HOA voting on Huge $236,000 pool with no other choices!!!

Pam,

Among your options is to organize a meeting of the members to vote on a more reasonable pool.

I don't think most states have laws that limit HOA expenditures, although some might. More commonly, your HOA governing documents (by-laws, CCRs, Deed restrictions, etc.) will spell out any limits on dues increases and special assessments. Have you read those docs to see?

Did anyone else gets bids and present them to the board? It sounds like there is enough apathy in your HOA to let whoever submitted a bid to get it. Otherwise, in our HOA we have a 3 bid minimum on all contracts. Anyone can submit a bid to the board to vote on. We take the best 3 and vote on them.

So it sounds like if you all want another option then some of you have to make an effort to bring some bids to the table. Otherwise if you do not supply an answer to your issue, one will be appointed to you by the board.

If you had a pool reserve fund this wouldn't be a problem.

I second the call for more information about the vote. PamW4's post sounds like she's against splurging on a fancy new pool, but then the very last line sounds like she's in favor of it. I'm confused.

Two years ago, we were in a similar situation - we'd closed our pool in 2009 because of money issues and as time went on and the pool remained closed (no one complained), it because more of an eyesore. By the time we did our reserve study in 2012, it was clear that to reopen the thing would be extremely expensive and there wasn't anything for it in reserves, so a special assessment would be necessary.

We sent the homeowners a detailed letter explaining the issues and the options - replace the pool (very, very expensive), fix the pool (very expensive) or close it altogether and fill in the hole (relatively cheap, given the other options.) We then threw in the numbers as to how much it would cost to run a full season, noting all of this would mean an increase in assessments (which will happen anyway, but some things jack up the fees more than others).
Because of the mind-blowing apathy of our community, it took another year and a half to gather enough votes to make a decision, but in the end everyone voted it down.

So, you want a pool and it sounds like you feel this particular one is too expensive. If the homeowners are voting on this again, it would seem all you and like-minded owners have to do is vote the thing down and start over again. This time, I'd suggest the board commission a special committee where interested homeowners (like you) could do some research on various pools, their costs and what it would cost to run a season and maintain it (this will impact your reserves after all). Come with several options and make a recommendation to the Board. Or, the Board can put all the options before the community (preferably no more than three) and put it to a vote.

The options should include the numbers and how this would impact assessments or if a special assessment would be necessary. You may think $1100 per homeowner is expensive and it is, but you also have to think long term as well as other community needs. Perhaps the community no longer wants a pool and if it does, they have to be willing to pay for it. You want a pool - how much are you willing to pay to have one?

Personally, I wouldn't get a loan for this - when I was our HOA's treasurer, I used to stress us avoiding loans whenever possible because loans mean high interest rates and assessments would have to be increased beyond our 5% maximum per year in order to pay routine expenses, fund reserves AND make the loan payments. If we must get a loan, I said, I'd rather it be for something more practical like new roofs for our townhomes.

By the way, there probably isn't any law that says HOAs can or can't spend beyond its means - frankly it shouldn't be necessary to legislate this because it should be a matter of common sense. Then again, consider how everyone overspends, from the government on down to Joe Taxpayer (although he might not admit it), one shouldn't be surprised.

You still haven't explained exactly what the "vote" is. THIS is what you need to understand and act on. As before, I am guessing this is a vote required when a special assessment is required. Not enough votes in favor = no pool contract for now.

THEN you can consider how to influence the board to choose a different option.

Hi Pam

For starters, what is the net worth of your association? On your Association's Balance Sheet, the Net Worth should be identified as "Fund Balance." Typically, 2 Fund Balances will be provided - one for the Operating fund and one for the Reserve/Replacement fund.

You asked about state laws . . . I don't know the state laws in Missouri, so you need to find those and read them yourself to see the capital expense-related language. There could be some language in your HOA documents as well, so you need to read and understand those. Regardless, it seems to me that your Board is operating foolishly if there is strong opposition to the direction they are going and they are still plowing ahead.

And I disagree with some of these comments and with how some HOAs seem to function.

Being on the Board doesn't give the Board Members carte blanche to do what they please with other people's money. Without 100% owner agreement (which will rarely happen), I personally would find it impossible to extravagantly spend other peoples' money and force them to pay now (for a capital improvement) and into the future with higher dues (for waterpark maintenance and replacement) just because I may be permitted to do so by the documents.

If your Board was/is performing their fiduciary duty to the entire association, then you would have the proper reserve funding already set aside for a new pool that is an appropriate replacement for your current pool. If that doesn't exist, perhaps that needs to be the first question to the Board which might put a stop to the foolishness.

People bought into your neighborhood knowing a pool existed. And that pool was operated and maintained with money from your monthly/yearly assessments. Money from the assessments should have also gone into the reserve account for eventual replacement of the pool. People did not buy in to your neighborhood expecting installation of and required payment for a waterpark. Without 100% owner agreement, I don't see how anyone could feel justified in spending that money.

If it is somehow decided that the money will be spent on this waterpark, then any cost over and above existing operation and replacement costs could come from some type of user fee. This user fee could be charged to those who use the pool. Those who do not use the pool won't pay any more than they do right now.

Thanks for all the help!
I have been the driving force for the no vote on the water park. all 8 of my neighbors are NO on this subject. I posted my comments on our web site called Next Door. One of the board members deleted all of our comments. Oh well. The vote will be on Thursday night. One of the board members contacted me tonight. I am the one going to audit the count. That should make the pool commitee happy. Now the HOA is saying that if this doesn't pass they are going to fill in the pool and let it go. That isn't their choice! We are going to fight this. It's not that we don't want a pool we can't afford a water park.
It says in the by laws that it's 51% to pass. And if you don't pay they will add $20 a month to the bill.
This issue has divided the subdivision. Infact some are saying the board is bullying them into voting.
Again thanks for the help

PamW4, if you'll excuse my saying, your opposition to the plan sounds like it lacks focus. The main reason the ballots don't say how many votes are needed is because the actual number isn't known in advance. For example, if you have a quorum of 30% then at least 44 ballots will be needed for a quorum, and then a simple majority of those, as few as 23, would be enough to approve the special assessment. If more than 44 ballots are received then the number will be different.

You say you have "a lot" of people backing you. How many exactly? Do you even know? 8 isn't going to get it done. Did you distribute any informational material opposing the SA to the other owners (NextDoor doesn't count)? You could also organize a recall of board members who are in favor of the plan. Probably too late for that now. You could organize for a recall of board members any time, in fact, before a contract is signed with the contractors. Are you preparing for that?

Good luck to you, it does sound like an extravagant pool upgrade. I'd probably be against it too. I'm getting the feeling, however, that you waited until the last minute and are just now finding out you haven't done nearly enough homework to prepare for this vote.

Are you knocking on doors every day leading up to the vote?

You said that the HOA could not borrow more than 25% or net worth.