New Board of Directors Plans on Dissolving the HOA

Started by CaroleL • 27 replies • 2482 views

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CaroleL (South Carolina)
Posts: 11

Posted:

I am on the board of directors. We had our elections last night for a new board. I did not run as I am burnt out from 3 years of being on the board. I have found out that the new boards intention is to dissovle the HOA. This is not possible without a 95% affirmitive vote to do so from eligible voting community members. I don't believe any of the new board members knew this prior to running. My fear is that since they will not be able to dissolve the HOA, they will just remain inactive, not enforce rules/regs and covenants. Our ByLaws do state the the board of directors or any individual director may be removed by a 51% vote of voting-eligible community members. However, there are no guidelines as to what should be the criteria for being removed from the board. The new board will take over in the next 30 days. While, I am still in a position to futher clarify this criteria, I am thinking of amending the ByLaws to include this information. I am seeking advise on what criteria should be listed. A vote is not necessary to change our ByLaws as long as they are not substantial changes and since I am further defining the criteria that is missing, I believe I am within bounds. Additionally, SC apartment/condo law, which is the only thing I could find that may be pertinent, states that the bylaws must specify the powers and manner of removal from the Board of Administration. Any feedback is greatly appreciated.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Carole,

The only 2 things I've ever seen in the bylaws that justify removal of a board member are for being delinquent in paying assessments for a period of 30 days or more and for more than 2 or 3 unexcused absences for BOD meetings. Frankly I think it's up to the members to decide whether or not a board member should be removed and for what reason. I don't think it's necessary to put all the reasons into the bylaws.

I really think you should give these new board members a chance. By golly, they haven't even taken office and you're thinking about a recall. Isn't that a bit premature???

CaroleL (South Carolina)
Posts: 11

Posted:

Thanks for your feedback. I do intend on giving them a chance. I just want to make sure I have what is needed to take action if they are not performing their duties prior to my leaving the board.

JohnB26 (South Carolina)
Posts: 1,569

Posted:

if your community is detached houses and the HOA is incorporated ... it was probably set up in the articles of incorporation to 'exist in perpetuity'

check with the sc secretary of state:

http://www.scsos.com/Search%20Business%20Filings

CaroleL (South Carolina)
Posts: 11

Posted:

Thanks ! I'll check it out.

BrianB (California)
Posts: 2,820

Posted:

let them try. there are only so many opportunities in this world to sit back from a position of experience and watch someone slowly lose the life force and will to live as they struggle against the bonds of their own making*, you should savor them when they come along.

*outside of marriage, that is

CaroleL (South Carolina)
Posts: 11

Posted:

Great point. Thanks !

JohnB26 (South Carolina)
Posts: 1,569

Posted:

Quote:

Posted By BrianB on 05/28/2010 11:18 AM
let them try. there are only so many opportunities in this world to sit back from a position of experience and watch someone slowly lose the life force and will to live as they struggle against the bonds of their own making*, you should savor them when they come along.

*outside of marriage, that is

ditto ditto ditto

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Poll:
Anyone ever heard of an HOA being successfully dissolved? I haven't.

SureshD
Posts: 268

Posted:

Good one Brian.

CarolF (Florida)
Posts: 435

Posted:

CaroleL - Do you have any common property?

CaroleL (South Carolina)
Posts: 11

Posted:

Sorry for not responding earlier, I was unexpectedly away. We do have 2 ponds which the HOA owns some of the land around them. We also own the retension pond and about a 1/2 an acre around that. However, there is no access to the ponds since the land that would give access to the ponds is all marsh. We do not have any amenities.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Quote:

I have found out that the new boards intention is to dissolve the HOA...... 2 ponds which the HOA owns..... retention pond

Sorry, you cant dissolve your HOA.

The state/city will force you to maintain your retention pond. The only reason your development was approved was because your HOA would be maintaining the retention pond and other common areas. If you dissolve, the state will take over (receivership) and charge the homeowners for the cost of managing your HOA. This includes the salaries of the people to manage you, costs to maintain the ponds, studies, etc. Summary: It will not be good and will cost you a lot of $$$.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Carole,

You say you do not have any "amenities", but the HOA does own common areas, including the retention pond which must be maintained. In order to completely dissolve the HOA, something must be done with those common areas. Selling them would not be practical, for one thing the retention pond could never be used for anything else -- it must always remain as a retention area. IMO, you're only recourse is to ask the Co./City to take back ownership of these areas or to create a special taxing district to pay for maint of these areas.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Quote:

only recourse is to ask the Co./City to take back ownership of these areas or to create a special taxing district to pay for maint of these areas.

