ref; delinquent accounts

Hello:

IM a director on the board...went to a meeting last night and manager was telling us that they have alot of delinquent accounts that they will have to use the rest of the funds in the resevers for the next quarter tp ay bills.

He also stated that we need to have an assessment for the next quarter bills to be paid, and hopefully it will get approved on the votes...if not the manager stated may have to go stated.

I ask what type of actions are you taking on these delinquent accounts he said he sent most to the atty...but also stated that the association cannot afford to pay for the process of foreclosing on the delinquent accounts....to me I cannot see how this assessment will help at all.

Any suggestions?

Thanks for the reply back! I do understand what you stated...IM just a board member....at the meeting was looking at the balance sheet and look at the reserves $9,599.06 and then the manager stated the this is going into operating account so its neg in the reserves.

The president of this association/Community pool & grounds always agrees all the time with the manager...what ever he says they all agree.....I had it out with the manger a few times he hates when you ask questions...which I strongly feel we need to get rid of this manager.

I am so glad I found this discussion. I am a new BOD and seem to be the first one to ever ask the PM about our finances. Our dues went up 12% this year because of a WA bill that was passed. What the BOD didn't tell the owners is that our dues is going to go up that amount each year for 4 years.

To me it is inexcusable not to keep the owners informed in cases like this. The PM has been running the board for at least 5 of the last 7 years and just in the last two months I have caught her doing things that are deemed unethical if not illegal.

Short story is that because two of the old BOD love this PM I was voted out as President and pushed to Member at Large. What they don't realize is that not only will it not shut me up and stop me from asking questions, it is going to drive it more. I have finally got 2 other BOD to "see the light" a little. They still are afraid the PM will quit. I already have a contingency plan for that so hopefully she will.

Until then I am learning all I can about the WA Condo laws and have been memorizing our bylaws and R&R.

It is our job as BOD to ask those hard questions. Remember this is YOUR money. Not the PMs.

"IM just a board member"

You should resign as you are NOT competant to on the Board of Directors of a Not-For-Profit Corporation. You have the SAME fiduciary duty as ANY board member whether you are paid or not.

Fish or cut bait but hire people who DO KNOW.

Steve,

RESERVE FUNDS MAY NOT BE MOVED TO ANOTHER FUND WITHOUT A VOTE BY THE MEMBERSHIP!!!!! No Way, No How. Your manager is in error to say that he will be doing that. It needs to go to a vote by the members. You probably will need a special assessment to get your money situation taken care of but anything seems like a temporary fix in your situation. You will need a budget redo unless you can collect on all of the delinquencies.

Here is the Statute---720:303 under Budgets.----f) Once a reserve account or reserve accounts are established, the membership of the association, upon a majority vote at a meeting at which a quorum is present, may provide for no reserves or less reserves than required by this section. If a meeting of the unit owners has been called to determine whether to waive or reduce the funding of reserves and no such result is achieved or a quorum is not present, the reserves as included in the budget shall go into effect. Any vote taken pursuant to this subsection to waive or reduce reserves shall be applicable only to one budget year.

The only way the tail can wag the dog is if the BODs are incompetant.

Would a 'reasonable person' allow this to occur?

Prima Facia: Breach of Fiduciary Duty

The only issue is whether the D&O insurance would cover the verdict.

---welcome to the happy world of community living---

I agree with you...I ask the manager what actions he is taking to get the delinquent accounts up to date...he stated that hes letting the atty handle it....I mention to him perhaps call the homeowners that are behind and see if you can get a payment plan with them.

I also suggested perhaps we serch for cheaper vendors for the time being to get our cost down but he did not seem to be interested.....like I mention the other board members agree to everything the manager request or suggests.

To me if he was a good manager he should of had something planned for plan B.....he knows that a few of the homeowners catch up with there payments and then fall back down.

So after the meeting this past Wed evening...he will send a letter to all the home owners to vote in person or proxy for the $ 120.00 assessment one time for all 133 units. All the homeowners are going to be so so mad.

Thank You

Dear Steve C4. My brother I am a Treas of a 307 unit HOA in Florida. Yes you can spend the reserves we have done it in emergencyies before and will do it in the future if the situation demands it.

