Private Amenities ?

Started by LynnG1 • 7 replies • 1413 views

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LynnG1 (Arizona)
Posts: 4

Posted:

Does anyone have experience with a CC&R community that has a privately owned (not community or HOA owned) amenity? My community has a developer-owned athletic club to which all homeowners must belong and must support with quarterly dues determined solely by the owner. Homeowners are upset at recent dues increases, with the sudden realization we can't do anything about it (yes, it's in the CC&Rs). We are wondering, is our situation unique or have other communities dealt with something similar? Any feedback would be greatly appreciated!

RogerB (Colorado)
Posts: 5,067

Posted:

Lynn, if your HOA is controlled by the owners they may want to amend the CC&Rs to eliminate this requirement.

LynnG1 (Arizona)
Posts: 4

Posted:

Thanks, Roger. Our HOA is still controlled by the developer, who also owns the athletic club. The question we are wrestling with is whether CC&Rs/HOA can be used to enforce a mandatory private amenity that the homeowners don't want. It seems a conflict of interest.

RickR1 (California)
Posts: 37

Posted:

How long have you been a community?

It seems like a fool proof way to make sure your business survives with mandatory dues (the athletic club)! Of course Roger probably asked about the CCR's so you could just change them but if its still under developer control then I don't know. I would suggest a joint use agreement thats written up in place of the current one. Option to do or not do the club per household.

rick

PaulM (Pennsylvania)
Posts: 1,347

Posted:

This is the same recurring problem the site has been visiting in the last weeks...an amenity which costs more to maintain than those willing to buy into it. It doesn't seem to be a clear cut option--to buy in or not buy in because ongoing maintenance and upkeep still have to be performed. Do you create CC&Rs to ensure that maintenance will be funded adequately but those who actually want to use the amenity then have to pay additional funds to use it?

RogerB (Colorado)
Posts: 5,067

Posted:

Posted By LynnG1 on 03/07/2007 9:54 PM
The question we are wrestling with is whether CC&Rs/HOA can be used to enforce a mandatory private amenity that the homeowners don't want. It seems a conflict of interest.

If you read your Declaration I think you will find that you did agree to this which legally means you did want it, albeit unknowingly. Otherwise you would not have signed to purchase. This is another example of why a buyer should request the Seller's Agent provide all controlling documents. And study the Declaration of CC&Rs carefully prior to signing any agreement.

LynnG1 (Arizona)
Posts: 4

Posted:

Roger, from the lack of replies regarding similar situations, I have to assume our mandatory private amenity is pretty unique. Which is why it has been allowed to happen, it flew under the radar screen. This is a fairly high-end community with a lot of pretty successful retirees, who all had the CC&Rs before buying. We were all perfectly happy to pay for a nice amenity, without realizing the potential for abuse by the owner.

Yes Rick, it is a good way to guarantee the success of a business! The current obligatory dues are well above what it takes to run the place.

I guess, at the least, that this can serve as a warning to others who might be presented with a similar situation, like making a private golf course membership mandatory.

JM2 (Oregon)
Posts: 439

Posted:

Hi Lynn:

Analagous situation in Oregon: There is a developer who set up a (shell) company to deliver internet service to the new developments being built. The (shell) company contracts out to provide the service and the builder gets a nice tidy profit. Unfortunately, the service is not good; the local utility has not been cooperative in getting the connections set up between their system and the builder's system, etc., so it has been a less than stellar experience for the new owners.

To me, these types of setups sound like a conflict of interest, but I'm not a lawyer and cannot provide legal advice. However, since the developer controls the Association's board, it may be something worth pursuing once you go through turnover.

Best of luck...

J. Patrick Moore, CMCA

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