Petition to change POA Mgmt company

Started by LynneV1 • 26 replies • 556 views

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LynneV1 (South Carolina)
Posts: 211

Posted:

I started a petition to change our management company upon the expiration of his one year contract. I had concerns about the October BOD election. After which I found out that the management company, Had not mailed out ballots to the entire community. Instead, they sent emails to about 80 people out of 231 H/o the 5 board members that were running brought in 55 of the proxies/ ballots which would voted for them. 3 people voted through the email process. And 10 showed up at the meeting to vote in person. The election was called in favor of the five board members running for the five open positions based on the 65 people. That voted in person or by proxy. We did not have a quorum. We did not adjourn and only myself and one other person at the meeting. At the meeting objected to this decision. That being said, five people ran. There were five positions. So what would be the difference.
Since I asked to see the ballots, I was put in the category of a troublemaker. My dealings with the property management company have been Concerning as he threatens to sue me every time I ask a question. anyhow, I started a petition in the neighborhood so that we don't renew his one year contract when it expires June 1st. According to our bylaws, if 10% of the homeowners request. Meeting to discuss an issue. The board has to comply.. so with 231 homes, I needed 24 people to sign a petition. I got 30 signatures.
I submitted the petition. The petition to the president of the board. And today, an email went out saying that I am calling a special meeting at the clubhouse. To discuss not hiring the management company. Again in June. So it looks like I am holding a meeting. I don't even know if the board of directors are gonna show up. And since the email came from the management company, obviously they're aware of the situation.
After doing a background check on the. Owner of the management company. I found he has 13 arrests. For negotiating. Fraudulent checks. Of $1000 or less. And he was arrested for lewd behavior and. And believe it or not, misconduct in office.
Can I share this at the Meeting Since this is available upon a background check.

LynneV1 (South Carolina)
Posts: 211

Posted:

Sorry for the grammatical errors as I was dictating this. I just feel that our community of 231 homes deserve a better management company. By the way, we have a negative home owner equity, and we've gone through 85% of our reserves over the last year. Our liabilities are higher than our assets. And yet, he says everything's fine.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Lynne

Your elected BOD makes this decision. Anything else is "advice only" to them.

ElleN (Idaho)
Posts: 4,420

Posted:

Quote:

Posted By LynneV1 on 04/20/2023 10:10 AM
I started a petition to change our management company upon the expiration of his one year contract.
[snip allegations of all manner of management company wrongdoing]
After doing a background check on the. Owner of the management company. I found he has 13 arrests. For negotiating. Fraudulent checks. Of $1000 or less. And he was arrested for lewd behavior and. And believe it or not, misconduct in office.
Can I share this at the Meeting Since this is available upon a background check.

Is this a condominium?

Chances are statutes and/or your bylaws give you the lawful right to seek a special meeting of the board.

Owners do not have the right to fire a management company. Instead the mechanism for getting rid of this management company is by electing people to the board who feel as you do.

Can you distribute this background check information to owners through say a mass mailing, as part of a campaign to get new directors on the board? I am not sure this is a good idea. I would ask myself: Do I have anywhere near enough numbers who feel as I do, such that I have a real chance of electing new directors at the next annual election? If not then IMO there are so many legalities that, without doing a lot of research, I would hesitate to use this approach to get information out to owners.

Be ready for massive retaliation by the board, manager or both. You will need a thick skin, and for many months.

ElleN (Idaho)
Posts: 4,420

Posted:

Quote:

Posted By ElleN on 04/20/2023 11:01 AM
Chances are statutes and/or your bylaws give you the lawful right to seek a special meeting of the board.

Post-o. This should be "special meeting of the owners>/i>."

LoriM15 (Florida)
Posts: 1,009

Posted:

How many days notice do you have to give before ending the contract? Does it automatically roll over? Can you find another management company to come and take over that quickly? Who is going to make that decision - do you realize that you would be putting this burden on your board who would have to make these decisions?

You obviously have issues in your community - but why is it all the fault of the management company? Why is the board not stepping in? Have you discussed these issues at an open board meeting?

As for the "background check" - I would be very careful about bringing up that information in an open forum unless you have absolute proof. Have you contacted a board member with this information?

