Senior Exemption for Dues

GnomeX (Washington)
Posts: 253

Posted:

Does anyone have anything to weigh in on possible pitfalls.

We are facing a fairly large dues increase next year and many seniors on fixed income are not going to be able to afford it. Some seniors here are well to do and their property here is not their primary residence. Others are struggling and their property in our HOA is their primary residence. I am considering presenting the following motion of the membership at the upcoming annual meeting to amend our Bylaws to give the low income seniors some relief:

"For retired seniors whose only source of income is from a retirement account and whose home within #### is their primary residence, the dues rate for the lot that is their primary residence will be 66.7% of the standard annual dues rate."

66.7% rate choosen where they will not see any increase in dues. Annual dues currently at $200 need to go to $300 (66.7% of $300 = $200).

I see nothing in our CCRs that expressly forbid such a motion. A Bylaws change requires a 2/3 vote of members attending the annual meeting. State law here just requires any budget and dues structure to be voted on by the membership. I approximate this could apply to around 25% of the owners here.

Any pitfalls?

TimB4 (Tennessee)
Posts: 21,050

Posted:

Check your governing documents first.

What you are proposing is a nice gesture but may be in conflict with the CC&Rs.
Typically the CC&Rs specify how annual and special assessments are to be assessed.

For example, this is what mine say:

"Section 5. Uniform Rate of Assessment. Both annual and special assessments must be fixed, at a uniform rate for all lots and shall be collected on a monthly basis, unless the Board of Directors shall otherwise determine."

Any Bylaw amendment, rule or decision of the Board may not be in conflict with the CC&Rs.

Therefore, Check your governing documents first.

TimB4 (Tennessee)
Posts: 21,050

Posted:

Oh, I would also add, I don't think it's a good idea.

Make a payment plan if needed. However, the Association needs to treat everyone equally. I expect that those in age restricted developments don't have any such provision.

FredS7 (Arizona)
Posts: 927

Posted:

Absolutely not. All owners deserve equal treatment.

As a way to prevent defaults in case of severe financial stringency: if absolutely necessary, a payment plan that requires repayment with interest on any deficiency at time of sale.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

This is what I would do.

All homeowners must pay the same amount for dues (or the full amount that they are designated) Paying anything less would mean they did not pay their full amount.

So when I finally voted out the current board and president, etc. I would go after all those people for not paying full dues and go after back dues. Why? Because the board and officers cannot take less than "full" amount of dues owed.

If your really concerned, how about reducing expenses?

CarolR11 (Colorado)
Posts: 2,563

Posted:

Well, GnomeX, as a 19th century philosopher warned, "The road to hell is paved with good intentions."

I agree with Tim & Fred and think you should abandon the idea. And it also may oppose your governing docs. I'd think it's in your CC&Rs, like mine and Tim's?

In addition, poverty can suddenly strike people of all ages through no fault of their own. The Great Recession has shown that to us all. But such folks would have to pay full dues? And you want to include seniors with "retirement accounts"? I know little about them, but don't some pay out handsomely? Who in your HOA would check seniors' incomes to see that they're not concealing some assets, etc.?

I am not making light of a $100 annual increase. But unless totally destitute, $8.33 per month is not very much. A payment plan might work if the extra $100 is too much to handle all at once.

GnomeX (Washington)
Posts: 253

Posted:

@Steve
Expenses cannot be cut any further. We have brought expenses down from $100K annually to around $35k-$55K. Road reserves are already drastically underfunded. We are basically down to just street lights, insurance, and minor road patchwork. We are having to raise dues to bring in a management company and to fully fund the roads. No one wanted to volunteer in the office and I cannot keep doing it due to work and school. I am now the ONLY one volunteering in the office and I simply cannot keep doing it anymore.

@CarolYeah
We already have payment plans in place. I know of several seniors here that simply cannot afford it. My concern is there are people that the dues increase are going to force into bankruptcy and that will lead to further expenses if we have to foreclose on them.

I am going to drop the idea and just let the management company deal with the increased delinquencies after the dues increase. I simply do not need more headaches.

Thanks for the advice folks.

KevinK7 (Florida)
Posts: 1,343

Posted:

That's a good way to have an age discrimination lawsuit on your hands.

GnomeX (Washington)
Posts: 253

Posted:

Quote:

Posted By KevinK7 on 10/06/2013 7:29 PM
That's a good way to have an age discrimination lawsuit on your hands.

How do counties get away with it then?

