Should I join Loosey-Goosey HOA?

SueW6 (Michigan)
Posts: 814

Posted:

Went to my new homeowner's association Annual Meeting this evening.

This association owns a 4 acre beach/boat launch/with boatdock parcel on a sought after lake in Michigan. This parcel was donated by a woman 50 years ago for use by homeowners living on certain streets in our small city.

They are not incorporated. voluntary membership. $75 dues. no treasurer's report (just balance of checkbook $7,300 - they said I could come and look at the books if I wanted to know how the money was spent) do not use Roberts Rules at meetings.

Meetings are called by the President "when something comes up."
Wife is secretary and husband is president
Next meeting will discuss "replacing a part of the fence around the park because there were people trying to jump the fence all the time."

I am not used to this kind of set-up, after coming from a 250 home HOA that ran like a clock.

I'm scared due to the liability and lack of transparency I saw at the meeting.

Should I join this new association?

NpS (Pennsylvania)
Posts: 4,216

Posted:

Quote:

Posted By SueW6 on 05/18/2016 5:00 PM
Went to my new homeowner's association Annual Meeting this evening.

This association owns a 4 acre beach/boat launch/with boatdock parcel on a sought after lake in Michigan. This parcel was donated by a woman 50 years ago for use by homeowners living on certain streets in our small city.

They are not incorporated. voluntary membership. $75 dues. no treasurer's report (just balance of checkbook $7,300 - they said I could come and look at the books if I wanted to know how the money was spent) do not use Roberts Rules at meetings.

Meetings are called by the President "when something comes up."
Wife is secretary and husband is president
Next meeting will discuss "replacing a part of the fence around the park because there were people trying to jump the fence all the time."

I am not used to this kind of set-up, after coming from a 250 home HOA that ran like a clock.

I'm scared due to the liability and lack of transparency I saw at the meeting.

Should I join this new association?

Shouldn't confuse lack of formality with lack of transparency.

Check what insurance coverage they have. Find out what complaints they get. See if what they spend money on makes sense to you. Ask if they ever considered incorporating.

If you like what you hear, join.

Sikubali jukumu. Read all posts at your own risk.

TroyS2 (Oregon)
Posts: 610

Posted:

Quote:

Posted By SueW6 on 05/18/2016 5:00 PM
Went to my new homeowner's association Annual Meeting this evening.

This association owns a 4 acre beach/boat launch/with boatdock parcel on a sought after lake in Michigan. This parcel was donated by a woman 50 years ago for use by homeowners living on certain streets in our small city.

They are not incorporated. voluntary membership. $75 dues. no treasurer's report (just balance of checkbook $7,300 - they said I could come and look at the books if I wanted to know how the money was spent) do not use Roberts Rules at meetings.

Meetings are called by the President "when something comes up."
Wife is secretary and husband is president
Next meeting will discuss "replacing a part of the fence around the park because there were people trying to jump the fence all the time."

I am not used to this kind of set-up, after coming from a 250 home HOA that ran like a clock.

I'm scared due to the liability and lack of transparency I saw at the meeting.

Should I join this new association?

Have you checked state law on whether or not incorporation is required if they intend to operate as an HOA?

I would be scared too if it was a husband and wife team at the head of that TITANIC.

Are Bylaws in place? CC&Rs?

$7,300 is a lot of money not to be accounting for it, again I would check state statutes on that.

As you said, liability and lack of transparency is disconcerting here.

SueW6 (Michigan)
Posts: 814

Posted:

They say this is a voluntary membership - but I'm going to check on this because the 4 acre property was donated to people living on certain streets. So how can they give "privileges" to just those who pay the dues?

I am going to check the original deed that states the gift to the people.

Whether it is voluntary or not, it still should be incorporated.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Sue,

Different Associations act differently.

My suggestion is if you think you can make a contribution, then join.

I would also suggest that you initially try to learn how things are done and why they are done that way (vs. the way you think they should run). Then, slowly make suggestions and changes that benefit most if not all.

SueW6 (Michigan)
Posts: 814

Posted:

I wouldn't be so concerned but there is a HUGE liability, IMO: 4 acres of property, beach, and boat docks. And in this overly litigious mood of the public, some kid splits his head open on a dock, and there is no protection (of the corporate veil) to its members.

Plus, the way the annual "financial report" was handled was disturbing. We are talking about $6 - 7,000 annual expenditures and no explanation.

I plan to find the deed stating the "gift" of this piece of land to this subdivision. That's where I will start.

MikeD15 (California)
Posts: 5

Posted:

Thanks for the information.

KellyM3 (North Carolina)
Posts: 2,239

Posted:

Quote:

Posted By SueW6 on 05/18/2016 5:00 PM
Went to my new homeowner's association Annual Meeting this evening.

This association owns a 4 acre beach/boat launch/with boatdock parcel on a sought after lake in Michigan. This parcel was donated by a woman 50 years ago for use by homeowners living on certain streets in our small city.

They are not incorporated. voluntary membership. $75 dues. no treasurer's report (just balance of checkbook $7,300 - they said I could come and look at the books if I wanted to know how the money was spent) do not use Roberts Rules at meetings.

Meetings are called by the President "when something comes up."
Wife is secretary and husband is president
Next meeting will discuss "replacing a part of the fence around the park because there were people trying to jump the fence all the time."

I am not used to this kind of set-up, after coming from a 250 home HOA that ran like a clock.

I'm scared due to the liability and lack of transparency I saw at the meeting.

Should I join this new association?

This tiny board exists for one purpose and there isn't enough business to call regular meetings. The president is likely the only person in the neighborhood who'll babysit the area and take of it and they've offered to open their books to you - which won't show much activity, I'd bet.

Separate that from your real question - "Do you carry liability insurance on the common areas in case someone gets injured in the property?" That's a fair business question and I'd not sign up with them if they aren't insured. The tiny HOA size wouldn't give me pause at all. These people seem very approachable based on your brief report to us but are informal.

If the dock, park and fence are in good shape...and the neighbors aren't complaining (or you're the only one who is disturbed), re-assess your thinking. Sounds like a nice place you've moved to.