KellyC3 (Florida)
Posts: 39
Posts: 39
Posted:
What happens when you have a functioning sub association with a solid budget and the Master Association is Broke and cannot even pay their daily exspenses? Has anyone encountered this?
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Master Assoc Broke
Started by KellyC3 • 9 replies • 1778 views
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RogerB (Colorado)
Posts: 5,067
Posts: 5,067
Posted:
Kelly, why are they broke? If you don't know it is time to investigate. Poor management by their Board? Unable to increase assessments sufficiently? Still controlled by developer? Or? Perhaps it is time to change the composition of the Board and/or increase the assessment.
KellyC3 (Florida)
Posts: 39
Posts: 39
Posted:
Thats a good question... The developer turned over in January they un officially shut out the management company to any meetings by holding them on evenings when the property manager had prior commitment to another HOA. They have been spending monies all along claiming to have no financial reports. Then after not utilizing the management company for five months turned around and fired them and brought in a new company that has been in for going on five months. They hired an attorney to go against us (we are gated, documents are not clear etc.... long story on that end) Yet in all of their previous minutes not until this last months minutes do they even comment on financials. If the ship is sinking shouldnt the sub that is in good standing and incorporated be able to take a lifeboat and get off!!!
DonnaS (Tennessee)
Posts: 5,671
Posts: 5,671
Posted:
,
KellyC3,
I get the feeling from your previous thread, that there is a stinker in the pot and it smells like the developer did a horrid job of prepairing your Master for takeover time. He was responsible for having a budget to present to them upon turnover and should have been having the finances monitored by the M.C.
Your accusations of why they held the meetings in the evening are kind of off beat. Most all association meetings are in the evening to accomidate more members who work and if the property manager is not there, then the secretary takes minutes. Someone has to do them.
You guys need to take charge and straighten this out. The developer is out of there now so fix what is broke.
"They hired an Attorney to go against us"??? What does that mean? Yes, you can start the seperation process but you will need 100% of your residents to agree. You will need to refile incorporation papers, etc. Basically, as long as you have no connection to this Master, it can be done. But what about your common entry, roadways and other areas that you share? There has to be some connection that you all pay for.
KellyC3,
I get the feeling from your previous thread, that there is a stinker in the pot and it smells like the developer did a horrid job of prepairing your Master for takeover time. He was responsible for having a budget to present to them upon turnover and should have been having the finances monitored by the M.C.
Your accusations of why they held the meetings in the evening are kind of off beat. Most all association meetings are in the evening to accomidate more members who work and if the property manager is not there, then the secretary takes minutes. Someone has to do them.
You guys need to take charge and straighten this out. The developer is out of there now so fix what is broke.
"They hired an Attorney to go against us"??? What does that mean? Yes, you can start the seperation process but you will need 100% of your residents to agree. You will need to refile incorporation papers, etc. Basically, as long as you have no connection to this Master, it can be done. But what about your common entry, roadways and other areas that you share? There has to be some connection that you all pay for.
KellyC3 (Florida)
Posts: 39
Posts: 39
Posted:
Actually the developer did prepare, they had a management company in place that had taken over when we (sub association) turned over two years prior. We have the same management and things are great on our end. They did provide the documents required. This board in every documented minutes state “no financial report” but they still spent money... How about the fact that they fired one management company at 4 1/2 months and the second has been almost 5 months, yet all they have successfully done is spend the daily operational funds to $0.
It is not that they had meetings in the evening we hold our meetings then, it is about the deliberate dates chosen so that the management company could not attend. If they don’t attend then a BRAND NEW BOARD WITH NO EXPERIENCE, has no proper guidance.
They refused our help back when they took office. We had list of estimates and contacts that we did as a to help them for a smoother transition after turnover, So whenever we had work done in our area we would get an estimate for improvements and or repairs for them…. They wanted no part of it. Including the management company that we also use (the one they fired).
They hired an attorney to strong arm their authority to come into our sub association and impose rules and regulations, NOW I might add we have been in play for 2 ½ years and have stricter ACC guidelines, covenants, and we are on top of our community.
I thought that the Master association had to be the one to release a sub association?
We do not share a common entry that they fund. We are gated and we cover the cost of the gates and everything behind the gates and our road is private.
There are no common amenities inside our community. The immediate areas outside the gates are taken care of by the CDD not the Master Association. The amenities are located outside of our community in the other communities which are not sub associations and are directly under the master.
Yes all located outside of our community adn one of which has been non operational since July.
It is not that they had meetings in the evening we hold our meetings then, it is about the deliberate dates chosen so that the management company could not attend. If they don’t attend then a BRAND NEW BOARD WITH NO EXPERIENCE, has no proper guidance.
They refused our help back when they took office. We had list of estimates and contacts that we did as a to help them for a smoother transition after turnover, So whenever we had work done in our area we would get an estimate for improvements and or repairs for them…. They wanted no part of it. Including the management company that we also use (the one they fired).
They hired an attorney to strong arm their authority to come into our sub association and impose rules and regulations, NOW I might add we have been in play for 2 ½ years and have stricter ACC guidelines, covenants, and we are on top of our community.
I thought that the Master association had to be the one to release a sub association?
We do not share a common entry that they fund. We are gated and we cover the cost of the gates and everything behind the gates and our road is private.
