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Stormwater Ponds Maintenance

Started by MartinL2 • 7 replies • 738 views

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MartinL2 (North Carolina)
Posts: 2
Posted:
I live in North Carolina in an HOA with almost 40 homes and three storm water ponds. Back in January 2019, our town inspected the three storm water ponds we have. The town sent the HOA a document with items to address regarding the storm water ponds, as well as a bill for the inspection.

A few weeks ago we had our annual HOA meeting and I was voted in as President (no one else wanted to do it). Shortly after, I read through the covenant and noticed two of the three storm water ponds are a join responsibility of the HOA and nine businesses in front of our community.

I knew from the town's inspection that the storm water ponds needed maintenance. It was brought to my attention that the storm water ponds haven't had maintenance done in over 10 years!

The HOA has been around 17 years. The dues began at $25/month, now they're $35/month, and we have a pool/wash house. We're already on a shoe-string budget, and now knowing how urgent the pond maintenance is, how do I get the money needed to pay for the storm water ponds? Do we raise the HOA dues, or have a special assessment? I believe raising the HOA dues requires a quorum vote, but does a special assessment require a quorum vote too? I'm upset the storm water ponds got to this point. Any advice or suggestions would be greatly appreciated!
MelissaP1 (Alabama)
Posts: 13,836
Posted:
Read your CC&R's about either option of dues increase or special assessment. It depends on how much you need to raise. We can raise our dues 5% a year with just a board vote. That may not be enough to cover this expense unless wanting to contribute to a capital savings fund.

If this is going to be a one time large expense, then I would do a special assessment amongst ALL members. If this is going to require a long term expense, then increase the dues. It may need to be a combo of both. The initial cost of large project costs and then the continued maintenance afterwards.

A HOA is ONLY funded by it's members for it's members. It's also a non-profit but NOT charitable corporation. So a long term maintenance items would need to be incorporated into the budget. Which on a shoe-string budget a dues increase would benefit.

I've had to do some big projects on a shoe string budget. So reference your rules about how to go about it. Remember if the bill is going to be 10K and you have 10 members the special assessment is 1K each member. Not paying could be subject to a lien.
Former HOA President
GenoS (Florida)
Posts: 4,276
Posted:
Martin, it's all going to depend on your documents how you raise assessments, be they regular or special. Assuming the report identifies what the problems are with your ponds, start looking around for companies who can do the work and get bids. Then take a deep breath and soberly consider that your shoestring budget for 10 years has been a major contributor to your current dilemma. Get bids and see how much money you're talking about.

Check the current deeds on those 9 business that border on the other side of the ponds. If those deeds also carry the same covenants for pond responsibility then be prepared to approach them, if necessary. Has the town also spoken to them? They'd have the deed covenants too, supposedly. Do those covenants address the sharing of the cost of maintaining the ponds? I don't know the topography of your neighborhood and I'm sure it's quite different from flatland Florida, but 3 ponds for 40 homes sounds like a lot. Are they small ponds? We have 100 homes on 25 acres and 1.5 acres of pond surface area. Yeah, NC's not FL, but 3 ponds still sounds like a lot. What's their total area?
MarkM19 (Texas)
Posts: 1,459
Posted:
Martin,
The quickest way to start healing is as mentioned raise the dues as much as can be done legally without a vote. Some say 5% and in Ca. it was under 10% I think the community must be given 30 days notice but it may actually be 60 days. Follow your guidelines.

If you do this emergency increase it will cost each homeowner $3.00 per month. If anyone is living that close to the bone they are already in trouble. Not sure when that last increase happened but it has probably been years. Have an elevator pitch that you will need to use often to defend the boards decision. Something like how much the cost of living has gone up in the last x years. How much has your Cable or Electricity gone up in x years. Anyone who expects HOA fees to remain static forever is not very smart.

You will only see an increase of $1440 if you raise the dues by $3.00 so you probably still need to look and cut some other expenses. This is also part of your job as a board member. Bring your vendors in and try and ask them how they can lower expenses for their individual services? You can always find ways to tighten the belt.

You may need to have a vote of the owners at the beginning of the next budget year increasing dues to a higher level. If this fails you will need to raise them to the max without voter support in another emergency increase.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Martin

You are getting all types of advice but remember it is your Covenants that will control what yo can do.

In my SC HOA, the BOD can raise the annual dues (assessment) as much as they want once a year at budget time. Owners do not need to approve.

For a Special Assessment, 2/3rds of all owners must approve.

Check your own docs.
TimB4 (Tennessee)
Posts: 21,059
Posted:
Sounds like the first thing you need to do is have a meeting with the 9 businesses pointing out their share of the responsibility for the maintenance of the ponds.

Second, you need to get prices for what the city wants done (as this needs to be done first).

Now that you actually have information, you can fully inform the businesses and membership of the need for x amount of money along with plans to properly maintain them in the future.

I would suggest that after this work is done, the Association starts billing the owners of the business for their contribution to the reserves for having the work done. You may need an attorney involved but wait until you see how the businesses respond.
MartinL2 (North Carolina)
Posts: 2
Posted:
Thank you everyone for the responses! There is a board meeting this week. I'll let y'all know the outcome!

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