KellyM3 (North Carolina)
Posts: 2,239

Posted:

Gnome,

Your board must assess uniform dues rates as it's the only equitable situation.

Sadly, you've reached your saturation point with HOA volunteer service. I'll bet you your owner-occupant neighbors will be able to swing maintenance fees as your goals are modest and gameplan appears straight-forward. I wouldn't allow myself to worry about this too much.

BruceF1 (Connecticut)
Posts: 2,535

Posted:

Quote:

Posted By GnomeX on 10/06/2013 8:23 PM

Posted By KevinK7 on 10/06/2013 7:29 PM
That's a good way to have an age discrimination lawsuit on your hands.

How do counties get away with it then?

I assume you are referring to taxes, such as real estate taxes. Taxes are not the same as common expense assessments. Here, in Connecticut, for example, real estate taxes are based on "assessed" value which is a specified percentage of "market" value. Everyone in a particular municipality pays the same rate per $1000 of assessed value. However, property owners can receive exemptions which reduces their assessed value and therefore their property taxes. For example, there are exemptions for veterans, disabled and the elderly. Most exemptions also depend on income levels and family size. This is really no different than exemptions for income taxes, which reduce one's gross income to arrive at an adjusted gross income and a taxable income.

Chances are your documents require that common expenses be shared equally among all homeowners and do not allow for "exemptions."

KevinK7 (Florida)
Posts: 1,343

Posted:

Quote:

Posted By GnomeX on 10/06/2013 8:23 PM

Posted By KevinK7 on 10/06/2013 7:29 PM
That's a good way to have an age discrimination lawsuit on your hands.

How do counties get away with it then?

They are the government. Here in Florida there are property tax exemptions for senior citizens. It is the law. I believe our HOA laws also require equal costs for homeowners. Not sure how it is in your state but I would say it is easier to challenge a corporation then the government, and considering the nature of the business, each homeowner should be equally responsible for the maintenance of their community. To start carving out exceptions based on age would be difficult to maintain.

What if an elderly homeowner may have the resources for an increase but a single mother of 3 would experience an economic hardship from such a raise. Why is one class given preferential treatment over the other? Comparing government to corporations wuld be like comparing apples and oranges.

KevinK7 (Florida)
Posts: 1,343

Posted:

If your math allows for a discount for some and not for others, and you can afford for some to pay less, why not split the difference and charge the same for all? One could argue that these seniors understood and accepted the risks of association living at the time of their purchase.

Also, how would one govern this policy? Will you require W2s? 1099s? Audits? If a senior citizen made 10 bucks babysitting yet took advantage of this rule would the HOA sue them for fraud?

ValerieS2 (Michigan)
Posts: 244

Posted:

Have you made it clear to the membership that due to lack of volunteers a management company is being considered?

If you did, and no one stepped up, why would you be concerned?

I would be shocked to hear that you forewarned them and still had no response.

DaveD3 (Michigan)
Posts: 796

Posted:

Sure sounds like you're sitting at the top of a slippery slope to me.

Resident A has no pension and barely gets by on savings and social security. He gets a pass.

Resident B has no pension but a million dollar 401k, plus social security. He also gets a pass.

CarolR11 (Colorado)
Posts: 2,563

Posted:

GnomeX, I can totally see why your Board hired a PM. As a volunteer who's working & going to school, and with no one else willing to staff the office, your HOA needs a manager. It sounds like you've given A LOT to your community.

Our of curiosity, what size is your HOA & what size is your Board?

To be honest, if less than $10 a month is going to send some folks into bankruptcy, I'd say they'r headed that way anyhow. A break on their dues wouldn't save them.

AnnH5 (Florida)
Posts: 304

Posted:

It seems you have your answer- it is a terrible idea. It is very sweet that you would like all of the homeowners to "subsidize" the HOA fees for retired people who may (or may not) be on a fixed income. I know this will sound cold, but an elderly person who is trying to hold onto a house on a severely fixed income is not doing themselves any favors. What if they need a massive roof or plumbing repair for their home? If they can't swing another $100 annually for HOA fees that pay for the roadwork, how would they ever manage to pay thousands for a new roof? It sounds like your HOA should have been raising fees all along but chose not to do so for whatever reasons. I see this happening in my HOA. Nobody wants their fees raised but realistically, we should have had them raised in small increments for the last 5 years (assuming we do not want a special assessment). That also raises a good question- what would your retired homeowners do if your HOA had to levy an extra assessment to pay for necessary repairs?