LynneV1 (South Carolina)
Posts: 211

Posted:

I started this petition in March. I notified the board of directors, all of them, that I was going to seek to have a special meeting to discuss this, unless they could meet and agree with my findings on their own. I assume they wouldn't sign the contract till May, since it starts June 1st. We are homeowners/ Our only common areas are the 6 retention ponds between the blocks. We do not have a pool or a clubhouse. We have access to a clubhouse from the condos across the street for our monthly meetings, which became quarterly meetings with this board for the last few years. The criminal check charges are from. A decade ago. But the man is nasty. He threatens some. Who asked if we could pay our bills online by getting in his face and saying, You're pushing my buttons. You're pushing my buttons.
When asked at open board meeting, how many homeowners were in arrears? He said two or three. I had met with him the day before, and he had told me 49. So I said out loud 49. And he said, oh, that's right.
That is a big difference. If he had sent letter to collect the money from the people in arrears, maybe we wouldn't have needed our dues increased. He does not like to send letters or do collections. He said to me personally, what am I supposed to do? Sit at a table and fold envelopes. So why are we paying him?? At last meeting, somebody complained, and 18 wheel truck was parked on their block for a week, and he didn't even know it's a violation to have trucks or trailer parked in the community.

LynneV1 (South Carolina)
Posts: 211

Posted:

So it seems like I have to stand up and hold this meeting. And that's my concern. Shouldn't the board be giving this meeting? Shouldn't they attend?

SheliaH (Indiana)
Posts: 6,964

Posted:

What everyone else said.

One of the biggest problems with homeowners (and a lot of board members) is that they expect the property manager to do EVERYTHING, including stuff that should only be the responsibility of the board. Your board should be overseeing the elections, so it's up to them to ensure the election information is correct and the proxies contain the right instructions. It's the responsibility of YOU and YOUR NEIGHBORS to read the information, ask about anything you don't understand and meet the deadlines (e.g. get your proxies in by noon on election day or just show up at the meeting and cast your ballot. It's also the responsibility of the homeowners to make sure the property manager has the correct name, address, phone number, emails, and other contact information, and if you dont want your phone number and/or email to be part of an owner's list any homeowner can request, you can tell the property manager you want to opt out of providing that information.

The property manager is there to work at the board's direction. It's ok for the board to instruct the property manager to send out election information and collect proxies, but those shouldn't be opened until the meeting and then homeowners who aren't running can be selected to open the proxies/ballots and count them in front of everyone (you don't say so and so voted for X, but 1 vote for X, open the next ballot and repeat.) You didn't have quorum so the people currently on the board stay until they resign, are recalled or voted out. the meeting could have been rescheduled to hold another election, and perhaps everyone should show up and cast their vote in person this time.

If this board isn't doing what it's supposed to do according to your documents (read them so you know what's expected), it may be time for a special homeowners meeting to sort all this out and perhaps recall this group and elect another slate. The documents should tell you have a special election is called, and that generally means petitioning the homeowners and getting a certain percentage to sign it. That's where you should focus for now. Once the election issue is resolved, then the board (a new one perhaps) can take a closer look at the property manager's performance and determine if a change is necessary. That's not as easy as it sounds and then you might want to be careful of what you wish for, because you might get it.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

LynneV1 (South Carolina)
Posts: 211

Posted:

And yes, I went on the county public index and. And all his traffic tickets come up and the criminal charges for 12 Fraudulent checks, for misconduct a public meeting, for malfeasance and lewd behavior. Then I went on Google paid $10.for a background check on him. It all came up. His company has over a dozen judgments against them which would be in the company name. And I gave a copy of that to the president of the board, and said it was for him to view, and he could share it with the other board members. It's public information. I live in Myrtle Beach. There are a lot of property management companies, and I just feel we could do better. Should I continue this, or should I let it go?.

LoriM15 (Florida)
Posts: 1,009

Posted:

If you are responsible for this meeting, then you should go in with an agenda that is focused and professional. The last thing you want to do is to start talking about someone's character. You will lose the audience the minute you do that.

