Who pays maintenance?

Our HOA is under declarant control (4 of 5 board members are employees of the developer). The Clubhouse title has not been transferred to the Association due to mechanics liens filed by subcontractors. The developer has never issued a written notice (required by the bylaws) making the clubhouse available for use by the members of the association. The bylaws state that once such written notice is given the association becomes responsible for clubhouse operation and maintenance costs. The costs of operation and maintenance of the clubhouse are being paid out of association funds. Do we need to file suit to stop the use of association funds?

DavidW5,
I don’t know all that much about HOA’s but, I would think you wouldn’t be responsible for the maintenance of the club house if you as members can’t use it! HMMMM. That doesn’t make any sense to me what-so-ever. You said “the bylaws state that once such written notice is given the association becomes responsible for clubhouse operation and maintenance costs.’ Didn’t that answer your question?

I’m sorry I wasn’t much help. I don’t know that much, when it come to the “legal lingo”
I'm not sure what file suit means. If this is what you need to do to get them from using association money, then I would say YES!

Chuck W.

Here are additional details on our situation:

We are a "55 or better" single family home community in Virginia
There are currently approx. 600 occupied homes of an eventual 800.
The community is over 3 years old and the developer still has full control of the HOA board. Transition to a homeowner elected board is at least two years away.
The Clubhouse opened in May '04 and has been in full use by the residents since then.
The developer board has tried to ignore the association members but we have been very active in demanding that all bylaws and statutes be followed. Attendance at all board and committee meetings has been good.
After checking with the county, we find that most bonded facilities, including the clubhouse and roads are not off bond and are not titled to the HOA. Yet the board has consistently authorized use of HOA funds for operation and maintenance of the clubhouse, snow removal, etc.
Our bylaws state that the HOA will cover the cost of maintaining any facilities not titled to the HOA once the developer notifies the board in writing that the facilities are being made available for members' use. We have requested to see such documents for the past year and the developer has not been able to produce them. Therefore, we believe that the use of HOA funds for maintenance of these facilities is a violation of the bylaws and county regulations.

How do we get the developer board of the HOA to stop using our funds this way?

DavidW5,

I still fail to see what is illegal here, please someone explain it to me. The owners in your community should be provided financials and accounting of where their monthly maintenance is allocated. However, you would be mistaken if you were under the impression that all the maintenance collected is held in reserve, and that the owners get a free ride until the association is turned over.

Your clubhouse has been in use by the residents, since 2004. So for the owners to turn around and sue the developer for not providing you written approval seems a little unfair, don't you think? Has the developer provided written notice of pool hours, rules and regulations of clubhouse use? If so, this could be considered "written approval".

Elections of unit owners to a board usually occur in phases when units are closed. As an example, New Jersey's Planned Real Estate Developement Act provides that when units are 75% closed, it's time for unit owners to be elected to the board. Therefore, the percentage of developer to unit owner board members is proportionate. Your state laws, or by-laws may have a similar requirement. If so, 600 units out of 800 is 75%. 75% of 5 is 3.75. It's seems time for 2 or 3 unit owners to be added to your board.

GeraldT1
NNJ

DavidW5,

Thank you for the specifics, this sheds light.

You have been successful in documenting an issue and associating a monetary cost prior to the association being transitioned to the owners. Congratulations, good work!!

Yes, the developer should pay the costs of a documented innefficient system that cannot handle the load capacity. This is a deficiency and should be documented as such via return receipt requested certified mail to the developer.

Typcially, it is not in the best interests of the developer to drag out construction for any lenght of time, let alone 10 years because the more that time lapses, the more deficiencies come to light.

A firm, but cooperative contingency of owners should impress upon the developer that is in his best interests to play fair with the association. I speak from experience, don't ever be afraid to ask or demand.

GeraldT1
NNJ