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Quote:

I am not making light of a $100 annual increase. But unless totally destitute, $8.33 per month is not very much. A payment plan might work if the extra $100 is too much to handle all at once.

Seriously? These same people have local property taxes, etc. If they can't afford a $8.33 month increase, they are not in a position to own property anymore. They need to sell it. The dues increase is not going to break them, they are already broken if they can't afford it.

If you need to foreclose on them, so be it. That is the legal process in place for people who don't pay hoa dues or property taxes.

Quote:

Posted By GnomeX on 10/06/2013 5:32 PM
@Steve
Expenses cannot be cut any further. We have brought expenses down from $100K annually to around $35k-$55K. Road reserves are already drastically underfunded. We are basically down to just street lights, insurance, and minor road patchwork. We are having to raise dues to bring in a management company and to fully fund the roads. No one wanted to volunteer in the office and I cannot keep doing it due to work and school. I am now the ONLY one volunteering in the office and I simply cannot keep doing it anymore.

So your spending $55k on street lights, insurance, road patching and dues are only once a year? And this is too much work for you? I seriously question your need for a mgmt company to write a check once a month to the electric company, write 2 checks per year to the insurance company, hire someone to patch the roads and cash the checks once a year.

SheliaH (Indiana)
Posts: 6,964

Posted:

Quote:

Posted By SteveM9 on 10/08/2013 9:02 AM

I am not making light of a $100 annual increase. But unless totally destitute, $8.33 per month is not very much. A payment plan might work if the extra $100 is too much to handle all at once.

Seriously? These same people have local property taxes, etc. If they can't afford a $8.33 month increase, they are not in a position to own property anymore. They need to sell it. The dues increase is not going to break them, they are already broken if they can't afford it.

If you need to foreclose on them, so be it. That is the legal process in place for people who don't pay hoa dues or property taxes.

Quote:

Posted By GnomeX on 10/06/2013 5:32 PM
@Steve
Expenses cannot be cut any further. We have brought expenses down from $100K annually to around $35k-$55K. Road reserves are already drastically underfunded. We are basically down to just street lights, insurance, and minor road patchwork. We are having to raise dues to bring in a management company and to fully fund the roads. No one wanted to volunteer in the office and I cannot keep doing it due to work and school. I am now the ONLY one volunteering in the office and I simply cannot keep doing it anymore.

So your spending $55k on street lights, insurance, road patching and dues are only once a year? And this is too much work for you? I seriously question your need for a mgmt company to write a check once a month to the electric company, write 2 checks per year to the insurance company, hire someone to patch the roads and cash the checks once a year.

With all due respect, GnomeX knows his schedule better than anyone else, so while this may not seem like a lot of time to you, it has become an issue to him, therefore the other homeowners need to understand that someone needs to step up or the work won't get done at all or won't be done properly (thus the need for a management company).

This is one of the underlying problems with being a HOA volunteer - pretty soon people start acting like this is your JOB, when in fact, you're giving up your personal time to help manage the property. If GnomeX had even 3 or 4 volunteers, perhaps they could take up some of the slack and no one would be exhausted.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

GnomeX (Washington)
Posts: 253

Posted:

Quote:

Posted By SteveM9 on 10/08/2013 9:02 AM
So your spending $55k on street lights, insurance, road patching and dues are only once a year? And this is too much work for you? I seriously question your need for a mgmt company to write a check once a month to the electric company, write 2 checks per year to the insurance company, hire someone to patch the roads and cash the checks once a year.

I get the same crap line from people that live here. Steve, with all due respect, you are simply clueless concerning the amount of work involved.

I've had to go to attorney meetings, file small claims court, sit in court on behalf of the association, meet and contract with vendors to get repairs, as Treasurer accept and process payments and keep the books, answer emails and for scores of people and actually, file the necessary paperwork with our accountant to file with the IRS, on and on and on.

This all used to to be handled by a PAID part-time employee 3 years ago.

It is a lot of work and since all the volunteers quit, I am not going to quit my life to basically run an entire non-profit corporation by myself.

In short, you do not know what the hell you are talking about.

TimB4 (Tennessee)
Posts: 21,050

Posted:

Based on my experience of being treasurer and processing all payments and keeping the ledgers, contacting members about delinquent accounts, etc. I know it's a lot of work. I spend approximately 18-20 hours a month on Treasurer duties. As Secretary, I spend another 5 hours a month (it goes to about 10 hours a month around the annual meeting). Sharing the duties of maintenance officer, I spend another 2-3 hours a month. Administering the website is another hour a month. As the newsletter editor, it's another 5-8 hours a month. As a Director it's about 2-3 hours a month.

