HOA Says Not an HOA

Sherry,

I would stick with this plan. This way you might also find out why there are differences in fees (there has to be some sort of rational behind the fee schedule).

And, Welcome Back.

Well, if there aren't enough volunteers to fill the board each year, why do you think there would be enough volunteers to sit on committees? Will you volunteer to serve on any one of those committees?



Auditing books are expensive. Even a simple financial review (which is not the same as a full audit, see Subject: Financial Audits, Reviews or Compilation Which do you use?, is fairly expensive. We recently had an outside CPA do complete a financial review of our last three years and it cost $2,000. If you have multiple years (lets say 10) you want reviewed it could be $7,000 to $10,000. If you want each year audited you might have to pay that amount per year. Does the Association have the funds to pay for that?



I hope you had an attorney review your governing documents and applicable laws and received a legal opinion prior to making the decision not to pay your assessments.

As you know, if everyone (or enough) members made the same decision, the Board would need to defer maintenance or cut out other costly requirements (like a CPA reviewing the books).



I don't know, if you look at each function separately, it isn't too confusing:

"asking us if we were going to pay" - You already admitted you haven't paid. This is usually a first step prior to escalating collection procedures.

"ask us if we would agree to a new HOA." - You have posted that the covenants are not well written and questionable. That the development is divided and bickering amongst themselves. It's likely that the Board is aware of all this. Perhaps the Board has been discussing methods to address these issues and the best looking option is to reorganize under a new Association. Hence, he asked a member their opinion to test the waters (so to speak).

"asked me if I would be interested in serving" - Heck, I do this all the time. If you mentioned the same things to that board member that you mentioned here, I would have asked if you were willing to serve to help address the issues you are concerned with. Matter of fact, I did that earlier in this posting.



If your talking about the validity of your documents, you may be right.

If your talking about straightening things out within your Association I disagree. Having the court become involved could result in things you don't want (like receivership). The better way to straighten out your concerns with the Association is to become involved and do some of the work to address the memberships concerns.



First, you better figure out what your legal rights and the Association's legal authority is way before you go to court. In my opinion, you should have figured it out before you made the decision to withhold your annual assessment payment.

It's highly possible that if the Association brings you to court on failure to pay assessments (and it's far more likely that they will simply place a lien on your property) then it's possible that that is the only issue the court will entertain. If the court makes that decision, then they won't even listen to your other issues. I urge you to seek out a legal opinion as soon as possible



Yep, try that one in court fighting a speeding ticket - But your honor, others were speeding and the Officer didn't issue them a ticket. It won't work there and it likely won't work for assessments.

Actually, regardless of your belief of a moral obligation, you likely have a legal obligation. You're just hoping that the Board does the same for you. It might work. Of course without the money, as I posted earlier, maintenance of items will likely be pushed out and the things you want done might not get done. Additionally, as a member not in good standing you may lose voting privileges and/or access to amenities or services provided by the Association.

Instead of joining the others who aren't paying, why don't you volunteer to serve and spearhead the collection of delinquent accounts.



Hopefully the county will keep it's promise. If this system isn't properly maintained the county might refuse until the system is brought up to code. If members aren't paying, this could cause things to be delayed.

Additionally, if the county is cash strapped they may chose not to exercise that option/commitment to take over the system.

I wouldn't count on it happening until it actually does.



Storm water management (i.e. the ponds) can be just as expensive to maintain as roads. Hopefully there are enough current Reserves and a plan to fully fund them so they may be maintained properly. Of course if members aren't paying assessments, those Reserves may have been dipped into to pay operating expenses. If that has happened, you should expect a special assessment in the future.



Actually, at this point you should be confirming your opinion of the Associations validity to collect assessments. I would suspect that even without valid CC&Rs, if the Association is maintaining a sewage system for the development that a court would side with the Association concerning assessments.

Again, I urge you to seek out a legal opinion on your concerns of the Assocaitions validity.

You should also fully read and understand your governing documents and the applicable corporate law:

Revised Iowa Nonprofit Corporation Act applicable if your Association is incorporated

Revised Uniform Unincorporated Nonprofit Association Act applicable if your Association is not incorporated.