Who Decides How Much Your Subdivision Fees Are?

tarcone · 02-12-2011, 08:07 AM

Our 3 person board recently decided to raise our subdivision fees from $395 to $425. I do not have a problem with the amount, but I do have an issue with 3 people decided for 125 homes what we will pay. I understand they are elected, and their job is to run the subdivision. But I feel anytime they want more money, the owners should have a say.

So, I went to the last subdivision meeting on Thursday to voice this. And after a 30 minute discussion the board agreed to solicit the homeowners opinion on whether or not we should vote on any raising of the fees. Basically, a mailing would be sent out to all the homeowners to see if they wanted the right to vote on this or just to leave it to the 3 in charge.
This morning I received an email from on of the board members and this is the text:

"I wanted to let you know that after more careful thought I have decided that we will not solicit any homeowners in changing the indentures on how assessments are raised.
I should not have agreed to do this without first processing all the information."

So he has decided on his own that he isnt going to do this. And he is one who decides to raise the fees. This guy is the alpha member of the board. The other 2, imo, will go along with whatever he says.

This email really hit me wrong.

Any opinions would be appreciated. Am I wrong? What does your subdivision do about fees?

Thanks for your help.

fantom1979 · 02-12-2011, 08:20 AM

42500 pennies? I have always found that a truckload of pennies gets my opinion across.

In all seriousness, I would email him back and request to know what information he has processed since Thursday that has made him change his mind? I would also want to know why the subdivision needs an additional $3750. What benefit will the subdivision see from the additional fees?

Also, what would happen if you just didn't pay? My parents went years without paying subdivision fees because they did not feel that the subdivision was living up to their side of the agreement.

RainMaker · 02-12-2011, 08:39 AM

I've dealt with it with maintenence fees in condos. The one thing I'd do is make sure you get documentation of what they are spending the money on. They should be providing members with financial records. You should look through them to go over any funny business.

Other than that, you're sort of at their mercy until you can vote them out. It's just part of living in a subdivision or condominium complex.

Speaking of which, a friend of mine got royally screwed by these guys.

Co-owners of shuttered condo management firm charged with fraud - Chicago Tribune

darkenigma510 · 02-12-2011, 08:41 AM

Pretty sure they can put a lien on your property for not paying HOA fees.

This has always been my beef against any condo/HOA board that is too small compared to the general population the Board supports. There is too much power in the hands of too few persons. If the HOA Board is corrupt/incompetent, the homeowners suffer by having to pay too much, either for useless expenditures or overpaying for some services. On the other hand, a Board that is too cheap can avoid dealing with problems that have to be addressed.

I am surprised the by-laws of the HOA allow for a Board size of only three board members. Ideally, a Board should have at least five members. This can allow for some dissenting opinion.

As for whether the Board should allow members to vote for a raise in fees, I would say the Board is empowered to raise thr fees where necessary. In some cases, the most prudent course is to raise fees to cover the expenses of the community. Asking the community if they want raised fees may be like a polition asking their citizens if they want to raise taxes.

The raise also doesn't seem too excessive (not knowing what its for) but it looks at though basic inflation could explain the need for the raise.

gstelmack · 02-12-2011, 09:01 AM

You should be able to get a copy of the budget, and next time elections come around get your neighbors together and vote them out. We threw out our HOA board members after they hired the former treasurer to take over the management contract and he spent his days biking around looking for violations.

Toddzilla · 02-12-2011, 09:21 AM

You vote these people in specifically to make these kind of decisions. Stop your whining you big baby and if you don't like it, run for the position yourself or STFU.

sterlingice · 02-12-2011, 11:12 AM

Quote:

Originally Posted by fantom1979

42500 pennies? I have always found that a truckload of pennies gets my opinion across.

SI

CU Tiger · 02-12-2011, 11:43 AM

425 in pennies wouldn't take up as much room as you think.
I have done that trick a few times...its good for effect.

Look into the covenance and by-laws it should be a profit neutral proposition. so they should have to show where every dime went.
Look through the expenses and see if anything jumps out.
If it does then I'd solicit a few competitive prices, and check your suspicions. If right ask to see the 3 competitive bids if they cant produce then you probably have grounds for removal based on incompetence.

I can't see any increase unless a capital project has been undertaken. I know most grounds keepers and contractors etc have had to cut their price recently due to the current economic climate.

PilotMan · 02-12-2011, 12:11 PM

My guess is that your current board has a hard time just getting people interested in serving in any fashion at all for starters. The economic climate has been very hard on HOA's as the number of homes behind and the number of homes in arrears are very high. People are simply not paying. The first step in any action should be to get a copy of the budget, and take a look at where the money is going. Our HOA spends most of the money on pond and landscaping maintenance.

Is the HOA completely self governing or is there a management company that helps file and maintain paperwork? A management company will have their own lawyer who will see that the correct procedure and laws are followed.

