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GT1
(California)

Posts:10

07/29/2010 1:20 PM
I am new to this forum and please forgive my verbosity in advance. My newly wed wife and I recently bought a bank owned condo in a 30+ unit complex in Los Angeles, CA. When we purchased the HOA dues were $275, when we moved in, we found out it was $325. Just yesterday, it was raised again to $350/mo. This is a lower income part of LA in San Fernando Valley where average HOA's in the same neighborhood for similar complex range in the $100's. HOA dues pay for water and trash and basic maintenance, there is no pool or other extravagant amenities. Increases have been occurring over the past year and in addition, two to three "special assessments" of $500 have already been charged in the last year, with a new $2000 assessment on the horizon. The HOA claims this is due to budget/reserves shortfall due to deliquencies and foreclosure related charges. I don't buy it because I calculate the HOA management fees to account for over 43% of the $325/mo dues, accounting for over $100,000k in management fees annually. Compared with other property management companies, this is way above and beyond market rates. I've challenged the HOA to look at quotes from other management companies and they play it off and say something to the effect of "you can't compare apples to oranges". The homeowners that have dissented have been forced out/foreclosed upon/gave up. Police were called once due to arguing. The supervisor from the Santa Monica based HOA property management company is a haughty condescending b**ch that blows smoke and spins deceptive lies. When I asked for the accounting statements, the HOA company is very evasive and cryptic. I and other owners have a laundry list of complaints which I will spare the details here. HOA meetings are controlled by the property management company acting as "proxy" for the homeowners that were either too lazy or stupid to decline representation. The board of directors are run by a small secretive group of homeowners with multiple units who have for some reason "voted" to side with the property management company. Thus, they always seem to have a slight plurality of votes and win any decisions. They also made it very difficult for new homeowners to be voted onto the board because the old board members are automatically on the ballot, while new owners have to be "write on" candidates. Write-ons hardly ever win. I suspect that there are improprieties/under the table stuff going on between the board members and the HOA but cannot prove it. Bottom line: homeowners are forced to pay these outrageous HOA dues/special assessments or face foreclosure while this HOA company is lining there pockets and laughing all the way to the bank. Condos in our complex are foreclosed left and right depressing home values leading to a death spiral. Meanwhile, hard working honest homeowners are trying to feed families and keep a roofs over our heads. I called the state Fair Housing Commission and LA Dept Real Estate, and they just send me in circles. Help. PLEASE. Any legitimate suggestions truly appreciated.

RichardP13
(California)

Posts:824

07/29/2010 1:55 PM
GT I live in Sylmar..My email is richard@mountainglen2.org if you want to talk.

RogerB
(Colorado)

Posts:4647

07/29/2010 4:08 PM
GT1, getting bids to manage can be done with an RFP (request for proposal) which should list all duties currently performed by existing management company. The management agreement will help when itemizing the duties. That will allow an apples to apples comparison. If the Board is still not willing to seek 3 or more bids offer to do it for them. Then do it and present them with the results.

GT1
(California)

Posts:10

07/29/2010 4:26 PM
@Roger I actually did get an itemized proposal with line by line charges, but this was "poo poo'd" and ignored by the HOA management company. Part of the problem is that there are a lot of renters in the complex, so getting a hold of the actual owners is difficult. Attendance at the HOA meetings is lower because of this high percentage of rentals, and thus, I surmise that is how the management company gets to cast a majority of the proxy votes in their favor.

GT1
(California)

Posts:10

07/29/2010 10:37 PM
I've been doing some additional investigating into my HOA situation, and its really got my blood boiling. I found out that a several homeowners in our complex, who consist of the board of directors of the HOA, are ALSO owners and/or employees of the property management company that manages our complex. Can you say conflict of interest!!? They control a good portion of the voting rights, and they just voted to increase our HOA dues and charge a $2000 "special assessment" claiming that the HOA reserves are low. Its no wonder these particular "homeowners" voted for the approval of the assessment as they turn around to pay their own their salaries! Their management fees are 5 times the going market rate quotes that I received, and when I brought that up to their attention, the management company just dismissed me with evasive smoke and mirrors. Anyway, I called the California State Fair Housing Comission, and they are spinning wheels in circles giving me different phone numbers. I'm not sure what else I can do as the few homeowners that are aware of the situation are in the minority voting block.

