False Contracts

I am following up on a previous post "Failure to Maintain HOA Landscaping Behind Houses."

I live in an upscale community of 400 houses in Florida. The condition of the landscaping in the community is poor, despite the HOA spending a huge amount of money on landscaping maintenance (35% of the budget; 20% of budget + reserves).

Recently, I inspected records relating to landscaping maintenance in the community (contracts, competitive bids, invoices, etc.) going back to 2015. In that time, there have been 2 competitive bids with one prospective company each time: 2017 and 2019. The current landscaping maintenance company (a no-name local company that doesn't have a website or an online presence of any sort) has been contracted to work for the HOA since 2011.

I reviewed the current and past contracts which all clearly state that fertilizing will be done on ALL residential lots and HOA land 4 times per year, shrubs will be trimmed 12 times per year, etc. (an 8 page contract) The fertilizing simply is not done. Period. Every homeowner with whom I have spoken was completely unaware that the HOA was supposed to be fertilizing their lawns, shrubs, trees and palm trees, as spelled out in the current and past contracts, as it had never been done and as a result, the lawns throughout the community are dead, diseased or weed-infested and trees are unhealthy and yellow. The shrubs are trimmed 6 times per year, not 12, as stated in the contract, and the list goes on. When I first caught wind that this was in the landscaping maintenance agreement last year, I brought it to the attention of the management company and received a very hostile response from the Board disputing every statement I made (with photographic evidence) and essentially called me a liar. Cased closed--until I reopened the case recently by asking to inspect the official records relating to landscaping management and actually saw the signed and dated contracts. It is worth mentioning that the management company (11% of the budget) does not keep a calendar and has no idea when landscaping duties will be performed or when/if they were actually performed. This has been confirmed numerous times.

The most recent competitive bid in 2019 came from a large, publicly traded company. There was a very professional, detailed proposal that illustrated the myriad landscaping maintenance issues faced by the community, supported by dozens of photographs. Yes, the bid came in higher than the bid from the current landscaping maintenance company, but that is because that company was actually bidding to do what was spelled out in the contract--maintain ALL landscaping in the community, including weed control and fertilizing, which is very expensive, while the current landscaping company does the bare minimum like mowing and edging lawns or performing other duties sporadically, not as often as stated in the contract, without doing the really expensive work--fertilizing and doing weed control on everything and actually maintaining ALL of the HOA landscaping, not just HOA landscaping that can be seen from the street, as is done today.

This is a long-winded explanation to say that it appears that the HOA has a false contract with the current landscaping maintenance company. This company does not perform the duties that are clearly spelled out in the contract. The Board and management company are fully aware of this and any homeowner who dares to complain (I have spoken to a few who have had the same experience as me) is insulted and promptly shut down and any request, for example, to have their property fertilized per the terms of the contract is ignored.

How can any competitive bid possibly win, given that they are bidding on actually performing the duties in the contract while the current landscaping company has some sort of "understanding" with the Board that it does not need to perform the duties spelled out in the contract in order to keep the price lower? Is the HOA actually paying a fair price for the minimal amount of work that the current landscaping maintenance company actually does, regardless of what is written in the contract? There is no way to know under the current circumstances.

Where do we go from here? Is the Board's failure to enforce a contract considered a breach of fiduciary duty? Easier said than done to change the Board. We have never had a quorum since turnover in 2007. The same people have been on the Board since that time. Any thoughts or strategies appreciated!

Go get some competitive bids and submit them. Do the work not the twerk. Substance usually wins over fluff.

Many landscaping companies have been having trouble getting workers during the pandemic Last spring we had to jump to a new company on short notice because our previous company's workers couldn't get back into the US due to visa issues - I expect they were not the only ones facing this particular problem. Throw the Great Resignation on top of this, and it can be hard to find enough workers to fulfill commitments. So that can be one cause of work not being done - although if this has been going on for several years, then there is probably some other cause.

It may not make Ruth feel better, but if their landscape company significantly underbids others in their area, then the HOA isn't actually paying for the level of service that was laid out in the contract. Still a bit shady, but harder to put a dollar figure on potential damages. And it's harder to prove dishonesty - it may be due to a good case of magical thinking about money, or general incompetence on everyone's part. Still, after a number of years it begins to look like deliberate choice rather than cluelessness.