Not to say that there are not bad HOA's out there. One subdivision, where a co-worker lives, had their treasurer busted by the feds for embezzlement and tax fraud. He had been doing the books for over 10 years, and had plenty of time to get into trouble.

Ksyrup · 02-12-2011, 12:36 PM

You need to get a copy of the charter document for your HOA/subdivision and see what it says about who gets to decide things like fees, expenditures, etc. We vote as a membership, but if your docs say that is vested in a 3-person board, then you're SOL. The fact that they tried to do it one way and then changed their mind after a meeting suggests to me they aren't following the rules of the HOA, whatever they are. They are just making it up as they go. That needs to stop, if there are concerns with how they are running the HOA.

bbor · 02-12-2011, 03:57 PM

Is there not a cap as to what % they are allowed to raise these fees in a year?

Is it not a MUST that they show financials every fiscal year?

Is there not a property managment company that works with your board?

I am an agent but in Canada....so i don't know exactly if these laws are in effect in the States as they are in Canada.

Flash may be able to help you.

MizzouRah · 02-12-2011, 06:55 PM

Is there some kind of by laws or anything that states they can just raise the price without any voting or interaction from the community?

We stopped paying our yearly dues because well, our road hasn't been re-rocked for two years now and that was written into our agreement. I told her I'm done, sue me. Haven't heard a thing since.

JonInMiddleGA · 02-12-2011, 08:22 PM

Quote:

Originally Posted by Ksyrup

The fact that they tried to do it one way and then changed their mind after a meeting suggests to me they aren't following the rules of the HOA, whatever they are. They are just making it up as they go.

This.

CU Tiger · 02-12-2011, 09:36 PM

Quote:

Originally Posted by MizzouRah

Is there some kind of by laws or anything that states they can just raise the price without any voting or interaction from the community?

We stopped paying our yearly dues because well, our road hasn't been re-rocked for two years now and that was written into our agreement. I told her I'm done, sue me. Haven't heard a thing since.

Just so I am clear, you have a hoa but not a paved road? Or did I readvthat wrong?

MizzouRah · 02-13-2011, 02:16 PM

Quote:

Originally Posted by CU Tiger

Just so I am clear, you have a hoa but not a paved road? Or did I readvthat wrong?

Sorry, I should clarify.. we have a subdivision committee, but it's only been around for 4 years now and yes.. we live on a gravel road with 8 other families.

They pay for lights on the road, rock (none as of yet), etc..

We country folk!

RainMaker · 02-13-2011, 02:39 PM

One other thing I'd mention, I've never had a condo association ever raise fees without a vote by all members. They made decisions on where fees went typically, but they couldn't just raise fees without a vote. I'm surprised that isn't in the bylaws.

CU Tiger · 02-13-2011, 02:59 PM

Quote:

Originally Posted by MizzouRah

We country folk!

Nothin wrong with that..its right up my alley.
In fact the last half of my road and my entire drive is gravel....just couldnt imagine a HOA "way out here"

MizzouRah · 02-13-2011, 04:17 PM

Quote:

Originally Posted by CU Tiger

Nothin wrong with that..its right up my alley.
In fact the last half of my road and my entire drive is gravel....just couldnt imagine a HOA "way out here"

Yeah, it's nothing like HOA Tarcone has, but it serves its purpose, or at least I thought that going in.

02-12-2011, 09:01 AM	#5
gstelmack Pro Starter Join Date: Oct 2000 Location: Cary, NC	You should be able to get a copy of the budget, and next time elections come around get your neighbors together and vote them out. We threw out our HOA board members after they hired the former treasurer to take over the management contract and he spent his days biking around looking for violations. __________________ -- Greg -- Author of various FOF utilities

02-12-2011, 12:11 PM	#9
PilotMan Head Coach Join Date: Oct 2002 Location: Seven miles up	My guess is that your current board has a hard time just getting people interested in serving in any fashion at all for starters. The economic climate has been very hard on HOA's as the number of homes behind and the number of homes in arrears are very high. People are simply not paying. The first step in any action should be to get a copy of the budget, and take a look at where the money is going. Our HOA spends most of the money on pond and landscaping maintenance. Is the HOA completely self governing or is there a management company that helps file and maintain paperwork? A management company will have their own lawyer who will see that the correct procedure and laws are followed. Not to say that there are not bad HOA's out there. One subdivision, where a co-worker lives, had their treasurer busted by the feds for embezzlement and tax fraud. He had been doing the books for over 10 years, and had plenty of time to get into trouble. __________________ He's just like if Snow White was competitive, horny, and capable of beating the shit out of anyone that called her Pops.

