Biggest Challenges for Today's Associations?

What do you see as the biggest challenges facing today's community associations?

HOATalk is building a resource library and we want to focus on areas that our members see as most important.

Thank You.

I've just become the President of a voluntary HOA. My biggest challange is getting residents to pay their annual dues (a whopping $35 a year, I'm not kidding). If anyone else is on a voluntary HOA board, any suggestions? Thanks! Becky

If it's voluntary, I guess one place to start is to focus on what people get when they join and pay (and what they miss if they don't). It almost turns into a marketing effort.

I am the facilitator here and will sometimes answer questions too. I do not claim to be an expert in the field, however I have been involved in real estate investing for many years, have a keen interest in this field and have been involved in many HOAs over the years. As the facilitator here, I also do quite a lot of research, so I may have some answers available and be able to save members time. My main goal is to help keep the conversation flowing and help the members. Thank You.

Living in California and testifying at many hearings in front of the legislature in Sacramento, I would be interested in knowing who this "group" is.

C.A.R.A. and the Gray Panthers fight the formation of these associations because of the Davis-Stirling Act and the results of that legislation.

Combating apathy. My association, in Central Florida, has suffered from years of being dominated by two people. Every year the AGM is held and a quorum is never achieved - no quorum, no elections, no change. Because this has gone on for so long people have lost interest and as a result don't participate.

I don't think it appropriate to bash other websites because ones view on associations doesn't agree with someone elses. I belong to at least seven other forums beside this one. Every single forum has homeowners seeking answers to what is happening in their association, to them or to their neighbors.

I have a forum on Yahoo that is made up of lawyers and homeowners that believe HOA's have gone overboard with their enforcement issues, foreclosures and their endless need for new rules and money.

Instead of complaining, my husband and I go to Sacramento and testify at hearings in front of our Senators and Assemblymembers, We have testified in front of the California Law Revision Committee. Our testimony on architectural changes resulted in the law being changed in California. We testified at the foreclosure hearings because this associationn tried to foreclose on us four times, never for being behind on our assessments, costing us thousands and thousands of dollars. All the attempts were illegal by California law.

We personally know Marjorie Murray, Senator Denise Ducheny, California Public Defender Wilbur Haines, and have personal contacts with the Attorney General I know the owner of the AHRC website and what her association did to her to cause the formation of AHRC.

Anti-Hoa? No. Anti-CAI, CACM, PACM, ECHO, and others who try to take our homes, empty our pockets and destroy what America stands for-Yes.

The biggest challenge for HOAs as I see it today is getting residents (or anyone--our assn. allows outsiders to be on the board) to run for the Board. I agree with previous post regarding anti-CAI. These organizations help the management companies to keep the board from doing their jobs effectively. The want to decide who to contract with, and what to pay and I personally don't believe all of the monies are always accounted for. I was on a board for several years and served every position except President, and served very well at that. I was assaulted by a disgruntled homeowner and maligned and defamed by his group of dissidents because they didn't want to abide by the CC&Rs, and wanted to be shown favoritism so they could be allowed to violate deed restrictions. The county officials did nothing because they referred to it as "a community dispute". That's what they call it when they don't want to deal with a situation. But no matter what it was, it was illegal, and something should have been done about it. Further, the board banded together to take sides with this dissident because he served a purpose for them--that purpose--taking over the common areas (pool, clubhouse, tennis courts) that EVERY HOMEOWNER pays to use, and allowing outsiders to use them for free while the very homeowners paying for them are told "the facility is tied up right now for this or that purpose--including total control of the pool for swim team practices and meets. So, you can see where being on a board (or being opposed to one select interest group taking over others' monies and facilities) can be dangerous--so ergo, being on the board is dangerous. They say that 1 in 25 people in a neighborhood is a sociopath--the whole percentage of them live around my house. Read the book--The Sociopath Next Door--sometime. The bad part and rest of all of this story--hold onto your hats--the president of the board and management company were involved in this calculated deliberate act for their take-over purposes. Sweet? You bet not!

I just moved in a NEW (over 55) communittee. I was appointed to the "Judiciary Committee" we are putting together a list of "Judiciary Committee duties". I am asking that you, please send an attachment to me with your community "Judicial Committee Duties".My email address is:

I'm hope that you send will help guide us.