Adding this together it's 32-44 hours a month spent on Association duties.

I also have a full time job and try to have a home life. I can understand Gnomes issues as being a full time student is typically more hours than a full time job.

Others can step forward, They have chosen not to. At some point, I will finally say the heck with it as Gnome has.

Now, 10-15 of those hours were previously done by an independent contractor performing bookkeeping services. I volunteered to absorb those duties so that money could go into addressing some of the issues in our Association. Yes, it was my choice to do this. However, like Gnome, I become curt when anyone says I'm not doing enough. If enough people say it, I would likely simply resign and let the rest of the Board and the membership deal with it.

GnomeX (Washington)
Posts: 253

Posted:

Quote:

Posted By SheliaH on 10/08/2013 9:10 AM

This is one of the underlying problems with being a HOA volunteer - pretty soon people start acting like this is your JOB, when in fact, you're giving up your personal time to help manage the property. If GnomeX had even 3 or 4 volunteers, perhaps they could take up some of the slack and no one would be exhausted.

Thanks Sheila at least you get it.

We did have 4 volunteers last year. And it was working then as everyone would pull their load. Basically I was just the Treasurer at the time. As it stands now, the Secretary isn't even doing the minutes and we have NOTHING for meeting minutes for the last 8 months.

Since they all quit I am literally doing EVERYTHING and I simply cannot keep doing it. I don't have enough hours in the day after work and school. Management company costs $13,500 a year. Sounds like steal to me.

And Steve's sentiment is just like a lot of people here in my HOA (mostly from the people NOT paying anything). They don't actually see the amount of work involved then want to bitch and moan when their concerns are not addressed fast enough.

RichardP13 (California)
Posts: 1,767

Posted:

Gnomex

How many units are in your complex?

CarolR11 (Colorado)
Posts: 2,563

Posted:

GnomeX, I support you and all you have done for your community.

But can you even conduct business without a board of directors? That's something else that Tim of VA went through for several months if I remember right.

TimB4 (Tennessee)
Posts: 21,050

Posted:

Carol,

Gnome never said they didn't have a Board of Directors, it was a lack of volunteers in the front office and/or a lack of the volunteers doing any actual work.

GnomeX (Washington)
Posts: 253

Posted:

@Richard,

366 lots total.

@Carol,
President resigned about 4 months ago. No one has come forward to be appointed to fill in. We currently only have 3 people on the Board including myself. The other 2 work full time and tell me they don't have time to volunteer in the office. As I mentioned earlier, Secretary isn't even doing the minutes. I don't slight her, she is now working 7 days a week and has a long commute along with medical issues.

The other community members volunteering in the office all quit for various reasons.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Quote:

In short, you do not know what the hell you are talking about.

I do know what I'm talking about, I just dont know your particular HOA. When you first told us the details, you minimized the amount of things you said you had to do, now you are listing tons more in detail. My previous statement obviously doesn't stand with this new information.

Tip: Overwhelmed by emails? Close the email account. When people have to write an email, they will fire off 20 of them in 2 minutes. When they have to sit down and write a letter, print it, mail it, etc, they may not even bother.

Quote:

Management company costs $13,500 a year. Sounds like steal to me.

That's the tickler price. Kind of like a drug dealer, they give you the product virtually free, then jack up the price.

Quote:

And Steve's sentiment is just like a lot of people here in my HOA (mostly from the people NOT paying anything). They don't actually see the amount of work involved then want to bitch and moan when their concerns are not addressed fast enough.

Who cares? Sometimes things are not fixed at my HOA for 5 or more years. Not everything has to be addressed right away. It's no big deal. If a deadbeat asked me to fix a fence, I'd ask him if he wrote the HOA dues check yet. If he said no. I'd tell him he won't have to worry about the fence for long. The HOA lawyers will be foreclosing and evicting soon.

Tip: Work on your skills for dealing with criticism. You will become a better person.

GnomeX (Washington)
Posts: 253

Posted:

Quote:

Posted By SteveM9 on 10/08/2013 4:46 PM

In short, you do not know what the hell you are talking about.

I do know what I'm talking about, I just dont know your particular HOA. When you first told us the details, you minimized the amount of things you said you had to do, now you are listing tons more in detail. My previous statement obviously doesn't stand with this new information.

Tip: Overwhelmed by emails? Close the email account. When people have to write an email, they will fire off 20 of them in 2 minutes. When they have to sit down and write a letter, print it, mail it, etc, they may not even bother.

