Charging fees to owners for exclusive use of common areas

Keep in mind that it's possible that such "rent" so to speak would likely be considered taxable income by the IRS

Welcome to the forum, Alan. You might get some really creative replies to your good question and I'm looking forward to reading them!

with JohnC, why do you now want to charge people? Do you have rules about the trailers that are parked in there? Must they, for example have current tags? be in working order?

How many does this maintenance yard hold?

Do your governing documents, probably your CC&Rs in this case, allow your HOA to rent out (or earn income) from your common areas?

The only comparable situation we have (high rise, underground garage) is that our HOA owns perhaps 2 dozen motorcycle parking places. They are numbered as are our deeded parking spaces.

We initiated an application process a few years ago: A resident applies; if we have a space a valuable, we assign it to the resident. Residents fill out a form saying they (or their unit owner) can be called to a hearing if they leave fluid leaks, and that the HOA is not responsible for (damage, etc.,) the bike in any way.

I guess if it were our Board, we'd want to protect the HOA from any liability that might occur due to this storage. I'm quite certain we shouldn't charge rent for those spaces.

It seems to me that this is reasonable if the objective is to fairly allocate a limited number of slots.

I think there has been discussion of similar charges for boat docking space and this would be analogous to providing reservations for a community center room for meetings.

Alternatives would be a lottery or waiting list and a limitation on total use times.

I would assume the reason is to raise revenue to offset some expense increases to maintain the HOA fees. With the rental/license plan, JMO, everyone benefits. The folks that have a trailer have a safe, convenient place to keep it and the owners that do no have trailers who do pay to maintain this area, have the benefit of an increased revenue stream to help maintain their fees. I'm not sure what anyone's issue is about this except those that had "free access" at other owners expense now are going to have to pay something for the privilege.

If there are costs associated with maintaining this amenity, then I'd say charge to cover the costs. If the association is just looking to raise money for the general fund, I wouldn't do it this way. As Tim suggested, any rental income that is not used for expenses directly related to earning that income would likely be taxable. Assuming you file form 1120H, that means you only keep 70% of what you charge.

I agree, we have just going through our lawyers for a very similar thing. They want us to call it a license fee and clearly we have let the owners know that it is purely a revenue enhancement items in an effort to keep in line our fees.