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Subject: property management
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Author Messages
TV
(Washington)

Posts:91


05/26/2021 8:36 AM  
Hello

we have a property management company that is adding fees "for project management" related hours.

we have many water related issues, so a few years back they started charging extra hours at inflated rate for management related to these 'services".

now the started charging for anything it seems, emails to vendors; intercom, and roof as an example.
They say these fees are for hours charged related to project management.

this is ridiculous
AugustinD


Posts:1920


05/26/2021 8:38 AM  
Posted By TV on 05/26/2021 8:36 AM
Hello

we have a property management company that is adding fees "for project management" related hours.

we have many water related issues, so a few years back they started charging extra hours at inflated rate for management related to these 'services".

now the started charging for anything it seems, emails to vendors; intercom, and roof as an example.
They say these fees are for hours charged related to project management.

this is ridiculous
Don't you think the Board needs to sit down with the management company; discuss the terms of the contract; and possibly seek a modification to the contract?
TV
(Washington)

Posts:91


05/26/2021 8:44 AM  
hi

I think we have sat down with the company before.
they don't care

what is our recourse for extraneous fees

these companies just drop hours or invoices, and say pay us.
i have seen in the past fees are taken directly from account on departure from PM.
JohnT38
(South Carolina)

Posts:794


05/26/2021 8:47 AM  
Posted By TV on 05/26/2021 8:44 AM
hi

I think we have sat down with the company before.
they don't care

what is our recourse for extraneous fees

these companies just drop hours or invoices, and say pay us.
i have seen in the past fees are taken directly from account on departure from PM.




According to you this has been going on for a few years and yet you still keep using them. What did you expect?
AugustinD


Posts:1920


05/26/2021 8:52 AM  
-- Don't you think the recourse is to stop paying the management company for any fees your Board says are inconsistent with the contract?

-- The Board should make sure the bank does not allow the management company to make withdrawals.

-- Your board may have to change how the HOA pays its bills.

-- I think good practices dictate that a HOA director or HOA officer be the main check signer. For checks over a certain amount, I think good practices dictate that the board should require two check signers.

-- Keep checking back here. Others will likely chime in.
TV
(Washington)

Posts:91


05/26/2021 8:53 AM  
Hi

I have been pushing to get rid of them for years

what is the recourse for these spontaneous and expensive fees?

TV
(Washington)

Posts:91


05/26/2021 8:58 AM  

the PM is asking for 2 check signers for these fees.

is this a definable offense that would constitute a complaint for state attorney general?
BarbaraT1
(Texas)

Posts:589


05/26/2021 8:58 AM  
Posted By TV on 05/26/2021 8:53 AM
Hi

I have been pushing to get rid of them for years

what is the recourse for these spontaneous and expensive fees?






What do you mean by recourse? You want your money back? You want them to stop charging them?

Your board has a contract with this company. Read it.

Nobody on the internet can solve your problem for you.
AugustinD


Posts:1920


05/26/2021 9:03 AM  
Posted By TV on 05/26/2021 8:58 AM

is this a definable offense that would constitute a complaint for state attorney general?
Not if it's about contract enforcement.

Listen to BarbaraT1. She's one of the HOA/COA managers who post here.
CathyA3
(Ohio)

Posts:2599


05/26/2021 9:36 AM  
Posted By TV on 05/26/2021 8:44 AM
hi

I think we have sat down with the company before.
they don't care

what is our recourse for extraneous fees

these companies just drop hours or invoices, and say pay us.
i have seen in the past fees are taken directly from account on departure from PM.



I think the board should have a serious talk with the PM, state that they will pay only for services charged in accordance with the contract, and then do it. And fer Pete's sake look for a new PM. People can only take advantage of you if you allow it. If I were a homeowner in this situation, I'd want to see both the PM and the board gone.

