Retention pond

Started by JimA17 • 4 replies • 305 views

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JimA17 (California)
Posts: 1

Posted:

I live in a HOA of 74 homes, my issue is the homes was build in 2005 and the members took over 1st of 2006, the builders turn it over to us there was a contract That the builder had made and sign as the president of the HOA to buy from the builder 2 lots at $10.00 each that the HOA had to maintain and the retention. Pond. The builder can them buy back from day one thru 21 years at $10.00 each and will reinburse the maintenance cost At 61/2 % interest.
We maintain the pond and the city charges $87.00 a year on our property tax for water runoff, we do have any runoff that goes into the pond other parts
Of the city does. I think we got taken, we our building little nest egg for future owners. Est: $150,000

We are a mutual Benefit association non profit.
All suggestions welcome

TimB4 (Tennessee)
Posts: 21,059

Posted:

Yep, sounds like you got a raw deal. However, there are pains with most transfers of control. Assessments will typically need to be raised as the developer often keeps assessments low to encourage sales. How high the assessments will need to increase won't really be known until a reserve study is done.

Now, it's possible that the builder sold the lots that way so the Association could be ran by the membership. Read the requirements for member control in your governing documents to be sure.

As I understand your post, the Association has two lots that can't be built on because anything built could be taken by whomever owns the rights to the property for 21 years. The Association may or may not be able to sell them (details would be in the contract/deed).

It is typical that HOAs pay to maintain storm water ponds. Make sure it is maintained, otherwise the Association could face major fines from the city/County/State. This was likely a requirement from the city the developer had to agree with in order to obtain permits.

Make sure that you have a reserve study done that includes pond maintenance, as storm water management can be expensive.

The only suggestion I have is for the Board to have a talk with the proper authority about possibly transferring maintenance of the pond to them - perhaps by creating a special tax district for all properties that feed that pond.

MichaelS56 (Minnesota)
Posts: 859

Posted:

We also have a retention pond, but the city is responsible for the maintenance of it. The nearby city streets have rainwater flow into it along with our water flow. We have a document that shows the ownership is by the city.

AugustinD
Posts: 1,027

Posted:

Quote:

Posted By JimA17 on 09/28/2022 9:45 PM
I live in a HOA of 74 homes, my issue is the homes was build in 2005 and the members took over 1st of 2006, the builders turn it over to us there was a contract That the builder had made and sign as the president of the HOA to buy from the builder 2 lots at $10.00 each that the HOA had to maintain and the retention. Pond. The builder can them buy back from day one thru 21 years at $10.00 each and will reinburse the maintenance cost At 61/2 % interest.
We maintain the pond and the city charges $87.00 a year on our property tax for water runoff, we do have any runoff that goes into the pond other parts
Of the city does. I think we got taken, we our building little nest egg for future owners. Est: $150,000

We are a mutual Benefit association non profit.
All suggestions welcome

Respectfully, I think the writing above has to be deciphered to be understandable.

Why is it you think the HOA got "taken"?

These retention ponds likely provide the drainage needs for a number of lots and possibly non-HOA property that is in the upstream drainage path.

I think it's time to approach the builder and ask for it to give up its rights. Then make the lots/retention ponds into bona fide common areas.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By MichaelS56 on 09/29/2022 5:49 AM
We also have a retention pond, but the city is responsible for the maintenance of it. The nearby city streets have rainwater flow into it along with our water flow. We have a document that shows the ownership is by the city.

Our docs say the association is responsible for the retention pond. I believe this is more common.

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