Can HOA raise dues in the middle of the year?

My HOA mailed out the 2013 dues and we paid them in full. Now, 3 months later, they sent another bill to all homeowners (for the same year- 2013) that states a 20% increase in dues by the board! Is this Legal? Can they do this after the fact?

Thank you John. I have checked both CCR's and Bylaws. But nowhere it mentions if they can raise and seek to collect after the first mail out. It only says they can raise 25% every year. But what I like to know is that can they just decide to raise it for the same year that they had just mailed out the previous amount couple months ago?
We live in Texas, by the way.

If something is not in your governing documents then this might be a time when you could get your neighbors to agree to change the documents for the future.

In my association the board prior to the annual meeting must determine the expenses for the year, which in turn is presented to the membership for approval at the Annual Membership Meeting prior to assessing the members. This is all laid out in a spreadsheet including money to be set aside in a separate account for future repairs to Capital Improvements which might be needed such as replacing the roof on the pump house or replacing main irrigation lines.

This still does not eliminate the fact that if something major happens it must be fixed and must be paid for, so if an HOA does not have money saved up which has been set aside to take care of these type major issues then the owners can be assessed a one time fee to pay for the repairs.

What do your governing documents state with regards to developer turnover when he no longer has control? Also, please confirm for sure if you are single family homes or condominium complex?

My concern is that since your assessments are yearly and paid at the beginning of the year, I would consider what they did as a special assessment. We pay monthly, and if raise dues by 20%, which is the legal limit with only Board approval, then the increase would apply 30-60 days AFTER it was approved. You have already paid for the whole year. The increase, IMO, should have been instituted at the beginning of the year.

Sorry Bruce I just noticed that you had previously stated the HOA was completely built out. Here is a link for the Texas State Statutes:

http://www.statutes.legis.state.tx.us/Index.aspx

Title 11 is the section that covers Restrictive Covenants

As just an average citizen when I read some of Texas statutes I personally think they are a bit goofy because some sections only apply to counties of a certain size or if located within X miles of bodies of water, etc. Not sure why they complicate the situation in such a manner.

The following is a link to a prior conversation on this site regarding developer control questions another person from TX posted which might help give you more info:

http://www.hoatalk.com/Search/ForumSearch/tabid/87/view/topic/postid/130443/Default.aspx

Bruce,

Bottom line is no one on this site can really answer your question. All we can really say is that the authority to raise assessments and any requirements/limitations on when they can be raised typically come from the governing documents.

If you have problems interpreting a section of your governing documents, we may be able to come up with a consensus on the meaning of it (limited by what you cite).

Without seeing the governing documents, the letters sent about the assessment or the minutes of the meeting where the increase was approved, I agree with Richard that it may be that a special assessment was adopted and it just appears that the regular assessments are going up 20%. Of course, this could be in error as well. We just don't have enough information and, due to posting rules, you may be limited in the information you can actually provide.

Typically, voting power is based on the number of lots owned. Therefore, I find it odd that your development is 100% built but the Declarant still has lots. Perhaps there are additional sections/phases that are planned but not yet implemented and it's these sections that give the Declarant the voting power they have. Again, we can easily speculate (and we have gotten pretty good at doing that), but that's all it would be - speculation.

My suggestion, request a copy of the minutes from the meeting that raised the assessments (as this may give you more information).

Tim

Bruce:

Depending on what your documents state with regards to developer votes can make a difference. What I have seen from posters in TX is generally the developer initially has a certain "class" of votes and then that tends to change at some point after X number of homes are built (such as what you stated above with the 80% figure). Did you review the other link I posted above and again have below?

The following is a link to a prior conversation on this site regarding developer control questions another person from TX posted which might help give you more info:

http://www.hoatalk.com/Search/ForumSearch/tabid/87/view/topic/postid/130443/Default.aspx

The homeowner on that post really knew his governing documents and posted a website link for anyone to review the documents. He also was familiar with the TX state statutes that were potentially applicable to his situation.

