Dissolving HOA with property

Robert,

If the HOA is a nonprofit corp then those statutes should be used for dissolution. Something needs to be done with the property owned by the assn. If it remains in the assn's name and there is no longer an assn then all the prop owners will be liable for any property damage or injury that occurs on the property. Exactly what type property is owned by the HOA?

As Mary stated you will need to check your corporation type and the state statutes. The state statutes can be found using this website: http://www.associationtimes.com/stateInformation.htm#M.

However, because of the type of property it should have some type of liability insurance. If someone became injured the cost of a lawsuit against all owners of the property could be very costly. One idea might be to fence the area with a security gate only the homeowners could access. This could help reduce or eliminate any tresspassing. While it may cost a bit up front if allowed in your city area, it would give homeowners peace of mind regarding many of their concerns you voiced and possibly increase the property value due to the increased security.

It was a suggestion Mary ... an option to consider along with the option to dissolve. Do you have nothing better to do on this site other than attack everyone's suggestions or comments?

First Find out who actually owns the property. Get the plat and verify the dedication. For 40 years our HOA thought they owned our park. We did not, we were only managers of it. It was dedicated to the "public" If this property is tax exempt..chances are good it does not actually belong to you.

2nd..I am living this nightmare. Assume nothing. Verify everything with the county. Check with the tax assessor, the auditor, anyone else that could possibly be involved.

Our CCR's led us to believe our beach would be sold if the HOA dissolved..but since we did not actually own it this was not the case.

I want to be sure to clarify. The deed to the property clearly states "to be used for beach privilges by lot owners of said association."

The HOA is "voluntary" always has been, so if those that are members pay taxes and all proper maintenance (including insurance) decide to dissolve, then it seems that the property "deeded" is able to be sold for the benefit of the HOA members.

Yes, this will diminish the value of homeowners within the area. It will also diminish the liability to all those who have supported it over the years and now face abuses of the propwerty by those who are NOT members yet use this property without any costs.

We are a small HOA and seem to be thought of as "voluntary" for dues but not for use!

My advice: Mail out a flyer to every homeowner, stating the property will be sold if they don't come to the meeting. Just shock them into showing up. Then at the meeting start talking about how you can set up a system that works, paying dues, etc. You need to work it out.

Hi Robert

I think there is confusion here on exactly what type of document or deed that you have.

1. Does the deed state who actually owns the property? Or, does it just say you are granted use of the property? You might check with the county records and get clarification.

2. Is the beach an inlet water area or on one of the great lakes? If it is an inlet water then the association might own the property. If it is on one of the great lakes, then it may be part of the great lakes basin compact and owned via the The Great Lakes Commission. In which case you may only have a document granting use of said beach area and do not actually own the property.
See: http://www.legislature.mi.gov/(S(05dhvg3mugrxwvzebgmu0p45))/mileg.aspx?page=getobject&objectname=mcl-324-32201&query=on&highlight=beach%20AND%20private%20AND%20beach

3. Do you pay "property taxes" on the property or do you have to pay possibly some type of "use fee"?

These are the type questions once answered will help determine actual ownership of the property. Your local county records office may also be able to fully answer your questions about possibly selling the property.

Answers to some current questions.1) the HOA owns the property. 2) the park and beach are on a inland lake. 3) the HOA pays summer and winter taxes on the property.

The property was deeded before the whole subdivision was completed in the 1960's.

Hope this helps. All your input is helpful.

Hey folks, I am not assuming the HOA can do anything, it really is an immediate question under the current financial circumstances. The inclusion of selling assets is a common question for any organization in financial dire death!

Dissolving itself(HOA)and therefore dissolve the assets of the said association, which also are its most current liability. Lawsuits are not what any lotowner wants to happen, with a park and beach open to all.

Looking for input from all knowledgeable avenues, is what this post is for.

thanks for the questions,

Here are some answers; yes, the property has been platted (from the original site development, including tax roles) and can be identified for a homesite.

The local police through the judgement made by the municipal attorney, has decided to call any use of the property by non-members of our HOA to be as civil matter. That is where the problem starts and ends, so with the "blessing" of local authority the use without dues happens.

No dues...no funds to exist.

Susan thank you for the input.

To answer some comments here. The HOA property is for riparian and non-riparian use. I have talked to many other HOA board members in our inland lakes area who have said, "that" mix in this situation is not a good mix and never is.

It seems that riparian owners do not feel the need, or the necesssity, to pay for something that they believe they alresdy have. The non-riparian see the riparian lotowners use the property for launching of boats without paying and question supporting an HOA that can not enforce the rules to them (chains and locks have been broken or stolen, many many many times!) Police say there hands are tied because local government does not want to prosecute their freinds or neighbors. Very sad.

Disrespect begets disrespect and so it goes... that is how most problems continue.

In this very situation riparian owners stand up for each other and claim ignorance of a violation or a problem (park and beach located on the water away from law abiding HOA members view).

Your idea about the zoning change of the HOA property soumds plausible. Another item to be investigated.

Hi Robert:

This would be a decision all concerned homeowners ultimately decide. Just be sure to take the time and weigh all to pro's and con's because once some decisions have been set in motion after a certain point there may be no return. Make a list of options ... then list all the pro and con for each. I understand your frustration when laws are suppose to protect your property.

Another thought ... check with your District Attorney and see if it could potentially limit personal liability everyone would have if "No Trespassing" signs were posted, along with verbage of some sort stating trespassers are liable for their own personal injury and any property damage. This maybe could take some liability off your HOA and possiblly deter some who are violating.

Just throwing out ideas for you to think about ... maybe something will be an idea that works the best. Those of us here are not experiencing your frustration, so ultimately your HOA will have to go with what they feel is best for everyone now and in the future. If you decide to sell try to make sure it will not be something everyone deeply regrets later in life.