What you should do is make a list of all the issues you believe the PM has either made mistakes on or done wrong. You say he only sent out a small number of emails about the election - but were written letters sent? Ask questions about exactly what the process was. Why did he follow that process? How could it have been better for next time?

On collections - what process does the community have? Does he follow that? Why are there so many outstanding accounts? What does the board say about that? How much is the total amount?

You need to have a list of questions for every point. Build an argument - so that it clearly shows the PM is not doing his job AND the board is allowing him to get away with it. Don't make assumptions, ask for facts. Don't be emotional or they won't take you seriously.

Finally, I think you are really naive if you believe that the board was going to start looking for or negotiating a PM contract on May 1 for a June 1 start. It takes months to find a good PM company and get a contract signed, and then it takes more than that to transfer the financials and get the records straight. It may already be too late for this year. Our PM contracts have a 60-day notice clause, so you have to give the company 60 days notice if you are going to fire them or the contract simply rolls over.

LynneV1 (South Carolina)
Posts: 211

Posted:

Thank you Sheila H. And I am probably blaming this management company because our board hired him to just ignore everything and do what they want.
The president of the board brought in 55 votes for himself and the other 4 Board members with him as proxy, which were running. only 3 votes came from the mgmt e-mailed to him, with him being their proxy and 10 or so in person votes. Nothing was sealed. When it was evident, we didn't have 51% Quorum (116 votes). We would normally adjourn, re-convene and need half quorum. This man from the management company stood up and said, "if you make me adjourn this meeting, I'm walking out right now. It says, we may adjourn and reconvene and need half quorum. Let's define the word "may." And I'm saying we don't have to. We're using the half quorum. 25%."
But with homeowner apathy when it comes to elections, I'm not happy, but obviously no one stood up at the meeting and said, no, wait, I want to run. The election was October, and I think it's pretty much settled.
I was on prior boards, and am a retired accountant. Our property taxes were not paid by December 31st, and I had to tell them that in March. The property manager never informed the county that they has taken over June 1 2022, so the Bills went to the former old property management company.

JohnT38 (South Carolina)
Posts: 1,631

Posted:

Quote:

Posted By LynneV1 on 04/20/2023 11:47 AM
And yes, I went on the county public index and. And all his traffic tickets come up and the criminal charges for 12 Fraudulent checks, for misconduct a public meeting, for malfeasance and lewd behavior. Then I went on Google paid $10.for a background check on him. It all came up. His company has over a dozen judgments against them which would be in the company name. And I gave a copy of that to the president of the board, and said it was for him to view, and he could share it with the other board members. It's public information. I live in Myrtle Beach. There are a lot of property management companies, and I just feel we could do better. Should I continue this, or should I let it go?.

Passing 12 fraudulent checks is a clear indication that this person is more than capable of stealing money. If I was on the Board I would be researching his replacement and when we had our ducks in a row he would be gone.

LynneV1 (South Carolina)
Posts: 211

Posted:

Thank You John and Lori M15. If money was being collected and our bills were being paid timely, I wouldn't be concerned. But they're juggling the bills. They're telling the landscapers to wait 30 days to submit a bill and then they'll get paid 10 days later.
I emailed the board and the management company that we were broke in December and that the 2023 budget would never work. They raised our dues 2 weeks before January 1st Quarterly bill was due under the premise of putting money in the reserves, yet no money has been transferred to the reserve fund yet this year. Our reserves dropped by 85% to only $6,000 in Febr. And now there are no financial statements posted on our website at all just the budget. They don't list the actual income received, they just list HOA Dues(as in total money expected) and there is no 'accounts receivable'. I was they net it out the liabilities to save space and time.....????Yes that is what they told me.
I've retired and lived in this community over 15 years, and, yes, I think I will be taking heat over this for a long time. But I feel the community should know it's being mismanaged by everybody involved.

ElleN (Idaho)
Posts: 4,420

Posted:

Quote:

Posted By LynneV1 on 04/20/2023 11:39 AM
So it seems like I have to stand up and hold this meeting. And that's my concern. Shouldn't the board be giving this meeting? Shouldn't they attend?