Thanks,
Gary Case

We really only have one big "issue":

Owner apathy. It's hard to make this thing work when only the same 10 or 12 people out of 450 step forward to do all the heavy listing.

If we had to think of something else, I suppose it would be Rental Properties.

We are a single-family home development and not a condo development. One of the things creeping up on us is home flipping. With the increase in foreclosures, we're having many homes bought up by home flippers who then rent them out. Our CC&Rs did not account for this and we will need to do some legwork to see if this is a concern and what, if anything, we can and should do about it.

My Opinion? APATHY,! APATHY!, APATHY!. Many of these posted problems disapear once you get the masses involved. Knowledge and education solves problems, not bashing and ignorance.

Challenges that face communities governed by association boards:
1) A quorum of owner apathy
2) A quorum of Board members that are satisfied with owner apathy
3) A lack of Board member understanding of fiduciary duty and good business judgement
4) Reserve transfers before discretionary spending (meat and potatoes before desert)
5) Ability within the governing infrastructure of a minority to impose their wishes to amend or not enforce the governing documents. Often accomplished by unilaterally placing agenda items before the masses.
6) Open lines of communication
7) Infrequent open meetings (1 or 2 a year)
8) Level of consciousness of Board members about ins and outs of governing and history of association, need for education and guidance.
9) Luck that a quorum of owners without an agenda will join the first Board.

To all those that posted on this thread and to Joe especially, because he went back and copied his entry from 2005, I have this to say.

IMHO none of you are out of line and all show knowledge, experience, deep thought and something that stands out like gold in a Hock Shop.

There is a whole lot of subject in the question and all that posted had a good handle on the answers. It also helps to see others have the same considerations. Good job, a Gold Star for everyone, in fact Joe gets two Gold stars.

HOATALK:

Frustration (PERIOD).
I am the VP and sit on the Board of Directors along with eight other volunteer members of a Private Community having 167 homes in Maryland.
I see where several other post here have addressed not being able to collect association fees.
We have about nine homeowners who just blantly refuse to pay up. The worst owing $3459.05.
Our fees are only $60.00 a month. We have one homeowner who only moved in a couple of years ago that has not paid a cent. Owes $1290.00. He owns two brand new BMW's, a brand new truck, and has just recently bought a new van for his business. He has lettering all over the van advertising his heating & plumbing business which he runs out of his home. We are zoned residential, and our rules say you may not park commercial vehicles on the common area parking lot, unless the letterings are covered. We also allow only two vehicles to park within the alloted spaces. He has four vehicles.
Currently we have been addressing a storm door that is laying over his front porch railing, and onto the porch. He refuses to at least remove it to the rear of his house.
By not paying his fees he is stealing the services given the other homeowners who do pay for garbage pick up, water, snow removal, and lawn maintenance.
We cannot garnish his pay because he is self employed.
He has not met one of our guideline rules, yet our management company representative keeps saying there isn't much we can do, other then the attorney making his attempts to collect the fees.
Any thoughts?

Jim
Baltimore County Maryland

Jim,
You might think about getting a new Management company.

You can Google "Maryland Home Owners Association Laws."

I used to live in Maryland and there have been many posters here from Maryland. Use the search feature on the Discussion Topics on this site.

Off hand I strongly suspect this is: "There is no will, so there is no way" on the part of the Board. The guy legally owes you over 3k and you are asking him to move a ladder from his front porch. Then are upset because he don't do it. Read what I said and see if it makes any sense to you.

If you read this thread you would notice it is titled, "The biggest Challenges in Todays Association." Might find it interesting to read some of the comments here and see if you can apply them to your Board. Read and understand the State Statute, all your documents, all your county requirements and if I am not mistaken there is a recently appointed state committee that you can contact directly.

We are always glad to try and help, so as your education evolves, post back and see if we can help.

I can not believe you are providing trash pick up, water, snow removal and lawn maintenance to these people and use the other owners money to do it. Do you realise how vulnerable this makes each Board Member personally. You need to get a hold on this.

JamesC, I do understand your pain - I am a new President of an HOA, undergoing transition, and while the community that I live in now is less than three years old, we have folks owing the HOA in the $3k range (as in at least five). While it is not an easily accepted "explanation" the current housing market crisis, or rebound, depending on who you talk to - did and will play an enormous role in assesment/dues payments and collections.

