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Subject: HOA Dues inequity
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JohnL40
(California)

Posts:5


02/04/2020 6:42 PM  
Hello Everyone,

I live in a condo complex of 48 units. 8 of them are town homes (share one wall) and 40 of them are single homes. The floor plans and square footage for every unit is the same. In our annual budget, the 8 town homes pay more than double the monthly dues compared to the single family homes. I was told that this is because the 8 town homes have a higher landscaping and insurance cost than the single homes. But looking at the annual budget, the HOA has the costs doubled across the board. Town homes pay more than double for all administrative expenses and even pool maintenance which really makes no sense. Since the units are all the same with the exception of a common wall in the town home units...is it common practice to charge some home owners double or more than others? This would make sense to me if the town homes were larger or had bigger lots...but we don't. Is it even legal to charge some home owners more than others in the same complex for common areas? Just seems crazy to me. Any help or insight you all might have is appreciated.
JohnL40
(California)

Posts:5


02/04/2020 6:43 PM  
I live in Northern California by the way.
AugustinD


Posts:2574


02/04/2020 7:54 PM  
Can you quote what your condominium's Declaration says about the assessment for each unit?
MarkW18
(Florida)

Posts:476


02/04/2020 8:49 PM  
As the townhomes are attached, the master insurance policy covers those units. The single family homes cover their own insurance. The only insurance they would paid for is common elements in the common area.

It is not uncommon for attached units to pay more, sometimes double of those in detached units.
DouglasK1
(Florida)

Posts:1479


02/04/2020 9:11 PM  
Posted By AugustinD on 02/04/2020 7:54 PM
Can you quote what your condominium's Declaration says about the assessment for each unit?


I think this is the key. The relative assessments should be defined here, and can't be changed without amending the CCRs.

Escaped former treasurer and director of a self managed association.
CathyA3
(Ohio)

Posts:737


02/05/2020 4:56 AM  
This sounds similar to a community that I worked in. The attached homes received more services (landscaping, snow removal, insurance coverage, etc.) while the single family home owners were responsible for their own exterior maintenance and insurance. In addition, there were some additional reserve items for the attached homes.

As others have noted, the details about the par value of your home (ie., the relative percentage of ownership in the HOA) will be in your governing documents. This, plus your annual budget, is what the board uses to determine the amounts of each home's assessment. It's just math - there is no value judgement in it at all.
SamE2
(New Jersey)

Posts:234


02/05/2020 6:41 AM  
You are looking at the wrong thing it is not the size of the unit it is the services they receive. Who is responsible for things like siding, roofing, insurance for the townhouses and the single family houses? What do the HOA documents say about cost allocation? If both get the same services I would be talking to my attorney and trying to organize the other 7 townhouses.



JoeB23
(Florida)

Posts:7


02/05/2020 9:01 AM  
Is your HOA assessment broken down to show how much is attributed to different expenses? For example, in our HOA, when our budget is prepared we get a copy of the budget and a breakdown of our monthly assessment showing how much goes to maintenance, cable, sewer, the golf course, etc. Some residents are connected to public sewer and not community sewer so their monthly assessment is less but they have to pay the city for sewer charges. When I was looking to buy in Florida, several communities had different HOA assessments for residents in the same community depending on whether you were in a condo or single home. Condos have more common area to maintain if the single homes are required to cut their own grass and landscape. Condos also share costs for a new roof and other condo related expenses that single home owners are required to pay themselves.

So, to answer your question, it is likely the difference in assessments is justified if the services your condo receives is paid for through your assessment while individual homes must pay out of pocket for those expenses.
KerryL1
(California)

Posts:6871


02/05/2020 9:15 AM  
I think Augustin and Douglas are right, JohnL. The assessments the THs pay must be spelled out in your CC&Rs.

Now, we have a similar situation and some of it is spelled out in our CC&Rs, but, in it, Owners are understand to understand the rest by referring to the "budget." What that means is the original Budget required of the developer by the Dept. of Real Estate (DRE) to approve your HOA. Referring to that is the ONLY way we can understand how much to assess certain condos. Yes, it's a mess and our CC&Rs must be revised.

Anyway, JohnL your CC&Rs are your starting point. It's possible, but unlikely, the "dues splits" if any required by your documents could be in your bylaws.

SteveM9
(Massachusetts)

Posts:3537


02/06/2020 8:25 AM  
The developer set the dues ratio, and it was done for a reason. They are pretty much set in stone, forever. You will never have the votes with only 8 town homes vs 40 condos. No one in the condo is going to vote to increase their own dues.