At a meeting of the owners, the board does not preside. Except for the President-Director, Directors should sit in the audience like all the owners. This is because any vote on the agenda does not involve a vote of the board but instead, a vote of the owners. The President normally would preside at a Special Meeting of the owners, but he or she can delegate the duty to preside to someone else.

Again, under the covenants, bylaws and state law, the powers of the owners are quite limited when it comes to day-to-day operations of the HOA.

If you would like to have the owners participate in an "advisory vote," then this is fine. Just understand an "advisory vote" has no legal power. The board does not have to abide by the outcome of an advisory vote.

For a meeting to be effective, it must have an agenda. The agenda for this proposed special meeting should be quite short.

LynneV1 (South Carolina)
Posts: 211

Posted:

Thank you Ellen.
What do I do with the agenda? Can I just leave it at the front table for when people come in. Do I have to send it out beforehand? I don't have a list of the homeowners names or their email addresses.
I had typed a list of nine reasons why I thought we needed a change. Should I print up 30 copies? I doubt more than 20-25 people will show up out of 231 homeowners.
And I doubt this will go anywhere it. It seems the board is digging their heels in. Somebody just asked me for a copy of my petition to give to the management company. Why would the 30 people that signed a petition want their names and addresses going to the management company?
Again. Sorry for my poor typing, but I dictate my emails. I no longer can type. I suffered a brain injury from lack of oxygen after a surgery.

LynneV1 (South Carolina)
Posts: 211

Posted:

JackieB4 (California)
Posts: 398

Posted:

Lynn, I speak from a So. CA position. The BOD rules, making the HOA decisions. You need a BOD that agrees (votes) and then continues with the HARD WORK that change requires. Pounding the pavement is admirable and usually needed, but the Board rules the Kingdom.

LynneV1 (South Carolina)
Posts: 211

Posted:

And my agenda has nothing to do with his personal history or past -- just with common community issues. Here's a sampling:
1. We are in the worst financial shape ever.
2 The 2022 real estate taxes were not paid timely.
3. The election was mishandled
4. We have had no website at all until two months ago.
5 We still have no way to pay our bills online.
6)We get no copies of the minutes.
7) There are no online financial statements.
8 There are no weekly drive arounds to make sure homes are kept up, and there are no obvious violations.
9. Over 20 % of our home owners were in arrears and not one collection letter was sent out as of last October.

So if you guys approve, I'm good to go. Thank you all for your input.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

1. We are in the worst financial shape ever.
What is your "standard" to determine this? A HOA that spends as much as it collects is in great shape. It is a non-profit but not charitable corporation. Having enough money to pay your bills and have a reserve account if needed is as good as it gets in a HOA.

2 The 2022 real estate taxes were not paid timely.
How do you know this information? What are the real estate taxes being paid on?

3. The election was mishandled

What does the voting rules say in your documents on how they are to be handled? Is it in the Articles of Incorporation or the PM's contract to hold the elections and how?

4. We have had no website at all until two months ago.

Websites are not necessarily "Free". Some HOA's the website is tied into the PM's website. Our HOA is still very new and Developer owned. We just got a website as part of the PM's upgrade to their system. Not everyone in your HOA is tech savvy to make and maintain a website.

5 We still have no way to pay our bills online.
That could be on the bank your using. It may be personal or the HOA's bank. I have the option through my bank to write a check if the insitution paying doesn't have that option.

6)We get no copies of the minutes.
You do not get a "copy" necessarily. You have the right to VIEW the minutes. Also have the right to PAY for a copy. It costs money for providing copies of meeting notes. Plus depending how often you have meetings. The minutes of the meetings are not approved till the next meeting.
7) There are no online financial statements.

We did not have online statements. We got hard copies from the Accountant right before our monthly meetings. It was what we covered in our meetings.
8 There are no weekly drive arounds to make sure homes are kept up, and there are no obvious violations.
Is that in the contract to do by the PM or is it on the HOA board?

9. Over 20 % of our home owners were in arrears and not one collection letter was sent out as of last October.
We have a policy of 6 months behind we lien, 1 year we considered foreclosure. So what is the timeline your looking at one should send a notice?

