Pool House Lease

Started by TomW20 • 4 replies • 1077 views

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TomW20 (Georgia)
Posts: 10

Posted:

Background---Developer is still head of the HOA and has not turned over. When they developed the neighborhood, a Pool house and Pool were built (bathrooms/kitchen, living room, large pool etc...).

There is still a lot of debate right now as our HOA is in flux and homeowners have not seen full financial report etc so we have a lot of questions about what is going on (new homeowners starting to question). Neighborhood is approx. 8-12 years old. It has approx. 70 lots with half of them currently having homes and approx. 20 lots privately owned with no dwelling.

My understanding is that "we", the homeowners, LEASE the Pool and Pool house for approx. 1000 per month. I am also being told that "we" pay for the water and power bill associated with the establishment.

We have questioned when it will be turned over but we have not gotten a straight answer. I am not sure that I have specific questions as i really don't know what to think of the subject. Maybe you can provide some general feedback or comments about the situation and what to be on the look out for.

Thoughts/Comments please???? Seeking all feedback!!!!

SheliaH (Indiana)
Posts: 6,964

Posted:

From my years reviewing conversations on this site, you're running into the primary problem with developer run HOAs - until they turn the community over to the homeowners, they can pretty much do whatever they please. I would think after 12 years, the homeowners would be running things by now, but it may be they're still trying to sell the rest of the empty lots (at least half of them) before that happens.

In the meantime, I agree you need to keep asking about the money, although you may still get half answers or no response at all. The real fun may begin after the community's turned over and you see things like little or no reserve fund, the clubhouse and pool cost a lot more to maintain that you anticipated and so assessments will have to be increased - a lot - and people will squawk about that.

If you don't have a formal board of directors yet, you may want to start educating yourself on transitioning from being developer run to homeowner run, so you and like minded homeowners can make a plan for that day, perhaps even volunteer to sit on the initial board. The Community Association Institute (CAI) has a number of education materials you can get for a small fee and some of them discuss these types of transitions and what to watch out for.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

JanetB2 (Colorado)
Posts: 4,219

Posted:

You need to read your CCR's and see what they state regarding developer control and turnover. Also, you need to read your State Laws regarding developer turnover. Sometimes the Developer will leave out State Law requirements from the CCR's because most people will not read or research that information. If there is a section in your State Laws and not noted in your CCR's regarding turnover of the HOA that is a potential red flag and something the developer is trying to possibly hide as an early turnover option.

What do your governing documents state with regards to developer control and HOA assessments for the pool area?

TomW20 (Georgia)
Posts: 10

Posted:

Quote:

Posted By JanetB2 on 03/22/2017 10:08 PM
You need to read your CCR's and see what they state regarding developer control and turnover. Also, you need to read your State Laws regarding developer turnover. Sometimes the Developer will leave out State Law requirements from the CCR's because most people will not read or research that information. If there is a section in your State Laws and not noted in your CCR's regarding turnover of the HOA that is a potential red flag and something the developer is trying to possibly hide as an early turnover option.

What do your governing documents state with regards to developer control and HOA assessments for the pool area?

The POOL is not in the current revision of our CC&R. So it makes me wonder how we are even "leasing" the pool and house to begin with. In the CC&R, it talks about common property but it does not define any common property and states that a "pool and pool house" may be added in the future to the neighborhood. As if the pool and house did not exist with when the CC&R was created.

So for me, common sense says that if we are leasing the Pool and Pool House, there should be a lease agreement in place or else you can't lease it. In that lease agreement it should state who pays for what (water bill, power, etc) to include maintenance such as pool liners.

But there should also be something, somewhere that states what are the long term plans. Verbally we are being told, it will be turned over to the HOA eventually but when, how and where...will it be paid in full before turned over, etc...

JanetB2 (Colorado)
Posts: 4,219

Posted:

Do you fall under the Georgia Property Owners' Act??? http://law.justia.com/codes/georgia/2010/title-44/chapter-3/article-6/44-3-221/

If so look at the definitions under the Law and also the definitions in your CCR's. Under the law common area property has to be either owned or leased. Therefore, the developer in order to charge any fees needs to either turn over to HOA or needs to provide a lease. Potentially your CCR's will state something similar.

What I did with my developer when wanted to charge HOA fees is asked what the fees were to cover. When stated the common area I told them the HOA currently does not have any common area as it has not been turned over to the Association. That got them in a tizzy and developer then turned over the common area property to the association. I then pointed out the state law in my area that said if the developer reserved the right to use the common area property during the development period to for instance store materials, place signs, etc. then the developer was responsible to pay to maintain ... LOL.

You need to know your documents, state laws, and your rights. That knowledge is power and will allow you to run circles around the developer and protect yourself and your neighbors.

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