Oh dear Part II (Threat of Insurance non-renewal)

The steps I would take and considerations I would present to the Board:

-- I would ask the Board to close the park until proper insurance is arranged.

-- If insurance cannot be arranged, then the Board has no choice but to close the park. I hope the implications and risks of not closing the park, when there is no insurance, are obvious.

-- Contact as many insurers as possible and see who is willing to offer insurance.

-- If any insurer is willing to insure the park (and all else that the HOA requires to have insured), then I think the Board has no choice but to arrange for the insurance and adjust the assessment to owners as needed.

-- If owners do not like what they are paying for insurance, they can vote to amend the covenants to remove the skateboard park as a HOA amenity.

Thanks AugustinD.

Just to be clear, our CC&Rs don't list the "skateboard park" as a HOA amenity. Our CC&Rs reference the physical location of the park but not what is in the park. I don't think we would need to amend the CC&Rs to remove the rails.

Then since:

-- The CC&Rs do not authorize the skateboard park, and so the HOA has no obligation to provide a skateboard park;

-- I expect insurance (if available) for the park will add noticeably to the HOA's insurance expense;

I would ask the Board to shut the skateboard park down calmly but post-haste. Subsequently I think the Board should take measures quickly to help ensure the skateboard park is not some kind of "attractive nuisance" that the kids will use and on which the kids may potentially have an accident.

FWIW I think explaining this to owners should be done matter-of-factly. Said facts should be what the CCRs say and your obligation as a board not to take improper risks or add expenses not authorized in the CCRs.

First of all, you didn't make a mistake. Amenities are nice, but some come with more liability issues than others, so it was a good idea for you to go to the master insurance carrier. That's what good boards are supposed to do - what would have happened if you hadn't done that and someone later busted his/her head open trying to do a backflip (you know how sue-happy people are these days).

That said, it seems to me the insurance company would have asked about amenities long before now and someone noticed your community had a skate park and told you 15 years ago about their concerns, but anyway...

Our community lost its insurance shortly after I moved in - I wasn't on the board at the time, but everyone received a letter explaining there had been too many claims. Nothing to do with our swimming pool thank goodness (there had been some sewer line disruptions, a fire, and something else I can't remember). The community went down to the wire in getting a replacement - and yes it cost considerably more money. Several years later, we did get rid of the pool - insurance coverage was one of the reasons we gave the community for pitching it.

The developer likely put in the skate park to attract homeowners, which is what they do, since they're in the home building and selling business. Once they turn the community over, it's the homeowners' problem in addressing attractive nuisances like skateparks and swimming pools, and of course, they usually don't tell the first board about those risks. Since it contains lots of concrete and rails that require maintenance and replacement (yet another reserve item to fund), so you're better off getting rid of it anyway.

You could shop around, as AugustinD suggested to see if someone would cover skate parks, but it would likely cost a ton of money and you'd also have to come up with a number of policies and protocols to try and control who used it and how (e.g. underage kids might require adult supervision) and that would be another set of problems.

Tell the homeowners what the situation is and double-check with your attorney regarding any CCR revisions. Like you, I don't think you'll need any - when we got rid of our pool, we interpreted our CCRs as requiring homeowner approval and spent a year and a half getting people to vote yea or nay. When we finally got the number we needed, our attorney later looked at the documents and said that WASN'T something the board had to do, but it was a good idea to keep homeowners in the loop. Keep that in mind whenever you and your board colleagues consider doing something that your neighbors might consider drastic.

That's a lot of work, Tim. Why not remove the skate park, which is - and has been - the goal as outlined in other threads. I understand your point, though.

If the goal of the board is to remove the skate park, then the insurance question is moot. They would just remove it.