Use of Daily Fines

Many HOAs, including mine, have the authority to impose a per diem fine for non-compliance. For example, if something isn't done (grass isn't mowed, unapproved shed isn't removed, etc.) by a certain date, then the HOA can assess $X per day until the situation is remedied (grass mowed, shed removed, etc.)

For those of you who have this capability, I was wondering:

1. How much is your daily fine?
2. Do you apply it always, or just in certain circumstances?
3. If someone brings things into compliance after the deadline, how likely are you to waive the daily fines that were assessed?
4. How effective are the fines for you in getting compliance?

Thanks.

NP,

IN VA we are limited by statute to $50 for a single offense or $10 per day for any offense of a continuing nature.

My Association has only ever had to threaten monetary penalties. We typically give them one final grace period to bring the issue into compliance before the penalty begins. Members who have gone that far in the process tend to comply once they have had their say and they see that the Board is serious.

If penalties didn't work, the next step would be the courts (but for most of the issues, I think the court would be ticked we are taking their time).

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Agree. We hope we never collect a single fine. We just the "fining schedule" to look reasonable ... but firm as you say. In hopes of course that the mere thought of a fine will get a positive reaction.

1. Not daily but per violation $50 to $75 (depending on the HOA) with fine doubled each time the violation is not cured by a stated deadline.
2. Always, after the homeowner has first been given a Courtesy Notice to make them aware of the Rule which is being violated.
3. Seldom.
4. Very effective. If the HOA does not have a stated fine policy then the only other option is to take them to court.

NPS

We basically issue fines in the amount of $50 after several warning letters have been sent. We also keep track so if the violation is repeated at a later time we go to $100.

In SC one can lien/foreclose on fines but our lawyer has told us the courts frown on it and best we do not go that route.

We have yet to have a owner that did not correct the problem based on threats of fines alone.

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You are correct. I have studied this to death and here in Florida, and for over a decade, the "boilerplate" language in all HOA CC&R's allows the HOA to enter the property to fix defects with 30 days notice. The reason is obvious. In the past, HOA's had to court to get relief ... a process which is not only costly, but it could take months or years to get the issues resolved. The new provisions eliminate any "no trespassing" defense by the owner of the property. If your HOA does not have this ... I'd recommend changing the covenants.

At item three below, here is how we explain our enforcement options on our website:

Rules Enforcement

1) Fines of up to $100 per violation per day (up to $1,000): These are permitted pursuant to Florida law (Section 720.305(2)) against any Member for failure to comply with any provision of the Covenants or reasonable rules of the Association.

2) Legal action: Article III, Section 1 of the Covenants as well as Florida law (Section 720.305(1)) provides that the Association (or any Member) has the right to enforce by law or in equity all restrictions contained in the Covenants. Although such enforcement can involve a costly and cumbersome legal process, the courts have a history of supporting the application of reasonable rules.

3) Direct intervention: With respect to a property where the yard or the home has been neglected and has essentially become a depreciating property to the neighborhood, Article V, Section 11 of the Covenants states that the Association has the right (with a 30 day notice) to enter upon the lot to repair, maintain, and restore the lot and/or exterior of the building and that the cost of such repairs (along with any legal fees) are to be paid by the Member. If not paid, the costs become a lien on the lot and are a personal obligation of the Member. If the lien remains unpaid, the Board can move to foreclose on the property.

Thanks everyone for responding.

To bring the thread back on track a bit, I will describe our situation.

1. We never budget for fines. So there is never an expectation or dependency on income from fines.

2. For some strange reason, we have two ways to fine. We have the $25, $50, $100, etc. escalation method for repeat offenses. We also have the per diem method of charging a fixed amount per day after setting a deadline. I think having both systems has led to some confusion. There's no clear distinction of which method to use.

3. For minor offenses (trash, parking, etc), we send a letter. Homeowners almost always take care of it right away. Never have to go as far as actual fining.

4. Most of the issues that concern us are about failure to make repairs or complete repairs in a timely fashion. We have the right to fix and bill. Back when the association was young, these repairs were relatively easy and cheap. But today if someone let's their house go, it usually involves years of neglect. Our board just isn't going to put thousands of dollars into a home. So even though we have the right to fix, bill, and lien - it isn't going to happen.

5. We have never foreclosed on anyone. (In PA, we can obtains liens and foreclose on fines alone.) The standard is reasonableness rather than a fixed dollar amount. Because there is no statutory limit, judges are free to make their own call on what's reasonable.

6. I am surprised that there were so few responses that described per diem (daily) fining. Is it that unusual?

At one time we were fining $50.00 for the first month of noncompliance to a rule. $100.00 for the second month for a total fine of $150.00 for the second month if the fine had not been paid and the owner was still noncompliant. Then $150.00 for the third month for a total of $300.00 if the fine had not been paid and the owner was still noncompliant.

We had to lower the total fine amount since one of our lawyers told us we could not fine this way.