20% cap
Dennis,
Assuming I am right when I say there is a 20% limit on the amount the Association of a Planned Community can raise Assessment Dues without member approval, my question is this:
If there is a section of that community that is governed like condominiums for exterior maintenance, through a fund filled by those owners only, via a separate Exterior Maintenance Fee, paid monthly just like the Regular Assessment Fee, does that cap of 20% apply to the Exterior Maintenance Fee just the same as it applies to the common Assessment Dues?
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Rhonda,
The common expense assessment can vary between individual lots in a community based on the provisions of the declaration. Common expenses can include the share of all administrative costs and the share of all operating costs of the association. The operating cost typically includes the regular maintenance cost for the common property but can also include the cost to maintain the exterior of the buildings if the declarations provide for that service. The statutory limitation applies to all these common expense assessments. So, in your example, the 20% limit would apply to the prior year’s assessment for both types of homes. This is not a single monetary value. It is a percentage increase over the preceding year’s assessment for each respective group of homes. In the example, you mention if the homes are subject to external maintenance requirements annual assessment were increased based on a one-time project for exterior maintenance The annual assessment would have to be approved by the members affected, excluding the members not affected. This would be the same as a special assessment for the affected homeowners, which may need 67% of the homeowner’s approval. In this case, the annual assessment would require only a majority of those members to approve.
I know this isn’t very clear, but it is the law. Many associations are abusing this provision to allow for the collection of what would normally require a special assessment approval without the approval by spreading the assessment over many years. Which was part of what I was trying to prevent in my HB-2442 this session.
Dennis
Oh, my. This seems like a complex issue and I may need you to dummy that down for me like I am a 3rd grader. I get the % increase and that it is based off of a set dollar amount representing the current assessment. If I can boil it down, I read this to say that the Courthome External Maintenance Fee that affects 405 of 841 owners only, cannot be increased more than the 20% without the vote of owners of those 405 homes. Anything over the 20% would require a majority vote in favor of the increase, based on the 405 members who are owners of that type of home subjected to the CHEM Fee.
How did I do?
Perfect. See you did not need it to be simplified.
Dennis