The Board of Directors has repeatedly stated that the Meadowcreek Association is out of money. Some have stated that they cannot even pay the light bill. This is the reason they feel the need to increase the maintenance assessment for single family homes by a mere one hundred dollars per year. The additional fifty thousand dollars collected will solve all of our problems they say, and allow for an actual surplus to accumulate. What they are reluctant to do, however, is explain where and how the current assessments are being used, other that a summary (by category) report provided on an irregular basis (and not posted monthly on the website).
The reality of the matter can be somewhat explained by the 2008 annual financial report and the 2009 to date report recently provided. It appears that a high percentage of expenditures have gone out for repairs on the Town Homes. In fact, during this period the income from the Town Homes has been $104,136.01 while the expenditures have come to $222,616.01 or a shortage of $118,480.00 in this time frame alone. This is simply not acceptable, and many questions must be addressed.
First, what is the cause or factors behind the repair expenditures? Can some blame be laid on Hurricane Ike? Did storm damage exacerbate existing damage and make repairs more expensive? What exactly caused this amount of damage in the first place?
Second, are all repairs now complete, or can we expect more large expenditures in the future? Were the repairs made in a professional manner in full compliance with city codes? Was the contractor selected professional, bonded and insured? Were multiple bids solicited from pre-qualified contractors? Are all owners satisfied with the results, or can we expect legal action from some owners to force the Board to comply with the current deed restrictions?
Third, did the Board of Directors have an insurance policy in effect to cover some of the damages? Section 12 of the deed restrictions covering the Town Homes requires the board to purchase, and the owners to pay for this type of coverage. If the insurance was in place, how much of the expense of repairs did the policy pay?
Last (and probably not least), why does the Board expect the single family homes to assume this burden? Our deed restrictions place no legal burden on us to pay for the operating expenses and repairs of the Town Home section. We have our own expenses (insurance, taxes, trash pickup, utilities, etc.) to pay for, along with our association dues.
It’s time for some answers. Perhaps some Town Home owners can sign on and let us know what’s happening.
The reality of the matter can be somewhat explained by the 2008 annual financial report and the 2009 to date report recently provided. It appears that a high percentage of expenditures have gone out for repairs on the Town Homes. In fact, during this period the income from the Town Homes has been $104,136.01 while the expenditures have come to $222,616.01 or a shortage of $118,480.00 in this time frame alone. This is simply not acceptable, and many questions must be addressed.
First, what is the cause or factors behind the repair expenditures? Can some blame be laid on Hurricane Ike? Did storm damage exacerbate existing damage and make repairs more expensive? What exactly caused this amount of damage in the first place?
Second, are all repairs now complete, or can we expect more large expenditures in the future? Were the repairs made in a professional manner in full compliance with city codes? Was the contractor selected professional, bonded and insured? Were multiple bids solicited from pre-qualified contractors? Are all owners satisfied with the results, or can we expect legal action from some owners to force the Board to comply with the current deed restrictions?
Third, did the Board of Directors have an insurance policy in effect to cover some of the damages? Section 12 of the deed restrictions covering the Town Homes requires the board to purchase, and the owners to pay for this type of coverage. If the insurance was in place, how much of the expense of repairs did the policy pay?
Last (and probably not least), why does the Board expect the single family homes to assume this burden? Our deed restrictions place no legal burden on us to pay for the operating expenses and repairs of the Town Home section. We have our own expenses (insurance, taxes, trash pickup, utilities, etc.) to pay for, along with our association dues.
It’s time for some answers. Perhaps some Town Home owners can sign on and let us know what’s happening.
I find it interesting that both proposals presented by the Board for modification to the single family home deed restrictions involves not only an increase to the HOA assessments but addresses special assessments as well.
ReplyDeleteI speculate the increase in HOA assessments from single family homes would be used to repair the shortfall in the townhomes and, further, the Board would attempt to burden single family homes (only) with a special assessment as well!!!
Notice there are no changes pending for the townhomes. The entire burden is to be borne by single family properties alone.
The townhomes pay their own assessment fees and have a seperate budget for repairs. Townhome residents pay about $1800/year which covers repairs, water, garbage. $180 of that goes toward the general fund just like the single family home residents. Each townhome owner is responsible for their own residential insurance, If the owner does not carry their own insurance, the board has to cover the cost and then charge the owner. If the owner does not pay, legal matters are taken against the owner for the cost of the insurance and fees.
ReplyDeleteSingle family homes do not pay anything toward the townhome expenses.
Hi Candace,
ReplyDeleteGreat information. According to Section 12 of the town homes deed restrictions however, the Board is required to purchase insurance to cover the town homes as a common expense.
Individual owners may, at their own expense, purchase homeowner's liability insurance covering personal property damage and loss.
The Section seems to imply that the cost of the common expense insurance covering the buildings is a part of your annual assessment along with the other common expenses. Can you comment on this?
You are referencing Section 12 of the town homes deed restrictions. These are restrictions that are limited to the townhomes and are not shared with the single family homes at all. The insurances must be covered for the townhomes, by the townhomes. In fact, the deed restriction specifically states that if the association has to cover the insurance, this is added onto the assessment fees that are charged to the specific townhouse owner. If any repairs for damage has to be covered and the owner did not have insurance, the board can put a lien against the owner's property until those fees are paid back to the board The deed restrictions for the townhomes also specifically state that these expenses are not to be part of the common expenses, it is a debt owned by that specific townhome owner.
ReplyDelete