All kinds of problems

Tracy,

Welcome to the forum.

When one walks into issues, any activity that makes it more difficult can seem odd. However, it's also possible that they are simply innocent mistakes.

Destroying files - Paper takes room. If there isn't a lot of storage availability, or if it is simply a lot of paper that nobody has been into for several years, logically one may think to simply shred what isn't needed. This happened with us when a Secretary (with boards approval) destroyed all but 3 years of minutes. Seemed odd to me since the Bylaws says to keep them. But it was an innocent mistake. Financials can be recreated (to a point) with help from the Bank and contractors. You may have to pay a fee for copies of their records, but it may be money well worth it.

Hiring Contractors - Any individual likes to get to know people they work with. Over time, friendships may develop. Although it might not be the best business practice, it is common to want to work with those you are comfortable with. I'm not saying it was right, but it could simply be innocent. My suggestion, institute policies and move forward. Also remind the Treasurer that their duties are to pay the bills not award contracts (as awarding contracts is a Board decision).

Issuing 1099s - Yes it should be done. There can be financial penalties for not issuing (filing) 1099s on time. Unfortunately, many volunteer treasurers (and other board members) are often unaware of this requirement. Keep in mind that just because you have contractors doesn't mean they all require a 1099. See who requires a 1099 at https://www.irs.gov/uac/about-form-1099misc

Yep, it sounds like it's bad. However you can recover from it. Simply take things one step at a time. My suggestion is to start by reconciling bank statements and see where you actually are financially Depending what you find, you may want to find a new treasurer.

Sounds like you need to make sure the individual is not reelected.

In the mean time, the board should take steps (motion and vote) to remove that individual as Treasurer - perhaps citing the failure to maintain records in accordance with generally accepted accounting principals (GAAP). This will require someone be willing to take the job over and, very likely, spend a lot of time figuring out what has occurred and why.

The individual would still be a Director and have a vote in things. They simply would no longer be an Officer and handle the day to day tasks of the Association.

As far as missing records, we were able to recompile a lot of them by contacting past board members. I suspect many will have copies of flash drives or emails with documents in them (draft minutes for example).

Keep in mind, even though it seems overwhelming, the issues can be resolved. It won't happen overnight and will take some time and energy. However, they can be resolved.

Hope this helps,

Tim

Do you know if there is some type of outline or template for a play book for new boards on the web?

Thanks so much I will look these over!

Tracey,

I apologize for not getting this done earlier.

Attached is our Association calendar.
I've also attached our schedule of repairs and maintenance (which is based off of our reserve study).

Hope this help illustrate what I was talking about and gives you a starting point for making your own.

Tim

Thanks so much for sharing that in formation, it does give us an idea on where to start.

Wow that sounds nice not having so much to look after, still a lot though. We may have to got to where each home owner is responsible for their own home. It just takes too much time and money to fix every little thing on the exterior. What concerns us and we are seeing it now is that home owners don't want to fix their rotten window sills and screens. Makes the development look bad but the prior boards didn't want to enforce the covenants. SO now we are going to have to be the bad guys.

It is a handful and pain in the butt The home owners only own what their house sits on. All the areas around the house are common areas, except for the decks, porches, and driveways are considered limited common areas. 65 home, on about 6 acres, our streets were not to code for the city so we have to take care of them.
Single family HOA laws? Will have to look that up.

Tracy

We might be a similar arrangement. We are 112 owners. We have 40 duplexes (side by side, single story homes) and 32 single family homes (one story and two story). Each owner owns the plot of land their home sits on which ends up being about 15 feet on all 4 sides thus not what is known as a zero lot line*. It is in the Covenants that the HOA maintains each plot (landscaping, etc.) and maintains the exterior of each home. The exception is that each home has a small, fenced (6ft privacy fence) in backyard that each owner must maintain. An owner can do nothing to the front nor sides of their lot (even planting a bush) without the association's approval. As we attempt to maintain a common look, we have never approved any changes. We do allow people to pretty well do what they want in their fenced in back yard area as long as whatever does not exceed the height of the fence. Sort of out of sight, out of mind approach. We often hear: but I own the land and want to make changes. We refer them to the Covenants that each agreed to that say no changes without association approval. So far (8 years) we have had no real issues.

Some other random thoughts per your posts:

1. You mention needing Covenant/Bylaw updating. I suggest this is a very low priority and one you should set on the back burner. You have more pending issues.

2. You say you may have to throw landscaping/maintenance costs back to the owners. I can assure you if we did, we would have a revolt on our hands and I would be one of the leaders of that revolt. I moved here to pay dues to cover things so I could live a carefree lifestyle. If they came come along and want to shift the burden/cost to me, I will slap an injunction on their a$$ in a NY minute. Think long and hard about doing such. Also think of the control you might lose. Owners doing as they wished.

3. Our Covenants allow the BOD to set dues/assessments once a year when we present the budget. Any increase does not need owner approval. Granted the owners can band together, call a special meeting, and override the BOD's decision but it would take a majority of owners (57 of 112 agreeing) to do so and they only have 30 days to do so once the budget is presented. Even if they did, our Covenants still allow the BOD to increase dues/assessments 5% per year. That 5% can not be overturned. Many do not realize this procedure/method of increasing dues/assessments is quite common. Read and examine your Covenants. Do not be surprised if yours allow the same procedure. Again, read it close. Some of our own BOD members (and fellow owners) did not read it as I did, but our lawyer agreed with me.

* A zero lot line basically says the ownership of the land ends at the edge of the house (thus only the land the house sits on) and the rest of the lot is common ownership.

NC is a lot like SC in that they are pro-corporation (such an HOA) in letting a BOD control even to the point of limiting what shareholders (owners) can do. SC has laws controlling multi-unit, multi-story buildings (SC Horizontal Property Act) such as condos but those laws do not apply to townhouse nor single family HOA's. Look for the same in NC.

Many of our posters are form CA and FL. States that have all kind of HOA restrictions/controls. Others are from states that have some. SC has little to none so take what others say with a grain of salt as it may well only apply to their state. As an example, in SC we do not even have to notify owners when the BOD is meeting. As another example, SC Corporation Laws say 10% of owners are considered a Quorum unless the Corporation Bylaws say otherwise. Our Bylaws say 20%.

Many might think that SC BOD's can pretty well do as they wish. While I agree with this sentiment, any BOD that does is heading for trouble sooner or later. Let us not forget, they can be replaced.

Hope this helps.