HOAleader.com - Tip of the Week - March 4, 2016
Published: Fri, 03/04/16
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HOA Reserve Planning: Is It Time for an Onsite Inspection?
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How long has it been since your HOA had an onsite inspection of your facilities and all their components so that you could update your reserve study? Be honest: It’s probably been a while, right?
In this week’s tip, we talk about why and when to schedule one.
First things first: What’s the purpose of this onsite reserve-study component inspection?
“It’s intended to verify whether the common area components are weathering according to the schedule that’s been previously set up,” notes Ken Kosloff, a principal and senior construction consultant at Richard Avelar & Associates in Oakland, Calif. “States that have enacted reserve study requirements want to make sure a set of numbers or assumptions for when components need to be replaced isn’t done and not revisited again.
“It’s not an exact science,” adds Kosloff. “It’s more of a broad brush stroke look at what the requirements are going to be in the future. We don’t know exactly when a component is going to fail. You typically have a range based on what it looks like now. It could be one or two years before or after the time specified.”
As Kosloff noted, some states require associations to conduct an onsite inspection at specified time intervals. California’s one of them.
“The only avenue that’s available for regular site inspections is in the reserve study process,” says Kosloff. “California law requires you to update the reserve study information annually in terms of budgets and things like that. It also requires that a site visit be conducted every three years.”
Other states, like Nevada, have a five-year requirement, reports Kosloff. “Canada has a requirement for reserve studies,” he says. “I went to conference up in Toronto, and they have an interesting setup there. They have theirs to verify the information required every five years. But the inspection has to be done by a licensed architect or engineer, unlike in the United States, where anybody can get certified and put their shingle up.”
Then there’s the unusual tack taken in Colorado. “Colorado has a mandatory reserve study policy,” states David Firmin, a partner at Hindman Sanchez, a law firm in Arvada, Colo., with about 1,600 association clients. “You have to adopt a policy of how often you’ll have the study done and how often to have your site physically inspected.
“It also has a specific carve-out that says the board can do the inspection on its own,” according to Firmin. “That provision is intended for small associations that can’t pop $3,500 to have an inspection. I personally think it’s a bad idea. Board members aren’t engineers or reserve study specialists. And it’s not the board’s role to try to determine what the condition of the community is. You really should have a profession do it.”
What if you have to wing it? Find out how often to have the inspection, and get tips on how to choose the right inspector, in our new article: http://www.hoaleader.com/members/1334.cfm
Best regards,
Matt Humphrey
President
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Onsite Inspections for Your HOA Reserve Study: What to Know
Did you know you should--maybe you're even required to--have an onsite inspection as part of your reserve planning?
How often do you need to make that happen? And who should do it? Here we give you a head start.
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Click here to read full article:
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An HOAleader.com reader asks: "Our association has 28 units and a 7-member board. The current board seems a pretty tightly knit group, and they often meet in 'executive session' and exclude those outside of the group with the argument that they're discussing confidential legal matters relating to unpaid assessments. No one is ever told the results of these executive sessions, and apparently no minutes are kept.
Click here to read full article:
http://www.hoaleader.com/members/What-Tell-HOA-Owners-About-Executive-Session-And-Why-Not-Make-All-Owners-Board-Members.cfm
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HOA Board Members and Fiduciary Duties: What You Must Know to Fulfill Your Duty to Your Association and Protect Yourself from Personal Liability
When you volunteered to serve your community association as a board member, did you realize you were agreeing to set aside your own interests and act as a fiduciary on behalf of the entire association? Are you confident you know every scenario where you might trip up and expose yourself to personal liability by failing to live up to this important duty?
Set aside an hour of your time to learn what you need to know and ensure you're not risking your own financial security by making common--but easily avoidable--mistakes while volunteering as an HOA board member.
Click here to read full article:
http://www.hoaleader.com/products/hoa-board-members-and-fiduciary-duties-webinar-b.cfm
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As Trees Grow, They Restrict Views. What's an HOA To Do?
An HOAleader.com reader asks: "Approximately 15 years ago, our HOA planted trees in a green belt. However, they didn't consult a landscape architect or arborist. The species grew to about 40 feet tall and are quite dense. The unintended consequence is that it blocks the view of the mountains for about 10 percent of the homes (75 trees on about 1.75 acres).
Click here to read full article:
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