Quote:

Management company costs $13,500 a year. Sounds like steal to me.

That's the tickler price. Kind of like a drug dealer, they give you the product virtually free, then jack up the price.

Quote:

And Steve's sentiment is just like a lot of people here in my HOA (mostly from the people NOT paying anything). They don't actually see the amount of work involved then want to bitch and moan when their concerns are not addressed fast enough.

Who cares? Sometimes things are not fixed at my HOA for 5 or more years. Not everything has to be addressed right away. It's no big deal. If a deadbeat asked me to fix a fence, I'd ask him if he wrote the HOA dues check yet. If he said no. I'd tell him he won't have to worry about the fence for long. The HOA lawyers will be foreclosing and evicting soon.

Tip: Work on your skills for dealing with criticism. You will become a better person.

Tip: Don't levy baseless accusations and you might not get the reaction you are now objecting to.

BTW your other "tips" are quite frankly... ridiculous... Close our entire email account due to complaints coming in? I guess we should cut the phone service too as people also call in complaints and issues . *rolls eyes*

Don't deal with problems wait 5 or more years until they get out of hand? Yeah when that greenbelt tree falls on someone's house, we will just deal with it then. Fine tips indeed.

If I managed a business using your "advice" I wouldn't have a business. If a Board addressed owner concerns like you, they would rightly vote you out.

Deadbeat homeowners are bad enough. But deadbeat Board members...

I sure wouldn't want someone like you on our Board managing the community's affairs. Sounds like you are a recipe for disaster. But hey thanks for the good laugh Steve ;)

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Quote:

BTW your other "tips" are quite frankly... ridiculous... Close our entire email account due to complaints coming in? I guess we should cut the phone service too as people also call in complaints and issues . *rolls eyes*

Yes. Our HOA does not have email, nor phone. If it is a life or death emergency people can call a board member or knock on their door, but that never happens. Everything must be in writing. If someone contacts me, I politely tell them its not an emergency and to put it in writing for the board, they never do. They obviously don't care that much about it, they just want someone to complain to immediately.

Quote:

Don't deal with problems wait 5 or more years until they get out of hand? Yeah when that greenbelt tree falls on someone's house, we will just deal with it then.

Again, depends on the issue. Don't think I know about your HOA or your tree issue.

Just because someone "thinks" something needs to be changed or replaced, doesn't mean it does. It doesn't mean we are deadbeats, it means we perform our fiduciary duty correctly.

SheliaH (Indiana)
Posts: 6,964

Posted:

Quote:

Posted By GnomeX on 10/08/2013 3:07 PM

Posted By SheliaH on 10/08/2013 9:10 AM

This is one of the underlying problems with being a HOA volunteer - pretty soon people start acting like this is your JOB, when in fact, you're giving up your personal time to help manage the property. If GnomeX had even 3 or 4 volunteers, perhaps they could take up some of the slack and no one would be exhausted.

Thanks Sheila at least you get it.

We did have 4 volunteers last year. And it was working then as everyone would pull their load. Basically I was just the Treasurer at the time. As it stands now, the Secretary isn't even doing the minutes and we have NOTHING for meeting minutes for the last 8 months.

Since they all quit I am literally doing EVERYTHING and I simply cannot keep doing it. I don't have enough hours in the day after work and school. Management company costs $13,500 a year. Sounds like steal to me.

And Steve's sentiment is just like a lot of people here in my HOA (mostly from the people NOT paying anything). They don't actually see the amount of work involved then want to bitch and moan when their concerns are not addressed fast enough.

I feel your pain - I'm treasurer of our Board (and the newsletter editor...and the CAI representative for the Association!) Like you, I've gotten fed up and am damned tired between this stuff and my day job, which is very demanding - which is why I turned in my resignation, effective January. The primary reason I didn't make it effective immediately is because I want to try and get some processes in place so they can continue without too much disruption.

When I FINALLY got the newsletter out two weeks ago, our president's column included a few thoughts about people not volunteering and the chaos that might ensue if we were to all quite at once - we'll see if anyone listens and steps up. In fact, our president has some personal issues that may result in HIM stepping down a few months from now....

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Work smarter, not harder.

If something like monthly dues, book keeping, going to the bank are taking up all your time as a volunteer, hire it out, just like you would hire someone to mow the lawn. (or use a drop box service).