GlenL
(Ohio)

Posts:3526

07/30/2010 12:53 AM
GT, assuming the facts are as you stated then don’t expect the Government – State or Federal to come to your rescue, they consider it a civil matter. You need to start by contacting the other owners, you can request a copy of the membership list from the BOD or MC but they do have the right to deny it; however if you sue they have to prove you would have used it for something other than a lawful purpose. You can also get their names and mailing addresses from the tax rolls, the tax bills are usually sent to the owner’s home address and the information is public record. Gather their support and recall the current Board and replace them with people willing to work. In addition to your own CC&R's you also need to become familiar with the Davis - Stirling Act which governs HOA's in CA. This is a link to an attorney's website that breaks D-S down into easy to understand language: http://www.davis-stirling.com/

Too bad the only people who know how to run the country are busy driving cabs and cutting hair. - George Burns

GT1
(California)

Posts:10

07/30/2010 1:04 AM
@Glen Thanks for advice, problem is the BOD/HOA/proxy controlled "evil empire" controls a plurality of the votes, so no matter what, we cannot garner enough votes to displace the BOD.

JonD1
(New York)

Posts:706

07/30/2010 4:41 AM
Something here does not make sense. You have 30 units and for some reson you alone have trouble with the actions of the Board but none of the other owners? They will happily pay the assessment and the incresed CCs and life goes on. Can't afford to pay their mortgages but an extra $2,000 just fine with them. Glen's advice was good you take the time to contact each owner and inform them as to what IS going on rather than what you think is going on. I would first suggest you obtain a copy of the financial report or budget to see if in fact your assumptions are correct. There is a chance you purchased a piece of property in a troubled complex with deep financial issues and the Board and or MC are unable to deal with them other then raising fees. It is also possible your approach has alienated yourself with the Baord and MC who no longer wish to deal with you. I just wonder where the other 29 prooperty owners are and why someone would go along with a $2,000 unwarranted increase and do nothing. That is even tough to understand using dumb as an excuse

GT1
(California)

Posts:10

07/30/2010 9:47 AM
@Jon Thanks for your reply, I'd be happy to clarify. Let me be crystal clear that I am not the only homeowner having problems with the management company. The homeowners (before I bought the property) that did put up a fight, most of them were or are being foreclosed because they could not afford payments. For example, a homeowner that opposed a past $500 special assessment (by not paying) was immediately sent to a collections agency. It ended up costing him more than $2000 in legal fees just to keep his house. I discussed with other neighbors, and we agree there are major problems but we don't have voting power. Another multi-unit owner didn't care who voted to approve because he is planning to short sale anyway. These are not just assumptions of what I "feel" is going on and is not some angry delusion. The property management company WEBSITE clearly lists the names as officers of the management company, who are also the same homeowners who completely dominate the board of directors. This conflict of interest is problem #1. We do have excerpts of the financial report, the annual budget, etc and the gross overcharge of management fees relative to market is problem #2. I agree with you that it seems absurd and did not make any sense why the other owners went along with the increases without a fight. After digging, I found out afterward this HUGE conflict of interest. It then made sense why the HOA dues kept increasing, why multiple special assessments were approved, and why some particular "homeowners" turned a blind eye to the above market management fees... because THEY ARE THE SAME PEOPLE who own/work at the management company!! We plan to talk to the other homeowners, but the fact remains that the management company will still hold majority voting power. It is a newer complex and the holding company who rents out many units gave proxy voting rights to the management company. Even if I get all the other individual mom and pop homeowners together, it won't amount to a majority. My personal opinion/editorial is that these are "haves" taking advantage of the "have nots" and they are using the "housing bubble" in part as a guise to help generate revenues for themselves.

GT1
(California)

