SusanS15 (South Carolina)
Posts: 9
Posts: 9
Posted:
Our neighborhood will be built out by the end of this year. The developer no longer owns any lots in the development; the last of the remaining lots were sold to the builder in March of this year. Construction is ongoing on those lots and they are on track to build out before the end of 2021. The Association owns all the common areas, which include a pool and a small pool house; Common Areas were deeded over from the developer in 2017.
Near the end of December, when residents hadn't received an assessment notice and budget for 2021, I (and other residents) contacted the property management company to ask why. They said the developer hadn't yet decided on the dues for 2021, but the budget would remain the same from 2020 and would be posted no later than January 15. A couple weeks later, we all received the dues notice, with the amount unchanged from 2020. No updated budget has ever appeared on the website.
Earlier this week, residents discovered that outside pool memberships were being offered for sale for our pool, without our knowledge. HOA funds were used to mail flyers to surrounding neighborhoods. When we inquired, we were told it was a "Board decision" and that it was for "budgetary reasons." The property management company said that unless we raised revenue, we were going to be stuck with a "large deficit" when we take over the HOA. They couldn't provide any numbers. None of the residents were ever supplied with a flyer about the pool memberships, even though a letter concerning the opening of the pool for the year and the rules was sent at the same time as the flyer was mailed. Pool memberships were never mentioned in the pool opening letter.
The Board consists of three officers/owners of the developer. Since April, we have had a resident volunteer Transition team who is supposed to learn the basic workings of our CCRS and by-law so they can assist a new Board when the time comes later this year. They are not to act as the Board in any way during this time.
The developer has been supplying deficit funding for the past couple of years to cover expenses since we are not at full neighborhood build out yet; that is provided for in the CCRs. They also had the option to raise initiation fees and dues a certain percentage without a member vote, but apparently the property management company suggested selling pool memberships and that's the route they took. As of Monday of this week, no memberships have been purchased. Again, we have not yet been supplied any financials for 2021, so we don't know what the numbers actually are. I did manage to get a copy of the pool membership flyer and the membership contract purchasers would have to sign (it was not provided by the management company).
The pool is part of the Common Area, which is defined in the CCRs as "...owned by the Association for the common use and benefit of the Owners..." The Association has rights to charge reasonable fees for maintenance of the Common Areas, suspend voting rights of an Owner for any infraction of published rules and regulations, the right to dedicate or transfer any part of the Common Area to any public agency or authority, and to impose rules and regulations for the use of the Common Area and improvements hereon. The developer was considered the Declarant in the CCRs, but since they are no longer an owner of any lot in the subdivision, the CCRs say the rights of the Declarant pass to the Association. So that leaves "The Board." The by-laws say the Board has power to "adopt and publish rules and regulations governing the use of the Common Area and facilities, including but not limited to the recreational facilities and personal conduct of the Members, their guests thereon, and to establish penalties for the infraction thereof." So is selling pool memberships considered "rules and regulations?"
The residents, and myself, have many concerns, the lack of transparency being the major one. We don't know that the developer, since they no longer own property here, can make unilateral decisions. We don't know that the Board can unilaterally make the decision to sell pool memberships. We don't know how any HOA funds, no matter how small or large, can be used without members knowledge and consent. We don't know how non-residents paying to use our pool affects our insurance. We're concerned that residents don't have any financial information concerning the Association. We haven't had an Association meeting since 2018. Talking with the property management company is useless. We have gone through three managers in the past three years, and the most current one quit a week after meeting with the resident Transition team in April to push to get the pool solicitation flyers out. We effectively do not have a dedicated manager.
So what should we do? Forget about it until December? Go to the property management office and demand answers? Consult with an attorney? No one is happy about any of this, but no one is sure what the next steps should be.
Near the end of December, when residents hadn't received an assessment notice and budget for 2021, I (and other residents) contacted the property management company to ask why. They said the developer hadn't yet decided on the dues for 2021, but the budget would remain the same from 2020 and would be posted no later than January 15. A couple weeks later, we all received the dues notice, with the amount unchanged from 2020. No updated budget has ever appeared on the website.
Earlier this week, residents discovered that outside pool memberships were being offered for sale for our pool, without our knowledge. HOA funds were used to mail flyers to surrounding neighborhoods. When we inquired, we were told it was a "Board decision" and that it was for "budgetary reasons." The property management company said that unless we raised revenue, we were going to be stuck with a "large deficit" when we take over the HOA. They couldn't provide any numbers. None of the residents were ever supplied with a flyer about the pool memberships, even though a letter concerning the opening of the pool for the year and the rules was sent at the same time as the flyer was mailed. Pool memberships were never mentioned in the pool opening letter.
The Board consists of three officers/owners of the developer. Since April, we have had a resident volunteer Transition team who is supposed to learn the basic workings of our CCRS and by-law so they can assist a new Board when the time comes later this year. They are not to act as the Board in any way during this time.
The developer has been supplying deficit funding for the past couple of years to cover expenses since we are not at full neighborhood build out yet; that is provided for in the CCRs. They also had the option to raise initiation fees and dues a certain percentage without a member vote, but apparently the property management company suggested selling pool memberships and that's the route they took. As of Monday of this week, no memberships have been purchased. Again, we have not yet been supplied any financials for 2021, so we don't know what the numbers actually are. I did manage to get a copy of the pool membership flyer and the membership contract purchasers would have to sign (it was not provided by the management company).
The pool is part of the Common Area, which is defined in the CCRs as "...owned by the Association for the common use and benefit of the Owners..." The Association has rights to charge reasonable fees for maintenance of the Common Areas, suspend voting rights of an Owner for any infraction of published rules and regulations, the right to dedicate or transfer any part of the Common Area to any public agency or authority, and to impose rules and regulations for the use of the Common Area and improvements hereon. The developer was considered the Declarant in the CCRs, but since they are no longer an owner of any lot in the subdivision, the CCRs say the rights of the Declarant pass to the Association. So that leaves "The Board." The by-laws say the Board has power to "adopt and publish rules and regulations governing the use of the Common Area and facilities, including but not limited to the recreational facilities and personal conduct of the Members, their guests thereon, and to establish penalties for the infraction thereof." So is selling pool memberships considered "rules and regulations?"
The residents, and myself, have many concerns, the lack of transparency being the major one. We don't know that the developer, since they no longer own property here, can make unilateral decisions. We don't know that the Board can unilaterally make the decision to sell pool memberships. We don't know how any HOA funds, no matter how small or large, can be used without members knowledge and consent. We don't know how non-residents paying to use our pool affects our insurance. We're concerned that residents don't have any financial information concerning the Association. We haven't had an Association meeting since 2018. Talking with the property management company is useless. We have gone through three managers in the past three years, and the most current one quit a week after meeting with the resident Transition team in April to push to get the pool solicitation flyers out. We effectively do not have a dedicated manager.
So what should we do? Forget about it until December? Go to the property management office and demand answers? Consult with an attorney? No one is happy about any of this, but no one is sure what the next steps should be.