We had a similar situation in my association, and we ran out the term of the contract and then kicked 'em to the curb. I don't recommend trying to terminating for cause unless it's something really egregious - they'll simply tie you up in court until the contract term ends, so may as well save the legal dollars.
MaxB4
(California)

Posts:1601


05/26/2021 10:09 AM  
Posted By TV on 05/26/2021 8:58 AM

the PM is asking for 2 check signers for these fees.

is this a definable offense that would constitute a complaint for state attorney general?



Are you asking if the PM is requesting 2 check signers, is this a definable offense? For what?
MaxB4
(California)

Posts:1601


05/26/2021 10:17 AM  
I haven't seen anything the OP has stated that fees for "project management" weren't in the contract, only that now they are charging them. A lot of things have changed with the pandemic. I went to dinner last night with my wife and daughter. The price of food had remained pretty much the same, but the margaritas have doubled in price, actually more than the food itself.
JohnC46
(South Carolina)

Posts:11665


05/26/2021 10:20 AM  
Posted By AugustinD on 05/26/2021 8:38 AM
Posted By TV on 05/26/2021 8:36 AM
Hello

we have a property management company that is adding fees "for project management" related hours.

we have many water related issues, so a few years back they started charging extra hours at inflated rate for management related to these 'services".

now the started charging for anything it seems, emails to vendors; intercom, and roof as an example.
They say these fees are for hours charged related to project management.

this is ridiculous
Don't you think the Board needs to sit down with the management company; discuss the terms of the contract; and possibly seek a modification to the contract?



I agree.
TV
(Washington)

Posts:91


05/26/2021 10:20 AM  

obviously not
KerryL1
(California)

Posts:8729


05/26/2021 10:21 AM  
Are you on the Board, TV?
TV
(Washington)

Posts:91


05/26/2021 10:30 AM  
If I were not on the board, how would I know these inside details?
JohnC46
(South Carolina)

Posts:11665


05/26/2021 11:24 AM  
Some 6 years ago we interviewed PM's as the Declarant was getting ready to transition to we owners. Several on our Advisory BOD suggested we go self managed which could work for us but no one was wanting to do the work required to be self managed.

We interviewed 3 which were all priced about the same. We eliminate one right away as they had a laundry list of additional charges right down to color copies. I felt they were more like a secretarial service then a PM company. One other was eliminated as one of our BOD Members knew of them as his sister's HOA used them and were not overly happy. We settled on one that we have used for 5 years now with only small rate increase 2 years ago. Beware of the nickel dime chargers. They can get expensive.
JohnT38
(South Carolina)

Posts:794


05/26/2021 11:32 AM  
Posted By TV on 05/26/2021 10:30 AM
If I were not on the board, how would I know these inside details?




I am so baffled by this. If the board, which I now know includes you, doesn't have what it takes to the manage the existing PM or get a new one what do you expect people to tell you? How can we possibly solve your problem? You know exactly what the problem is and have for years. I am simply amazed by how many people who post here don't grasp the concept that the PM works for the HOA and it is the board that is responsible for managing them. In situations like this the problem is clearly not the PM. They are simply the byproduct of an ineffective board that made a conscious decision to bury their heads in the sand and do nothing.
AugustinD


Posts:1920


05/26/2021 11:34 AM  
Posted By TV on 05/26/2021 10:30 AM
If I were not on the board, how would I know these inside details?
It's common for non-directors to post here with inside information.

I think the main problem is either (1) your Board does not have the backbone to ask questions of the management company; or (2) a majority of the Board does not feel as you do.
JohnC46
(South Carolina)

Posts:11665


05/26/2021 2:03 PM  
Posted By AugustinD on 05/26/2021 11:34 AM
Posted By TV on 05/26/2021 10:30 AM
If I were not on the board, how would I know these inside details?
It's common for non-directors to post here with inside information.

I think the main problem is either (1) your Board does not have the backbone to ask questions of the management company; or (2) a majority of the Board does not feel as you do.



I agree that many think the PM "owns the association" and we should do as they say. The BOD works for the association via the BOD. I especially see this if the MC is the same one that was used before turnover to the owners. If the BOD or association is not happy with the MC, then kick their ass to the curb and find a new one.
KerryL1
(California)

Posts:8729


05/26/2021 3:11 PM  
I think both JohnT & Augustin are on target.