Posts:10

08/10/2010 9:54 AM
Some additional points that I would really appreciate comments on. I went through the CC&R's and found these points: 1) Under Article V, 5..04a4. "The board may not ordinarily take .... Pay compensation to members of the board or to officers of the association for services performed in the conduct of the association's business provided." << Doesn't this mean that they cannot have dual interests, ie. cannot be owners/employees of management co with conflicting interests? 2) Under Article VIII Mortgagee protection, 8.05(a)1, "Except as provided by statute in case of condemnation or substantial loss to the property, at least 67% of owners and at least 51% of votes of eligible first mortgagees must give written approval before the association may do anything of the following: (1) Alter the method of determining the assessments or other changes levied against the owner." << The special assessment was calculated based upon reserve study calculation by 3rd party private company. This study was approved on a vote in a previous HOA meeting, where 16 votes were cast which does not meet the 67% owners threshold. Thus the method of assessment, ie. The use of the study, is automatically invalidated, no? 3) Under Article III of the bylaws, 3.09c and 3.09d Voting and Election of Directors, it states "Not less than 20% of the total number of board directors shall be elected by a majority vote of the members (other than Declarant) as long as a majority of association voting power resides in the declarant. << I don't understand this completely, but it sounds like the declarant votes should not count?? In this case, I don't know if the original developer who retained condo units (now rentals) and delegated proxy voting rights to the management company, is still considered the "declarant". 4) Under Article V of bylaws, 5.05b, "Specially elected directors may be removed from office prior to expiration of the directors term of office only by the vote of at least a simple majority of the voting power residing members other than Declarant." << if declarant does not include developer proxy votes, I think we can remove them from office. 5) Under Article V of bylaws, 5.15; nominates need to comply with Corporations Code Section 7520 which is "(a)As to directors elected by members, there shall be available to the members reasonable nomination and election procedures given the nature, size and operations of the corporation. (b)If a corporation complies with all of the provisions of Sections 7521, 7522, 7523, and 7524 applicable to a corporation with the same number of members, the nomination and election procedures of that corporation, shall be deemed reasonable. However, those sections do not prescribe the exclusive means of making available to the members reasonable procedures for nomination and election of directors. A corporation may make available to the members other reasonable nomination and election procedures given the nature, size, and operations of the corporation." << it seems to me the nomination procedure was NOT reasonable, thus the last board member voted on should be invalidated?

JoeO1

Posts:0

08/10/2010 1:55 PM
Dear GT1, This is exactly what is happening at our complex. We can’t get enough votes to reach quorum and the Management Company has been taking us to the cleaners for 12 years. Our Roofs needed replacing 15 years ago; we have had 3 special assessments and at least 10 increases which have doubled our dues in Ten Years. Our paint is gone now and only the wood which is decaying is showing as the Mansards and Roofs are all leaking. We have started a website here http://www.highlinemeadows.org/ but, we cannot get any support from the association members as 60 % are renters and don’t care what happens. we are truly at the mercy of the Board and the management company as our property values have plummeted 40 to 60 percent and now we could go into condemnation as the porches are failing, roofs,mansurds, roads, paint, garages, landscape, fences, aluminum wiring, fire control all need attention. We have another special assessment coming up soon. We have no choice but to have a class action lawsuit (D& O Insurance) against the Board of Directors for severe violations of the Declaration. Our proof is the Reserves at Zero dollars and the Condition of the complex as this place is falling apart each year with no capitol improvement and all the money is being used in a big money sucking business leaving us with nothing. You think you’re being held hostage you should see this place.... I wonder with so much evidence of financial corruption and fraud how these people have not been caught in over 12 years. Joe Owner

GlenL
(Ohio)

Posts:3526

08/10/2010 2:28 PM
Joe if things are as deplorable as you say why haven't you petitioned the court to appoint a receiver to oversee the community? When an association is improperly operated or the members are non-responsive, any member or creditor can petition the court to appoint a receiver to operate the association. If proof is made to the satisfaction of the Court, the judge will appoint a receiver to take control of association assets and give them the power to impose emergency special assessments if necessary. While a Board may stagger needed repairs to spread the costs out, a receiver would have the power to enter into contracts for all of the necessary work. The Association must pay all the resulting expenses, including the receiver's hourly fees. The receiver has broader powers than the board and will strictly enforce the rules and finances. Members lose their right to vote and have no input into the operation of the HOA. With the receiver's fees and the court costs, it could add thousands of dollars each month to the association's normal operating costs. All of which must be paid by the homeowners. The receiver will likely be an attorney, a bankruptcy trustee, an accountant, or a similar professional who has expertise in property management. The Court will usually require the receiver to be bonded to guard against misappropriation of Association assets with the cost of the bond passed along to the Association. The court will require periodic reports from the receiver and the receiver most likely will stay in place until the problems that prompted his or her appointment have been solved. There is no set period of time for a receiver to stay in place; it is not a permanent fix but can last for several years.

Too bad the only people who know how to run the country are busy driving cabs and cutting hair. - George Burns

DanielH1
(California)

Posts:481

08/10/2010 4:25 PM
From other experience, the California Department of Real Estate (DRE) is a rubber-stamp agency. They'll be no help to you. In fact, they have nothing to do with HOAs, focusing on real estate agents and brokers. But, even if they had a mandate to help you, they only take action after somebody is convicted of a felony. What's the point of that? Beats me.

