Starting an HOA

Started by EileenP • 1 replies • 1274 views

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EileenP (Illinois)
Posts: 1

Posted:

I have just purchased a home in a small community about 50 miles south of Chicago. The town at the last census showed a little over 2,000 people. This town is growing leaps and bounds. Here is my situation.

Most of the people in our section of 170 homes have never been in an HOA. The town itself is not familiar with how this works. We had a meeting last night and the town has proposed to take over our common area's. They will access our taxes to do this. Our common area's consist of 2 retention area's and 2 entrance signs located in small medians at the entrances. They are looking to charge us in the neighborhood of $32,000 a year to do this. All they have to do is mow the lawn in the retention area's and mulch the two sign area's. I feel this is absorbant. What are your thoughts on this?

If we turn these common area's over to the town are we going to lose control over how they are maintained. What would stop them from just removing the entrance signs when they begin to need repair?

In our neighborhood we have covenants to follow. If we do turn over the retention area's to the town will they still have to follow our guidelines? Such as no Chain Link Fencing. I am afraid they will want to reduce their liability and fence these area's in.

Any help would be appreciated.

Thanks

Eileen

JM2 (Oregon)
Posts: 439

Posted:

Hello Eileen:

I would recommend that your HOA talk with a Lawyer regarding this issue. Several reasons:
1) It might not be a good deal for the HOA if the city would charge more than your current maintenance cost. Find out your current maintenance cost.
2) It might not be a good deal for the HOA if the property was no longer subject to the covenants (i.e. chain link fence...)
3) If the city really wants the property, it might be able to condemn and take it over; you would want your rights protected.
4) If the city wants to buy the property, your lawyer could negotiate.
5) There are likely some procedures that should be followed that are listed in your documents regarding how the HOA could sell and/or transfer the property; the lawyer would be able to make sure that the sale and/or transfer is done in legal accord with your documents.
6) If the city retains the abililty to charge extra money (beyond what they charge anybody else) they may not care how much it gets raised, whereas a board of directors who are directly affected by the cost are more likely to work to keep costs contained.

By the way, the HOA may want to consider a fence around the retention ponds to reduce your own current liability (attractive nuisance, like a pool; what happens if a kid falls in and drowns?).

It may be worthwhile to talk to any other HOA in the city (if there is one) that has gone through a transition similar to what the city is proposing.

J. Patrick Moore, CMCA

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