Can They do This?

Started by PattyB1 • 9 replies • 1541 views

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PattyB1 (Kentucky)
Posts: 40

Posted:

Our By-Laws state that BMs can only accecpt compensation by a majority vote of homeowners and only if they purchase items for the HOA with their own money.The BMs that I sit on the Board with have decided,with a majority of themselves, that because they can't be compensated for all the work they do, they are not going to pay their HOA dues. This has been announced in a newsletter. They hope it will encourage other homeowners participation(?). I was President for 3 years and I know, as well as these others do, that our time is voluntary and alot of times a thankless position,as well as non paid. They intend to not pay their HOA dues as of this July. This is not fair to the other homeowners, it is also against our By-Laws. Is there anything that can be done to stop these BMs from doing whatever they want? I am the only no vote. They really made it sound in the newsletter like it was a fair thing to do for all their work. Thank you for any advice. Patty

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Whats a BM? Try not to use acronyms.

PattyB1 (Kentucky)
Posts: 40

Posted:

I'm sorry. Board Members is what I mean. Thank you.

BarbaraD6 (Florida)
Posts: 347

Posted:

NEVER are we compensated for work we perform on property, as we serve as volunteer's. Yes it is a violation of our documents too.

Barbara

GlenL (Ohio)
Posts: 5,491

Posted:

Patty, I would inform them that if they try it that you as a homeowner would sue them in small claims court for the assessments.

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

MaryA1 (Arizona)
Posts: 7,043

Posted:

Patty,

Your board members cannot be compensated unless it is granted in the bylaws or by state law. However, even if the gov docs and/or state law allow this, the compensation cannot be in the form of nonpayment of assessments. I'm sure your CCRs state that ALL members of the assn are subject to the payment of assessments. I'm sure that nowhere is it stated that anyone's assessments can be waived -- not even a board member. If these board members feel that strongly about being compensated then perhaps they shouldn't be board members. This is a voluntary position. I wonder, what part of "voluntary" they do not understand. As a board member, I would try to urge them to reconsider this as it is an illegal action and they could be subject to a recall. If they won't then I would make a point of letting the membership know that what they plan to do is illegal. I would also make a point of having my objection put into the record.

MicheleD (Kentucky)
Posts: 4,491

Posted:

After doing a hand-stand and cheer for Mary's comment, I would like to make an observation.

What you are talking about in your original post is not "COMPENSATION" to a board member for monies they expended on HOA items.

That's called "reimbursement."

I don't know of an HOA, or any corporation, for that matter, anywhere that doesn't allow for expense reimbursement.

That is completely different from "compensation."

Reimbursement of expenses out of ones own pocket for HOA items or materials can sometimes include mileage, but even that's not considered "compensation."

To reinforce Mary's post again, if these board members feel they aren't being adequately compensated for what is a strictly volunteer position, they need to move on.

By the way, they (and you) should also be aware of the tax implications if they attempt to waive assessments in compensation for their "time" of service on the board.

SusanW1 (Michigan)
Posts: 5,202

Posted:

This is a stickey issue. Especially for states that don't deal with issues involving non-profit boards. CA and FL have oodles of rules.

But . . . . Do your CCRs or bylaws state that the board can NOT waive dues for any reason?

MicheleD (Kentucky)
Posts: 4,491

Posted:

Quote:

Posted By SusanW1 on 06/08/2010 5:21 AM
This is a stickey issue. Especially for states that don't deal with issues involving non-profit boards. CA and FL have oodles of rules.

But . . . . Do your CCRs or bylaws state that the board can NOT waive dues for any reason?

That is usually considered under the equal rate of assessment clause, in addition to the assessments being mandatory.

SusanW1 (Michigan)
Posts: 5,202

Posted:

Well, one option is - since the board feels that they need to be compensated with waived dues - the HOA should hire a management company and downsize the board or its role in the day to day activities.

No one knows just how much this board is actually doing. It may be burned out by trying to do so much, like running a water system, roads, beach, community center, etc. etc.

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