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Subject: New Board Member questions
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DavidG45
(Delaware)

Posts:10


09/04/2020 8:12 AM  
I was recently elected to our three-member HOA Board. The community is only 250 homes into the 600 planned, so currently I am the only resident board member; the other two are from the developer.

I am unclear on the relationship between the developer, the board, and our property management company. For instance, our clubhouse is about 90% complete and a few weeks ago landscaping was put in (trees, sod, flower beds, etc.) Since then, none of it has been mowed. The weeds are taller than the trees, several of the trees and shrubs are dead because they haven't been watered, etc. The property manager says "John" (the President of the HOA and of the Development company) has to arrange it. "John" says the property manager has to arrange it.

Same with our common areas. Large fields of common areas only get mowed a couple times a year, at which point the weeds are three and four feet tall.

The entire community is up in arms, with good reason. "John" is completely unresponsive and seems to be of the opinion that he will not lift a finger or spend a dollar that he doesn't absolutely have to, and not until he absolutely has to. I have to assume that SOMEBODY is ultimately legally accountable to maintain the property to a reasonable standard, and SOMEBODY has the authority to simply ask our landscaping company to replace a dead tree and mow the common areas.

But nobody from the developer or the property management company is in any way responsive.

Looking for an education on how this is all supposed to work, as well as suggestions.
AugustinD


Posts:3900


09/04/2020 8:31 AM  
Short of filing a lawsuit, your hands are pretty much tied until the developer does not control a majority of the board.

Other veterans will post here soon. Stay tuned.
JohnC46
(South Carolina)

Posts:9877


09/04/2020 9:14 AM  
Posted By AugustinD on 09/04/2020 8:31 AM
Short of filing a lawsuit, your hands are pretty much tied until the developer does not control a majority of the board.

Other veterans will post here soon. Stay tuned.



I agree. Also, the PM is hired by the Developer.
SheliaH
(Indiana)

Posts:3460


09/04/2020 9:49 AM  
Well, AugustineD and John have given you a good head start. The developer pretty much runs the show until the community is turned over to the homeowners. Usually, they (or he, in this case) also hire the property management company, but after the homeowners take charge, they can decide whether to stay with that company or hire another.

If the clubhouse landscaping is looking dreadful, it could be John and/or the property manager are fighting with whoever's been hired to maintain it. I suspect if you spoke to the landscaper, you might hear something about not being paid to do what's already been done, and therefore, there won't be any watering, mowing or anything else until the account's bought current.

This may also mean John is having money issues - 250 homes built and 600 planned doesn't sound like progress, depending on how the community currently is, and the current financial issues of the country thanks to COVID isn't helping. Hold on to your knickers, you may be seeing the beginning of money drama.

What to do in the meantime? Since you're the resident board member, keep on speaking up on behalf of your neighbors, noting to the others that if the property starts to look run down, potential buyers may move on. If the clubhouse's landscaping is crappy, what will you find if you go inside the building?

Meanwhile, start looking at the HOA documents to see what the association is supposed to provide, and then start keeping some sort of punch list of things in the common area (like the clubhouse) the developer should have completed before the homeowners take over. When it gets closer to the time of the takeover, you and the new board will need that if you end up having to take legal action to blast the developer into getting things done. If the developer ends up going bankrupt and bailing on the project (which happens far more than you think), you'll need to know what you're looking at in order to set assessments to pay to finish everything up.

I often recommend people take a look at the Community Association Institute's website - it's a national organization of HOAs, property management companies and related vendors. It has a lot of good educational materials out there for new and experienced board members, not very expensive (cheaper if you join) and there's a book on transitioning from a developer to a homeowner run community. In your case, that's the first book, I'd get so you can talk to other neighbors on how to proceed (you may be the genesis of the future board).

There are also books on reserves, hiring property managers, rule enforcement and other HOA stuff that will be useful to you, and if you're really lucky, there may be a local chapter in your area, where you can attend seminars and meet people from other communities to exchange ideas and horror stories on what to avoid. Good luck!
CathyA3
(Ohio)

Posts:1235


09/04/2020 11:53 AM  
I recommend talking to the developer in ways that will motivate him.

The developer's main goal is to sell homes, so anything that makes his properties less attractive will be counterproductive for him. At the same time, he will want to minimize expenses, so he may have an incentive to view grass cutting as unnecessary maintenance.

You need to convince him that neglecting landscaped areas will make prospective buyers wonder if the developer is in financial trouble and that proposed amenities will never be built, as Shelia noted. This sort of thing was common during The Great Recession, so it's a reasonable thing to ask. In fact, that's the first thing I thought when I read the original post.

Of course, if this is the problem you're unlikely to convince him no matter how much you talk to him as a business partner.

Other comments:

Is he neglecting landscaped areas, or undeveloped lots? The undeveloped lots are not common area and won't be maintained to the same standard. The builder I work for bush hogs these areas every few months to keep things more or less under control, but it's nowhere close to a normal landscaping routine.

In addition, if construction is still going on, as with a still unfinished clubhouse, he probably won't want to maintain areas that are going to get damaged again. This is reasonable.

If you live in a community that is only partially finished, you're going to have to roll with the punches to some extent. Not fun while it's going on, things won't be pretty sometimes, but it won't last forever. (Ask me about the port-o-let that tipped over on the sidewalk in front of my home.)
GeorgeS21
(Florida)

Posts:3115


09/04/2020 12:57 PM  
Like others:
- start collecting every possible record of every possible transaction
- archive every discussion
- maintain a log of every discussion
- try and get as many promises and information as possible by email
- review county code and see if there is a circumstance where they will do enforce tall grass, etc

By all the above, be clear with the declarant that you are putting him on notice - notice he will be tracked and everything said and done, or not done, will be recorded and archived.

Consider getting an attorney to start working the file up - make sure the declarant knows this is ongoing.
GenoS
(Florida)

Posts:4066


09/04/2020 1:09 PM  
I'd also recommend checking with your county to see if the developer posted any kind of "completion bond". Many counties require this before they'll approve a new development. When the developer leaves, either because he finished or, perhaps, fell on hard times and is abandoning the project, the county refunds the bond. It's up to the homeowners left holding the bag to protest the return of that money to the developer and if there's a dispute, it's not unusual for a county to refuse the refund.
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