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BettyO1 (California)
Posts: 104
Posted:
Could not find any information in Davis Stirling on what happens if a homeowners vote on a special assessment does not achieve quorum (51% of total members)on the first ballot. Does the special assessment simply die, or is subsequent balloting allowed with reduced votes required to pass the assessment (as in Board elections)? Would appreciate any dates, Board actions, other rules governing this.
RichardP13 (California)
Posts: 1,767
Posted:
Betty,

We have a sections in our CCR's that would allow a reduced quorum if the number was not reached at the first go around. We have a 51% quorum and if the required quorum is not present, then another meeting may be called and subsequent meeting shall be 1/2 of the required quorum for the preceding meeting.

We have it listed under:
5.3 Maximum Annual Assessment
5.4 Special Assessment
5.5 Notice and Quorum for any acxtion authorized under Section 5.3 and 5.4

Hope this helps
BettyO1 (California)
Posts: 104
Posted:
It does not appear that our CC&R's address this, so unless Davis Stirling specifies, don't know how to proceed. Consult attorney?
GlenL (Ohio)
Posts: 5,491
Posted:
Betty my interpretation of Civil Code ยง1366 - Duty to Assess, Limitations on Assessments. Is that it requires a quorum of 50% notwithstanding what might be in the CC&Rโ€™s for a reduced quorum. It would also require a secret ballot in which case the BOD would have 30 days to gather the necessary support to pass the measure or it fails. If it fails then the Board is limited to a SA of 5% of the gross budget unless it is for an emergency. An emergency being defined in the statute as:

(1) An extraordinary expense required by an order of a court.

(2) An extraordinary expense necessary to repair or maintain the common interest development or any part of it for which the association is responsible where a threat to personal safety on the property is discovered.

(3) An extraordinary expense necessary to repair or maintain the common interest development or any part of it for which the association is responsible that could not have been reasonably foreseen by the board in preparing and distributing the pro forma operating budget under Section 1365. However, prior to the imposition or collection of an assessment under this subdivision, the board shall pass a resolution containing written findings as to the necessity of the extraordinary expense involved and why the expense was not or could not have been reasonably foreseen in the budgeting process, and the resolution shall be distributed to the members with the notice of assessment.

Studies show that 5 out of 4 people have problems with fractions
JerrellC (Florida)
Posts: 83
Posted:
BettyO1 Our CC&R's say we need to have a 2/3 vote for any special assessment. However the board is allowed to assess the membership 5% above the previous year without the membership's approval ever year if they wish to. So far we have been able to meet our expenses for the last three years without an increase in the budget even with sixteen homes in forclosure, ten liens filed and 16% behine in their dues. JerrellC
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Jerrell,
It would be interesting to a lot of people to find out how you all have been able to handle this burden with such excellent results. If you are so minded it would be nice to read a recap, and if your association has thought about how are you going to handle the expenses when the economy improves and we get back to a normal life (Maybe) I expect if we were faced with such a deficit we would have to cut something that is normally provided and reduce expenditures for other things. How did you all decide this?
JerrellC (Florida)
Posts: 83
Posted:
RobertR1 We currently do not have no amenities like a clubhouse etc. We only have two parks with children's playground equipment to maintain grass cutting, sprinklers, water use fees. Our other costs is maintaining the entrance to our subdivision and 14 retention ponds. We have a total of 473 lots with 4 lots left befor buildout two of which are under construction. Our budget is around $124k. We recently added a fountain at the entrance pond and partially fenced in the two parks. Other than that is the normal fees for management, insurance, attorney fees when needed, etc. does this answer your questions? JerrellC
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Jerrell,
We get many posts here concerning budget deficits caused by foreclosures and folks not paying assessments. Each association has to tailor their operation dependent upon income and expenses. Your association appears to have taken a pretty big hit and you are still going along making improvement and such.
Do you feel your association was over budgeted before and this allows you a cushion for a rainy day or are your cutting services, etc. to stay within budget. All questions that loam large in many association in today's markets. I can also see some possible pressure on the Board to lower fees if you can cope with delinquent accounts.
Many associations attempt to assess only what the past has shown necessary to fund a budget and maybe a Reserve account. All like to talk about bare bones budgets.
Don't feel I am pushing you for information, your business is your business, you all seem to have done what many haven't been able to do..........good for you.
JerrellC (Florida)
Posts: 83
Posted:
RobertR1 Well robert as I said we haven't had to many expenses in the past few years. I also believe we are a little over budget at this time but our reserves have been enough to pay for the expenses we had last year. We did have damage to our wall from a vehicle accident but repair was paid by insurance. We probably will keep our budget the same for this year because we may have an expense coming up that is not known right now. It seems that our development design has created a problem with water flow. If you can visalize a large horseshoe in a part of our development where the top part having high land which closed off the flow of water out and away from the lots. Many pine trees are dying now in this area being contained and under water for long periods. It has created a danger for several homes in this area of these trees falling over into them. Some have already fell narrowly missing a home. The issue is under study now in determining who is responsible for the problem. The developer's surveyor,the management district, or the city for approving the development. The solution is simple to resolve. I suggested we need to cut a trench thru the high land which we own and let the water drain out. The trees in this area also needs to be cut down near the homes but the management district doesn't want them cut down unless we replace them with another tree perferably cypress trees. I don't know of any nurseries that sell cypress do you? Any time you have to deal with the invironmental agencies it means money and problems. If you have any ideas to our situation let me know. JerrellC

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