Dues & Annual elections
I am just learning as this is the first time I have served on a board. The previous board was an absolute train wreck and I am picking up pieces. I want to make sure I do an accurate, ethical, legal job. I have a few questions that I am sure you have answered before so I thank you for your patience.
1. We charge dues once a year, am I right in understanding that we can charge a maximum of $15 late fee, one time for the year rather than adding it on every month. Other members think we should be adding it every month, and I just want to make sure that we aren’t breaking the law.
2. When it comes time for the annual board member election what is the procedure if no one vacates any of the positions? Can we just carry on or do we all have to be voted in again? What if only one or two positions are open?
3. When we do get to the voting can we do it entirely electronically or must we offer a paper ballot option?
Again thanks,
Sheryl
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Sheryl,
Assessment late fees are allowed based on a payment being late if you only ask for payment once, then only one late fee can be applied. That assessment is a lien on the property automatically the day the assessment is due. If your declaration allows you to charge interest, then in addition to the single late fee, you can charge interest from the date the assessment is considered late. Unscrupulous attorneys or community managers generate any attempt to distort the law by charging monthly late fees.
Boards are elected for a specific term established in the governing documents, and when that term expires, those board members are no longer on the board unless they are re-elected. While most associations have staggered terms so that all director terms do not end at the same time. Elections must be held annually by law to elect any vacancy not filled by the board or to elect board members for positions whose term has expired.
The last question is a sticky one. The law states that all elections must be conducted in person or by absentee ballot. A very vague part then said that alternative forms of ballot delivery, like e-mail or fax delivery, could be used. In 2016, the Non-profit Corporation Act was modified to allow online voting. Since then, attorneys have told associations that online voting is valid for these communities, and you can ignore the provision for in-person voting. This was a total lie. The laws that address voting for these communities contain a provision that expressly excludes the use of the section in the Non-profit Corporation Act that enacted online voting. Additionally, even that section requires that if online voting is used, the association must notify and provide paper ballots to anyone who desires them.
It has always been my contention that online voting has never been legal for these communities, and lawyers have lied to these communities. Until someone challenges the association in court, they will continue to violate the law. My problem with online voting is auditability with online voting. There is no paper trail, and the auditability for elections in these communities is limited to language assuming paper ballots. Additionally, online systems can be easily manipulated to alter the results of elections.
If you are interested in the truth, online voting is illegal for these communities, but that is not what any attorney will tell you. Irrespective of that, any homeowner has the absolute right to ask for a paper ballot, and it must be provided and allowed.
Dennis
33-1812 section B does state that absentee ballot or other form of delivery, including the use of email and fax delivery are valid. So, if we make a Google form and mail it that would be valid for paper voting. If we email that same Google form to members, they fill it out and submit it then that would also be valid, correct? Each completed form could be printed and kept with the forms that were mailed in. (our bylaws state secret ballots if that makes any difference.)
Also wondering, our bylaws say we can suspend the voting rights of any member who is delinquent in paying their dues. So, if voting rights are suspended and there is a vote of any kind does that then reduce the number of votes needed to pass amendments or vote on board members?
Thanks again for all your help as I try to keep things right with the law and our members,
Sheryl
Sheryl,
I’m assuming that you are speaking from the perspective of the association board. Yes, your Google forms would satisfy the statute’s other forms of delivery aspect. The only issue would be addressing the bylaw requirement for secret ballots. To do that, the name of the individual voting cannot be displayed on the actual ballot. You would also have to protect the voter’s identity from anyone in the association other than the individual opening the ballot envelope or e-mail and keep the email and attachment separate. The law does not prescribe how you would do this other than with a mailed-in ballot where the name and signature are on the envelope and not the ballot itself. Just work out the logistics of how you would protect the identity of the voter with whatever process you use. The law does not mandate secret ballots; only your bylaws do.
Dennis