because as I have read in other posts here, they can become an issue in themselves.
The issue of fines came up as some BOD believed that it would be the impetus to force compliance...and we are only talking about a couple of people who store their trash receptacles visible from the street. The Violation Notices worked, but then people forget or get lazy...just human nature. I believe that we need only to send out more notices since we had almost 100% compliance going that route before.
I guess apathy among our Membership of 27 HomeOwners to help serve on the BOD has triggered this entire debate.
The question which I bring to this forum is would going through all the legal steps necessary to put fines in place worth the effort...or have most HOA's found that Violation Notices/legal letters demanding compliance/liens just as effective?
Sorry this is so long...I have been wondering aloud.

Thanks,
Gloria

Gloria:

I don't know the laws of Georgia so I can't advise you on if it is good in your state to amend to allow fines and the steps you have to go through to do it and then collect. I will tell you from experience that the threat of fines does work with a lot of people depending on the issue. There are some cases that it just doesn't matter to them, they are going to fight you fine or no fine. My personal opinion is that you should have the ability to fine, it will help with some violators, but not all. The problem is every state is different in your ability to collect, that is where you have to check out your state laws.

There is no such thing as a 100% enforcement tool, hopefully you have good people living there, but every HOA has a knucklehead that will test your limits. I think that liens and fines are good tools, just not 100% effective.

In the end fines are a reaction...I believe most HOA's (mine included) do not do a good job explaining rules and being proactive in their enforcement. Periodic literature from newsletters to flyers reminding folks about basic rules is good, when there is a violation take care of it. A lot of times someone will see their neighbor do something and think it is ok, when in fact it isn't.

SkuddleM,
I think you bring up some vavid observation about "Hands on" involvement.

However, I am just as right concluding anything you learn on this site will serve you greatly, lawyer or no lawyer.