There are no common amenities inside our community. The immediate areas outside the gates are taken care of by the CDD not the Master Association. The amenities are located outside of our community in the other communities which are not sub associations and are directly under the master.
Yes all located outside of our community adn one of which has been non operational since July.
NancyD1 (Florida)
Posts: 447
Posts: 447
Posted:
Kelly,
You have to find something in the master docs that states how firmly entrenched your sub is. When the developer set up all the subs he refered to them in the master. Each sub should have an obligation to the master. This is what you need to find out.
Your sub cannot just split from the master. You will find this in the doc's but most likely the master will have to permit this. Do you have automony from the master for everything but common elements outside of your gate? Do you pay your subs bills, electric, landscaping, etc.?
You can petition the master for financials and any doc's that pertain to your community, follow the rules for getting the doc's.
I think you should read the following article. I posted this today but IMO you need to follow the example for dismissing the master BOD.
http://www.sun-sentinel.com/news/local/southflorida/sfl-flbcondocol1003sboct03,0,226863
You have to find something in the master docs that states how firmly entrenched your sub is. When the developer set up all the subs he refered to them in the master. Each sub should have an obligation to the master. This is what you need to find out.
Your sub cannot just split from the master. You will find this in the doc's but most likely the master will have to permit this. Do you have automony from the master for everything but common elements outside of your gate? Do you pay your subs bills, electric, landscaping, etc.?
You can petition the master for financials and any doc's that pertain to your community, follow the rules for getting the doc's.
I think you should read the following article. I posted this today but IMO you need to follow the example for dismissing the master BOD.
http://www.sun-sentinel.com/news/local/southflorida/sfl-flbcondocol1003sboct03,0,226863
KellyC3 (Florida)
Posts: 39
Posts: 39
Posted:
We PAY ALL BILLS related to our community our private road, gates, etc.. THERE is NO financial input from the Master to our association. When our residents bought they were told and under the impression that our association paid into the Master for the use of the amenities. Now that they have turned over seems that is not the case. We turned over 2 1/2 years ago the Master turned over from developer first of this year. (our community was built by a different builder)
KellyC3 (Florida)
Posts: 39
Posts: 39
Posted:
Oh and we are the only sub association out of the four communities. All others are directly under the Master.
NancyD1 (Florida)
Posts: 447
Posts: 447
Posted:
Kelly,
If your sub has been operating independently the master cannot just assume control of your subs money. There has to be some sort of definition of your sub's HOA in the masters doc's and the powers that they have over your HOA.
Your board needs to get together with the board of the master and come to some sort of agreement as per the doc's relating to each association. Try to find out where they are coming from and if they have the document to back up what they want from your HOA. See if the master and your sub's doc's mesh with state law. The doc's may have to be amended.
If this does not work call in an independent arbitrator. This may be the only way both sides are going to settle this dispute short of court action. This will cost you both and cause misdirection with all the homeowners. Both sides will be asked about their points and let the arbitrator decide. If you call an arbitrator make sure he is well versed in homeowner associations. There are many mediators through Florida. It will cost you a few hundred an hour but hopefully it will be worth it. If he is versed in HOA's ask him to make recommendations for extending the doc's between both associations. Sometimes it takes an outsider to help solve the problems.
If your sub has been operating independently the master cannot just assume control of your subs money. There has to be some sort of definition of your sub's HOA in the masters doc's and the powers that they have over your HOA.
Your board needs to get together with the board of the master and come to some sort of agreement as per the doc's relating to each association. Try to find out where they are coming from and if they have the document to back up what they want from your HOA. See if the master and your sub's doc's mesh with state law. The doc's may have to be amended.
If this does not work call in an independent arbitrator. This may be the only way both sides are going to settle this dispute short of court action. This will cost you both and cause misdirection with all the homeowners. Both sides will be asked about their points and let the arbitrator decide. If you call an arbitrator make sure he is well versed in homeowner associations. There are many mediators through Florida. It will cost you a few hundred an hour but hopefully it will be worth it. If he is versed in HOA's ask him to make recommendations for extending the doc's between both associations. Sometimes it takes an outsider to help solve the problems.
KellyC3 (Florida)
Posts: 39
Posts: 39
Posted:
I might have not been clear. They have made no attempt at our money. They have mispent money, and now they cannot pay their daily operating costs. So now they want to special assess and then raise the annual dues. They also want to come in and start dictating and fining the residents in the sub, which is a complete duplication of what we do effectively already. Since they are not privy to our daily operations, the double indemnity is inevitable.
There is no sitting down and working it out.... They have shown to be purely power driven, instead of priorities and what is good for overall. Also our docs, and guidelines are more strict than the master and we enforce... The areas covered directly by the master are for lack of a better word horrible! There are certainly more homes directly under them that are not even at the minimum requirement of the Master some out of code, Our worst home and problem child does not even measure up to theirs, We have maybe three problem homes one of which sits on the Master board, They have at least 100!
There is no sitting down and working it out.... They have shown to be purely power driven, instead of priorities and what is good for overall. Also our docs, and guidelines are more strict than the master and we enforce... The areas covered directly by the master are for lack of a better word horrible! There are certainly more homes directly under them that are not even at the minimum requirement of the Master some out of code, Our worst home and problem child does not even measure up to theirs, We have maybe three problem homes one of which sits on the Master board, They have at least 100!
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