Advise on Board communication

SusanW1 1/2,

What do your documents say about special assessments? Ours read special assessment are to be used to meet expenses when the Dues Assessment are predicted to not meet the dues assessment expenses.

We have had a special assessment for the last 7 years, and they are now calling this a Capital Assessment. Now this year they want to have another special assessment in addition to the one that has been running for seven years, they want to have another starting next month, with no expiration date, same as other one. They will both total around $1000.00 for 65 five units. Total of 65K.

There is nothing in our documents that mentions a capital assessment, in fact if memory sewrves it was first called and passed as a Special assessment. Our past boards seem to strive and make things complicated and legally borderline, and there will be a complete change by next year but I meet the same resistance in getting them to watch what they are doing. The latest debacle is this special assessment business. Never has been any accounting of this special assessment other that some explanation that they collected around $450,000 for thia capital thing, have spent about this amount and now this is supposed to justify another special assessment that will last to 2014.

I am very concerned that this program already has them in fiduciary trouble and here's why. To pass a special assessmenr it takes a majority of the apportioned vote to pass. Since they always use proxys and actually suggest to our owners if the can't attend they assign their proxy to a board member and list the names of the board on the proxy instructionss. Of course the Board always can control any elections or voting on anyhing at the annual meeting, and they have done it for years.

Now, as far as dues (fees) are concerned, in order to have a quorum you need 66 2/3rds vote. This is a lot harder to get than fifty %, so I expect the reason for these continual special assessments is to be able to control the vote. Also our MD says the Board can on;y raise the dues the CPI for this area and anything else has to be by brought up to voite and requires 66 2/3 vote.

I have tried to tell them, if nothing else this practice could be taken as a way to control the vote systematically. I have told them to call a special meeting to amend our documents that allows for a 10% majority to reach quroum. Then you could do away with the proxys and all ballots would be secret and if people don't want to vote, then don't vote, just like a general election.

They think I am trying to cause trouble.

Forgive my long post.

Susan,
Thank you very much. Can I ask if this special assessment will just go on forever?

I need some more input. Has anyone every had this happen to them, what is the longest time a Special Assessment has gone on?

Our doccuments say a special assessment is called when the annual dues are going to result in a short fall. The dues assessments are used to cover all common expenses and day to day expeenditures, and concludes by saying, this includes all espenses of any king. Every thing is grouped together with dues paid. If you need more moneey for say, a long range fund, you have to raise the dues. I don't think this is unusual. Howabout it Roger, Dr, Gloria, and Don, and anyone else.

You didn't say what the special assessment was for.

In our sub, each homeowner paid for the orginal paving of our roads over 10 years!
While we do repairs and keep them up, (chipseal, fill, etc.) to totally re-do all our roads would need another special assessment.

Some things, like the TOTAL road replacement, are not placed into the Reserve Fund system. It must be community property, have a life of 25 - 30 years and be repairable.

Right on Harold! Let's not forget the potential for fraud when it comes to collecting proxies. There are a number of issues with Fraud potential, when it comes to processing Proxies.

Every state has different laws; I'm not familiar with VA's. I believe every HOA's gov docs will outline special assessments but wouldn't be surprised to learn there is no cap on how much or how often. In most instances it requires member approval. Oftentimes special assessments are required because the assn has no reserve fund or a grossly unfunded account. Condo assn's especially are notorious for special assessments.

Mary

Mary and AgniezKaH,

Now we know all associations can pass a "special Assessment."
What I would like to find out is how your documents described "Special Assessments" and their justification.

I want to see if the coreect way to raise funds is a "Special Assessment" or a "Dues Assessment." It is my belief that special assessment are to provide money for the shortfall that is predicted will happen to the Common Expenses. Once that "short fall is" satisfied with a "Special Assessment" the the board has to re-tool and declare a raise in the dues assessment with their presentation of the Annual dues Assessment which is described as money to use for common expenses.

Also I would like to know what % is used to pass a Special Assessment and what% is needed to pass a Raise in the Annual Assessment.

Mary - once again you fail to cite the entire law. Your statement sounds as if all Arizona HOAs can raise their dues 20% per year by state law. However, the law qualifies UNLESS the HOA documents have a lower limit. There is no "notwithstanding" in this statute. If you are going to cite state laws, please be accurate.
"A. Unless limitations in the community documents would result in a lower limit for the assessment, the association shall not impose a regular assessment that is more than twenty per cent greater than the immediately preceding fiscal year's assessment without the approval of the majority of the members of the association."

Sweetpea, what you said exactly was: 'In AZ, State law limits the raise in the yearly dues to 20% for planned communities." That is misleading and sounds to anyone reading it that an Arizona HOA can raise their dues 20% by law if they wish. And that is simply not true.

Thank you Glen,
That is exactly what I am looking for. My relations with our Board is ar times been contentious over the years. I have a a long history here. But in any event, I better be ready to justify and suggestions I may have that the Board doesn't understand what they are doing sometime. They have shot me down enough times by being smarter than I, my maneuvers are always be well prepaired.
Thanks again, our documents have no time limit. It's crazy.

Robert from the way you have described this SA and what they're doing with it, it sounds to me as they're doing this to raise fees without raising assessments or are they doing that too.