JoeO1

Posts:0

08/11/2010 8:34 AM
Glen, As usual you are very much right about our situation. Would we have to have a petition with signatures? How many of homeowners do you think?. Do you have any examples of this type of process Called "Receivership"? Does it work if the monies being spent can be cut dramatically since they are overspending and wont cut cost. We think that we can cut two to three hundred thousand dollars out of the budget right away. Easy!! The maintenance guy makes 82K with his sidekick at 40K and they have no certifications... so we have to get multiple third party contractors from everything from Plumbing, landscape, lights, drains, lift station, porches, pool,parking lots, paint, fence etc. We don't know what they do but when we see them they are either driving, sitting, meeting with vendors, at home... an always together like two peas in a pod....Our Admin is over 45% Thanks for your insight on this issue. We need all the help we can since we don't want to go into condemnation. Look forward to hearing from you or any body else who has information on "receivership" and it Pro and Cons. PS : We have passed on 4 years worth significant financial budget money issues and questions to the DA for investigation to see if criminal charges can be enforced and an investigation be conducted. It would appear that invisible monies have been reported, changed, moved, altered to the association and Auditors as well as IRS officials. We cant tell if the reported numbers are 5 is a 1 or a 3. We cant trust any numbers reported by the management company and Board at all at this point because there is so much inconsistent material reported in the past, on website, at meetings, in newsletters, Ledger, Directors Disk, and in minutes. They(management company and Board) seem to be able to change any numbers they want at will even to the past. They some how issued a 1/4 million dollar assessment in November of a calender year and reported all of the monies received and in the budget in December of that same year, only to never report any of these monies the next year until the month of October when they showed 2K worth of monies. HUh? What really crooks me is that all the information is there information presented at one time then changed or reported differently depending on the year or circumstance like reporting to the auditors. They even alter the minutes for the website and keep there own version hiding information from the association members. Can you say “cooking the books”? Sure there honest? The Condo Cert website they provide has outdated insurance, missing minutes, altered minutes and annual meeting meetings two years behind. They wont tell us about the 3 year ongoing lawsuit that has been in district court and cost us hundreds of thousands of dollars. Basically we don't know where the money is going..We cant trust these people.. and..We are screwed as they wont cut cost and this place is falling apart.. Joe Owner

GT1
(California)

Posts:10

08/11/2010 8:55 AM
Joe, Its amazing our situations are pretty similar. I found out that the rabbit hole is much deeper and darker than I originally thought. It turns out our developer has family ties with the management company and HOA board of directors. One of the many transgressions include using their own contractors and charging "full" to above market price for maintenance work to the HOA. Besides breach of fudiciary duty and conflict of interest, I suspect criminal fraud going on. I'm interested in how far you get with the city DA. As far as changing website info, try this site as it archives historical changes. http://www.waybackmachine.org/

DanielH1
(California)

Posts:481

08/11/2010 11:07 AM
Any single homeowner can usually petition the court to appoint a receiver. So, you only need to be willing to pay the money to get the process going. You should hire your own lawyer. You'll have to convince a judge to appoint a receiver. In the end, the judge could always decide that it isn't warranted and refuse to appoint a receiver. You might not save any money with a receiver; your monthly fees may even go up. Either the court will set the receiver's salary or the receiver will propose a salary to the court which the court will approve or reject. Your HOA fees will pay the receiver's salary. Most likely, the receiver will come up with plan which will be approved by the court. To implement the plan, the receiver will make all decisions for your HOA, large and small.

JoeO1

Posts:0

08/12/2010 9:38 AM
Daniel, I'm afraid that if a receiver is appointed that he will decide the this place is too far gone and should go into Condemnation. I know that the homes here at 298 units are worth about 17 million dollars at rock bottom prices but it would take about 4 million dollars to fix this place. I guess unless we get a grant, sue for insurance monies or find someone who would like to assist us rebuild.. we therefore may be the first condemned property in this city since its inception. The scrap off of the property due to the Asbestos's in the buildings would reduce the overall payment to each owner and they may not get a fair deal. I am thinking that maybe each homeowner might get 10 to 20K for the land value. Theres going to be a allot of people (298) stuck with a mortgage with no where to live. Its not fair.. we might have about 4-5 years left unless someone gets hurt from a roof collapsing or a porch falling. I wish that we had a chance instead of being taken to the cleaners for all these years and not saving any money in the reserves for Roofs and such..... Oh Well, I guess we are screwed..................................... Joe Poor Owner

