Long post, sorry 'bout that

Although I haven’t posted in awhile, I read this forum daily. I couldn’t log in under my former name. I’ve been re-elected for another two-year term to our BOD. We have a good, strong board now and a management company that is very helpful as we oversee the business of our association and sort through our legacy problems. Our current daily issues are fairly routine - the occasional violation and rare fine. We are going to have to raise our association fees to meet our current budget. Our association fees are simply too low and have been since turn-over from the developer a few years ago.

History: We are a 30 unit condo association within a larger site condo (single family homes) association that is still being developed. The original developer is finishing the first phase of the site condos (was also our developer) and a second developer who bought out the first developer, is building the 2nd and 3rd phases of the site condos. As of now, there are 3 associations: ours #1, phase #2 and phase #3.

Associations #1, #2 and #3 share a common entrance. There is no other entrance. Our by-laws and Master Deed state that Assoc #1 (us) is responsible for paying 10% of utility bills of common elements (irrigation, electric) and 10% of landscaping/snow removal of common elements. We have no amenities other than a short lane giving us access to our homes, a small grassy common area adjacent to our condo buildings, the entrance road and possibly maintenance of one of six retention ponds in the overall development.

Legacy issues: At our Annual Meetings in 2008 and 2009, I questioned the exorbitant water bill that was presented. We had paid upwards of 11K for each of two years. We were told by the property manager that we had had dry summers. We also had been paying an electric bill for years and a property insurance bill but have no street lights and no outside property to insure.

After digging into it, it was apparent that our 30 unit condo association had been footing the bill for ALL of the common element expenses for the entire development. Our phase was sold out first. The management company (hired by the developer) allowed this to continue even after our association was turned over to co-owners and we had our own BOD. The former BOD is gone now. The current BOD hired a new PM and have engaged an attorney to try to recoup some of our money. 32K provable, more certainly discoverable.

There’s more. We have been invited to be part of a Master Association with the other 2 associations. We declined. Our attorney sent a letter to the BOD of Assoc. #2 describing what is owed to us with supporting information, in March with a request for a reply in 10 days. It’s June and we haven’t heard back. I know from reading this forum that we will likely not recoup our money, which is a shame. The developer doesn’t have it and the other associations don’t either.

My frustration: how can the other BOD/MC not respond to a letter from our lawyer? Why don’t they have to?
We’ve lost a lot -a lot ! -of money. We could have used it to pay for our own work orders, shutter replacements, window caulking, tree removal and replacement…the hits go on and on.

Sorry about your problems, Cindy. You wrote: "... how can the other BOD/MC not respond to a letter from our lawyer? Why don’t they have to?
We’ve lost a lot -a lot ! -of money. We could have used it to pay for our own work orders, shutter replacements, window caulking, tree removal and replacement…the hits go on and on. "

I don't think any of us can explain the non-response to your attorney's letter. Your attorney probably needs to send another letter. I do think it'll hard to recoup those funds without a lawsuit. And then --- would you want to go through with that?

Concerning your shutters, window caulking, tree removal: Are these a part of your reserves list of HOA components? In other words, is your HOA supposed to pay for the replacement of these elements and you're setting funds aside each year to do so?

If some need replacement now, so early on, was the original work defective?

Shoddy work. We are paying for all work orders, shutter replacement etc from our reserves. We clearly have to increase our monthly assessment. We have followed up on original installation of windows, siding etc. to see if anything is covered. Imagine that...it's not.

Even if those items aren't covered by warranty, you still may have a construction defect case against the original developer. But it depends on the statutes of limitation. Window caulking, for instance, should last several years, right? Some statutes only run a few years, other perhaps up to 10. Your attorney should be able to advise you or at least get you started looking into that.

Cindy

The outstanding water bill issue aside, would it be advantageous for your association to join the other two? Do not cut your noes off to spite your face concerning water over the damn....great analogy on my part...LOL

Also with only 30 units, I would question your need for a management company if anything other then a dues collection/tracking (like a book keeper) arrangement.

You also mention raise the dues. How much % wise are you considering? Many can raise a specific amount (our is 5% per year) without owner approval.

Thanks

Say, Cindy, I'm not involved with the legal profession in any way. But I read that a reason it's so hard to collect when you've paid for expenses that others should have paid for is that your HOA's Board should have caught the MC's error long ago. And if the MC acted in "good faith," i.e., you can't prove that the MC purposely overcharged your HOA, they're probably off the hook too.

But I definitely think it's worth the effort and some expense to try to be reimbursed for these errors. One question is: How much expense, i.e., legal fees?

Re: possible construction deficiencies. Unbeknownst to our Board, our developer's wrap policy insurance on our high rise's construction lapsed before we tried to settle on some defects. Our defect attorneys were able to get us a lot from various manufacturers who supplied the products, and from some other firms that installed some stuff in a way that wasn't up to the "standards of the profession." So even if there was insurance or if your developer is broke, there are pots of money out there--if it's not too late.

Seems like they think there is nothing to respond to. They are waiting for a lawsuit where they legally have to respond.

Can you just stop paying your 10% of the water bill into the future? Also don't pay the electric bill. Recoup it over time.

Reimbursement is pretty much out of the question. Credit for what we've paid already and recouping slowly that way is the plan. Thank you all for your thoughts and suggestions.