Special Siding Assessment

Believe me, if you want to try to get a $6000 assessment voted in, you WILL get voter turn out.

Check your bylaws or CCRs. I have a feeling you will need more than just a majority to pass this increase.

Thanks for your answers. I would hope the HOA would figure out the cost and pass it through as an additional monthly assessment over a fixed period. With regard to a reserve account, I am looking at the 12/31/07 financials and the HOA has a replacement fund with $56K in it. No mention of siding in the additional footnote which breaks out the $56K. To be honest the replacement study was last done in 2000 and I am quite nervous to see what an outside consultant would determine needs replacing today.

I would love to speak to an attorney because I feel the managing agent and previous board have grossly mismanaged the develpoment. At the last meeting a homeowner wanted to know how something was voted on and the managing agent basically told him that he didn't know since he wasn't the account exec at the time. He failed to understand that he is the owner of the management company and his ignorance may not fly in a court of law. Anyway I told them that the board should look at the HOA minutes since this should be documented in them. The board told me they weren't sure if they had minutes and I basically told them they could be potentially breaching their fiduciary responsibility. They all looked like a deer in headlights.

Andrew,

I can't imagine that siding replacement would not be in the "replacement fund". Do you know what the total cost of the siding replacement will be? Perhaps there's not enough in the fund to cover the whole cost w/o depleting the fund or at least not leaving monies in there for other replacement projects coming up. Hard to determine w/o knowing exactly what is covered in the fund.

IMO, not keeping minutes may not qualify, in itself, as a breach of fiduciary resp; however, mismanagement of assn funds certainly would. But, you would have to have supporting evidence that this has occured. When ruling on such an accusation, the courts generally use the business judgment rule, which is whatever any other individual would do in a like situation. All aspects of the situation would be looked at, not just whether minutes have been kept or whether the board knows how a particular item was voted on in the past. I believe it's a very hard accusation to prove. But, just making the claim to the board may give them cause to seriously look at how they are operating and to make some changes for the good.

Tracy,

Sorry, I didn't catch that! However, if whatever they now have is an item in the replacement fund, perhaps the funds allocated for that could be used for the siding.

The managing agent's rough guesstimate would be around $550K to do the whole development with vinyl siding. The HOA has a maintenance fund that it uses to currently maintain the buildings in the development by painting 4 a year and by covering $150/unit in wood replacement. Paint and wood replacement currently costs $25-20K a year. I'm not sure if I told you but we have wood siding and would look to replace with vinyl and the HOA does not have any allocated funds for potential vinyl siding.

The agent was saying we could borrow the money and pay it back over 5 years but without assessing for it now I can't see us borrowing in the immediate future.

Andrew,

One possibility would be to undertake the project one section at a time. It may take several years and perhaps the members would be faced with several smaller special assessments instead of one large one.

It seems to me that however much is being spent every year to maintain the wood siding can be used toward the cost of the vinyl siding. Also if any funds have been earmarked in the replacement fund for the wood siding, those funds can now be used for the vinyl siding.