GlenL
(Ohio)

Posts:3526

08/12/2010 9:59 PM
Joe in the immortal words of Mel Gibson: “Bravo Sierra.” You blame the Board and the MC but the real culprits IMO are the homeowners who sat on their collective a**es for the past however many years and allowed the property to fall into such deplorable condition; at least a deplorable condition according to you. Posted By JoeO1 on 08/12/2010 9:38 AM I guess unless we get a grant, sue for insurance monies or find someone who would like to assist us rebuild.. we therefore may be the first condemned property in this city since its inception. I wish that we had a chance instead of being taken to the cleaners for all these years and not saving any money in the reserves for Roofs and such..... Oh Well, I guess we are screwed..................................... Joe Poor Owner Typical of today I guess, we got ourselves into a mess; won’t somebody else fix it for us because we couldn’t possibly take responsibility and fix our own mess? Bottom line you and your neighbors either allowed it to happen or you bought into a community without doing your due diligence. Please explain why it is now someone else’s job to pay to fix it??? Before you again blame the Board and MC which is a lot of malarkey, bad Boards are recalled and bad MC’s fired all of the time, I’d look closer to home as to who is ultimately responsible.

Too bad the only people who know how to run the country are busy driving cabs and cutting hair. - George Burns

JoeO1

Posts:0

08/15/2010 9:00 AM
Glen, OK I hear you..I agree that it should be a majority of people who have caused this place to get to this point because they majority of people have never come together to have a say in the matter. I understand that bad MC's and Bad Boards are fired all the time, but I and the Majority of the people in this complex did not vote for them or the MC or put them in there position. We know we have a serious problem, but it's business as usual, as the position of the Board and MC is to keep increasing dues and assessing the members. At some point they should look within themselves as to what is needed to really save our complex and make so much needed changes to the budget and CUT SPENDING. We are really just running a huge business that is not really benefiting the homeowners property values or fixing the major issues such as Roofs, Paint, Porches etc. The budget reads like a out of control money sucking machine that has never tried to cuts cost, go green, or save money. Each year we keep spending more and more while the property values slip into the dirt. Yes, this place needs help! I'm not looking for a hand out just some reasonable common sense approach to running this place correctly. Like I said it's just a matter of time before we could have a major accident. We already know everything is broke and needs fixing but somewhere in this equation the decisions of the Board to consider cutting spending and going into emergency mode has been lost and not even considered. So lets say that we have a bad MC and Board and want to stay on the same course? It would take 51% of the people in this complex to make us change course at 151 members. We have great ideas of how to obtain the monies needed to save the complex but the board wont even answer our questions or see the alternative solutions to our plight. We just need change. As usual, the current board, who's president have been in every position since 1995, will select who they want and not who the majority of people want. This has been the way it has always been the last President was in power for TEN years. It will that Board and not the majority of the people in this complex who will have TO ABIDE BY THERE DECISIONS WITH NO say in the matter. You must believe me that we have tried so hard to get the owners to sign petitions, attend meetings, come together that it just has not happened ever since the place became a condo in 1978. Like I said we are screwed as a majority as the Board and MC control us and we are nothing more than "Sheep in a Field.(wool is covering our eyes as we are being taken to the cleaners) Thats Our fault! Youre Right! Joe

GT1
(California)

Posts:10

08/15/2010 10:51 AM
@Joe Looks like you and I are in similar situations where we try to fight but don't have enough voting power. In my case, the MC, developer and the board control more than 51% of the units. Things I am trying to do: - report to IRS - file a compliant with local district attorney - file complaint with BBB - contact dept of real estate, State Housing commission, local media etc. Any other ideas welcome.

MaryA1

Posts:0

08/15/2010 1:14 PM
GT, It's not uncommon for the developer to have the majority vote while still in control of the HOA. Transition will occur when that majority vote changes. Until then, nothing can be done about this. Usually the CCRs give the developer more than one vote for each unsold lot. It might sound good to say you're contacting all the agencys you list. But what will you be complaining about? For ex, what complaint could you make to the IRS? And, before you complain to anyone, do you know for certain your complaint is valid? Have you thoroughly read your gov docs? Do you know what the HOA state laws are? Exactly what CCR provisions and/or state laws have been broken? If none, then you have no complaint to file. But, even if you do have a valid complaint, the BBB can't do anything about it. And, the local district attorney nor any state agency will do anything about it. Perhaps the local media will listen to you but that's no guarantee that anything will change.

