Tea partying plan against HOA

2 of 3 HOA board members in our 160 units TX condos are not performing their job in addition to 6 months late on their mandatory HOA dues. because they are in control with a majority vote, they hired a management company that does NOT follows one of our bylaws duties of collections and liens filing against those properties (they owes about 20 units between them). the next election is in about 11 months. We want to remove them ASAP, but bylaws said it needs 75% of all units owners vote in addition to 50% just to call a quorum. ByLaws also doesn't state it can force a auto step-down for late dues. We feel even if success in getting the 75%, management company may drags its feet to put on the agenda.

We could not get the 75% votes count to remove them. What do you all think if we apply this plan to below if 50% of HOA agrees to participates?

https://dl.dropbox.com/u/7287071/HOA_tea_party_fund_process.jpg

Your method is interesting, but to get other homeowners involved you need to send a letter to each member of the HOA via US mail. forget flyers and other things the board will just tear down. If you use US Mail, your flyer will get to the homeowners.

PS. Might not be a bad idea to fib a little and say "Your HOA dues will go up $100 if you dont act now" Get people's attention!

Quite frankly it looks like the balderdash spewed out by the same people that can prove to you why the Federal Income Tax is not valid and you don’t really have to pay it. They have all kinds of “legal” ways to get around paying it. Then you pay them their money and put their plan in action, voila six months latter you are facing loosing your home and jail time and the people who convinced you to do it are no longer around. They’re kicking back on a beach somewhere with your money.

Also this is just an observation but you must have some slick characters down there in Texas, since it is 11 months until the next election; that means the current Board has gone rogue in only 30 days. Not to mention if they are six months in arrears, they had to be five months in arrears when they were voted in, that has to be some kind of world record.

Hi Tim, thanks for the reply. Regarding...

> Are you willing to step forward to serve on the board?
That's the a problem, we have several candidates, inlucding myself. The 2 of 3 board members are absentee crooked investors from CA who felt they can come to our state and control the board and the management company without paying most of their dues. The sad part is they only shows up once a year during an annual meeting and since they losing money in their NV, CA and FL properties dues to overleveraged, they use the TX properties as cash cows even to the point of renting out to drug dealers to maximize their rental capacity.

> Have you attended the board meetings to find out and/or ask why the management company isn't performing the duties they were hired to perform?
Yes, I have and since they once here once a year, only their puppet management company are there to "take notes" and relate the messages to the board.
The reason management company isn't performing the duties is because it was part of the scheme. When they first arrived 13 months ago, they try to stall with
the original management company by asking for time (and I am sure some kick backs for keeping it quiet), when we find out the overdues and pressured that management company to collects, the board fired it and bring in their current and even worst crony management 2 months ago who says we are "working on it" to collect...Nothing happens.

> Have you volunteered to serve on any committees of the Association?
We have folks in the Landscaping committee (there was only 1 committee) and they are powerless depsite the complains.

We have pretty much exhausted the poitical and diplomacy aspects of the process. Since tradionally legal means to remove them is not as financial sounds as the tea party style, we though we give it a dry run at HOATalk.com to see if y'all can stab at it for holes and pitfalls.

Hi Glen L, thanks for the reply. Regarding...

> people who convinced you to do it are no longer around. They’re kicking back on a beach somewhere with your money.
Actually, those people are current (and angry) condo owners and they are not going anywhere

> Also this is just an observation but you must have some slick characters down there in Texas, since it is 11 months until the next election; that means the current Board has gone rogue in only 30 days. Not to mention if they are six months in arrears, they had to be five months in arrears when they were voted in, that has to be some kind of world record.

See above #1

Thanks.

If I understand it correctly, the homeowner would pay his fee to the "Tea Party" and refuse to pay the HOA. The Tea Party would create a fund from those fees to defend against liens by the HOA and buy back the house if the HOA foreclosed against it using the HOA lien. And, if there is extra money, file a case to remove HOA Board Members.

Maybe there is some sort of arbitrage opportunity to rip off banks. During the Great Depression, farmers made informal agreements to bid low on auctions on foreclosed farms and return the farms to the original farmer.

Hi Tim, thanks for the diplomatic languages usage to help us out. We really appreciates it.

Regarding if "investors" truly have a majority...No they do't, they only have about 12.5% of the overall voting rights, 50% are people like me who actually willing to vote, the rest are careless; thus we could not gets 75% of the votes. What the investors have are 2/3 of the Board along with its voting power on HOA activities for the next 11 months.