Are the "extras" in the Contract, TV?
SheliaH
(Indiana)

Posts:4290


05/26/2021 7:02 PM  
Have you READ the contract? That's where you should start - it may be there's language that allows the property manager to charge extra fees for certain services.

By the way, "expensive" is relative - what's expensive to you may be reasonable to someone else, especially if the board is asking the property manager to do a lot of extra work. You don't get champagne services for beer money, so once you have a handle on the fees, the board can decide what's really necessary and what could be dropped (that's called renegotiating the contract).

If you can't make a deal, the board will have to do the work in finding another property manager, and that will take time and effort. You'll have to prepare a request for proposal, get bids (at least three) and if you find someone you like, you'll have to talk to the current property manager about a transition plan so the transfer from company 1 to company 2 is as seamless as possible. Usually, people balk when they see how much work is involved, but if you're going to do this, doing it right is mandatory.

The CAI website has a book on selecting and working with property managers - if you're on the board, you may want to purchase a copy (or see if it's in your local library) and read it to get some ideas on best practices. And take a look at old conversations on this website to see how other associations handled this so you'll know what to do (or not) Don't respond to the old conversations - if you have questions, start a new one. And pay attention to Max, Bill, Barbara, and other posters who are also property managers. You may not agree with everything they say, but at least you'll get some insight as to how they work and keep your expectations in check.
NpS
(Pennsylvania)

Posts:4216


05/27/2021 3:26 AM  
Back in the day when putting a meter on a copy machine was the latest technology, MCs had a heyday hiding fees in nickel and dime charges.

3 options:
1. Take a red pencil to the contract and eliminate all metered or similar fees.
2. Add a contract clause that puts a cap on all add-on charges so that you can't be charged more than a specified amount.
3. Write your own contract which favors the HOA rather than the MC.

Sikubali jukumu. Read all posts at your own risk.
BillH10
(Texas)

Posts:783


05/27/2021 8:15 AM  
TV

Our client contracts stipulate the following activities may result in additional hourly charges:

1. Certain clerical services, project management services, non-legal complex research and document drafting, complex research and document drafting for attorney review and filing as required. The foregoing require negotiations with the Board in advance of incurring billable hours.

There are other billed expense scenarios involving collections activities and mileage reimbursement but you expressed concern about project management services. We expect to be on the property of a client at least twice monthly, which includes 1-2 hours of time while there to meet contractors, owners, etc. We are flexible on the 1-2 hours, we do not set a stopwatch.

However, we make it clear to the client if their desire is we be on the property for hours on end while vendor work is taking place, we expect to be reimbursed for our time.

I suggest your Board first understand the contract services received under the base monthly contract rate and then establish ground rules with the management company regarding incurring charges over and above the monthly base contract rate.

2. Following a discussion on another forum regarding management company incremental expense charges, we reviewed our contracts and price schedules. We found the time and effort to keep track of how many stamps, envelopes, copies, file folders and the like were used each month was not justified in light of the amounts being charged. We made the unilateral decision to simply furnish those items under the basic monthly rate for the client. However, we specialize in small condominium clients with fewer than 25 units, it was silly to bill for three copies, 2 envelopes, and 2 stamps for ordinary business operations (not collections or annual/special association meetings).

If we were managing a 250 home HOA, our decision may have been different. Or, maybe not depending on how the analysis turned out.
KellyM3
(North Carolina)

Posts:1806


05/27/2021 8:30 AM  
Posted By TV on 05/26/2021 8:36 AM
Hello

we have a property management company that is adding fees "for project management" related hours.

we have many water related issues, so a few years back they started charging extra hours at inflated rate for management related to these 'services".

now the started charging for anything it seems, emails to vendors; intercom, and roof as an example.
They say these fees are for hours charged related to project management.

this is ridiculous




The property management company is contracted to manage the community's "business operations" as its primary responsibility. This is separate from a years-long project management issue related to water/drainage issues. If these water issues are, and have been, ongoing and in addition to normal property management, then you can expect to compensate your property management office to oversee this special issue on your behalf.

