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Subject: New Roof assessment /failed
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Author Messages
CindyH6
(Florida)

Posts:20


02/20/2021 7:16 PM  
I live in small townhouse community with a new board , the prior board breached fiduciary duties for 15 years ( no $$ left in reserves , no insurance for the roofs). Hurricane came in 6 months ago and we are still covered in tarps.

We must have the roofs replaced because they are toast. We had a vote for new roof assessment and it failed by a huge margin, the owners don’t care if they lose the value of the home. I am ready to sell, but it’s illegal to rent a unit in this condition and I can’t sell either because buyers can’t get loans and a cash buyer is extremely rare in this area. I already paid my home off.

I thought the HOA had one job to protect value. We have zero amenities at our complex, so for them to get paid a pretty large HOA fee for zero amenities, no insurance and no money saved over 15 years.

I just want to get the assessment passed and sell and leave this dump low class community.

Thank you
TimB4
(Virginia)

Posts:17439


02/20/2021 8:23 PM  
Ouch.

Two options:

a) Loans (if the HOA/COA is solvent enough to qualify for one).

b) Petition the court for receivership. It will be costly as assessments will go up to pay for the receiver.
However, the receiver answers to the court and not the members. In the end, roofs will be replaced and you should have healthy reserves.

The cons of receivership is few will want to purchase into a development under receivership and there will be assessment increases and, likely special assessments. Some may not be able to afford the increases (especially with the pandemic economy) and might be forced into foreclosure (worst case).

I suspect that whomever petitions the court will not have many friends either.

TimB4
(Virginia)

Posts:17439


02/20/2021 8:44 PM  
Cindy,

Quick question, did you have your own hurricane insurance?
CindyH6
(Florida)

Posts:20


02/20/2021 9:25 PM  
Thank you, I thought about a receiver, but it said it was for HOA without a board?

I would have no problem petitioning for a receiver,

I have already bought a new home in another town and don’t have friends here

It’s not fair for the responsible owners to lose their investment just because of the deadbeats that don’t want to pay bills.

Yes the HOA can get a loan, but these people are too short sighted to understand that it’s imperative to replace the roof.

Yes, I have insurance, however, in Florida the law allows all insurance companies to have an extremely high deductible unique to hurricane related claims. So the deductible for a this claim will be double the cost of a new roof.
TimB4
(Virginia)

Posts:17439


02/20/2021 9:28 PM  
It appears that the board has another option if they are willing to do it.

718.1265 Association emergency powers.

per that act:

l) Regardless of any provision to the contrary and even if such authority does not specifically appear in the declaration of condominium, articles, or bylaws of the association, levy special assessments without a vote of the owners.


HOAs have a the same language: 720.316 Association emergency powers.

Time to start informing your board of the options they have.


CindyH6
(Florida)

Posts:20


02/20/2021 9:45 PM  
Wow , you have the statute number ,thank you very much , that is the best hope.

It’s in all owners best interest to not lose their investment,

The good news is the units have significantly appreciated
But are basically worthless if we can’t get the new roof
SheliaH
(Indiana)

Posts:3824


02/21/2021 6:40 AM  
Amazing how some people continue to vote against their own interests despite the folly if that decision slapping them in the face and kicking them in the behind. I imagine they're all focusing on the cost or figure the problem couldn't be that bad because the tarp is there. Or they know full well this won't be cheap, but simply don't have the money.

What were people saying when the special assessment was discussed. Did the board onside bringing in whoever inspected the roof go have him or her explain why the community can't put this off anymore? could there be implications with whatever city or county agency regulates the building code? perhaps someone from that agency can come to a meeting and tell the truth everyone is refusing to face.

In any case, you may have to bite the bullet and sell for whatever you can get and get out of here if your neighbors can't or refuse to see the light. On your other post you asked if you could sue your neighbors - as Tim noted, its one thing to sue, but another to win. And to be blunt, you're one sixth of this community, so as Melissa might say, you'd be suing yourself.

You don't say how old the community is or how long you've lived there, but be honest - were you of the mindset that assessments should be kept as low as possible? How much attention did you pay to spending the previous board and this one? Too many people move into HOA communities and set their minds on autom9, not paying attention to what's really going on until they have to. By then they find themselves knee deep in mess that takes lots of time and money to fix

This is yet another reason why I've never understood why any builder creates a HOA under 15 units. From what I've seen on this website, the smaller the community, the more drama because all it takes is one or two people to gum up the works.
TimB4
(Virginia)

Posts:17439


02/21/2021 8:41 AM  
Posted By SheliaH on 02/21/2021 6:40 AM

Amazing how some people continue to vote against their own interests despite the folly if that decision slapping them in the face and kicking them in the behind. I imagine they're all focusing on the cost or figure the problem couldn't be that bad because the tarp is there. Or they know full well this won't be cheap, but simply don't have the money.




It could be that the board simply didn't explain the issue well enough.


I know when we needed a membership vote to increase our assessments 22% to fully fund our reserves, I was writing articles every month for our newsletter. I explained the reason for reserves, what steps the board had already done to decrease costs, etc. Participation still wasn't that great, but the there was enough to have the issue pass.


JohnC46
(South Carolina)

Posts:10651


02/21/2021 9:53 AM  
It took us over a year to explain why we needed a dues increase. Meetings, mailings, spreadsheets. In our case it was a 40% increase. $50 to $70 per month. Our owners do not get to vote on it. The BOD can do it once a year, any amount they desire. We only had one of 112 that openly challenged us. He soon went away. Not that people liked it, but they accepted it.
CindyH6
(Florida)

Posts:20


02/21/2021 1:22 PM  
Hi Shiela, you are absolutely correct.

