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Posted By AudreyR on 01/15/2009 11:48 AM
What steps need to be taken to dissolve a homeowners association? We have no pool, tennis courts, park etc. Our dues mainly cover needed roofs and siding down the road ( 15 to 20 years). The Board just increased our dues because so many residents are not paying their dues. We have about $100,000 in the reserve fund. What happens to that money? Residents are tired of paying for the people that don't pay.
Audrey,
B/4 I answer your question. . .
What steps does your BOD take when a member becomes delinquent in paying the assessments? Do they have a collection policy -- that members have been given copies of -- that outlines the steps that are taken? If not, then it's time to adopt one. Delinquencies must be dealt with immediately. No member likes to carry the load for someone else, but it's a fact of life when living in an HOA. The assessments are the lifeblood of the assn, if everyone doesn't pay their share, then the ones who do suffer. Dissolving the assn may not be the answer. I assume you live in a condo assn. What would happen to the maint responsibilities of the HOA if it was dissolved?
I would look to the HOA State statutes for answers regarding dissolution. If the HOA statutes are silent on this topic then check out the nonprofit corp statutes. I'm sure it's addressed in those statutes. Every state may have different requirements so I won't comment further on what needs to be done, except to say the members will be required to vote on the matter. The quorum for the meeting may be quite high making it difficult to even have a vote. Alot of research needs to be undertaken and all the info gathered needs to be presented to the members. If the majority agree that dissolution is the only answer, then the next step will be to follow the procedure outlined in your state statutes.