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TerriV (Colorado)
Posts: 2
Posted:
Our HOA was formed to provide road maintenance in our remote development in Colorado. Unimproved lots that don't have a house have historically paid 1/2 the dues amount of improved lots with a house. The bylaws do not state a percentage amount for the two classes, but simply states the amount of dues for each "class". Last year our HOA voted in a change to the bylaws to include snow removal, limited by funds available.(There isn't any money after basic maintenance). Now there is a proposal to increase improved lots dues by 50% to be used specifically for snow removal, and NO INCREASE for unimproved lots. Many house owners use their house as a second summer home. Winters are brutal at 9000 feet in Colorado! The house owners who leave for the winter would not benefit very much from snow removal. Yet with this proposal they would have to help fund it as if they lived there, while unimproved lots are exempt totally. Since the bylaws now state that the HOA is to provide some level of snow removal, shouldn't all members have some level of responsibility? Also, unimproved lots will get to vote to raise our dues while they are unaffected. Is that legal?
RobertR1 (South Carolina)
Posts: 5,164
Posted:
TerriV,
I'll take a guess and say I doubt it is illegal since the precedence for charging different amount is already there and operating. Is it fair, that would appear to be a Board decision. Is it necessary, I would think the board would want to justify the numbers to the owners, but I doubt it is required. The logic of it seems to be that the Board is mandated to provide certain services to the association. They have seen fit to add snow removal because they think the association should plow the roads so this becomes a service to the association and provided for under their mandate. However, it is your right to ask and receive clarification about their decision and their rationale. They should offer an explanation which it seems to me would be they are mandated by the documents to provide this servioce and as far as the cost applied, it would be their call to make.
RogerB (Colorado)
Posts: 5,067
Posted:
Terri, what is legal depends on the wording of your HOA's Declaration of CC&Rs. Perhaps this justifies a legal opinion by an HOA attorney. I presume the two classes of members are Class A which are individual lot owners (including those with homes only live in during the summer and those with no houses owned by individuals); and Class B which are lots still owned by the developer. Some CC&Rs state that all Class A lots shall be charged the same assessment amount.

The CC&Rs rule over the Bylaws so focus on the CC&Rs not the Bylaws.
TerriV (Colorado)
Posts: 2
Posted:
Thank you for your responses to my questions. I am on the Board but am the only one that wants to contact a lawyer about this. It was the members, not the Board, that amended our declaration last year to include snow removal. All the lots are individually owned. The CCRs & Bylaws state very simply 2 classes of members: Class 1-improved lots and Class 2-unimproved lots. Class 1 pays $500 and Class 2 pays $250.

There is no wording on how to change the dues for separate classes or that it needs to be uniform. They just state that a change in the bylaws requires more than 50% vote approval of all members regardless of the Class. My contention is that with this proposal one Class can vote to increase the dues of the other Class without raising their own dues.\\\Any further thoughts on this?
RobertR1 (South Carolina)
Posts: 5,164
Posted:
TerriV,
First , have a discussion with your Board to try and get a lawyer that will serve as your association lawyer. You don't need to put him on retainer, just see if you can work out an arrangement he would be available to the Board for consutations when these things come up. Normally an association that is active in their work will need the services of a good lawyer several times a year. or more...........work out a deal and then discuss among the Board who can contact this lawyer and how that will be worked. It's done all the time with many different ways to skin the cat. Make this a budgeted item (estimated)

You say your association amendended the documents.........all to the better.
How was it done and did you follow procedures in the By Laws or CCR's? Let's say you did and the members were given the chance to vote. Do you have equal # of class 1 and class 2 votes? Strange if you do because the Class 2 are aways moving to class 1 as they improve their lots. It is true there are two different amounts that are paid by the owners with one vote each. Consider this please. In a condo, the owners pay a apportioned share of the total assessment. Why, because not all units are alike and basically the larger units or those with the best view or those on the ground floor, etc, etc, are more valuable to the whole. Of course I am talking about a different animal but we still come back to the whole. The whole of your HOA is what it costs to run the association. It costs the association more to provide services to the impproved lots than the unimproved lots, as this ratio changes so will that apportionment that you should charge, but I doubt you will alter it because as time passes you will gain % of improved lots (more money) Your assessment about the minority being able to increase the dues of the majority is not going to happen and the documents set votes needed to pass assessments. Look at it this way, the votes are not to establish parity, although that is where you are headed, the vote is to allow each voter to contribute to the operation of the whole, not different classes of votes.
I think you all would be comfortable with an attorneys opinion, it is a question, but once settled I doubt it will be raised again.
Keep in mind we give opinions not legal advise, we hjnave the best of both worlds we can mouth off and if we are careful no one can find us and start swinging as a p[opster suugested is the way to get things done. Just my opinion.

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