The complex is 15 years old, we are in an area of extremely low inventory. I bought 2 years ago and was informed they were already in works of replacing the roof. I had been dealing with the property management company and they kept putting me off. I finally said I would sell and get out of here , but the hurricane came and now the old roofs are beyond repair.

The former board has moved away , the last person , resigned and nominated warm bodies for the new board.

Your correct that the board and property management company refused to do anything to explain why we needed a new roof. I begged that they needed to send a letter explaining the benefits of a new roof and they would not do it. I even offered to write a letter and they could use or improve it. These people don’t even understand how an assessment works and that is the only way the HOA can finance the roof. I talked to someone that went on a rant about the rate , I tried to explain that the assessment helps people that have difficulty obtaining a loan on their own and the assessment can be paid off early without penalty.

Thank you again for your insight






SheliaH
(Indiana)

Posts:3824


02/21/2021 3:00 PM  
Here's another thought - since it appears no one want to address this (because it also reflects how short sighted they were), maybe it's time to sell the buikding, dissolve the association, divide the money and everyone goes their separate ways.

If the roof is at bad as you say, you'll likely take a hit on the final proceeds after attorneys and other folks are paid to finalize the legal stuff, but you'll finally be out of there and these homeowners can go live somewhere else.

This is no small decision and everyone would have to be on board - but who knows, maybe this is what some really want but don't have the guts to speak up and say so. During the next board meeting, toss that grenade in the middle of the discussion and see what happens.

Just be sure you have all the facts you'll need to see how much this will cost, along with any tax implication before you do anything. you might also need to chat with your mortgage company because it may have to sign off on anything you do regarding your unit (after they get their money, you may not have any money.)

Good luck.
MikeB23
(Louisiana)

Posts:18


02/21/2021 5:55 PM  
Members don't get to vote on assessments in our HOA. The Board decides and invoices are sent in accordance with the Bylaws. If someone doesn't pay, we sue.
SheliaH
(Indiana)

Posts:3824


02/22/2021 6:07 AM  
Same in my community - homeowners vote on assessments only if the upcoming year's assessments have to exceed a 5% increase (the maximum our documents allow) or a special assessment is proposed.

If Cindy's homeowners won't vote on a special assessment, the only thing I can suggest is for the board to increase assessments as high as their documents allow and keep doing that every year. Tell the homeowners this is necessary to raise money to repair or replace the roofs (replacement is probably the best option at this point) while paying routine assessments and funding reserves (properly this time). Sure, the current board may risk being voted out, but that also means the replacements will have to come up with something (good luck with that). Sometimes, you have to be the adult in the room and say this is how it's going to be because if we don't do something, EVERYONE will suffer.

Speaking of reserves, you said there was only $10K in yours so I imagine you're terribly underfunded. I don't know where the money will come from, but it's time for a reserve study so everyone will see where the association is at. You could even have the specialist attend a special meeting to give a presentation on the findings and people can ask questions.
SheliaH
(Indiana)

Posts:3824


02/22/2021 6:07 AM  
Same in my community - homeowners vote on assessments only if the upcoming year's assessments have to exceed a 5% increase (the maximum our documents allow) or a special assessment is proposed.

If Cindy's homeowners won't vote on a special assessment, the only thing I can suggest is for the board to increase assessments as high as their documents allow and keep doing that every year. Tell the homeowners this is necessary to raise money to repair or replace the roofs (replacement is probably the best option at this point) while paying routine assessments and funding reserves (properly this time). Sure, the current board may risk being voted out, but that also means the replacements will have to come up with something (good luck with that). Sometimes, you have to be the adult in the room and say this is how it's going to be because if we don't do something, EVERYONE will suffer.

Speaking of reserves, you said there was only $10K in yours so I imagine you're terribly underfunded. I don't know where the money will come from, but it's time for a reserve study so everyone will see where the association is at. You could even have the specialist attend a special meeting to give a presentation on the findings and people can ask questions.
MichelleG7
(Connecticut)

Posts:49


02/22/2021 7:42 AM  
This is considered an emergency the board needs to figure it out and get it done. OR rep[lace the board.. Do you have management? if not might be time to get them. After three leaks on one of our roofs. I got the BOD to replace the roof. For this reason. We had the funds no assessment. If the roof was in this condition and there are zero reserves what did the BOD spend the funds on? after all this thats what I would have an audit done. Possibly the Association needs to go after the BOD. Just some thoughts.
MichelleG7
(Connecticut)

Posts:49


02/22/2021 7:42 AM  
This is considered an emergency the board needs to figure it out and get it done. OR rep[lace the board.. Do you have management? if not might be time to get them. After three leaks on one of our roofs. I got the BOD to replace the roof. For this reason. We had the funds no assessment. If the roof was in this condition and there are zero reserves what did the BOD spend the funds on? after all this thats what I would have an audit done. Possibly the Association needs to go after the BOD. Just some thoughts.
MichelleG7
(Connecticut)

Posts:49


02/22/2021 7:42 AM  
This is considered an emergency the board needs to figure it out and get it done. OR rep[lace the board.. Do you have management? if not might be time to get them. After three leaks on one of our roofs. I got the BOD to replace the roof. For this reason. We had the funds no assessment. If the roof was in this condition and there are zero reserves what did the BOD spend the funds on? after all this thats what I would have an audit done. Possibly the Association needs to go after the BOD. Just some thoughts.
CindyH6
(Florida)

Posts:20


02/22/2021 10:09 AM  
Thank you Michelle, yes , it’s an emergency. We have had tarps for 6 months.

The prior board is gone. I followed the money and it went to : 50 percent - property management company
A mowing service that only a few owners use and stamps only the legal minimum was put in reserves.

That is a breach of fiduciary duties so we have to have the HOA get a loan for the special assessment.

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