First of all it is a common problem with HOAs that the PM takes charge of the HOA and unless the BOD does not have a emergency budget meeting ( Allowed under Chap 720 ) without the PM being present you will never get out from under at al. Thats step 1

step 2 go to the owner of the PMC and demand a new PM becaise of reasons that the BOD refuses to divulge also legal

step 3 Fire the accounts receivables folks at the PMC or the accounting firm.

step 4 argue out that hence forth at every meeting you recieve a packet of the following data,

a. a copy of the last day of the months TOPS report,
b. copies of the front and backs of every check signed for and cashed at your bank
c. The treas shall have online access to every bank acct you have
d. the treas shall issue a monthly report of monies spent where you are out of synch with your budget
e. copies of all work orders issued by the PMC
f. The PM must make a report of what happened that month and what actions he-she took to solve the problem
g. Institute a writen down policy to follow on personnel not paying on time I suggest 2 months max
h. Send out a letter to the entire community explainning that times are bad and we intend to move the entire reserve account.
to operateing account to prevent a special assessment and a emergency rate increase .
I hire a better than the atty you are useing he-she stinks. We pay our firm $300 for a bank foreclosure and they add $1500 to what a member owes it does 2 things it makes people pay on time and it gets your funds out of others pockets and prevents members
from repeateing there mistake.
J. Get agressive at the Banks that own homes in your hoa they are members by default if they dont pay inside of 2 months
go after them also with the same gusto as physical members its legal.

People are going to scream that you cant use reserve funds and so forth well let thm scream they are not in your canoe they are dealing from the stand point of regulations and rules. Your job is to cure the problems and get them operateing correctly. If you are in Broward County send me a email at [email protected] and I will give you the firm and there number. Please do not ever say I am just a member of the board deD WRONG YOU ARE AS RESPONSIBLE AS THE tREAS AND THE pRESIDENT AND IN CLOSING DO NOT ALLOW THE pm TO SIGN CHECKS UNDER ANY CONDITION AT ALL. 2 SIGNATURES THE REZ AND THE TREAS ALONE PERIOD AND THE ASST TREAS AND THE VP AS A BACK UP TEAM

REMEBER THE PM MAY JUST LOOSE YOU AS A ACCOUNT YOU MAKE A MISTAKE AND YOU LOOSE YOUR COMMUNITY. DO NOT ALLOW A HOA TO FAIL IN FLORIDA THE RAMIFICATIONS ARE A MONSTER THEY THE ASSTATE GET TO APPOINT A PERSON TO RUN IT AND THEY DONT HAVE TO USE THE CHEAPEST OF ANYTHING AND THE HOA PAYS THERE SALARY AS WELL AS ALL EXPENSES............NEW FLORIDA LAW......EFFECTIVE 2008

Good Luck henry

Steve,

It absolutely amazes me that some PMs are so ignorant. Reserve funds are not to be raided to pay bills. How often are your assessments increased? A buget projection should have shown the need for an increase in years past. It looks like a special assessment may be necessary but if your association cannot pay everyday bills it certainly cannot pay for foreclosures. I have no idea how large your association is but from the performance of your PM I would think they should be the first to go.

Some day with your rostering you might end up on a BOD and then you can make the tough decisions for your community. As to how is it done very simple you send a letter to the entire membership and vote on it period. Reserve funds are not the property of some obscure law that is written by politicans but belongs to the HOA period

John,

The Board cannot vote for anything that is against the law, which raiding the reserve fund would be.

John,
"SOME DAY" I did sit on a Board, during transition from the Developer, thru a lengthly court case, thru writting of a ARC manual and a Documents chairperson at another community where I own a 55+ property.

IF you did obtain a proper amount of votes to use the Reserve funds as operating monies, then that's the way it goes. But I also question what the membership knows about replacing it's capital assetts without a Reserve fund to pay the costs. From what I know of your type of situation, I'll bet a great deal of the members don't have a clue what that will cost them and they only can think very short term. I know of that mentality as most older members think that they will be gone before it affects them and they will not have to deal with it.

Hello EllenS1: I do agree with you! I would like to get rid of this manager but the board members look up too him and they always agree what he suggest at all times...I just joined the board a few months ago and they are not too friendly but I can deal with them...IM much younger they are!

My main concern is I do beleive that we need a new manager...I feel the current one we have is burnt out also he is a homeowner in this community . Theres 133 townhomes here in this community we pay quartly payments for the common grounds and the community pool and each townhomes has there own monthly association and manager.....this manager was also our manager for the monthly association at one time,we got rid of him and now have a new manager and have no issues at all!

I was told that the board members have to vote current manager off, is this correct?...or can all the homeowners vote him out and get a new manager?

Steve,

If the manager has breached his/her contract there would be no reason for a vote. Line up a new management company and if the contract has been breached have an attorney so advice them.

We here in South Florida are running up against the samedeliquent accounts situation.
This is because we have had over 40% of the units fore closed.
Thus those of us still here are having to support the entire delinquency shortages.
This, in turn, is because the Banks of the foreclosures is not being paid by the Banks whichis required.

Anyone in a similar positon?

Davidh16