TimB4 (Tennessee)
Posts: 21,050

Posted:

Quote:

Posted By SteveM9 on 10/09/2013 9:48 AM
Work smarter, not harder.

If something like monthly dues, book keeping, going to the bank are taking up all your time as a volunteer, hire it out, just like you would hire someone to mow the lawn. (or use a drop box service).

Steve,

It appears that Gnome's Association is hiring it out. They are hiring a MC which caused the increase in Assessments and prompted the initial question of the thread.

GnomeX (Washington)
Posts: 253

Posted:

Quote:

Posted By SheliaH on 10/09/2013 9:38 AM

I feel your pain - I'm treasurer of our Board (and the newsletter editor...and the CAI representative for the Association!) Like you, I've gotten fed up and am damned tired between this stuff and my day job, which is very demanding - which is why I turned in my resignation, effective January. The primary reason I didn't make it effective immediately is because I want to try and get some processes in place so they can continue without too much disruption.

When I FINALLY got the newsletter out two weeks ago, our president's column included a few thoughts about people not volunteering and the chaos that might ensue if we were to all quite at once - we'll see if anyone listens and steps up. In fact, our president has some personal issues that may result in HIM stepping down a few months from now....

It is like you mentioned earlier, people start assuming just because you are a volunteer, they feel they are entitled to your time. Actually had a homeowner recently yelling at me stating he pays my salary and should get what he wants out of me! Of course Board members are unpaid volunteers but this guy just goes on on a tirade under the assumption the Board members are paid by the HOA. I'm not joking... This is so out of hand... The apathy + misinformation is staggering here.

And it isn't just the HOA. The Water District which provides water and server to the HOA is an actual utility and even THEY are down one commissioner and no one will step up. They are going to have to get the County involved to fill the vacancy using someone from outside the district. And the water commissioners actually get paid and still no one will step up. One commissioner is begging me to do it but I simply do not have the time due to everything else on my plate.

We live in an area that gets a lot of snowfall. That is my biggest concern. I am approaching my term limit next year and cannot get reelected for another 5 years. If the other Board members quit after I reach my term limit, and no one steps up, without a Board there could be some dire consequences in the winter.

GnomeX (Washington)
Posts: 253

Posted:

Quote:

Posted By SheliaH on 10/09/2013 9:38 AM

I feel your pain - I'm treasurer of our Board (and the newsletter editor...and the CAI representative for the Association!) Like you, I've gotten fed up and am damned tired between this stuff and my day job, which is very demanding - which is why I turned in my resignation, effective January. The primary reason I didn't make it effective immediately is because I want to try and get some processes in place so they can continue without too much disruption.

When I FINALLY got the newsletter out two weeks ago, our president's column included a few thoughts about people not volunteering and the chaos that might ensue if we were to all quite at once - we'll see if anyone listens and steps up. In fact, our president has some personal issues that may result in HIM stepping down a few months from now....

It is like you mentioned earlier, people start assuming just because you are a volunteer, they feel they are entitled to your time. Actually had a homeowner recently yelling at me stating he pays my salary and should get what he wants out of me! Of course Board members are unpaid volunteers but this guy just goes on on a tirade under the assumption the Board members are paid by the HOA. I'm not joking... This is so out of hand... The apathy + misinformation is staggering here.

And it isn't just the HOA. The Water District which provides water and sewer to the HOA is an actual utility and even THEY are down one commissioner and no one will step up. They are going to have to get the County involved to fill the vacancy using someone from outside the district. And the water commissioners actually get paid and still no one will step up. One commissioner is begging me to do it but I simply do not have the time due to everything else on my plate.

We live in an area that gets a lot of snowfall. That is my biggest concern. I am approaching my term limit next year and cannot get reelected for another 5 years. If the other Board members quit after I reach my term limit, and no one steps up, without a Board there could be some dire consequences in the winter.

SheliaH (Indiana)
Posts: 6,964

Posted:

Are you SURE you don't live in my community? (Whoops, wrong state - LOL!)

The water district can't get anyone to serve on the commission and it's a PAID position? Wow.

Sometimes, I think the real reason most people don't step up is becuase they KNOW what a pain in the butt volunteering can be and have enough ish going on in their lives. I guess they think if they ignore the problem it'll go away or resolve itself, but as we all know, that won't happen. As for public positions, the downside is that you have to deal with the public and pretty soon EVERYONE comes complaining about things you have no control over, but you have to listen politely anyway because you are...a public servant!