What does your governing documents state with regards to who owns the Club House or Pool? Also, check with your Local County Records regarding those items and who is listed as the owner for the property. Is it still the developer or the Homeowner Association?

I sure will be willing to share. I can contact you later so that I may email you our docs that is absolutely absurd. But give me few weeks to find time. When are you planning to finish your book?

Our does give developer 5000 votes. Believe it or not. I'll be happy to email it to you.

Hi Bruce ... If the clubhouse and pool are not owned by the association ... are you and other owners being charged assessments by the HOA to maintain those properties? I find this situation quite curious.

Janet,

Simply make sure that you vet the Association prior to agreeing to purchase. Because the disclosure laws are different, you may have to pay for some of the information (copies of Association documents) and rely on the seller to get them to you.

I believe it's because they see property rights, water rights, mineral rights, etc. as all separate issues (as it's possible to purchase property but not have the mineral rights for that property and, you must accommodate the mineral rights owner to allow drilling if needed).

The CC&Rs I mentioned that authorized the Declarant to waive the covenants to make a sale was in the McKinney area.

I would like to see it if you still offering to email and can send to [email protected]. 5,000 votes and $7,000 per month both seem overly excessive.

Hi Bruce:

Just started reading ... You do understand that your CCR's are just a portion of the overall "Master Association"? Do you have a copy of the "Master CCR" defined in Article I, Section 1?

Hi Bruce:

From what I am reading potentially according to your prior statement whereby you stated you are 100% built out with the developer not owning property the following would potentially apply:

Section 4. Voting and Membership Limitations. The Association shall have two (2) classes
of Members:

(i) Class "A". Class "A" Members shall be all Owners, with the exception of Declarant. Each Class "A" Member shall be entitled to one (1) vote for each Lot owned by such Member in the Properties; provided, however, when more than one person holds an interest in any Lot, all such persons shall be Members, and the vote for such Lot shall be exercised by them as they among themselves determine but in no event shall more than one (1) vote be cast with regard to any Lot owned by a Class "A" Member.

(ii) Class "B". The Class "B" Member shall be Declarant. The Class "B" Member shall have 5,000 votes, until the Class "B" membership and Class "B" votes cease to exist as set forth below. All Class "B" and the Class B membership votes shall cease to exist and automatically be converted to Class "A" votes and the Class B membership shall no longer exist on the happening of any of the following events, whichever occurs earlier:

(a) When 100% of the Lots on the Property (including Property added hereto by annexation) planned for development has been sold to and occupied by Class A Members that are not Sub-developers;

(b) December 31, 2030; or

(c) At such earlier time as the holder of the Class "B" votes may, in its sole discretion, elect, as evidenced by a document recorded in the real property records of Fort Bend County, Texas.

However, you need to insure that the following has not taken place which is included in your documents:

(iii) Reinstatement of Class "B" Votes. Notwithstanding the prior provisions of Section 4(b) or 4(c) above, if additional property is made subject to the jurisdiction of the Association pursuant to a Supplemental Declaration, or if Declarant repurchases any Lots, such that Declarant again owns any Lots in the Property, then the provisions regarding Class "B" votes in this Section 4, shall be automatically reinstated ipso facto.

LOL … Hope you understand that if I was purchasing and read either (ii)(a) or (iii) above then I would have had one of two responses to the developer either (1) UP YOURS, or (2) BITE ME. If enough people across the country would stand up and NOT purchase with absurd statements in documents then we can maybe all make a difference. If developers could not sell properties with those type statements then they themselves would choose to eliminate those statements … but it unfortunately takes many people willing to take a stand, and unfortunately as many have noticed on this website many people do not read or possibly comprehend their CCR’s prior to purchase.

I'll also try to find the master CCR and send it to you.

Yes I wished state law was in such way that could order these type of people get out and be punished with heafty fines.

food for thought:

under common law an 'unconscionable' contract can not be enforced and may be ruled null and void

good luck with that in our nation of merchant barbarians

BruceH8, I believe that William meant to reply to a different thread. But . . . maybe not?