What?? Can I request to see?

Started by KimberlyW2 • 20 replies • 941 views

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KimberlyW2 (Tennessee)
Posts: 38

Posted:

After nearly a decade, my health is forcing me to step down as President of my Association.

We have a management company, but only 3 remaining board members that are not overly involved. To say I pretty much did everything would be an understatement.

In the months going forward, what records can I request for viewing? What should I request? Can I view our debits and credits?? Right now, I have real time access to our banking records and I check them daily. I am from a banking background and know my way around a bank statement. I've caught more than one error over the years.

I do realize I will likely have to pay a large amount for " copies " even in this digital world. I'm well aware of how management companies make a profit ( NO offense to property managers out there. Your job is hell! )

I've been a board member so long I guess I forgot how to act as just a member of my HOA. I feel a little out of control...and maybe I simply fear where things might wind up. Not to give myself too much credit- but, I did A LOT as President. It became a daily job.

Our board does not meet in person on a regular basis. It just wasn't something anyone was willing to do. It was like pulling teeth to even get them to attend our required annual meeting! So, attending board of directors meetings isn't an option. I wish it was.

To others in my similar situation: How did you stay informed after you stepped down?

Thanks for any advice.

K.

AugustinD
Posts: 5,144

Posted:

Quote:

Posted By KimberlyW2 on 07/10/2019 8:54 AM

In the months going forward, what records can I request for viewing? What should I request? Can I view our debits and credits??

Is this a condominium or a neighborhood of stand-alone houses?

Is this HOA a corporation?

First, check what your HOA's Declaration says on the subject of record viewing. Second, review your state's statutes on this, as given at https://www.hopb.co/tennessee . One of the following is going to apply:

Tennessee Code AnnotatedTitle 66 Property Chapter 27 Multiple Ownership of PropertyPart 1 Horizontal Property
66-27-113. Administrator's books -- Examination by co-owners.
(a) The administrator, or the board of administration, or other form of administration specified in the bylaws, shall keep a book with a detailed account, in chronological order, of the receipts and expenditures affecting the building and its administration and specifying the maintenance and repair expenses of the common elements and any other expenses incurred.
(b) Both the book and the vouchers accrediting the entries made thereupon shall be available for examination by all the co-owners at convenient hours on working days that shall be set and announced for general knowledge.

Tennessee Code AnnotatedTitle 66 Property Chapter 27 Multiple Ownership of PropertyPart 4 Tennessee Condominium Act of 2008 -- Unit Owners' Association
66-27-417. Association records. [For condominiums]
The association shall keep financial records sufficiently detailed to enable the association to comply with §§ 66-27-502 and 66-27-503. All financial and other records shall be made reasonably available for examination by any unit owner, the holder of any mortgage or deed of trust encumbering a unit, and their respective authorized agents.

Tennessee Code AnnotatedTitle 48 Corporations And Associations Nonprofit Corporations Chapter 66 Records and Reports Part 1 Records
48-66-102. Inspection of records by members.
(a) Subject to § 48-66-103(c), a member is entitled to inspect and copy, during regular business hours and at a reasonable location specified by the corporation, any of the records of the corporation described in § 48-66-101(e) if the member gives the corporation a written demand at least five (5) business days before the date on which the member wishes to inspect and copy.
(b) A member is entitled to inspect and copy, during regular business hours and at a reasonable location specified by the corporation, any of the following records of the corporation if the member meets the requirements of subsection (c) and gives the corporation written notice at least five (5) business days before the date on which the member wishes to inspect and copy:
(1) Excerpts from any records required to be maintained under § 48-66-101(a), to the extent not subject to inspection under subsection (a);
(2) Accounting records of the corporation; and
(3) Subject to § 48-66-105, the membership list.
(c) A member may inspect and copy the records identified in subsection (b) only if:
(1) The member's demand is made in good faith and for a proper purpose;
(2) The member describes with reasonable particularity the purpose and the records the member desires to inspect; and
(3) The records are directly connected with the purpose for which the demand is made.
(d) The right of inspection granted by this section may not be abolished or limited by a corporation's charter or bylaws.
(e) This section does not affect:
(1) The right of a member to inspect records under § 48-57-201 or, if the member is in litigation with the corporation, to the same extent as any other litigant; or
(2) The power of a court, independently of chapters 51-68 of this title, to compel the production of corporate records for examination.

