Wednesday, May 23, 2018
Home and Garden

Community Living: Board has the power to set budget

Board has power to budget for expenses

Q: A member sent the board notification that a motion made at an annual meeting limited the amount of money they could spend and they had violated this policy approved by the members. If they needed more money; they had to call a members meeting to seek approval. The board approved an increase to their spending at a board meeting. What can we do to force the board to comply?

A: The statutes require the board to maintain and operate the association. As such, the statutes give the board the power to budget to meet the expected expenses and assess the members to meet the budget needs. This is the "prime-directive" for the directors, their responsibility. Members cannot just say do not fix or repair to keep our fees low, however the members can vote to eliminate a common element facility. A director cannot accept the lowest bid just to save money. They must review the bids and select the best offering as a wise business decision. If you are not happy with the board, then elect new directors. Be aware that a new director has the same responsibilities as the past director. That means he cannot just cut spending and reduce services. In other words, he has the same responsibilities as the past director.'

File a lien over unpaid HOA fees

Q: How do we pursue residents who have not paid HOA fees for two years? The home-owners have good jobs, nice cars and a good social life. The owner claims that the bank has lost their paperwork so he does not pay his mortgage. He feels that there is no need to pay his HOA fees.

A: Associations have the power to evict the owner. It does take an attorney to handle the paperwork but, most of the legal costs can be added to the owner's account. Contact an attorney that deals with association law. Have the attorney file a lien and within 30 to 60 days start foreclosure. The argument that the bank has first lien rights is true but they take forever to foreclose. The association should be able to foreclose in weeks and take title to the property. Once the association has title, they have options of renting, selling or giving the property to the bank. The key objective is to get the property paying fees as soon as possible.