HOAleader.com - Tip of the Week - February 18, 2011
Published: Thu, 02/17/11
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Owners Nitpicking Your HOA's Spending? Try These Responses
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In this week's tip, we offer you a life line if you're at your
wits end over owners constantly nagging and challenging your HOA
spending.
Bill Worrall, vice president of The Continental Group, which is
based in Hollywood, Fla., and manages 1,300 condominium and
homeowner associations totaling 310,000 residential units, has
seen an increase in the number of owners challenging boards on
spending.
"Boards are being challenged," Worrell says, "particularly over
the last couple of years as a result of collections and bad debt.
It's been no fun for anybody involved. It's most common at the
annual budget meeting. If there's no increase or decrease in fees,
nobody ever shows up. But if there's any increase at all, that's
a sure-fire way to get people at meetings these days. You'll
certainly have a quorum before you know it."
Elizabeth White, a shareholder and head of the community
associations practice at the law firm of LeClairRyan in
Williamsburg, Va., has also seen more owner challenges, some of
which are calculated attempts to undermine the board. "We're
encountering this a lot, particularly on legal fees," she
explains. "And the people challenging the legal fees are the
people creating the legal fees--those with debts to the HOA or
those filing a gazillion books-and-records requests. There's a
certain type of resident who'll run up legal fees and then
criticize the amount of legal fees or spending in general. A lot
of times it's a ruse to get control or to facilitate their
position politically within the association."
Start any discussion over spending with a well-thought-out and
presented plan. First remind owners of how the board operates and
plans its budget. "Board members have to preemptively defend
themselves by communicating with owners about how replacement
fund requirements are determined, the trade-off between deferred
maintenance and later special assessments, and the risks entailed
by not following the insurance company's loss-control program,"
says Harry Styron, an attorney at Styron & Shilling in Branson,
Mo., who's drafted covenants for more than 100 subdivisions and
more than 40 condominiums, agrees. "If the board can't explain
those things, it may need more education."
Then do a complete budget presentation. Find out what to cover
and how to deal with die-hard complainers in our new article:
http://www.hoaleader.com/members/547.cfm
Best regards,
Matt Humphrey
President
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Recent articles posted at HOAleader.com:
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Click here to read full article:
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Click here to read full article:
< http://www.hoaleader.com/members/538.cfm >
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Click here to read full article:
< http://www.hoaleader.com/members/537.cfm >
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