Town Hall Meeting 9/7/24
Town Hall Meeting
Following 2024 Annual Meeting
approved 9/28/24
Introduction of HOA lawyer Kim Porter: She came to listen to the discussion in order to know how to advise the board better.
Background:(not exactly expressed this way at the Town Hall Meeting) The board has hired Kim Porter to update and amend our covenants. She found some discrepancies regarding the HOA’s decisions vs. what the Declarations meant to convey. The 2 major discrepancies are regarding decks and assessments. Prior to the Town Hall meeting, the board has had a couple of zoom meetings with Kim. This is information from the meetings.
Decks: The common elements can not be divided or subdivided. The grounds is a common element. The HOA can not give an owner common grounds to expand their deck without a 75% vote of approval from the owners. The decks are limited common elements for the sole use of the owner, so common elements can’t be used to increase limited common elements without a vote. 30-I also states that when an owner upgrades the “patio area”, the owner is responsible for the cost of the upgrade and the subsequent maintenance.
Problem: 6 of the “Golf Course” units have expanded their decks to wrap around the back of their units. All of those decks are maintained by the HOA. Four of the “Inner Circle” units have either expanded or improved their decks to upgraded materials through the HOA. All expect maintenance from the HOA. Two of the “Brodie” units have added sunrooms to their decks. The current owners moved in thinking that the sunroom was part of the unit, not the deck. (Technically, their “decks” are “balconies”.) Not all owners are the owner that increased the size of the deck or improved it. We’ve never voted on any of this and shouldn’t have approved any of this.
Since 30-I is titled “patio area” and B&G hasn’t considered that we have any patios, it’s been entirely ignored.
Possible Solutions:
1. Clearly define 30-I so that it’s understood that the patio area includes decks/patios/balconies and then defining that the ground level patio area extends from two perpendicular edges of the building to create an area for a deck/and /or landscaping with 1-2’ extended surrounding landscaping from the edge of the building. All changes need to be approved by the board according to the Architectural Guidelines. Balconies can not be enlarged.
2. Licensing: When an owner makes approved changes to a patio area or balcony, they will sign a license agreement that gets documented with the Secretary of State to legally remove the responsibility of the deck from the HOA and move it to the owner and all subsequent owners. The benefit is that the deck becomes an asset to the owner and increases the value of their unit (provided the owner keeps it maintained and keeps records of the money they’ve spent on it).
Sidenote: Currently this would apply to 13 units plus one to come. A few years ago we decided that since the units were over 30 years old and in need of much repair that the HOA was to upgrade decks to include composite and metal rails. The HOA would pay for the least expensive composite and metal rails and the owner would pay the difference between wood and the upgrade. The idea was everyone would eventually have upgraded decks with minimal maintenance needed. We didn’t know about licensing at the time this was decided, but that could be a solution for gradually moving all the units to owner responsibility. An upgrade other than that offered by the HOA would be the full responsibility for payment by the owner and could be done anytime prior to the scheduled year. The remaining 16 units would be put on a schedule to alleviate all 16 needing to be done at once. Something along these lines would need to be done if the amended “all units decks are responsibility of the owner” vote doesn’t pass.
3.Owners become responsible for their deck/balcony.
4.HOA becomes responsible for all decks/balconies regardless of size and past agreements.
Assessments: Exhibit B is titled “Percentage of Ownership of the Common Elements”. It is referenced 3 times in the Declarations. Once as the way all assessments should be assessed, once as the way special assessments should be assessed and once pertaining to how to split the HOA funds should the HOA dissolve (fire, whatever). It was originally declared by the developer/builder and would need 100% of the ownership to agree to change it.
Problem: There’s only 6 of 30 units listed on it. The percentages listed are not solely by square footage and we’re having a hard time figuring out how to complete it according to the original ratios. It’s difficult deciding which units belong in each of the 6 categories without knowing the criteria used to come up with the original percentages. Typically this document is only used for dissolving the HOA and needing to know what percentage of remaining funds each unit should receive. Mortgage companies need it, but don’t go out of their way to get it.
Possible Solutions:
1. Don’t tie assessments to Exhibit B and split all assessments either equally or primarily equally with some by percentage of ownership.
2.Insurance: We used to split the insurance into small, medium and large units, determined by square footage with a $5 difference between sizes. With insurance tripling in cost over the last few years, we know this solution is outdated. The Declarations has a definition of terms entitled “percentage of responsibility”. This has a formula with it. Each units square footage as a percentage of the total square footage. We could split insurance as a percentage of responsibility instead of percentage of ownership of common elements and everything else equally like before. (Susan has done the math on the “Unit Sizes” document at the bottom of the right sidebar on the website, epmfhoa.com.) This would solve the Exhibit B problem,by renaming it and by having the only thing tied to it is the insurance and dissolving the HOA. Basing it on square footage would be reasonable for those two areas.
Sidenote: The original Declarations that we’re currently obligated to go by has the premise that since all units are not the same size, all assessments should be determined accordingly to the incomplete Exhibit B: percentage of owner ship of the common elements. Assessing everything equally would change that premise, but may be more legally correct. How to assess the insurance is still an option, we think.
Discussion in the Town Hall Meeting:
Key changes:
Declarations:
We need to update Exhibit B to include all units and determine the percentage of ownership of the common elements. However, we’ve never used that % of ownership of the common elements because we can’t figure out how the original 6 units percentage was figured out. We do need this document for the long-shot situation of needing to dissolve the HOA for whatever reason and then needing to split the money according to each units percentage of ownership of the common elements.
How we split the expenses between owner and HOA. Do we turn over driveways, sidewalks, and decks and skylights over to the owners responsibility rather than the current HOA’s responsibility? There was much discussion on what should be turned over to the owners. The number of skylights varies between 0-7 per owner, the sidewalks and driveways are currently up for costly repairs. Mostly, none were viewed as needing to be turned over to the owners at this time or changed in the Declarations. Most want these items to be taken care of by the HOA. (Keep in mind we still need to add 250K to the reserves for the retaining wall replacement.)
By-Laws:
Most were in favor of the changes, as they were primarily updated legal issues.
If you have any other thoughts or suggestions, please contact someone on the board preferably before the next board meeting, Sept 28,2004.
Adjourned: 3:30pm
Posted in Minutes 2024 by Susan with no comments yet.
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