While its good to question what services are provided and where the dues money is going, your never going to change it.
JohnL40
(California)

Posts:5


02/06/2020 5:53 PM  
Hello,

Thank you all for your responses. To answer some questions: All the units in the complex (singles and town homes) receive the same services from the HOA. In the budget, all assessments are broken down and the 8 town homes pay more than double each month across the board. For example, the 8 town homes pay $19 a month for pool maintenance, while the single homes pay $8 a month. This kind of cost difference applies to all fees in the budget from landscaping to administrative and even reserve account collections. I consulted the CCR document and it spells out the distribution of fees quite nicely: "Regular and Special assessments shall be levied against each lot equally, based on a fraction, the numerator of which is 1 and the denominator is the total number of lots in the project." There is an exception for town homes relating to landscaping and insurance, which makes sense, but there is no mention of the other assessments besides the equal weighting across the project line. This certainly sounds like all fees except insurance and landscaping should be levied equally right? I don't know how "across the entire project" could mean "more for town homes and less for single homes." I did send this to the HOA and they said they would "look into it with their accounting department." It has been this way for years.
MarkW18
(Florida)

Posts:476


02/06/2020 6:18 PM  
Do you have a management company preparing a budget based on what was legally laid out in your CCR's.

It does sound like someone screwed up. If everyone uses the same pool, the cost should be the same. If not, someone screwed up.
AugustinD


Posts:2574


02/06/2020 6:34 PM  
Posted By JohnL40 on 02/06/2020 5:53 PM
I consulted the CCR document and it spells out the distribution of fees quite nicely: "Regular and Special assessments shall be levied against each lot equally, based on a fraction, the numerator of which is 1 and the denominator is the total number of lots in the project." There is an exception for town homes relating to landscaping and insurance, which makes sense, but there is no mention of the other assessments besides the equal weighting across the project...
I would want to see the Declaration's definition of "lot." I would want to see the pertinent sections of the CC&Rs quoted verbatim.
KerryL1
(California)

Posts:6871


02/06/2020 7:43 PM  
What is the exact wording of this section, JohnL? :"There is an exception for town homes relating to landscaping and insurance, which makes sense..."
JohnL40
(California)

Posts:5


02/06/2020 11:28 PM  
From what I understand, the association prepares the budget and the board signs off on it. There isn't a property management company apart from the association. Yes, there is only one pool yet the town home owners pay more than double for maintenance fees.
JohnL40
(California)

Posts:5


02/06/2020 11:38 PM  
A "lot" is defined in the CCR as "any parcel of land shown on the Map, with the exception of the Common area" The "map" is a map of the entire subdivision.

The section on assessments reads verbatim: "Equal Division of Regular and Special Assessments. Regular and special assessments shall be levied against each Lot (and its owner) equally, based on a fraction, the numerator of which is one and the denominator of which is the total number of Lots in the project, provided however, the owners of attached lots shall pay, in addition to the basic assessment, a Supplemental Assessment for all costs incurred by the association in providing fire and casualty insurance on the Attached Lots, and with respect to lots 41-48, inclusive, only an additional supplemental assessment for all gardening service and maintenance provided by the association to Lots 41-48, inclusive and to Lot C pursuant to section 5.01 B herein."

lots 41-48 are the 8 town homes and section 5.01B is just a definition of landscaping.

So this reads to me that town homes incur additional costs related to landscaping and insurance but all other costs should be equal right?
AugustinD


Posts:2574


02/07/2020 6:09 AM  
Posted By JohnL40 on 02/06/2020 11:38 PM
The section on assessments reads verbatim: "[snip for focus]... an additional supplemental assessment for all gardening service and maintenance provided by the association to Lots 41-48, inclusive and to Lot C pursuant to section 5.01 B herein."
The "and maintenance" part has my attention. Now I need to see the sections of the Declaration dealing with maintenance responsibilities. By any chance is the HOA responsible for the roofs of the townhomes? The exterior walls? Plumbing before it crosses the boundary of the townhome?
CathyA3
(Ohio)

Posts:737


02/07/2020 6:48 AM  
What I'm curious about is if the OP's community is being assessed a single fee with different amounts, or if the townhomes are actually being assessed two separate fees that have been added together to "make things easier" but instead leads to questions like this.

The Single Family Plus Townhomes communities that I'm familiar with actually have two separate assessments. One is an annual fee paid by everyone that covers any amenities used by all owners plus any common area belonging to the entire HOA (such as landscaping at the community entrance). In addition, the townhomes are assessed a separate monthly fee that takes care of the exterior maintenance on those homes. The separate assessments make it much more obvious what people are actually paying for, even if the HOA chooses to allow various payment options for convenience.

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