Quote:

Right now, I have real time access to our banking records and I check them daily. I am from a banking background and know my way around a bank statement. I've caught more than one error over the years.

If you currently neither a director nor an officer, then I think having this access may be inappropriate and legally, a bad idea.

Quote:

To others in my similar situation: How did you stay informed after you stepped down?

Only with considerable obstruction by the board and manager, including refusal to comply with state law and the governing documents regarding records inspection until, after a few months of polite well-documented requests, one often had to threaten suit. Then the board and manager would single requesting members out for hostile treatment for threatening suit. "Through the looking glass" was more rational.

On the other hand, volunteers being as clueless as they often are, many directors like to give favorable treatment to ex-directors and ex-officers.

KimberlyW2 (Tennessee)
Posts: 38

Posted:

Thank you for this, August.

We are a condominiums and we are incorporated. There is no wording about viewing records in our governing documents. They are old. Nearly 30 years. And seem to have been just copied and pasted from other governing documents by the developer at the time. Not a lot of thought put into it. I've tried to garner enthusiasm to amend or add to them and never could get much interest. Our Association membership passed the apathetic stage many moons ago. But, that is another subject for another time.

I am going to study the info you gave me fully.
Thanks again!

PestY
Posts: 128

Posted:

sit back - relax - enjoy your retirement

or

relocate somewhere without stress

~

best of luck

JeffT2 (Iowa)
Posts: 880

Posted:

What Augustin and Pesty wrote. Also:

Step down as president, remain as a director like the other directors. Directors usually have easier access, and apparently it does not take much time to be a director in your community.

Ask the board to vote you in as Treasurer. It is sometimes possible to be Treasurer without even being a director. Check your bylaws for requirements to be Treasurer. Retain your access to bank records by being the Treasurer.

Before you step down, work out the policy and steps for a homeowners to view financial documents.

What does your contract with the management company say about providing financial records? What records are provided as part of the contract, and how often?

If you ask the management company to produce records and make reports, it may cost you money, but if you go to inspect and bring a smart phone camera, it may not cost anything.

NpS (Pennsylvania)
Posts: 4,216

Posted:

I was pres of my board for years. Stepped down 2 years ago.

The other BOD members wanted me to stay in the loop.

Our 30 year old docs gave the BOD the authority to create Officer positions other than Pres, VP, Treas, and Sec. I didn't want any of those jobs. So we made up an Officer title and my BOD gave it to me.

- I have access to everything that I had access to before.
- I'm covered by D&O insurance.
- I recommend but don't vote on BOD decisions.
- In my officer position, the BOD delegates to me the ability to do those things that they will never get to and I'm willing to take on.

Working fine.

Should also note that, under my docs, all Officer positions except Pres can be filled by a non-BOD member. That's fairly typical around here.

Sikubali jukumu. Read all posts at your own risk.

KimberlyW2 (Tennessee)
Posts: 38

Posted:

Thanks all for the great advice!

My board doesn't really have titles or roles. Except for mine. We only have volunteers to essentially fill the " seats " to make up a semi board. If any of the board members actually had to do anything but vote by email, we wouldn't have a board, at all. I know the ramifications of that. I do. But, you can't force people to participate. I have tried. We are a small HOA and 50% rental units at this point. Things aren't good. You can understand why I am concerned to be relinquishing my role. I pretty much know what could happen.

My health will not allow me to stay on in any capacity anyway. Even as a director. It would fall on me again to play the volunteer manager of everything. My stepping down might force change, but I doubt it. The only bright spot is the real estate market is booming in my area and we are getting new owners at an increasing rate. Perhaps someone new will pick up the reigns? It also gives me hope I may be able to sell and move.