Good thing your idiot homeowner doesn't live in our community - as crazy as things are, I think everyone knows if anyone were to come to a board meeting spouting off that nonsense, EVERYONE would quit on the spot and then things would REALLY cut loose. Maybe that's what needs to happen in your community - it's like everyone else is thinking "nah, he won't quit..." Time to surprise the hell out of them.

Good luck to us both!

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

ValerieS2 (Michigan)
Posts: 244

Posted:

Gnome,

I am curious: did you or did you not inform the membership that unless volunteers stepped up that a management company would be hired?

If not - shame on you.

If so, it is a win-win for everyone.

KellyM3 (North Carolina)
Posts: 2,239

Posted:

Something I missed here is that the issue of whether or not to obtain professional management services to save Gnome's sanity is $8.33 per resident per month. Gnome's dues reduction proposal for senior residents is approximately $1.80/month reduction for seniors - not enough to haggle with the HOA accounts to ensure compliance. Raise the dues $100/annually (which sounds worse than $8.33) and have the property properly represented. NO volunteer servant should be punished and made to feel guilt for burning themselves out offering professional services for free.

I don't believe $8.33/month for organizational stability is too much to ask. It's a great price when the alternative is zero services being offered. Based on the average COLA increase for Social Security of $22/month this year, the fixed-income residents can, unfortunately, afford this in real cash dollars. This entire issue is moot. Threatening to quit will do nothing.

GnomeX (Washington)
Posts: 253

Posted:

Quote:

Posted By ValerieS2 on 10/10/2013 5:41 AM
Gnome,

I am curious: did you or did you not inform the membership that unless volunteers stepped up that a management company would be hired?

If not - shame on you.

If so, it is a win-win for everyone.

Yes we have asked for volunteers NUMEROUS times over the course of 3 years. At annual meetings and via newsletters. I've even made personal phone calls to several people I know that have professional experience and would be great help. No one will step up. We cannot even fill the Board vacancy let alone get anyone to help in the office.

However we did not use the language, "We need volunteers or we are hiring a management company." This summer we just stated we are hiring a management company to take over the office functions.

GnomeX (Washington)
Posts: 253

Posted:

Quote:

Posted By KellyM3 on 10/10/2013 6:30 AM
Something I missed here is that the issue of whether or not to obtain professional management services to save Gnome's sanity is $8.33 per resident per month.

It is actually less than $8.33 a month per resident, its more like $3.83 per property each month. And that figure considers the non-payers.

The mgmt co. is charging $13,500 flat rate annually. There are 366 lots. Roughly 20% of the owners here refuse to pay anything in dues at all. So the cost has to be apportioned among the 80% that are paying which is roughly 293 lots.

$13,500 / 293 = $46 per lot per year to pay for the mgt co.

$46 / 12 m $3.83 per lot per month

If the 20% that refuse to pay dues actually did pay, then it it would only be $3.07 per lot per month.

And I STILL have people complaining the management company is a waste of money!!!

ValerieS2 (Michigan)
Posts: 244

Posted:

"However we did not use the language, "We need volunteers or we are hiring a management company." This summer we just stated we are hiring a management company to take over the office functions. "

Using that language might have been the prudent thing to do.

GnomeX (Washington)
Posts: 253

Posted:

Quote:

Posted By ValerieS2 on 10/10/2013 2:07 PM
"However we did not use the language, "We need volunteers or we are hiring a management company." This summer we just stated we are hiring a management company to take over the office functions. "

Using that language might have been the prudent thing to do.

Probably but at this point it is a done deal.

GnomeX (Washington)
Posts: 253

Posted:

Maybe there will be incentive for people to volunteer in the office now when they see an additional $46 dues increase to cover the mgt co. But I doubt it. And the reason is for most people the opportunity cost of volunteering their time is higher than the $46 in dues annual dues increase. They will pay the $46 and just grumble about it instead.

RichardP13 (California)
Posts: 1,767

Posted:

Maybe, by hiring a management company, you now have a opportunity to bring the delinquencies under control.

GnomeX (Washington)
Posts: 253

Posted:

Quote:

Posted By RichardP13 on 10/10/2013 2:37 PM
Maybe, by hiring a management company, you now have a opportunity to bring the delinquencies under control.

Yep that is part of the plan. Top priority in fact.

KellyM3 (North Carolina)
Posts: 2,239

Posted:

Gnome,

It seems your community would tangibly benefit from a third party handling the day-to-day business, especially if your dues delinquency rate is 20%. A good company will get the true default rate to under 1% and a late payer rate to about 3%. This is a no brainer.

