Condos, Townhouses, Co-ops, HOA

Question: Our By-laws indicate that expenses are shared equally. We have one and two bedroom units that vary significantly in size. Dividing expenses equally seems unfair. Can we simply vote to change it? If so, how many need to vote in favor of it?

Answer: Occasionally, developers propose an expense allocation like the one you describe. It's easier to calculate but clearly overlooks disparity in size and value. When there is substantial difference in square footage, the norm is to allocate expenses according to a unit's square footage as a percentage of the total units square footage.

When developers ignore the unit size and value issue, the inequity usually becomes apparent after turnover when the new board focuses on the budget process. Members that feel they are carrying a bigger share than they should lobby to "fix it." The problem is, all members agreed to pay what the developer indicated was their share of HOA expenses, fair or not.

If a majority of the owners were allowed to change the expense allocation formula, theoretically 51 percent of the owners could pass an amendment that would force 49 percent of the owners to pay 100 percent of the expenses.

This can't possibly be right or equitable. So changing the expense allocation should be based on receiving the consent of those affected. However, since people are people, this is unlikely to happen.

Bottom line (listen up developers), the expense allocation formula needs to be fair from the get-go. Don't set up the HOA for conflict that inevitably will be blamed on the developer.

Question: One of our homeowners wants to start an HOA newsletter. A few Board members object to this because people don't read the minutes as it is, the Board would need to review it and finding someone to do it consistently may be difficult. What say you?

Answer: Having a regular newsletter is not just a good idea, it's a basic good management practice. To encourage readership, the newsletter should be worth reading and provide information that all members need to know. If certain members don't choose to read it, that's up to them. The HOA should not withhold information because of it.

The Board Secretary generally previews the newsletter for content and accuracy. This doesn't take much time for a two to four page newsletter (more than ample for most HOAs).

Newsletters do not need to be long and involved, just timely and relevant. There is boilerplate information that can be repeated each issue (like key contacts) and pre-written articles that can be used to make a point. In fact, there are hundreds of articles in the Regenesis.net Article Archive that are designed exactly for that purpose and that are available to subscribers.

Question: I just read your article on sex offenders in HOAs. My experience with paroled sex offenders is that they rarely bother anyone. Is this really a problem?

Answer: While the answer to that question varies from location to location, national statistics do bear out that recidivism is a big problem with sex offenders. And statistics to the contrary are small consolation when you, or someone you know (especially a child), is the victim of this crime.

However, in fairness, all sex offenses are not created equal. Some involve underage consent while others committed unspeakable acts. The Board should investigate the facts before unduly impugning a resident's character.

That said, for the Board to keep silent about a known sex offender could be viewed as complicity. State laws allow disclosure and the Board should do so along state prescribed guidelines.

Question: Our professional manager is pandering to certain Board members and ignoring policies passed by the Board majority. How do you keep a manager from getting involved with Board politics?

Answer: The Board President should speak to the manager directly and plainly about this problem. Most managers are only trying to please or do their job. It may be a simple misunderstanding. If, however, there is conscious subterfuge and unwillingness to change, the matter should be addressed directly with the management company owner. If change isn't forthcoming, the President should recommend to the Board that there be a change in management company.

On the other hand, if the manager is kowtowing to the Board President, the remaining directors need to have a heart to heart with the President. All officers serve at the pleasure of the Board. If an officer is exceeding authority, the Board can remove and replace that person with another director who won't.

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