voting and dues

There is a provision in our documents wherby thy can be amended. OF course it is very difficult to amend them, but it can be done. Do your documents have such a provision. And I thought our dues were low. I am in a condominium and pay less than $200.00 a month.

Hi Peggy:

When you stated HOA I assume you are an HOA and not Condominiums. If you are not already aware of here is the state statutes regarding special assessments and reserve fund information. The membership needs to keep in mind that the HOA must have money for certain repairs in the reserve fund. Failure to have the money for the expenditures can result in having to levy special assessments to cover the costs. Therefore, would they rather pay a little extra a month and build the reserve; or possibly have a larger amount due because of something that needs repaired and no money is available because there is no reserve fund. This is a choice the homeowners need to decide what is in the best interest.

§ 55-514. Authority to levy special assessments.

A. In addition to all other assessments which are authorized in the declaration, the board of directors shall have the power to levy a special assessment against its members if the purpose in so doing is found by the board to be in the best interests of the association and the proceeds of the assessment are used primarily for the maintenance and upkeep of the common area and such other areas of association responsibility expressly provided for in the declaration, including capital expenditures. A majority of votes cast, in person or by proxy, at a meeting of the membership convened in accordance with the provisions of the association's bylaws within 60 days of promulgation of the notice of the assessment shall rescind or reduce the special assessment. No director or officer of the association shall be liable for failure to perform his fiduciary duty if a special assessment for the funds necessary for the director or officer to perform his fiduciary duty is rescinded by the owners pursuant to this section, and the association shall indemnify such director or officer against any damage resulting from any claimed breach of fiduciary duty arising therefrom.

B. The failure of a member to pay the special assessment allowed by subsection A shall entitle the association to the lien provided by § 55-516 as well as any other rights afforded a creditor under law.
C. The failure of a member to pay the special assessment allowed by subsection A will provide the association with the right to deny the member access to any or all of the common areas. Notwithstanding the immediately preceding sentence, direct access to the member's lot over any road within the development which is a common area shall not be denied the member.

§ 55-514.1. Reserves for capital components.

A. Except to the extent otherwise provided in the declaration and unless the declaration imposes more stringent requirements, the board of directors shall:

1. Conduct at least once every five years a study to determine the necessity and amount of reserves required to repair, replace and restore the capital components;

2. Review the results of that study at least annually to determine if reserves are sufficient; and

3. Make any adjustments the board of directors deems necessary to maintain reserves, as appropriate.

B. To the extent that the reserve study conducted in accordance with this section indicates a need to budget for reserves, the association budget shall include, without limitation:

1. The current estimated replacement cost, estimated remaining life and estimated useful life of the capital components;

2. As of the beginning of the fiscal year for which the budget is prepared, the current amount of accumulated cash reserves set aside, to repair, replace or restore capital components and the amount of the expected contribution to the reserve fund for that year; and

3. A general statement describing the procedures used for the estimation and accumulation of cash reserves pursuant to this section and the extent to which the association is funding its reserve obligations consistent with the study currently in effect.

How much of an increase is the board considering?

Thank you all very much. I was, of course, hoping for an easy answer, and "legwork" was not what I wanted to hear, but you are all right. It must be done. Please let me ask for more clarification--we have been sending "ballots" around for the vote, but your replies seem to indicate that these votes must take place at the annual meeting or at a specially called meeting just for this. If this is the case, I will sent the recommended letters (thanks TimB4, prepare the information for our annual meeting in May, send out proxies (thanks again, TimB4)then hope for the best. Janet B2--yes, single family homes with an HOA. We are a waterfront community in the Northern Neck of VA and many of our lot owners have not yet built and live elsewhere, and not all are on the more valuable waterfront. They have seen their "investment" decline over the past 5 years and are not terribly excited about it anymore. That is part of the problem. They are not interested in paying or participating, but about half of the lots have full time owners. We have private gravel roads that must be maintained and common areas that must be cut and the drainage areas unobstructed and a pier/boat ramp that must be kept in repair. Everything you said was helpful b/c it is necessary to raise the dues just to pay grass cutting, road repair and insurance and corporation fees, etc. We are grossly underfunded for our capital reserve. We are not frivolous--no gardens or fancy landsacing, no parites. We do have provisions to levy a special assessment--the same as raising dues: 2/3 of......SusanW1--We are hoping to initiate a 2 tier system--those that front HOA property that must be maintained raising $50 and those that don't (i.e., they live on state maintained roads) a $25 raise. But, we also want to give the BOD the opportunity to raise dues up to 5% each year as necessary, especially until the capital reserve is built up. We asked at the last meeting if those present would approve a $50 pay raise and they said yes, but there was barely a quarom there, much less the required 67%.

I have read several other subject posts and see that when it comes to quibbling, not sharing the load, not working as a team and thinking that criticism is the highest form of participation, we have plenty of company.

Thanks again for your help and suggestions.

This will depend on the language in your governing documents. VA Non Stock Corporation Act, § 13.1-855 specifies that election of directors must be at an annual meeting.

The VA Prop. Owners Association Act - § 55-515.3. Use of technology provides that voting can be done by internet or e-mail, providing the governing documents do not require a meeting for such a vote.

My Association has documents that require these votes to be held at meetings. Therefore, a directed proxy is the closest we can get to voting by mail, internet, etc.. Per your initial post you stated "unless changes in whole or in part by a 75% vote of the then property owners of record of *name of subdivision* at the 1986 or any subsequent annual corporate meeting". I would interpret this to mean that the vote to amend the Declaration must take place at a meeting and specifically at the annual meeting (vs. a special meeting).


Have you completed a reserve study to know exactly how underfunded your are?

Here is a link to a thread in HOAtalk about reserve studies:

http://www.hoatalk.com/Forum/tabid/55/forumid/1/postid/103517/view/topic/Default.aspx


As Janet said, make sure that the idea is in compliance with your governing documents. You may need to amend a section or two in one or more of the governing documents first in order to institute such a system.


My Association has that authority. May I suggest the following language as a starting point:

Section 3. Basis of Assessments. After consideration of current maintenance costs and present and future needs of the Association, the Board of Directors shall fix and determine the amount of the annual assessment. The maximum annual assessment may be increased by the Board of Directors up to 5 percent per year without membership approval. Any additional assessment shall have the assent of two thirds (2/3) of the votes of all members who are voting in person or by proxy at a meeting duly called for this purpose, written notice of which shall be sent to all members not less than thirty (30) days nor more than sixty (60) days in advance of the meeting setting forth the purpose of the meeting.

Of course, the bolded section will need to be changed to comply with your current document requirements which state 2/3 of the voting membership vs. ours (2/3 of the votes cast).


If your amending the documents, you might want to consider additional amendments that changes the quorum requirement. e-mail me [email protected] and I can give you more specific detail of our documents.

Basically we have the following:

If the required quorum is not forthcoming at any meeting, another meeting may be called, subject to the notice requirement set forth in Sections 3 and 4, and the required quorum at any such subsequent meeting shall be one half (1/2) of the required quorum at preceding meeting. No such subsequent meeting shall be, held more than sixty (60) days following the preceding meeting.

Note: sections 3 & 4 discuss annual and special assessments.

It might be better to address the bigger picture of amending your documents to allow the Association to function in the future vs just trying to get an increase in assessments.

Tim

Peggy,

Please do contact me. I have more info that shouldn't be posted in this forum that might be able to aid you in the rewrite.

Tim