GnomeX (Washington)
Posts: 253

Posted:

Quote:

Posted By KellyM3 on 10/13/2013 5:04 PM
Gnome,

It seems your community would tangibly benefit from a third party handling the day-to-day business, especially if your dues delinquency rate is 20%. A good company will get the true default rate to under 1% and a late payer rate to about 3%. This is a no brainer.

I agree. However it is looking like it is going to be a fight.

New update: I already have people fighting hiring a management company. They are stating it has to be put up to a vote of the people at an annual meeting. Not true. What is next? Have the people vote to cut the grass?

And now we have this:

Link

Allegedly not only is this guy that is running wanting to waive the dues for all delinquent owners, rumor is he also wants to fire the management company if he gets on the Board and hire his own personal choice for a bookkeeper.

Luckily he can't. We just signed a one year agreement.

But get this. Bookkeepers in the area are $20+ per hour and the lady he wants to hire asks $23 an hour. Just for bookkeeping services. It is going to be at least 15 hours per week for the job. That is $17,940 annually BEFORE payroll taxes. Factor in federal payroll taxes and state unemployment insurance, and total cost is around $19,700 annually.

Management company costs $13,500 per year and they do more than bookkeeping. They handle legal, complaints, call center, run the annual meetings, website, two monthly visits to the community inspecting the entire subdivision, attend all board meetings, contract all vendors, etc.

GnomeX (Washington)
Posts: 253

Posted:

Quote:

Posted By KellyM3 on 10/13/2013 5:04 PM
Gnome,

It seems your community would tangibly benefit from a third party handling the day-to-day business, especially if your dues delinquency rate is 20%. A good company will get the true default rate to under 1% and a late payer rate to about 3%. This is a no brainer.

BTW the dues delinquency rate is much higher than 20%. Roughly 35-40% of the community are in arrears. However many of them came in to arrange a payment plan.

Sorry didn't want to mislead. Here are the details. The 20% I stated is 20% of the community in arrears that refuse to pay anything at all AND refuse to come in to agree to a payment plan to pay off their outstanding balance.

KellyM3 (North Carolina)
Posts: 2,239

Posted:

I can understand why a large bloc of your community would 'fight' the hiring of a management company based on the picture you've painted, to them, of a management company's duties. Remember, your diehard 20% of non-payers will certainly not want a professional, non-emotional, third party handling collections through a bona fide legal process that gives your community a "win" in every case as defined by your state's law. That's a huge incentive. Once accountability is instilled in your operations, residents who are current on dues as well as those "catching up" will be treated with greater respect than belligerents whereas the reverse is true in your current situation.

A resident who runs for board service not to serve the health of the HOA but to eliminate delinquent dues is running to destroy the organization and they don't realize it. I'd wager to bet this candidate would find a large one-time special assessment - on an as-needed basis - as a legitimate form of HOA funding; it's not. It's destructive to those on fixed incomes, sometimes catastrophic.

If you can raise your dues within the rules and use the funds to support proper management, you'll get one year to prove the professional service is paying dividends. The sad fact is that your community may be full of dead-beats hiding behind the guise of "fixed income senior." I've no personal problem with an HOA board's recognitions of the limits of a fixed-income lifestyle. When an entitlement mentality leads people to fully rationalize dumping their share of common maintenance onto other residents, that's corruption. If this is your community's reality (and it does NOT sound like it), then your job is a responsible downsizing where the amenities are phased out from least-critical to most-critical, while keeping property management.

If your "exonerate the delinquents" candidate finds traction and widespread support, then the equal distribution of his policy is to waive future dues for current and mildly-delinquent dues payers equal to the largest delinquent account on file. No cash payouts, just account credits. That will sufficiently bankrupt your HOA in line with the community vision and give the new leadership the direction it desires. This approach would, obviously, destroy the proposal at the debate stage.

TammyI (California)
Posts: 68

Posted:

Are none of the seniors in your association able to volunteer? They have the most time on their hands. Sometimes they need to be asked in person. If you can find a few good ones that are unable to pay the rate increase and are able to help in the office maybe they could be paid a small amount for their work to make up the difference.

Just a thought. I have been dealing with a slumlord who owns 2 of our 16 units, why waste your time on these people, they want you to work for free so that they save can save their money. We now have a management company. Beware though, our MC quoted $400 per month and the last 3 months has charged double that for things like postage, mailing, attending meetings, account setup, stationary the lists go on.

good luck

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Tammy

I am making a note to myself about additional charges.

Thanks