Now, regarding your good and reasonable intent explanation of "a binding contract. Therefore one would have a contractual agreement to pay assessments...". That actually started by the investors who have not been paying their mandatory dues for 6 months on 20 units at about $200/each month per unit. Everyone else that matter are current. Thus, we are not doing anything different from what they are doing, except being "late" into the game. We even asked them to gracefully step down for not setting a good example, they refused. We find the primary reasons are since they needed the money, they would use their voting powers to obtain kickbacks from vendors. For example, 3 yrs after hurricane Rita damaged the roofs, we finally got a settlement from the insurance company to have it repaired. Now instead of having a competitive bidding process for the $100K payout for the roofs, they used their friend's roofing company without the proper evaluation and bidding process of obtain 3 candidates, they just let that roofing company have the contract for around $90K, where as other estimates put that around $65K-$70K. Once we find out, we were outraged by it.

"The chart appears to show the HOA giving money to a "HOA Tea Party Fund" and/or "tea party activists" both of which would violate the non-profit status of the Association and are typically in violation of governing documents and perhaps State laws. "

Perhaps, but it's no different in terms of intent that he could use his 6 months overdue for his for-profit real estate investment business. Furthermore, they allow known drug dealers to rent their units out and that's probably even more criminality negligent.

If we were to compare whether suing the HOA as last resort, doing what I am proposed would be an option we probably could live with as it levels the playing field from a lose-lose to a fair play from a financial points of view.

Now, here's another question/option really: what if everyone else stops making HOA dues payment like they do, then the issue is solved since everyone else are in the same boat. And without the money to raid, there's no need for an HOA board of directors and the HOA is dissolved. We may resume the process in 11 months....

Juan,

Mary is right, your best course of action would be to have a recall election.

Typically, anyone who is behind in assessments no longer has voting rights. Therefore, you might try challenging the past election. Request to look at the financials, meeting sign in sheet and ballots. If there are issues, it can be grounds for a new election.

I would also recommend that you seek the advise of a local attorney before preceding with this suggestion as the need to actually read the governing documents and have knowledge of local and State laws would be a must.

Tim

Glen,

I believe Juan characterized the 2 board members as "absentee crooked investors".

Well, the CA BODs are serving 2-yr terms. They started in arrears 6-months into once they have check out our books and study the weaknesses of the byLaws. Specifically, it doesn't have a clause to remove them if not in good standings, requires 50% proxy votes for a quorum, and 75% proxy votes to do a recall. I am telling you all this so HOA all over the US needs to close those gaps for lessons learned. They actually had 100% of the BOD votes until 1 of them felt hard from bankruptcy and lost all his units 9 months into his staggered 24-month term. We finally got enough votes for an annual election for replace that person with someone local and on our side. The problem is the new BOD only has a voice and no action dues to 2/3 votes is required to make yes/no decisions.

Well i understands and appreciates for your the concerns "that hardworking people trying to make ends meet will buy into this cockamamie scheme and end up loosing their money and their homes.", what people don't yet understands is they are in the verge of losing it from the FAST depreciation due to the drug dealers who occupies those units they rented out. As an example, one citizen saw a drug deal going on in front of him and basically told the guys to do business else where. Instead of doing that, they threaten him not to says a words from now on or they will "take care of him" since they knows where the concerned citizen lives. So, we hired a police officer by giving him a unit to live in exchange for 4 hours patrol per night. well, that cop was doing fine for 2 months until they messed with him apt by shooting onto it and messed his parked car. So he had enough and moved out and told us that he don't feel safe anymore if he lives and patrols there. Thus, we now have to layout a budget for $26/hr for 2 officers to patrol the property 12 hour a day 4 days a week.

Basically, we literally have to take the tasks into our own hands since those absentee landlords (they used local management company to manage their units) and the crooked Management Company (paid $11k/month for being a puppet) just bleeding us away.

I appreciated MaryL's common sense approach to resolve it by the book. But we are dealing with crooks here. Furthermore, if I did not understand the Bylaws, I would not have know-how to think out of the box and create this creative tea party HOA model, which is to creates a legal unit to handles any legal matters they tries to throw back at us so our participating owners got their backs cover. The fact that it hasn't been try doesn't means it won't work. If someone can gives us a legal case to serve as evidence, we may considers to back out.

A three director Board seems too small for a 140 unit complex. How hard would it be to get two more Owners (yourself and another concerned owner) elected such that you have 5 on the Board? I have often wondered what it takes to actually change the number of people on the Board. For instance, our Bylaws say something like: The number of directors shall be a minumum of three, but no more than seven. What does it take to formally increase the Board size from 3 to 5? Seems to me it would be a lot easier to effect change from the inside of the Board than from outside, especially if there were 3 honest members vrs 2 not so honest members.