Special assessments, old and new

Mary,
Comment please on special assessments paid in installments?
The statement was made at our annumal meeting by a director that the payments could be paid over the year. pay anyway you want as long as bill is paid in 12 months. I objected because our by-laws sets a stepwise procedure if someone doesn't pay their assessments within 30 days then a series of notices are sent, etc, etc., and these assessments that are in arrears have to be noted on financials as a negative, and have to be carried as a bad debt at some point. I am not sure but I believe the board is now going to bill this new special assessment as a monthly bill, whereas the old still active special assessment is billed as a yearly bill.
How do you or anyone think this mess should be billed.

Please consider this foreclosure economic climate. I think they should have consolidated the old special assessment with the new and have one monthly bill. I just don't know if it is proper, because each special assessment was levied for different reasons. Also, the first special assessment, as close as I can figure should have had a end point, and has been in effect for at least seven years. How do you straighten this out, if necessary, I think it is trouble waiting to happen. However a new five year plan was offered and from what I can see the old project and the new project were consolidated. If true then we have three special assessments to contend with, if none are done away with. We have the old, we have the new one and we have the consolidated one. Much too much for my brain, without chucking the whole mess and starting over again and we can't do that because the New special assessment for specific projects was just passed.

Is there a simple answer here somewhere?

Robert,

Wow! It sounds as though your BOD is "special assessment happy". One SA isn't completed b/4 they're asking for another one and the members vote yes to it! Amazing!! Each special assessment should be for a specific period of time, IMO, not more than one year. A special assessment shouldn't be ongoing. Once the amount approved has been paid by all the members that special assessment is complete. Of course with so many SA's going on at the same time I'm sure some board members and even members are quite confused and might not realize that one or more SA's have been completed.

I would think your docs should address special assessments and the method of payment. My CCRs state: "The board shall have the right to adopt, rescind and amend rules setting forth procedures for the prupose of making, billing and collecting assessments and charges, provided that said rules are not inconsistent with the provisions hereof." IMO, this article would give the board the authority to require a special assessment to be paid monthly or yearly and to set the delinquency date for these payments.

"Is there a simple answer here somewhere?", you ask. YES. Advise the members to quit approving these special assessments each year. It's time the BOD started contributing to a reserve fund so that funds will be available for special projects instead of asking for a SA.

You would have to take a close look at the books to see why the special assessments are taking place.

- Dues too low?
- Expenses too high?
- Delinquent dues?
- Etc.

The assessments might be legit, but you need to start with the question "Why does the reserve not cover this?" and start digging in deeper from there.

Mary,
I don't know if everyone experiences this but after finding yourselves in an uncomfortable position for some long , that becomes part of your persona. Maybe this is laying it on thick but I sure am positive my attitude and demeanor have improved. Shoot, we still got problems that need to be adjusted but time and good people will take care of that. I hope my experiences help me to give better answers here. Those that have posted here a while know there is very little new in all this, it is just how these challenges are met.