I just want to be able to keep up with what our management company is or is not doing in my absence. Until I can make the changes needed for my well being and my financial interests.

K.

KerryL1 (California)
Posts: 14,550

Posted:

In CA, Owners may review almost all records and documents upon written request to the PM or Board. Exceptions are what you'd expect, I can no longer review delinqunent owners' records. But I don't know about TN. Your own bylaws might give you some idea. Ours do and do not conflict with state statutes.

I stepped down from the board several months ago, and I have a standing order to our PM for a copy of our HOA's financials once they've been approved by the board pending the year end audit. We have a Finance Committee and the treasurer chairs it, but they constantly miss errors.

KerryL1 (California)
Posts: 14,550

Posted:

I apologize for my useless reply. when I viewed Kimberly's OP a few moments ago, no replies showed on my screen!

I'll just add our MC ones' charge anything to email me records and in CA, we don't need to specify a purpose for wanting to review them. the idea to review your MC contract makes sense as it'd be easy for you to pint out that the PM must abide by all state statutes or some such that might be in th contract.

AugustinD
Posts: 5,144

Posted:

Quote:

Posted By KimberlyW2 on 07/10/2019 10:21 AM
We are a small HOA and 50% rental units at this point. Things aren't good. You can understand why I am concerned to be relinquishing my role. I pretty much know what could happen. ... [snip for brevity] The only bright spot is the real estate market is booming in my area and we are getting new owners at an increasing rate. Perhaps someone new will pick up the reigns? It also gives me hope I may be able to sell and move.

Someone here at hoatalk[dot]com recently pointed out that, as more of a condominium association's units become rentals, the less chance the resident-owners have of effecting change that goes to help resident-owners. My former condo was at 57% rentals. The reserve account was about 26% percent funded (dismal). Parking gets worse every year. Tenants did not want to complain, lest their landlords refuse to renew their lease, or the vindictive idiot employee manager retaliates. And so on. The landlords generally seem to want to pay as little as possible towards reserve funding.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By KerryL1 on 07/10/2019 11:27 AM
I apologize for my useless reply. when I viewed Kimberly's OP a few moments ago, no replies showed on my screen!

I'll just add our MC ones' charge anything to email me records and in CA, we don't need to specify a purpose for wanting to review them. the idea to review your MC contract makes sense as it'd be easy for you to pint out that the PM must abide by all state statutes or some such that might be in th contract.

Even here in old backward SC we can electronically send anyone a complete financial package, albeit some 40 pages long. Ask and our MC will Email it out.

PestY
Posts: 128

Posted:

..... Posted By KimberlyW2 on 07/10/2019 8:54 AM

In the months going forward, what records can I request for viewing? What should I request? Can I view our debits and credits?? .....

? A former long term BOD President does not know ?

? Or know WHERE to research state law & the CCRs for the answer ?

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

First, check what your HOA's Declaration says on the subject of record viewing. Second, review your state's statutes on this, as given at https://www.hopb.co/tennessee . One of the following is going to apply:

Tennessee Code AnnotatedTitle 66 Property Chapter 27 Multiple Ownership of PropertyPart 1 Horizontal Property
66-27-113. Administrator's books -- Examination by co-owners.
(a) The administrator, or the board of administration, or other form of administration specified in the bylaws, shall keep a book with a detailed account, in chronological order, of the receipts and expenditures affecting the building and its administration and specifying the maintenance and repair expenses of the common elements and any other expenses incurred.
(b) Both the book and the vouchers accrediting the entries made thereupon shall be available for examination by all the co-owners at convenient hours on working days that shall be set and announced for general knowledge.

Tennessee Code AnnotatedTitle 66 Property Chapter 27 Multiple Ownership of PropertyPart 4 Tennessee Condominium Act of 2008 -- Unit Owners' Association
66-27-417. Association records. [For condominiums]
The association shall keep financial records sufficiently detailed to enable the association to comply with §§ 66-27-502 and 66-27-503. All financial and other records shall be made reasonably available for examination by any unit owner, the holder of any mortgage or deed of trust encumbering a unit, and their respective authorized agents.

