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Our association is under funded. My current assessment is…

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our association is under funded...
our association is under funded. My current assessment is 230.00, to pay the bills it will rise to $430.00, is this legal? The question if legal is there are attorney fees and back water bill payments included in the $430.00, some want to pay $330.00 and do a special assessment until the old bills are paid. If we do the $330.00 there will not be much if any reserve amount collected, if we do the $430.00 as the bills are paid the extra money can go to a reserve or pay other bills. At $330.00 every new bill or repair will have to go under a special assessment. We have 2 back water bills and 3 current attorney fees to pay. Which is the better way to go
Submitted: 10 months ago.Category: Real Estate Law
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9/25/2017
Real Estate Lawyer: Marsha411JD, Lawyer replied 10 months ago
Marsha411JD
Marsha411JD, Lawyer
Category: Real Estate Law
Satisfied Customers: 20,984
Experience: Licensed Attorney with 29 yrs. experience with Real Estate
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Hello,

Thank you for the information and your questions. Yes, the increase in HOA fees are legal assuming there are costs associated with the HOA that must be paid. As for which is better, it really depends on what the Association membership prefers. From a personal perspective, as a long time member of one HOA or another, I would always prefer the consistent payment of a higher HOA dues to the lower one and then an unexpected assessment. That is just from the perspective of personal budgeting. In addition, from the HOA's perspective and keeping the property maintained, it is much better to have sufficient money in reserve and ready to be used for unexpected maintenance or repairs, rather than have to take the chance that some homeowners won't have the funds for a special assessment and then have to decide on taking a loan or leaving something unrepaired because the funds aren't there.

Please feel free to ask for clarification if needed. If none is needed, then if you could take a moment to leave a positive rating in the ratings box on this page, then the Site will give me credit for assisting you today. Thank you

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Customer reply replied 10 months ago
If the owners want to do everything as a special assessment can the board decide to incorporate those bills in monthly assessments instead
Real Estate Lawyer: Marsha411JD, Lawyer replied 10 months ago

It depends on what your By-laws say about the budget and dues and special assessments. This is what the statute says about ratification of special assessments: (doesn't fit your situation exactly, but it is information that is relevant to your issue). Ultimately, the Board drafts the budget and recommends changes to monthly dues/assessments and special assessments, but the membership votes on whether they want to pay the required expenses in special assessments or dues unless the associations bylaws state otherwise.

Sec. 18. CONTENTS OF BYLAWS....
......(8) (i) that each unit owner shall receive notice, in the same manner as is provided in
this Act for membership meetings, of any meeting of the board of managers concerning the adoption of the proposed annual budget and regular assessments pursuant thereto or to adopt a separate (special) assessment, (ii) that except as provided in subsection (iv) below, if an adopted budget or any separate assessment adopted by the board would result in the sum of all regular and separate assessments payable in the current fiscal year exceeding 115% of the sum of all regular and separate assessments payable during the preceding fiscal year, the board of managers, upon written petition by unit owners with 20 percent of the votes of the association delivered to the board within 14 days of the board action, shall call a meeting of the unit owners within 30 days of the date of delivery of the petition to consider the budget or separate assessment; unless a majority of the total votes of the unit owners are cast at the meeting to reject the budget or separate assessment, it is ratified, (iii) that any common expense not set forth in the budget or any increase in assessments over the amount adopted in the budget shall be separately assessed against all unit owners, (iv) that separate assessments for expenditures relating to emergencies or mandated by law may be adopted by the board of managers without being subject to unit owner approval or the provisions of item (ii) above or item (v) below. As used herein, "emergency" means an immediate danger to the structural integrity of the common elements or to the life, health, safety or property of the unit owners, (v) that assessments for additions and alterations to the common elements or to association-owned property not included in the adopted annual budget, shall be separately assessed and are subject to approval of two-thirds of the total votes of all unit owners, (vi) that the board of managers may adopt separate assessments payable over more than one fiscal year. With respect to multi-year assessments not governed by items (iv) and (v), the entire amount of the multi-year assessment shall be deemed considered and authorized in the first fiscal year in which the assessment is approved; ...

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Real Estate Lawyer: Marsha411JD, Lawyer replied 10 months ago

Hello again,

I wanted to touch base with you and make sure that you did not have any further follow up questions for me from the answers I provided to you on the 25th. For some reason, the Experts are not always getting replies, or ratings (at the top of the question/answer page you are viewing or in the pop up box for this question), which is how we get credit (paid by the Site) for our work, that the customer thinks have gone through. In your case I have not received your rating.

Please keep in mind that I cannot control the law or your circumstances, and am ethically bound to provide you with accurate information based on the facts you give me, even if the news is not good. If you are having technical difficulties with reading, replying or rating, please let me know so that I can inform the Site administrator. Please note that Site use works best while using a computer and using either Google Chrome or Firefox.

In any event, it was a pleasure assisting you and I would be glad to attempt to assist you further on this issue, or a new legal issue, if needed. You can bookmark my page at: http://www.justanswer.com/law/expert-marsha411jd/

Thank you.

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