DavidD31 (Washington)
Posts: 18
Posts: 18
Posted:
Our HOA Board wants to increase our monthly assessment from $20 to $80 based on the needs of our budget and Reserve Fund. We are a residential Non-Profit Corporation HOA, not a Condominium HOA. The developing agency that initially created the HOA set the assessment at $20 with no regard for what it will cost for insurance, landscaping, private road maintenance, etc. We were set up for failure. The Board has been told that they can list the $80 in the budget to be ratified, and under WUCIOA rules RCW 64.90.525 if a majority shows up to the meeting and rejects the budget, it goes back to the old budget. BUT, if there aren't enough votes to reject the budget, or a majority doesn't show, because there is no quorum needed for a Budget Ratification meeting, the budget is ratified with the new higher assessment. They were told WUCIOA supersedes CCR's. The CCR's state that for an increase of assessments, the greater of 5% or current Consumer Price Index needs a 2/3 vote of all the members to approve the higher assessment. If it is 5% or CPI, or lower, it doesn't need a vote from the membership and can be ratified in the budget meeting.
The question I have, I found RCW 24.03A.360(1) which reads, "(1) A membership corporation may levy dues, assessments, and fees on its members to the extent authorized in the articles or bylaws. Particular dues, assessments, and fees may be imposed in the articles or bylaws or by resolution of the board, subject to any membership approval required under RCW 24.03A.695(1), on members of the same class either alike or in different amounts or proportions, and may be imposed on a different basis on different classes of members. Members of a class may be made exempt from dues, assessments, and fees to the extent provided in the articles or bylaws or by resolution of the board."
RCW 24.03A.695(1)(c) reads, "(1) Except as provided in the articles or bylaws, the board of a membership corporation that has one or more members may not, without approval of the class or classes of members affected, adopt or amend a provision of the bylaws: (c) Under RCW 24.03A.360, levying dues, assessments, or fees on some or all of the members;"
So if I'm understanding the laws correctly, they can not raise the dues above the parameters the CCR's set (5%) without 2/3 of all the members vote in Good Standing. Once the assessment increase is approved by the membership, THEN RCW 64.90.525 is applied to ratify the budget with the new member-approved assessment increase listed. Does this look like I'm interpreting this correctly?
The management company told the Board that WUCIOA takes precedence over the CCR's. But when I asked the management company about the other laws, they said RCW's 24.03A, 64.38, 64.90 and the governing documents all work together. But when it comes to the budget process 64.90 controls.
This sounds to me that what I'm understanding the law to be are correct, that there MUST be a vote to approve the higher assessment first BEFORE it goes into the budget to be ratified under WUCIOA law.
Any HOA lawyers willing to chime in on this without a fee?? We are desperate here to get an answer quick.
Thank you.
The question I have, I found RCW 24.03A.360(1) which reads, "(1) A membership corporation may levy dues, assessments, and fees on its members to the extent authorized in the articles or bylaws. Particular dues, assessments, and fees may be imposed in the articles or bylaws or by resolution of the board, subject to any membership approval required under RCW 24.03A.695(1), on members of the same class either alike or in different amounts or proportions, and may be imposed on a different basis on different classes of members. Members of a class may be made exempt from dues, assessments, and fees to the extent provided in the articles or bylaws or by resolution of the board."
RCW 24.03A.695(1)(c) reads, "(1) Except as provided in the articles or bylaws, the board of a membership corporation that has one or more members may not, without approval of the class or classes of members affected, adopt or amend a provision of the bylaws: (c) Under RCW 24.03A.360, levying dues, assessments, or fees on some or all of the members;"
So if I'm understanding the laws correctly, they can not raise the dues above the parameters the CCR's set (5%) without 2/3 of all the members vote in Good Standing. Once the assessment increase is approved by the membership, THEN RCW 64.90.525 is applied to ratify the budget with the new member-approved assessment increase listed. Does this look like I'm interpreting this correctly?
The management company told the Board that WUCIOA takes precedence over the CCR's. But when I asked the management company about the other laws, they said RCW's 24.03A, 64.38, 64.90 and the governing documents all work together. But when it comes to the budget process 64.90 controls.
This sounds to me that what I'm understanding the law to be are correct, that there MUST be a vote to approve the higher assessment first BEFORE it goes into the budget to be ratified under WUCIOA law.
Any HOA lawyers willing to chime in on this without a fee?? We are desperate here to get an answer quick.
Thank you.