You can ask the city, but they always say no. Good luck.

GlenL (Ohio)
Posts: 5,491

Posted:

Carole also until the city / county takes over the title to your common areas (as Steve said, good luck with that) the HOA must maintain insurance on them. If anyone were injured or killed, they could come after each homeowner jointly and severally for damages. In most documents I've seen the BOD doesn't have the power to dissolve the HOA no matter their plans or wishes, that power lies with the homeowners and there should be a section in the CC&R's on exactly what is required to accomplish this.

Studies show that 5 out of 4 people have problems with fractions

MaryA1 (Arizona)
Posts: 7,043

Posted:

Steve,

Don't say "always". I've heard of cases where they have; however, I would say it's safe to say the "majority" of the time they won't.

JaniceO (Georgia)
Posts: 3

Posted:

http://zoning.comdev.cobbcountyga.gov/2008-03/final_other_business/Other%20Business%20Item%2002.pdf

There was an association dissolved in our area of Georgia and the property containing the amenities was sold in a tax sale. A lot of neighborhoods were set up years ago with voluntary association membership and these older communities can't raise the funds to maintain their properties.

MicheleD (Kentucky)
Posts: 4,491

Posted:

Also, in many cases (if not the majority of cases) in mandatory associations, the common area cannot be sold and also cannot be developed.

They are meant to remain perpetual "green" spaces.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Michele,

In AZ, that would apply only to the water retention areas. Those areas cannot be used for any other purpose and have been mandated by the Co. in accordance with the 100-yr flood plan. As for any other common areas, usually just areas around the entrance, I don't know who would want to buy them as they don't amount to much and could never be used to build anything upon. As has been discussed earlier, dissolution usually is NOT an option unless the Co./City is willing to take ownership of the common areas or set up a special taxing district to pay for the maintenance thereof.

MicheleD (Kentucky)
Posts: 4,491

Posted:

Mary,

yes, one of our common areas is a retention basin (which we lovingly call "The Lake").

But we have about 13+ additional acres that are pretty much landlocked and can't be used for anything else at all unless someone wants to also purchase all the lots (or even some of the lots) surrounding them and knock down the homes and do ... something... I don't know what.

But in many cases, the development's "green spaces" are what become the common areas and those are usually unusable (for any development purposes) lots anyway, so I doubt that local municipalities want to take on the burden of maintaining them without the benefit of selling them off for development.

BrianB (California)
Posts: 2,820

Posted:

or worse, those common areas could be developable, and someone buys them and builds a junkyard, convenience store, halfway house for newly released violent offenders, nudist retreat for 90 year olds, etc..

MaryA1 (Arizona)
Posts: 7,043

Posted:

Brian,

That could only happen if the area was zoned for those type developments!

BrianB (California)
Posts: 2,820

Posted:

Mary, you are correct.

However, in local government, $$$$$$$$ wins. I am pretty sure the right amount of $$$$$ spread among some zoning commissioners, planners, council members, etc. could get you a rezoning of a parcel in exchange for your continued support of the community at large.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Brian,

Perhaps. But, the rezoning must be noticed and residents have the opportunity to state their objections. Sometimes that helps to sway the Council members' votes; sometimes not. And, I doubt that would ever happen with a water rentention parcel -- that use is set in stone, I'm sure. Well, guess I shouldn't say I'm sure, but I'm very doubtful that would ever change no matter how much $$$ was thrown around.

BrianB (California)
Posts: 2,820

Posted:

i agree mary.. unlikely, but never say never is a motto around here.

BrianB (California)
Posts: 2,820

Posted:

It's not quite the same as scooping up former common areas, but it makes you wonder... what if someone buys your front gate area?

http://newsok.com/property-owners-outraged-by-guthrie-businessmans-dealings/article/3466790?custom_click=pod_lead_business

MaryA1 (Arizona)
Posts: 7,043

Posted:

Brian,

THis is totally wierd!! Moral of story: if you live in OK CO, OK you better make certain you pay your prop taxes!!

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