Tennessee Code AnnotatedTitle 48 Corporations And Associations Nonprofit Corporations Chapter 66 Records and Reports Part 1 Records
48-66-102. Inspection of records by members.
(a) Subject to § 48-66-103(c), a member is entitled to inspect and copy, during regular business hours and at a reasonable location specified by the corporation, any of the records of the corporation described in § 48-66-101(e) if the member gives the corporation a written demand at least five (5) business days before the date on which the member wishes to inspect and copy.
(b) A member is entitled to inspect and copy, during regular business hours and at a reasonable location specified by the corporation, any of the following records of the corporation if the member meets the requirements of subsection (c) and gives the corporation written notice at least five (5) business days before the date on which the member wishes to inspect and copy:
(1) Excerpts from any records required to be maintained under § 48-66-101(a), to the extent not subject to inspection under subsection (a);
(2) Accounting records of the corporation; and
(3) Subject to § 48-66-105, the membership list.
(c) A member may inspect and copy the records identified in subsection (b) only if:
(1) The member's demand is made in good faith and for a proper purpose;
(2) The member describes with reasonable particularity the purpose and the records the member desires to inspect; and
(3) The records are directly connected with the purpose for which the demand is made.
(d) The right of inspection granted by this section may not be abolished or limited by a corporation's charter or bylaws.
(e) This section does not affect:
(1) The right of a member to inspect records under § 48-57-201 or, if the member is in litigation with the corporation, to the same extent as any other litigant; or
(2) The power of a court, independently of chapters 51-68 of this title, to compel the production of corporate records for examination.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Quote:

Posted By PestY on 07/10/2019 9:39 AM
sit back - relax - enjoy your retirement

I wish it were that easy.

When you care about the work you've done, you like to think things you set up can go smoothly.

After 1 year of not being treasurer, I asked to see our financial statements and budget.
I discovered that the beginning amount for last year was changed from the original.
I was provided with 5 different beginning balances for this year and push back when requesting to see the actual bank statement.
The budget was bad - planned budget beginning balance was the actual amount (which included pre-payed assessments) vs. the normal cushion we keep in the account (a difference of 10K).
The reserve study was never updated in the budget (even though I had made updates to the study while I was treasurer).
The board has spent 19K on new playground equipment (which was needed) but they don't have a clue how they are paying for it.

No real reasons for the gross errors, simply excuses.

Therefore, I understand the concerns Kimberly has.

I know from experience she will enjoy the time she doesn't have to spend on Association business.

However, the members are the watchdogs to the boards actions, mistakes, etc.
If nobody takes the time to simply do a spot check now and then, errors can turn into issues that the members will have to pay for.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

Just want to say it is NOT a profit making thing for the MC or even the HOA to provide documents. Be it electronic or hard copy. They are basically recouping their costs. Hence why VIEWING is recommended and not "Free" copies. It takes an office worker to put those documents in electronic form or time to send out email wise. It also takes a stamp and cost of paper.

So if you are complaining that the MC is making a "Profit" by providing the documents if you pay for them... I don't see how. It's called recouping their costs.

Former HOA President

PestY
Posts: 128

Posted:

Quote:

Posted By TimB4 on 07/11/2019 3:31 AM

Posted By PestY on 07/10/2019 9:39 AM
sit back - relax - enjoy your retirement

Very well stated.

but

? at what age does one RETIRE and relax ?

Probably never

UNLESS

one relocates where there is NO HOA to fret about

KerryL1 (California)
Posts: 14,550

Posted:

TimB wrote: "However, the members are the watchdogs to the boards actions, mistakes, etc.
If nobody takes the time to simply do a spot check now and then, errors can turn into issues that the members will have to pay for."