GT1
(California)

Posts:10

08/15/2010 4:02 PM
@Mary The situation is that the developer, management company, and board of directors are all the same people. No individual homeowner can even be elected to the board of directors for the HOA as they've made it exclusive (Ie. they have all the votes). I'm gathering more evidence currently, but I have preliminary evidence that shows accounting irregularities. They are utilizing their own employees as contractors and charging higher than market rate for all these services. Past homeowners who requested review of financial statements (which they are supposed to provide us regularly but do not) have been stonewalled with a variety of excuses. Its gotten so ludicrous that they sent out a "opt in" letter of membership to the HOA, stating that if the letter isn't returned in 2 weeks, it is assumed that the homeowner is electing to automatically "opt out" of HOA membership. There is clear conflict of interest and a breach of fiduciary duty and likely fraud going on. I've researched the Davis Stirling Act as well as the CC&R's, and there are multiple violations in both. Do you still think that what they are doing is ok? If not, I would appreciate suggestions. Thanks.

GT1
(California)

Posts:10

08/15/2010 4:40 PM
Can someone clarify the meaning of the word "declarant"? If this means the developer, then CC&R places restrictions on how they can vote.

GlenL
(Ohio)

Posts:3526

08/15/2010 8:44 PM
Declarant is the original developer; the person who started the project and made the original Declarations (Covenants). While he is a developer he may not be the only one, for instance he could have sold off a tract of the land to another developer. Now the second developer would still have to operate under the terms of the Declarations and would not have the power that the original Declarant has.

Too bad the only people who know how to run the country are busy driving cabs and cutting hair. - George Burns

GlenL
(Ohio)

Posts:3526

08/15/2010 9:13 PM
Posted By JoeO1 on 08/15/2010 9:00 AM Glen, OK I hear you..I agree that it should be a majority of people who have caused this place to get to this point because they majority of people have never come together to have a say in the matter. I understand that bad MC's and Bad Boards are fired all the time, but I and the Majority of the people in this complex did not vote for them or the MC or put them in there position. We know we have a serious problem, but it's business as usual, as the position of the Board and MC is to keep increasing dues and assessing the members. At some point they should look within themselves as to what is needed to really save our complex and make so much needed changes to the budget and CUT SPENDING. We are really just running a huge business that is not really benefiting the homeowners property values or fixing the major issues such as Roofs, Paint, Porches etc. The budget reads like a out of control money sucking machine that has never tried to cuts cost, go green, or save money. Each year we keep spending more and more while the property values slip into the dirt. Yes, this place needs help! I'm not looking for a hand out just some reasonable common sense approach to running this place correctly. Like I said it's just a matter of time before we could have a major accident. We already know everything is broke and needs fixing but somewhere in this equation the decisions of the Board to consider cutting spending and going into emergency mode has been lost and not even considered. So lets say that we have a bad MC and Board and want to stay on the same course? It would take 51% of the people in this complex to make us change course at 151 members. We have great ideas of how to obtain the monies needed to save the complex but the board wont even answer our questions or see the alternative solutions to our plight. We just need change. As usual, the current board, who's president have been in every position since 1995, will select who they want and not who the majority of people want. This has been the way it has always been the last President was in power for TEN years. It will that Board and not the majority of the people in this complex who will have TO ABIDE BY THERE DECISIONS WITH NO say in the matter. You must believe me that we have tried so hard to get the owners to sign petitions, attend meetings, come together that it just has not happened ever since the place became a condo in 1978. Like I said we are screwed as a majority as the Board and MC control us and we are nothing more than "Sheep in a Field.(wool is covering our eyes as we are being taken to the cleaners) Thats Our fault! Youre Right! Joe Joe, accepting that all of your statements concerning the condition of the property and the apparent disregard by the BOD and MC are true; IT IS STILL UP TO THE HOMEOWNERS TO RECTIFY THE SITUATION! Since the property is falling down around your ears and ready to be condemned and the majority of homeowners are willing to put up with it I don’t know what to tell you except keep trying to educate your fellow owners.

