New declarant needs help with park suggestions

I recently obtained the rights of the Declarant to my 50 house-single family subdivision. The original Declarant sold the property to a bank, but did not sell the Declarant rights. A new developer bought the land and held himself out as the Declarant. When he offered a waiver for a homeowner to put up a fence but wouldn't extend that courtesy to others in our sub, I began researching, reached out to the original declarant, and purchased those rights.

My intention now is to begin raising assessment dollars from all lot owners (including the new builder) in order to purchase the park space back from the bank and to build a playground. My question is this: has any one built a park for their HOA? Any advice, tips, resources? I think that a park would be a great community asset and my neighbors (aside from the new developer) are on board.

Thank you!

Rebecca-

Do your documents allow you to collect dues from the builder? Many only allow on improved lots (lots with home with occupancy permits).

Thank you for your replies. I had liked to idea of a splash pad, so I'm glad to see you talking about that. Will definitely shy away from it if the costs are high to maintain.

I'm very curious, how much are declarant rights worth for a 50 lot development?

Declarant rights often expire when the declarant has sold a certain percentage of lots. In your case, it appears that the declarant has sold 100% of the lots and the rights have therefore expired. Do you know if the rights have expired? What are the conditions in your CC&Rs for the rights to expire?

This sounds most unusual. Do you have prior experience as a Declarant of a deed-covenanted development? If the documents give you control of the board, the devil on my left shoulder says,

1. Sell your home and move outside the development right away
2. Appoint yourself and your friends as directors
3. Quadruple assessments
4. Buy up the properties at bargain basement prices as distressed owners sell
5. Profit!

But it's probably not that simple. Along with rights there are probably state and local laws and regulations that impose obligations and the duty to perform certain things. This would depend on the governing documents and the local planning board (or whoever approved the development in the first place).

The angel on my right shoulder says if you've never done this before you should hire competent legal counsel right away before doing anything at all.

If you have the full set of the usual declarant rights, you can appoint members to the board of directors, including yourself, take over the bank account, manage the association, and raise assessments.

I assume that the association has not been turned over to the homeowners. If it has, your declarant rights may be gone (or can be challenged).

Who has control of the hoa's bank account now?

Be ready for a legal challenge.

Raising the assessments might not be as popular as you imagine.

You may wish to turn the hoa over to the owners sooner rather than later. Let the owners decide what to do.

By the way, board members must act in the best interests of the association, not in their own best interest.

You will need an hoa to maintain the playground in the future.

You can hold a vote to get rid of the restrictions without being declarant.

This gets more interesting all the time. I'm usually on the side of the homeowners, not the declarant, but in this case I wish you good luck.

Most HOAs are incorporated. You can check the name of your HOA at the MI secy of state here:

http://w1.lara.state.mi.us/businessentitysearch/

You can view the articles of incorporation there. The current builder should be using the name of the HOA and have established a TIN with the IRS and should have a bank account in the name of the HOA. The right to assess homeowners usually goes through the HOA, and not in the name of the declarant or builder. The builder usually has no right to collect assessments independent of the HOA.

Do you make your yearly assessment check payable to the HOA or the builder?

If the HOA is incorporated, the MI non-profit law has procedures for members of an association (lot owners) to view/copy all of the association's records, including the HOA's current bank statements that are in the possession of the builder.

If the HOA is incorporated, you will need to take charge of the corporation. The board of the HOA is the board of the corporation. Appoint the board, call a board meeting, everything by the book, then go to the bank to take over the existing HOA account. You can't usually collect assessments in the name of the declarant.

If not incorporated, I would start by incorporating the HOA.

Reinstating the original non-profit corporation through the secretary of state website (or by paper) will have the real name of the HOA, be the real HOA corporation and may be more legitimate than a new corporation (and probably already has a TIN).

So ... how could the new developer create a new Non-Profit HOA and ATTACH any such new HOA to current properties without any owner's approvals??? If you are an attorney ... that potentially should be a question you are asking yourself. Potentially in my state the new developer would just be an owner of X number of lots, if the developer did not have the "development rights" transferred to them at the time of their purchase. Seems to me the moron is exceeding their legal authority.