Former HOA President

LynneV1 (South Carolina)
Posts: 211

Posted:

The answers to those questions will have to wait, as it is 9:00 PM.
This is exhausting. And there are 'good' answers to each of those questions. But I don't want to bore everybody to death.
SINCE, the petition was given to the board President AND
the special meeting of the h/o is set up for May 1st, I will discuss my concerns with the attendees, ask their opinions and see what happens.
Also, I'd like to mention that 8 of the other 29 people signing the petition were on prior boards. So there had to be agreement on the premise, or they wouldn't have signed.

Last question: Should the management company be allowed to come and sit and hear this whole meeting. Are they a part of the homeowner meeting?

BillD16 (Texas)
Posts: 973

Posted:

Quote:

Posted By LynneV1 on 04/20/2023 10:13 AM
Sorry for the grammatical errors as I was dictating this. I just feel that our community of 231 homes deserve a better management company. By the way, we have a negative home owner equity, and we've gone through 85% of our reserves over the last year. Our liabilities are higher than our assets. And yet, he says everything's fine.

Lynne, I know I’m gonna sound like a jerk saying this, but your posts here are extremely difficult to read. If you want good responses from the people here, I hope you’ll consider taking some time to put together a readable, thoughtful explanation of your situation. If you’re using some kind of voice to text system, it’s not working well.

Bill

HOA Board ex-President
Austin, Texas USA

“You can’t put too much water in a nuclear reactor”

ElleN (Idaho)
Posts: 4,420

Posted:

Quote:

Posted By LynneV1 on 04/20/2023 3:33 PM
Thank you Ellen.
What do I do with the agenda? Can I just leave it at the front table for when people come in. Do I have to send it out beforehand? I don't have a list of the homeowners names or their email addresses.
I had typed a list of nine reasons why I thought we needed a change. Should I print up 30 copies? I doubt more than 20-25 people will show up out of 231 homeowners.
And I doubt this will go anywhere it. It seems the board is digging their heels in. Somebody just asked me for a copy of my petition to give to the management company. Why would the 30 people that signed a petition want their names and addresses going to the management company?

-- The agenda should be mailed out with the notice that gives the date, time and place of the meeting.

-- The agenda must be sent in advance to all owners, not just those that signed the petition.

-- You have a legal right to obtain the names and addresses of all the owners. The manager is supposed to provide this on request. Ask him or her for the "members list, with names and addresses," stating the purpose is for notice of the special meeting, and report back.

-- It's possible the law requires the HOA Secretary to send out notice.

-- The manager and president are entitled to an original copy of the petition.

-- I am not having any problems whatsoever reading your posts. They are far better written than many posts here.

ElleN (Idaho)
Posts: 4,420

Posted:

Lynne, also check to see what the "quorum" requirement is for special meetings. If quorum is not met, the meeting cannot occur.

LynneV1 (South Carolina)
Posts: 211

Posted:

Thank you ElleN and yes to Bill... I was voice typing, and when I take a breath the computer was putting in periods and starting new sentences. I should have reviewed my posts better before sending them to this group to read.
And yes, I remember that line from maybe vintage Saturday night live:
"you can't put too much water in the nuclear reactor".

Thank you all for your help. I'll prepare for this special meeting on May 1st and will let you know what happens.

LynneV1 (South Carolina)
Posts: 211

Posted:

I have to make one more post to you.
A balance sheet was put on our website for March 2023.
current assets shows bank checking account, say $13,000.
next is accounts receivable. He put a - $8000
then he subtracted the accounts receivable from our cash in the checking account.
so Total assests $5,000.
Then when he got to the liabilities,
he put total accounts payable $3,000.
Other liabilities minus -11,000.
Total liabilities was a - 8,000.
stay with me....
so assets minus a (minus) liabilites = a positive owner equity of $3,000.

But it didn't end there.
he took this months owner equity of $3,000
from last month's owner equity of $10,000

and bottom line we now have $7,000 in owner equity.

my head exploded.

LynneM (Massachusetts)
Posts: 52

Posted:

Lynne, this will take some time but you might want to start by knocking on doors of your neighbors and have printed material with facts about the fiscal condition of your community. With you being a numbers person you might get more interested owners to listen and be willing to support a special meeting.
Good luck It's not easy when the board let's the property manager make all the decisions.

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