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Subject: Anybody's management comapny charge for Covid?
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Author Messages
FirstL3
(Illinois)

Posts:37


04/15/2020 4:28 PM  
Just wondering if anybody else got charged extra by HOA management company?
I am on the board as the treasurer and was surprised to find a charge for "Natural Disaster Response and Recovery Management" aka Covid. When asked for explanation they told me they have additional administrative costs....
Our mgmt company is really very basic. i.e. no onsite services.

With the various social distancing and stay-at-home orders issued by the government, xxxx made internal operating and technology changes to continue to provide services to the community. In this instance, we are able to charge an hourly rate for anyone having to assist with the management of your community. This, coupled with the normal additional administrative support provided by your regular support team, would result in higher variable billing charges for your Association.
JohnC46
(South Carolina)

Posts:9461


04/15/2020 5:05 PM  
WTF?
SheliaH
(Indiana)

Posts:3224


04/15/2020 5:10 PM  
Go back and read your management agreement - COVID-19 might not be mentioned specifically, but there may be language in there allowing this in case of a disaster or something similar (like a pandemic). If you can't find it, have your association attorney have a look.

That said, it would have been appropriate for the company to give you a heads up about the additional charge. Your board may have been able to do a little negotiation to suspend some services to help save money. You don't say how much the charge is, but if the additional charge comes out to a dollar or so per homeowner, it might be worth paying it to keep the services consistent. Be sure you ask specifically what they had to do, such as bump up their computer systems so people can work at home or rearrange work crews to ensure social distancing.
MarkW18


Posts:1067


04/15/2020 5:52 PM  
I can see that happening.
BillH10
(Texas)

Posts:495


04/15/2020 6:07 PM  
We posted a question a few weeks ago regarding decreasing our contract monthly flat rate charges as we reduced the level of service we provided to our clients, specifically we believed we should suspend property reviews based on the shelter in place orders of the county governments in which we operate. We received several responses with good advice.

We have since resumed full service operations, with precautions.

I cannot imagine increased costs as a result of COVID-19, for one thing our fuel costs in north Texas are in the $1.21-$1.35 range, down $0.50 a gallon or so from when this began. Our client 'touches' (email and call volumes) are significantly lower than five weeks ago. We have seen no uptick in administrative expenses, such as time spent collecting delinquent accounts.

To answer your question, no, we have not increased our charges and see no reason to do so at this time. We do have provisions in our contracts to increase charges should circumstances warrant.

I recommend you ask the President/Owner of your MC to join the Board on a conference call and explain the drivers for the increased costs.
KerryL1
(California)

Posts:7217


04/15/2020 6:19 PM  
With Sheila, review your contract. Even if there is such a clause, e.g., for disasters, etc., the MC should have sent a letter pointing it out to the board.

I do know our MC has written numerous alerts, etc. to our owners and presumably many are boilerplate for all their accounts so that's extra work for them. On the other hand, our full-time onsite PM & her asst. are now sequestered in their offices with no direct contact with residents as they usually are with their own door policy. So they seem to have a little less to do.

(200+ unit twin tower high rise)
FirstL3
(Illinois)

Posts:37


04/16/2020 5:21 AM  
Our current contract actually allows xxx to charge for “Any time spent on natural disaster response and recovery management” – that being said I don’t see how this applies. I do believe the intent here was different; i.e. a tornado hits a subdivision with actual work.

Some our fees are automatic (italicized in contract). However, “natural disaster” isn’t. Therefore, I assume default clause applies whereby agent has to potion board with documentation in advance. They didn't. They never do.

P.S. our management company got bought by a large national company (RealManage). Contract is still with original company. Team is still original.

SheliaH
(Indiana)

Posts:3224


04/16/2020 8:49 AM  
That may be how you feel, but it could also be argued that the fallout from COVID-19 is a lot similar to what may happen after a tornado or hurricane. In this case, social distancing is requiring all of us to change our routines and depending on what your property manager does, there is likely more time and resources being used.