I agree. Our finance committee & treasurer routinely missed errors on the monthly financials, so I review them every month--takes about 15 minutes. Our PM has corrected some small errors I found and there are are a couple I'm watching to make sure they don't turn into big errors.

There are other ways "retired" directors can contribute to their communities using far less time then when they were on the board. NpS seems to have found a good method.

KellyM3 (North Carolina)
Posts: 2,239

Posted:

Quote:

Posted By PestY on 07/10/2019 9:39 AM
sit back - relax - enjoy your retirement

or

relocate somewhere without stress

~

best of luck

If you step down as president, then congratulations on your years of service!

As an ex-officer, you'll not help the board nor your own health by serving as an emeritus board member. Enjoy your life and drop the stress of an HOA.

NpS (Pennsylvania)
Posts: 4,216

Posted:

Quote:

Posted By KerryL1 on 07/11/2019 9:10 AM
There are other ways "retired" directors can contribute to their communities using far less time then when they were on the board. NpS seems to have found a good method.

Thanks Kerry.
The title we came up with for me is Logistics Officer.
- 90% of my time is spent researching and presenting ways that we can become more cost effective and efficient. Only 10% of my time is spent on things going on this year. I have no deadlines. I don't attend meetings when it's inconvenient for me - which is often.
- I advise individual BOD members on where the boundaries of HOA authority and responsibility are - Hard for some people to get it even when they've been on the BOD for years. Like you situation, our Treasurer is all over the lot in his thinking, but doesn't have a clear handle on the basics like making sure that finances are handled with uniformity and consistency.
- It is with great pleasure that I no longer have any personal reaction to what the crybabies have to say. I'm no longer responsible. I'm no longer disappointed in their inability to think about anyone other than their little cluster of buddies.
- Having fun without all the stress.

Sikubali jukumu. Read all posts at your own risk.

ND (PA)
Posts: 792

Posted:

I think others have answered your actual questions, so I'll just provide some additional thoughts.

If you are stepping down because of health reasons, I honestly think your health needs to be the main focus and you need to completely remove yourself from Board-related activities and information. Easier said than done, but trying to stay informed and having little ability to guide where the HOA is going or the decisions being made will just cause you unneeded stress and anxiety, and it will negatively impact your health.

I was faced with a similar situation in that I had been involved in the Board for a really long time but it was consuming too much of my time with not enough reward/ROI and it was negatively impacting my health, sanity, and family life. I was the main Board Member doing a majority of the work. I no longer wanted to be part of the Board, but I also couldn't see myself going back to being a regular, naïve homeowner. It seems like wanting similar information that the Board receives, but not being part of the discussion and decision-making would almost be more work, stress, and anxiety than being an actual Board Member. I also feared that if I still lived in the neighborhood, I would be dragged in to much of the discussion anyway because of past experience and knowledge . . . so much so that I might as well just remain a Board Member.

The only way I found that I could completely separate myself from the possibility of all of that was to sell my home and move. I did have other reasons for selling and moving; however, removing myself from that HOA was one of my main factors. It was definitely the right decision for me. If you can deal with the stress and anxiety of a move, I would suggest you do that and not think one more second about your current HOA. Also, if possible move to a non-HOA location or make a smarter decision on which HOA to join since you don't want to repeat your current situation. Best wishes to you!

SueW6 (Michigan)
Posts: 814

Posted:

One “gift “ we can give to the boards we serve is to ensure that the condition of the board affairs are in better shape than when we arrived. Too bad this board cant function when one person leaves, especially the president.

Walking out the door leaving behind a healthy board is a good legacy.

NpS (Pennsylvania)
Posts: 4,216

Posted:

Quote:

Posted By SueW6 on 07/12/2019 6:51 AM
One “gift “ we can give to the boards we serve is to ensure that the condition of the board affairs are in better shape than when we arrived. Too bad this board cant function when one person leaves, especially the president.

Walking out the door leaving behind a healthy board is a good legacy.

Well said Sue.

Sikubali jukumu. Read all posts at your own risk.

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