Too bad the only people who know how to run the country are busy driving cabs and cutting hair. - George Burns

JoeO1

Posts:0

08/16/2010 7:45 AM
Glen, Thanks. We have been educating the people in the complex for the last 3 years when we started a petition to audit the books. Back then it only took 556K to run the complex and we found all kinds of problems with spending in the budget. We have Two Web site's and a You tube Video site. We have Proven in county court that the 2008 special assessment was not legally assessed. We know that the reporting of monies to the auditors does not match what is reported to the homeowners. We know and have shared information about the BOD 25 counts of violation of declaration's, misreporting, altering of the minutes, Bulletins, Current Budgets, previous budgets, spending and accounts of monies. We have tried to work with the board and get our questions answered but they seem to want to continue on this same course as this complex is falling apart. It is very obvious that the BOD is being bamboozled by the MC. The MC Write the budget, Write the checks, Spend the money...The board just signs the checks and kicks back assuming everything is good to go. It is not good to go because their are no monies left at the end of year and no capitol expenditures have been spent for Roofs, Paint and Porches replacement. The BOD and MC continue to waste our monies on third party contractors, substandard repairs which require re-repair constantly, executive salary's to the MC and Maintenance personnel along with the fleet of lawyers. In the end, we don't have a dime left for anything! Whats funny is they know they can get away with it, without any community say in the matter. Now we spend about 800K to 1 million per year. We got a 4K assessment coming up and it may not still include Roof Replacements, Porches and Paint. The board has written off 21 uncollected dues in 15 months and have been battling a homeowner who sold his unit, but the sale was lost due to the inspection of the roofs and porches which failed. The buyer pulled out and the sale was lost so this homeowner decided he was not going to pay his dues and the Board and MC sued him (he lost and Paid 9K). Now his counter claim in District court has been going on for 3 years as the board has spent hundreds of thousands of dollars on legal fees. It's just for spite because we could have replaced three roofs already with the monies they have wasted. The worst part is the Board does not even show up for court and allows the management company to represent them. They recently presented attorney checks which did not have anything to do with the case and now Fraud is being included in his counter claim lawsuit. Well... I guess we are just screwed and all this education wont help us until the BOD wise up or the people who own in this community come together. Maybe we should...Suggest to the owners a movement will be made to get the present board of directors to repay all the over spending out of their pocket personally. That means money is returned to the HOA without coming from the owners.. Thanks, Joe

JoanneD1
(Arizona)

Posts:243

08/16/2010 8:12 AM
I haven't read every single post, but you need to work through a system. Check and see if there is an organization to which property managers join in your area. You might talk to someone at that organization about the difficulties you are have. You could also call another management company and ask them if there is an organization that the managers belong to. Get organized. You should also check the state statutes and you can contact the attorney general's office and ask for advice. Without the support of fellow homeowner's your job will be tough and I speak from experience, but my mottos are "the truth will set you free" and "knowledge is power!" Have you tried the better business bureau in your area? Check out the manager's business reputation there and file a complaint. You must gather facts and only work in the facts....no personality stuff! Communicate by emails because the papertrails are invaluable!! Another media outlet might be the local TV stations or the local newspapers. Most have writers that specialize in real estate and specifically HOA matters. Just do the right homework and if what you say is true, you will be successful in your quest for fairness. There are disclosures that must be made in the state of AZ prior to buying real estate. The management company probably does all of that papaerwork. It is a big circle that you are working with, but as you start gathering the right information, the circle will get smaller!!!!