You've read the contract, but now it's time for you to run this past your association attorney to see how he or she interprets that language. You still haven't said how much more the property manager is charging, so you need to run the numbers so you can talk to the manager about suspending some services if that's necessary to bring the cost down if that's what you want to do. You should certainly ask why they didn't give you a heads up that the additional charge was coming, so you could see if the budget could carry it.
BenA2
(Texas)

Posts:707


04/17/2020 3:06 PM  
There's noting wrong with charging you for extra work IF that is in their contract. If not, I would not pay it.
LetA
(Nevada)

Posts:946


04/17/2020 9:11 PM  
Thankfully our PM isn't charging us an extra fee for disaster fee.. We had an owner reach out to us about using the night droop for paying their assessment because the office building to our PM is locked. We told them to just mail it in because all late fees are suspended until the lockdown is lifted.
LaskaS
(Texas)

Posts:290


04/18/2020 12:10 AM  
I don't see how this could be in a contract.. unless there is a specific provision for pandemic operations which outlines what extra services will be provided.

I don't know the specifics of your Mc does for your community or what the specifics of the contract are, but it sounds like a money grab to me..

Yes,,i've officially become suspicious of most everything to do with hoa, cai,, management companies,, business that service hoa's exclusively,, I'm continually amazed at how easily money can just be Fudged away . A line item here, a line item there. noone pays attention to 500 here or there.. it's sickening.
FirstL3
(Illinois)

Posts:37


04/18/2020 5:20 AM  
BTW. They really did do nothing on Covid for us. Didn't expect them to. They keep sending emails on topic with generic information. Our HOA mgmt company is really very basic, yet 11% of our income goes to them. They to assessment collection, pay vendors, show up to 4 annual meetings, create a monthly financial report. In theory do vendor management (i.e. finding contractor). In reality we do most of that. And yes, they keep adding fees whenever they can. The other day we got charged $590 for an extra meeting that we needed. Performance of agent is not good. Half of the board would like to switch. However, we are all concerned that another company might be not better - just the way this industry works. Also, we are a small HOA (40 town homes).


GeorgeS21
(Florida)

Posts:2681


04/18/2020 5:43 AM  
FirstL,

I was once on the Board of an HOA with quarterly "Annual" (actually "Membership") meetings. They took a lot of additional effort, increased the opportunities for grandstanding and complaining by the ankle biters.

We rewrote the Bylaws to go to a Board meeting system, with an Annual Meeting that elected Board members - all meetings are open - but, since there is a limited audience, and the audience is usually knowledgable, the ankle biters don't like to attend them.

This, to me, is a far simpler construct than multiple membership meetings.
PaulJ6
(New York)

Posts:860


04/18/2020 6:19 AM  
Posted By FirstL3 on 04/15/2020 4:28 PM
Just wondering if anybody else got charged extra by HOA management company?
I am on the board as the treasurer and was surprised to find a charge for "Natural Disaster Response and Recovery Management" aka Covid. When asked for explanation they told me they have additional administrative costs....
Our mgmt company is really very basic. i.e. no onsite services.

With the various social distancing and stay-at-home orders issued by the government, xxxx made internal operating and technology changes to continue to provide services to the community. In this instance, we are able to charge an hourly rate for anyone having to assist with the management of your community. This, coupled with the normal additional administrative support provided by your regular support team, would result in higher variable billing charges for your Association.




That is a pure money grab.
FirstL3
(Illinois)

Posts:37


04/18/2020 6:52 AM  
I guess we are shopping for a new HOA contract. Just afraid that many companies have the same low service quality. I am surprised nobody is offer a cloud/outsourced HOA platform (managed service). i.e. call center, does billing/paperwork.
SueW6
(Michigan)

Posts:693


04/18/2020 6:59 AM  
Better get used to it.

Any business impacted by Covid is going to have to increase prices. This especially impacts restaurants or any other business where there is close contact with clients/ customers.

OR

The business has to restructure itself in order to satisfy upcoming regulations, within their own industry, even down to work stations, handling communications, building regulations, etc.