My sincere advice to you... put the guy out of your mind ! PERIOD !! Focus on either finding a better management company, attorney, etc that will aggressive (and properly) seek out payments owed to the HOA by ALL residents - and not those in awful states of arrears. Yes, I agree with you that those who are not paying are getting a deferred "free" ride; at the expense of others. However, you still have a responsibility to the other owners, and the reality is that the world still turns and expects to turn for the other residents.

I am willing to wager anyone here that those who habitually fail to pay assessments fall into one of two main categories; ignorant of the rules, or well versed in what the rules are and choose to ignore. Everyone of us here has had a month where we paid assessments a little late, with or without the late fees, etc - but we made sure we paid. Those that are ignorant to the rules, are still adults and should know better. It is the class of folks who know the rules, and "play the game" in hopes that there is an advantage to them later on - simply want to skirt responsibilities. For the latter, let the attorneys deal with them....

On to the original post - I'd have to agree with all here, APATHY is what really creates failings in HOA's. I have heard some here mention that poor board communications; boards gone bad; etc - and in now way am I, or would I, trivialize those situations; however, boards are made up of neighbors. And if the neighbors are putting forth the effort (for whatever reason), and successfully convincing others to put them on the board, oh, well, then you have to either get more involved, devise better positions/tactics, etc, or accept it. Might not be palattable to many to have to accept the situation, but the reality is that nothing worth having comes easy. I bang my head everytime I hear owners ask me why "I" made such and such decision, when there is a board decision. Or when a board member clearly has a personal agenda and puts forth a bad vote, or request for vote on services, etc.

It all goes back to the general theme - COMMUNITY!! If you want a great community you have put in great amounts of work. If you want to sit on your backside and complain, you get just that. Don't "let" them control your community, your investment, your lifestyle - without input from you and your neighbors. But also do not site idle, and then complain about things changing and you not being "part" of the process; if you didn't make the effort.

I agree that more and more communities are HOA/COA/POA, etc - and our general federal and state legislatures need to be more involved. However, when we have no funds coming from Community groups to fund changes - and the other side of the table (SOME management companies, attorneys, etc) have a well supported voice - well you get the levels of laws/codes/oversight that we have now.

My $0.13.... anyone got change, because I think I got a Canadian penny slipped to me...

Jadedone,
Nice post. I think we agree, this should not happen, boards are mandated to handle the problems, they are libel if they don't, they need a new Lawyer to start, there are probably resources with the state legislation to support actions, the issue here is not the no-payers, the issue is how to correct the problem, community is often overlooked in solving problems, who care if thyis gut owns ten properties, the point is these people have a legal debt they should pay.

My report is tempered because I am very upset because I see this from the owners side and am insulted because the elected members are not acting to safeguard my money and in fact are costing me money I never agreed to provide.

Collection of assessments seems to be a big problem for some associations.

Following are procedures we recommend.

1. Establish rules and regulations (policies and procedures) for collection of delinquent accounts which are in accord with your CC&Rs. Hopefully they allow late charges, lien, and foreclosure. Provide copies to all owners.

2. The late charges should be high enough to encourage payment of the assessment over other bills when an owner must decide which payment(s) to defer (example: $10 for a few short term delinquencies and $25/month for many or longer term delinquencies. For extenuating circumstances allow for waiving the late charge.

3. Give 30 days notice of intent to lien when an account is over 2 months delinquent.

4. For accounts delinquent over 3 months file a lien. Make the lien filing fee sufficiently high to encourage payment prior to filing. We include the cost of filing notice of lien and for later filing the release of lien.

5. Provide owner a copy of the lien and notify them that if not paid within 30 days the account will be turned over to an attorney to garnish wages and if necessary foreclose on the property. Continue to file late charges and also consider charging interest at 1% or more per month on delinquent accounts over $xxx,

James,
I am sure that we all have symapthy for your association because we all have had 1 or more of these same kind of members , doing the same things.

We have gone to lein a few times in 3 years and that is just a temporary bandaid on our inability to keep up with our expenses. Most leins never get paid because as we learned, we were not on the top of the collection list.