Fees can be negotiated and the manager can explain the time commitment in defending the fee scale but I can understand the extra cost as such projects - when left unattended and unsolved by the HOA - will increase business costs for the PM beyond the time/labor expectations of managing daily business affairs.

If not articulated well, it can frustrated board directors. Been there. But, PM's are not ad hoc project managers, especially on a never ending project or concern.
MaxB4
(California)

Posts:1601


05/27/2021 8:51 AM  
Posted By NpS on 05/27/2021 3:26 AM
Back in the day when putting a meter on a copy machine was the latest technology, MCs had a heyday hiding fees in nickel and dime charges.

3 options:
1. Take a red pencil to the contract and eliminate all metered or similar fees.
2. Add a contract clause that puts a cap on all add-on charges so that you can't be charged more than a specified amount.
3. Write your own contract which favors the HOA rather than the MC.



Better yet, SELF MANAGE!
TV
(Washington)

Posts:91


05/27/2021 10:14 AM  
self management is not realistic

KerryL1
(California)

Posts:8729


05/27/2021 11:06 AM  
What about NpS's suggestions, TV? Or Kelly's? Or Bill's?
BarbaraT1
(Texas)

Posts:589


05/27/2021 12:22 PM  
Posted By TV on 05/27/2021 10:14 AM
self management is not realistic





So why do you think someone else shouldn't be paid to do the job you and the rest of your neighbors either refuse to do or can't do?

Pardon me, but I'm a little salty today. I injured myself on Tuesday and am in considerable pain.

Boards and residents say the management company charges too much, when what they mean is "more than I want to pay, which ideally would be nothing." Don't want to be "nickel and dimed"? Okay, pay a higher base management fee, except nobody wants to pay that either. If you think the MC is charging too much, go find someone cheaper, and get what you pay for. Association management is a for-profit industry. No management company is obligated to make as little profit as possible so your dues won't have to go up. And the ones that charge very little are the ones that pay their employees very little and again - you'll get what you pay for.

Project management oversight, insurance claim management - those come with extra fees because that is extra work. Most associations are paying for portfolio management, meaning you are one of many properties your manager is responsible for and you get 1/10 to 1/20th of her time. So when you have a special project that takes up more than the fraction you are paying for - yeah, you have to pay more for that.

Now in my case, I am a dedicated onsite manager, so the association I work for doesn't get charged any extras because I'm paid to take care of this property- whatever that involves. But it also means I get a salary commensurate with "whatever that involves." Which today, involves hobbling into the office with a broken foot to ensure that all the people who didn't get around to picking up their pool access cards until the last minute can get them before the holiday weekend.







JohnT38
(South Carolina)

Posts:794


05/27/2021 12:45 PM  
Barbara, you and some of the other posters here are truly better people than me for answering cryptic posts like this. TV can only manage to mumble a response with the minimum words possible and has no interest in providing a detailed intelligent response such as what the current PM's contract says and what duties they are contractually responsible to provide as part of the base contract. Without this information everyone here is pissing in the wind when it comes to providing any meaningful help since we are unable to assess what the real situation is.
TV
(Washington)

Posts:91


05/28/2021 8:11 AM  
John your are a godlike creature
JohnT38
(South Carolina)

Posts:794


05/28/2021 8:47 AM  
Posted By TV on 05/28/2021 8:11 AM
John your are a godlike creature




Thanks and I will now use my 'godlike' abilities to get you to answer questions. Now speak my child. What does the contract say?
TV
(Washington)

Posts:91


05/28/2021 8:55 AM  
generic additional charges:

this is what is being used to justify charges of any nature, and billable hourly at a much higher (almost double rate).
nature of new charges incurred: anything deemed by company to not be normal services.