Your MC should be able to tell you how they have been impacted. (You dont say how much of an increase there is, but be realistic - you are going to see price increases for almost every service the HOA receives. )
FirstL3
(Illinois)

Posts:37


04/18/2020 7:20 AM  
Posted By SueW6 on 04/18/2020 6:59 AM
Better get used to it.

Any business impacted by Covid is going to have to increase prices. This especially impacts restaurants or any other business where there is close contact with clients/ customers.

OR

The business has to restructure itself in order to satisfy upcoming regulations, within their own industry, even down to work stations, handling communications, building regulations, etc.

Your MC should be able to tell you how they have been impacted. (You dont say how much of an increase there is, but be realistic - you are going to see price increases for almost every service the HOA receives. )




Can't really follow how this applies here. Our HOA has no direct interaction (i.e. no onsite services).The mgmt company is using an online platform that we share. I know that our agent can access and perform work from her laptop at any place. Maybe there are other employees who don't have a laptop yet? But really...
PaulJ6
(New York)

Posts:860


04/18/2020 7:23 AM  
Posted By FirstL3 on 04/18/2020 6:52 AM
I guess we are shopping for a new HOA contract. Just afraid that many companies have the same low service quality. I am surprised nobody is offer a cloud/outsourced HOA platform (managed service). i.e. call center, does billing/paperwork.




Such is the world of HOA "professionals".

Pretty much any business has been impacted by the coronavirus- whether having to buy laptops for remote access to losses of revenue, etc. Only some decide to get more money from their customers to make up for their changed financial positions. I realize that my customers are suffering as much as I am, so I would not pass on added costs.

There are plenty of online HOA management platforms.
FirstL3
(Illinois)

Posts:37


04/18/2020 9:48 AM  
Posted By PaulJ6 on 04/18/2020 7:23 AM
Posted By FirstL3 on 04/18/2020 6:52 AM
I guess we are shopping for a new HOA contract. Just afraid that many companies have the same low service quality. I am surprised nobody is offer a cloud/outsourced HOA platform (managed service). i.e. call center, does billing/paperwork.




Such is the world of HOA "professionals".

Pretty much any business has been impacted by the coronavirus- whether having to buy laptops for remote access to losses of revenue, etc. Only some decide to get more money from their customers to make up for their changed financial positions. I realize that my customers are suffering as much as I am, so I would not pass on added costs.

There are plenty of online HOA management platforms.




Possibly, they have higher costs. Then again it seems like they seem to be able to work form home already. Compared to most other business, they are very protected form revenue standpoint, I doubt HOA's cancelling contracts. Many other businesses have reduced revenue, higher cost and don't pass on. Bad style to pick such a moment and charge already only after two weeks into stay-at-home order.

Regarding: "There are plenty of online HOA management platforms." Very interested in exploring some. Ideally an online platform paired with somebody working behind:
1.) taking calls from homeowners as needed and enter into system
2.) collect funds, pay vendors, do accounting


PaulJ6
(New York)

Posts:860


04/18/2020 10:44 AM  
I found this list in searching for "HOA online platform" but "HOA management software" might also work:

https://www.capterra.com/hoa-software/
FirstL3
(Illinois)

Posts:37


04/18/2020 11:54 AM  
thanks. Looks like there are plenty of choices. I don't know that we are ready to go back DIY. Ideally, the service woudl be paired with backed operations. Almost like an online bank. Or find a part time association manager?
MarshallT
(New York)

Posts:58


04/21/2020 6:33 AM  
I haven't heard of this, but do check the contract. If you are concerned that they have added fees that does not align with their services, you can seek guidance from an attorney.
FirstL3
(Illinois)

Posts:37


05/14/2020 5:27 PM  
meanwhile our attorney reviewed our contract and agrees that such charges are non-automatic and have to be approved. They waived the fees as a "courtesy" but tell us there is a SLA that apparently superseded our contract. No board member has seen it before or signed.
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