JoeO1

Posts:0

08/16/2010 8:28 AM
GT1, Yes............ we have done all these things even we had a Picket off the main road near the complex. Posted By GT1 on 08/15/2010 10:51 AM @Joe Looks like you and I are in similar situations where we try to fight but don't have enough voting power. In my case, the MC, developer and the board control more than 51% of the units. Things I am trying to do: - report to IRS - file a compliant with local district attorney - file complaint with BBB - contact dept of real estate, State Housing commission, local media etc. Any other ideas welcome. 1)The BBB said since I was just a volunteer and not a board member I could not send any complaints about the management company. This was after we caught the Maintenance personnel illegally removing asbestos' from a HUD unit and exposing the occupants of building to it. 2) The IRS sent us a letter saying they are conducting an investigation and they would appreciate any more information, Unfortunately they got our association name mixed up with another complex the MC company manages...Imagine that? The MC and BOD are currently renting two common area owned units for 15 years and they have never paid any property tax on them. 3) Yes, DA know all about whats happening here..Is it criminal? You really have to have direct proof; like this " the BOD is does not have to pay there dues each month" or The BOD are given “Vacation's each year in Hawaii" 4) Local Media- Most news stations tell you.... “quit bothering us with your petty problems” but one magazine picked up on the fuss here because the MC was involved directly with two complexes in which there was “dissatisfaction with the MC”. One of those complexes was ours and it involved all 20 roofs leaking here at this complex and not being replaced. 5)Real Estate people selling in this complex are not telling the buyers of upcoming special assessments and the condition of the complex. Which a real Estate person calls the MC they are told there are no problems with the complex. 6) We were able to Video Tape one meeting which the sued neighbor had the police called on him by the BOD and MC during the meeting. Now we cant video tape anything. 7) We have all the owner contacts and phone numbers from the County website. We have sent them letters and called them. Most out of state rent and the others that rent just don't care. They made their money on the rental and paid them off years ago.. There Response. What ever happens. oh well it happens! Good luck with your battle, Joe “ You cant stop a community volunteer who knows he's in the right and keeps on coming”

JoanneD1
(Arizona)

Posts:243

08/16/2010 9:00 AM
Just keep up the fight!!! The truth will prevail, but be aware of the personal toll it might take on you. I serve on a board in a community with great political division. I have had dog feces put on my windows and sidewalk and recently had water and dirt put into my car's gas tank which cost me over a grand to repair. it is awful when the enemy is within!!! 1. Tell the BBB you are a consumer!!!! 2. IRS!!! Look what Geitner and others pull off so don't expect much from them. 3. Call the your city assessor's office and run the problem past them. Maybe they will know someone in the government with a sympathetic ear and INTEGRITY!! By the way, in Arizona, rental properties must be registered. See if you have that law by calling the assessor's office and if so, report all the owners who are not registered. That will get their attention!!! 4. What about the Registra of Contractors? If someone has repair and structural problems here, all we have to do is threaten to call this group and you get resolution. It is a government agency. 5. Get the names of the agents and the brokers and if you have any proof, file complaints with the local Board of Realtors. In fact, I would put something in writing if you know about coming assessments and anything else that might impact a buyer and send this to the real estate companies addressed to their managers and ask to have it read at the weekly sales meeting or see if you can go to a sales meeting. Check the real estate listings and see what agencies currently have listings. 6. I don't think it is legal to prevent you from taping or recording the meetings 7. Rental properties are a pain and we have a big issue about that right now because we are changing the CC&R's to discourage renters. THE NEXT THING YOU NEED TO DO IS GET SOME LEGAL ADVICE. CONTACT THE LEGAL AID SOCIETY AND SEE YOU CAN QUALIFY FOR SOME FREE ADVICE.

JoeO1

Posts:0

08/16/2010 9:27 AM
Joanne, I have been a victim of “Selective Enforcement” in my community. Thanks for all your thoughts, I will have to research them. I have had my petition box ripped down, two flat tires, my van has been broken into, My website has been compromised 3 times, our building has had the flower and pictures taken on 3 occasions, I have been defamed in the monthly newsletters (comparing me and my neighbors to nazis)AND I have received 3 violation notices, 3 courtesy notice's and two cease and desist notice's. The MC company called the police on me several times making stories that I have been harassing the Maintenance personnel or following them around. It's all a bunch of bull to make me nervous and sequel like a pig and run to the hills. The BOD and MC have come after me for everything they can. They even confront me in the street and harass me. It got so bad I had to contact the Attorney General Offices and submit a complaint about the Harassing untrue letter from the association lawyers. I have been flipped off by one of the former Board of Director Treasurers and been called a “Front Man”. I have checked the minutes from the last year and found that only I have received so much attention because I started a petition, questioned the Budget spending, proposed new assessments, questioned the roof leak issue, wanted a beatification committee along with wanting to get a new election to replace a board of director who have exceeded there terms. They elected me as Chairman of the Beautification committee only to stomp the idea dead because I would not play ball. I have found that you can get more with honey than vinegar and thats sometimes its better to keep quiet and do nothing like sheep in a pasture. Because if one tries to fight the Board which acts like its own country they will try to squash you quickly. I have also found that the "Selective Enforcement" imposed on me as a community member in good standing pulls the blinds down for all to see the real issues that the community is facing. Thanks, Joe

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