As with other HOA issues, this one will boil down to what can homeowners do about it.

If the board is shutting down any discussion, then you'll be left with dispute resolution of some form or else banding together with neighbors and replacing the current board. Realistically, if most neighbors don't seem particularly interested, then replacing the board will be difficult to impossible. You may also be up against what I suspect is going on: the services listed on the contracts actually cost more than what the HOA is budgeting for, and if homeowners want that level of service then they'll have to increase assessments to pay for it. When faced with that reality, many folks may decide that the status quo is just fine.

(Speaking of over-committing, in the last ten years or so one of the big name landscaping companies in my area put themselves out of business through a policy of signing contracts for more than they could deliver. They solved the problem by taking care of their big contracts first, with the smaller communities drawing the short straws. After a number of years of this, the lawyers arrived.)

From your post, it sounds like you may be willing to volunteer your time to help with the landscaping contract. Would you be willing to send a note to your Board and/or property manager asking if you can volunteer to help with the landscaping contract? Ideally, they would put you in charge of overseeing the contract with the vendor. Then if you continue to feel the vendor was billing for services not rendered, it would be within your purview to obtain additional bids and make a recommendation to the Board to switch to a different company.

Essentially, from the perspective as a Board member, we're all volunteers with different amounts of time and experience working with large contracts. I discovered about 1 month into my Board membership that no one was watching the pot. We'd hire vendors to do the work, they'd submit invoices to the offsite property manager, who would promptly pay them. No one inspected the work first to make sure the work they did was acceptable. I am quite convinced that we paid $4000 a year for an imaginary service (i.e., one that was offered but never performed).

If you are willing to roll up your sleeves and volunteer to help the Board, and if they accepted your offer, you probably would make for a great community volunteer to help administer this contract.

RuthM4, is this a HOA subject to Florida Statute 720?Yes, but with some important caveats in my opinion. I would be discreet about this. Some HOA/COA directors do not know the law on records requests and disseminating information very well and may give you a hard time. More importantly, vendors are not wild about their bids being shared. Nationwide often times bids are proprietary, meaning they cannot be distributed. Florida vendors presumably know their bids will be shared among HOA members but if I were in your shoes, I would hesitate to share the bids.

You must keep in mind that a board has no obligation to take the lowest bid. In fact, often times there is a good reason why the lowest bid was not accepted.

If your HOA is subject to FS 720, then from FS 720:

Bids received by the association for work to be performed must also be considered official records and must be kept for a period of 1 year.

Typically bids are not kept nor shared as they were not contracts. Association signed contracts should be available to all owners.

Although that is true........ we keep and share all of our bid with hoa members on our google drive. Transparency in the bidding process is just as important to us as picking the correct bid. When you have no secrets, you have no drama. We keep pretty much all paperwork available for people to view.

We want people to speak up if they see a problem. We want to do better. We want people to donate their time to make the HOA better.

Secrets docs are for the incompetent or criminal.

Thank you all again for your valuable input. As for sharing bids, we only have 2 and both are ancient history. The most recent bid from 2019 is valuable in that it has about 60 photos and several charts highlighting major problems with the landscaping maintenance in the community. It is shocking, but it is a professional opinion and not just me being picky. It proves that it took years for the landscaping to decline to this level due to lack of fertilization, weed control, proper pruning, etc.--and yet, even when confronted with these facts, the HOA still decided to keep the landscaping maintenance company that was responsible for these problems. When seeing that this bid came in higher, the Board did not do the responsible thing and go back to that bidder and ask them to bid on the smaller scope of work that the current company is ACTUALLY doing, not "contractually" doing (i.e., not fertilizing residents' lots, etc.) to try to get an apples to apples comparison of cost. We have never had a legitimate competitive bidding process in which current and prospective companies were actually bidding to do the same smaller scope of work. Given the advice above, I will not circulate the 2019 bid (although the photos and analysis are very powerful) and stick to circulating the current and past contracts so other homeowners can see that the contracts vs. the work that actually has been performed have been very different since 2013.