ADDITIONAL CHARGES - NON-ROUTINE SERVICES (REQUIRE BOARD AUTHORIZATION)
Agent shall maintain availability for services related to certain non-routine activities, which shall be performed with the proper authorization of the Association’s Board.

Non-Routine Services may include, but are not limited to, the following: research, court appearances, depositions, consultation with
attorneys related to the Association’s role as a plaintiff, defendant, co-defendant or witness in any action
(including court appearances, depositions and witness testimony), preparation and development of special reports, collation and/or dissemination of records and compilation of information requested by the Board, the Association’s attorney, or others, insurance claim administration and administration and
enforcement of rules or other obligation of the Association or its membership.
AugustinD


Posts:1920


05/28/2021 9:04 AM  
As everyone and their sister can see:
Posted By TV on 05/28/2021 8:55 AM
which shall be performed with the proper authorization of the Association’s Board.
No board authorization = the HOA owes nothing for these services
TV
(Washington)

Posts:91


05/28/2021 9:12 AM  
your a genius

but that is meaningless


they take implied approval as signed contract, and proceed to do actions and bill.

are you guys awake?

have you ever seen Pm companies make up invoices, remove funds from account without explicit approval?
ever try and take action?

in my mind most of the industry is bad
AugustinD


Posts:1920


05/28/2021 9:19 AM  
Posted By TV on 05/28/2021 9:12 AM
your a genius
You too!
MaxB4
(California)

Posts:1601


05/28/2021 9:38 AM  
Posted By TV on 05/28/2021 8:55 AM
generic additional charges:

this is what is being used to justify charges of any nature, and billable hourly at a much higher (almost double rate).
nature of new charges incurred: anything deemed by company to not be normal services.


ADDITIONAL CHARGES - NON-ROUTINE SERVICES (REQUIRE BOARD AUTHORIZATION)
Agent shall maintain availability for services related to certain non-routine activities, which shall be performed with the proper authorization of the Association’s Board.

Non-Routine Services may include, but are not limited to, the following: research, court appearances, depositions, consultation with
attorneys related to the Association’s role as a plaintiff, defendant, co-defendant or witness in any action
(including court appearances, depositions and witness testimony), preparation and development of special reports, collation and/or dissemination of records and compilation of information requested by the Board, the Association’s attorney, or others, insurance claim administration and administration and
enforcement of rules or other obligation of the Association or its membership.



There could have been authorization and the board in all their infinite wisdom, left you out of the loop. I would be pissed too!
BarbaraT1
(Texas)

Posts:589


05/28/2021 9:52 AM  
Posted By TV on 05/28/2021 9:12 AM
your a genius

but that is meaningless


they take implied approval as signed contract, and proceed to do actions and bill.

are you guys awake?

have you ever seen Pm companies make up invoices, remove funds from account without explicit approval?
ever try and take action?

in my mind most of the industry is bad




If the contract says x,y,z services cost extra and the board says “hey manager we need you to do x,y,z” they have given their approval.

Are you for real?

We are not your fellow board members. We can’t bring about whatever resolution you want. Go tell it to the rest of your board if you think you have all the answers.

In my mind, you don’t want to solve problems, you just want to complain.
TV
(Washington)

Posts:91


05/28/2021 10:03 AM  
another godlile creature response

are you a PM or BD?
MaxB4
(California)

Posts:1601


05/28/2021 10:07 AM  
Posted By TV on 05/28/2021 9:12 AM


in my mind most of the industry is bad



And this genius observation is based on exactly WHAT?

I have been a Board member and president, have been a PM, and for the past seven years, have owned a management company.
TV
(Washington)

Posts:91


05/28/2021 10:13 AM  
well experience

but I am thinking you are a PM?
JeffT2
(Iowa)

Posts:638


05/28/2021 11:03 AM  
Posted By TV on 05/28/2021 9:12 AM
your a genius




you're also a genius
CathyA3
(Ohio)

Posts:2599


05/28/2021 11:29 AM  
We're all geniuses. Yet we don't seem to be getting anywhere, or even know yet if there is an anywhere to be gotten to. :-)
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