02-12-2011, 12:36 PM	#10
Ksyrup This guy has posted so much, his fingers are about to fall off. Join Date: Nov 2000 Location: In Absentia	You need to get a copy of the charter document for your HOA/subdivision and see what it says about who gets to decide things like fees, expenditures, etc. We vote as a membership, but if your docs say that is vested in a 3-person board, then you're SOL. The fact that they tried to do it one way and then changed their mind after a meeting suggests to me they aren't following the rules of the HOA, whatever they are. They are just making it up as they go. That needs to stop, if there are concerns with how they are running the HOA. __________________ M's pitcher Miguel Batista: "Now, I feel like I've had everything. I've talked pitching with Sandy Koufax, had Kenny G play for me. Maybe if I could have an interview with God, then I'd be served. I'd be complete."

02-12-2011, 03:57 PM	#11
bbor Pro Starter Join Date: May 2001 Location: toronto	Is there not a cap as to what % they are allowed to raise these fees in a year? Is it not a MUST that they show financials every fiscal year? Is there not a property managment company that works with your board? I am an agent but in Canada....so i don't know exactly if these laws are in effect in the States as they are in Canada. Flash may be able to help you. __________________ Pumpy Tudors Now that I've cracked and made that admission, I wonder if I'm only a couple of steps away from wanting to tongue-kiss Jaromir Jagr and give Bobby Clarke a blowjob.

02-12-2011, 08:20 AM	#2
fantom1979 College Benchwarmer Join Date: Apr 2008 Location: Sterling Heights, Mi	42500 pennies? I have always found that a truckload of pennies gets my opinion across. In all seriousness, I would email him back and request to know what information he has processed since Thursday that has made him change his mind? I would also want to know why the subdivision needs an additional $3750. What benefit will the subdivision see from the additional fees? Also, what would happen if you just didn't pay? My parents went years without paying subdivision fees because they did not feel that the subdivision was living up to their side of the agreement.

02-12-2011, 08:39 AM	#3
RainMaker Hall Of Famer Join Date: Jun 2006 Location: Chicago, IL	I've dealt with it with maintenence fees in condos. The one thing I'd do is make sure you get documentation of what they are spending the money on. They should be providing members with financial records. You should look through them to go over any funny business. Other than that, you're sort of at their mercy until you can vote them out. It's just part of living in a subdivision or condominium complex. Speaking of which, a friend of mine got royally screwed by these guys. Co-owners of shuttered condo management firm charged with fraud - Chicago Tribune

02-12-2011, 08:41 AM	#4
darkenigma510 n00b Join Date: Jan 2007	Pretty sure they can put a lien on your property for not paying HOA fees. This has always been my beef against any condo/HOA board that is too small compared to the general population the Board supports. There is too much power in the hands of too few persons. If the HOA Board is corrupt/incompetent, the homeowners suffer by having to pay too much, either for useless expenditures or overpaying for some services. On the other hand, a Board that is too cheap can avoid dealing with problems that have to be addressed. I am surprised the by-laws of the HOA allow for a Board size of only three board members. Ideally, a Board should have at least five members. This can allow for some dissenting opinion. As for whether the Board should allow members to vote for a raise in fees, I would say the Board is empowered to raise thr fees where necessary. In some cases, the most prudent course is to raise fees to cover the expenses of the community. Asking the community if they want raised fees may be like a polition asking their citizens if they want to raise taxes. The raise also doesn't seem too excessive (not knowing what its for) but it looks at though basic inflation could explain the need for the raise.

02-12-2011, 09:21 AM	#6
Toddzilla Pro Starter Join Date: Jan 2001 Location: Burke, VA	You vote these people in specifically to make these kind of decisions. Stop your whining you big baby and if you don't like it, run for the position yourself or STFU.

02-12-2011, 11:43 AM	#8
CU Tiger Grizzled Veteran Join Date: Nov 2006 Location: Backwoods, SC	425 in pennies wouldn't take up as much room as you think. I have done that trick a few times...its good for effect. Look into the covenance and by-laws it should be a profit neutral proposition. so they should have to show where every dime went. Look through the expenses and see if anything jumps out. If it does then I'd solicit a few competitive prices, and check your suspicions. If right ask to see the 3 competitive bids if they cant produce then you probably have grounds for removal based on incompetence. I can't see any increase unless a capital project has been undertaken. I know most grounds keepers and contractors etc have had to cut their price recently due to the current economic climate.

02-12-2011, 06:55 PM	#12
MizzouRah Hall Of Famer Join Date: Sep 2002 Location: Troy, Mo	Is there some kind of by laws or anything that states they can just raise the price without any voting or interaction from the community? We stopped paying our yearly dues because well, our road hasn't been re-rocked for two years now and that was written into our agreement. I told her I'm done, sue me. Haven't heard a thing since.

02-13-2011, 02:39 PM	#16
RainMaker Hall Of Famer Join Date: Jun 2006 Location: Chicago, IL	One other thing I'd mention, I've never had a condo association ever raise fees without a vote by all members. They made decisions on where fees went typically, but they couldn't just raise fees without a vote. I'm surprised that isn't in the bylaws.

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