Now, as much as you would love to publish the list with the "slackers" names, you cannot do that. You won't shame them into paying and probably will make them really mad. Your attorney is correct and you pay him for that advice, so heed is opinion. At a meeting where we had to decide to lein or not(all of our meetings are required open), we had given each Board member, a list with the members name being replaced with # 1, # 2, etc. We knew who they were but it is NOT business of the membership in general, once the attorney gets involved in possible litigation. And the fact that all members are not on your web site, then only select members will be given this information.

So my best advice is, Do Not Publish Names.

JamesC: While it is true that to post one's name as being delinquent, it is not advisable as your attorney has counseled you.

However, there has been some discussion on this site about just noting the address numbers (no names mentioned) of those delinquent. Something to check out with the attorney.

If that doesn't work, perhaps you can include a blurb in your newsletter about
...many residents are not fulfilling their responsibility of paying assessment fees which are due...process is lien and foreclosure(?)...puts a greater burden on the community as a whole...operating income is minimized, maintenance suffers, blah, blah, blah...

At the very least, they know who they are and they may feel inclined to step up to the plate and fulfill their responsibility. Good Luck!

In the "green state" of NC:

1. Foreclosures & bankruptices
2. First time home buyers in an HOA not knowing or understanding the ins & outs of HOA's.
3. Management Companies with no experience starting up with no credentials.
4. Lack of knowledge amongst HO, boards and committees and sadly yes, even management companies.
5. Local and federal goverment not stepping up and assisting HOA's with the numerous problems that exist in transition from Developer to HOA, as well as the horrific things I have seen when a new community comes on.

I can go on and on, but I have a doctor's appointment so I will stop here for now. lol

JamesC:

You might want to check with Maryland law and see if it is legal for you to turn off the Owners water.

When I had my business in NJ, I turned off an Owners water for over 3 years of non-payment (I was only working with them for 1 year) and was successful in turning it off and winning.

If the water department can turn off services for nonpayment then why couldn't the HOA?

I believe the biggest issue is the continued "us vs them" mentality. By that, I mean those on BOD's vs Homeowners. Even here (and granted I have taken this to be a bastion for BOD's) there is little discussion of better communication with homeowners, of BOD members getting consistently up and getting out, seeking out the people who they proport to represent. Apathy? Sure, its absoluteky an issue, but as I have seen here in my own community, when people take the time to get out and talk to each other, when they invest mot just time on a computer, but time on the sidewalks, there is a lot less apathy. Apathy, in my opinion is the result of the bigger issue, not the root cause.

Justin

Robert,
I can only speak from the experiences I have had here in my community, in North Carolina. For us, one of the biggest hitches is that with the exception of the NC Planned Community Act (and btw, did anyone else in NC see where the court here just ruled that BOD's can't change the CCR's?) is unregulated in how HOA's and the people who make money off of them are regulated. Our previous MC resigned...granted they were already in court on something like three embezzlement charges from other HOA's. MC's in NC are unregulated. Hang your shingle and charge people! The MC's don't work for the homeowner, they work for the BOD. They encourage the BOD to direct questions from the homeowner to the MC, whichc may or may not respond in a timely manner. The MC's encourage separation between the BOD's and the people they are supposed to represent. The apparent use of violation letters and/or fine letters as a BOD "weapon" does not seem to be uncommon, from reading this site and others. Our former BOD forclosed on a Veterans house for $200 in unpaid dues. The man was out of work due to injury and homebound. The people in our community stood up and raised the nearly $1000 needed to get the lien removed. The other $800, of course, is the attorney fees charged back to the homeowner as the lawyer attempts to take their home! If someone from the BOD of directors...who btw, are also supposed to be neighbors...had gone and talked to these folks and said, "hey, we noticed your behind, is everything ok?", I suspect that BOD would have made a friend. We don't act as neighbors anymore; the machinery has become more important than those whom it was supposedly built to serve.

Justin

Robert,

http://www.aoc.state.nc.us/www/public/sc/opinions/2006/640-05-1.htm

Also, I agree with you that there are good people here. I think there are good people everywhere; some of the ones here have helped me tremendously in understanding some things I did not before or informing me of things I had no idea about. Jan telling me about loss of liability insurance stands out and is something my wife and I are acting on now.

Justin