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Illegal behavior?

Jan 22 2019
I understand that a board member can be removed for illegal behavior concerning the HOA. 1. Is performing repair work requiring a permit and not obtaining one Illegal? 2 Is hiring for work done exceeding...
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Homeowner

Nov 30 2018
Have yet another question and this has to do with surplus funds from your HOA budget. Dennis and I have been discussing it. I’ve discussed it with my Association’s CPA and I guess now the...
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Homeowner

Nov 30 2018
Need some information on how your HOA conducts your Board elections with absentee ballot and in-person voting. It’s actually been years since my community has run their elections in accordance with ARS 33-1812. Shocking. Yes...
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  • From Tracy Swaim on CPA firms that are recommended for HOA

    In regards to searching, I have had some luck using google with the following term:

    site:hoatruth.com

    and your topic. “site:” tells google to only search that domain. So, a search that looks like this

    site:hoatruth.com cpa

    will look for all occurrences of “cpa” on the hoatruth.com website. May not be perfect, but it helps!

    Tracy

    Go to comment
    2023/03/27 at 9:49 am

  • From Fred on Annual Meeting

    Thanks Dennis.

    The excuse in the past has been the cost of re-doing the meeting and sending out ballots again.

    In my example of being 30 short, can it just be canvassed to get the remaining 30 or does the whole process have to start over?

    What time frame is involved if any?

    Thanks

    Go to comment
    2023/03/26 at 11:17 am

    • From Dennis Legere on Annual Meeting

      Fred,
      Absolutely nothing has to be redone. If a meeting cannot be held because it did not achieve quorum than the meeting never occurred. Robert’s rules would establish that the meeting be reconvened at another time within 15 days. Any absentee ballots would still be valid and any members that had not submitted a ballot earlier could send one in for the reconvened meeting. Those voting in person could also be increased to satisfy quorum for the second meeting. Some communities have a scaling quorum that is reduced in half every time a quorum is not meet. The association waits 15 minutes and sees if the meeting can now be convened if not it is reduced in half again and finally held. The other issue is that the quorum requirement can be changed by the board to be more achievable for the community, as long as the quorum is specified in the bylaws and not the cc&r’s. 10% for large communities’ or 20-25% for smaller to mid-size communities. The issue is if the board really wants to hold the meeting required by law, they will do everything in their power to turn out the vote the first time to reduce the cost of room reservation and mailings. Failing to meet quorum is a board issue not a membership issue. An annual meeting of the members is not and has never been optional. The election of board members must be conducted every year and once boards finally acknowledge that fact, they will work to make that happen.

      Dennis

      Go to comment
      2023/03/26 at 1:57 pm

  • From Dennis Legere on CPA firms that are recommended for HOA

    DPK
    I don’t deal directly with any CPA firms so I cannot recommend any. I’ve been having my web developer work on a keyword search feature for the site for exactly the reason you stated for some time now but have not yet been able to launch that feature. All I can say is that it is coming soon.
    There is no easy way to answer your question on cost because of the variables involved. So much will depend on the vendor chosen and the complexity of your common property and long range plans.

    Dennis

    Go to comment
    2023/03/26 at 11:01 am

    • From Todd Stevens on CPA firms that are recommended for HOA

      FWIW:

      I had worked with Dan Martin at Barry & Moore CPA to engage a look into our HOA’s finances in 2019. The firm seemed knowledgeable and willing to help determine if finances are being handled properly.

      Unfortunately it was never completed for murky reasons.

      At the time they offered a compilation plus type service, which comprise the balance sheet
      and the related statements of revenues, expenses, and changes in fund balance, and cash flows for the year. They quoted $1500-$3000 for this service and $250 for the years taxes.

      HTH

      https://hoa.tascs.net

      Go to comment
      2023/03/27 at 10:29 am

      • From Dennis Legere on CPA firms that are recommended for HOA

        I approved this comment to be posted only because it consisted of information that was 4 years old. Cost of services are somewhat proprietary and should not be published on a web site like this. The dated nature of the content I believe to be or no real value to anyone. I will say that a compilation is the simplest form of financial review available to an association and consist of simply an affirmation of the financial reports provided by the community manager or association treasurer. There is absolute no Indepth analysis or affirmation and the quoted price from that relative time period is outrageous for such a service.
        Dennis

        Go to comment
        2023/03/27 at 6:03 pm

        • From Todd Stevens on CPA firms that are recommended for HOA

          I understand, I was using the range from then as a general idea.

          It seems my posting is causing more issues than assistance.

          It is good to see people interested in their community finances.

          Please remove my account and posts.

          Thank you and take care.

          Go to comment
          2023/03/28 at 6:46 pm

  • From Ann Stone on Liquor license

    Thank you for your swift response and the contact information.

    Go to comment
    2023/03/24 at 5:56 pm

  • From Priscilla Tramontana on ARS 33-1813

    Sorry, Dennis…It has been brought to my attention that our Bylaws (I only checked our CC&Rs) do state that the election of Board Members shall be by secret written ballot! Does that change anything?

    Thank you!

    Go to comment
    2023/03/24 at 5:25 pm

    • From Dennis Legere on ARS 33-1813

      Your bylaws dictate this election process. If you are required to have secret ballots to elect board members than you are also required to have secret ballots to recall board members. See ARS 33-1812 for all elections. Your association violated their own governing documents in the application of the votes for the meeting of the members to recall the board, and could be held accountable for that failure in court or by petition to the ADRE dispute resolution process.
      Dennis

      Go to comment
      2023/03/24 at 5:59 pm

  • From Priscilla Tramontana on ARS 33-1813

    Thank you….so helpful!

    Go to comment
    2023/03/24 at 4:05 pm

  • From Priscilla Tramontana on ARS 33-1813

    Thank you, Dennis! I should have mentioned that although our documents do not specify secret ballots when electing board members, it is always done that way. Does that not set a precedent for future voting expectations?

    Go to comment
    2023/03/24 at 3:51 pm

    • From Dennis Legere on ARS 33-1813

      Clearly if you had secret ballots there is no way for the association to know legally how anyone voted never mind posting that information on the web site. All the more reason why this was an intentional act totally in the hands of the board to address. Why was this ballot measure done without secret ballots?

      Dennis

      Go to comment
      2023/03/24 at 3:55 pm

  • From Dennis Legere on Liquor license

    Ann

    There is nothing in the planned community or condominium statute relative to this issue. This would most likely be based on statute and regulation established by the Department of liquor licenses and control. You could forward your question to the department public information officer Thomas Mangan 602-542-9046. Thomas.mangan@azliquor.gov, I know absolutely nothing about liquor licenses.

    Dennis

    Go to comment
    2023/03/24 at 3:46 pm

  • From Dennis Legere on ARS 33-1813

    Priscilla,
    The board president is absolutely incorrect in his interpretation of the law, and you are. Nothing in the law allows an association to publish the voting results and how everyone voted. What the law says is that the ballots and all associated documents must be made available for inspection upon request for one year by any homeowner. The real issue here though is the concept of secret ballots. The association controls that because the statute addresses that issue differently, so the board president had no valid argument stating that the law was invasive and provides no privacy, the board can change their governing documents to require secret ballots at any time. Because they chose not to is not the laws fault. With a secret ballot the ballot must not identify the person voting so in viewing ballots no-one can ever determine how anyone voted but can see who voted. The association is free to establish balloting by secret or non-secret ballots. If you do not use secret balloting both the association board, management company and homeowners can see how you voted and use that information against you. There are many communities that have done so and resulted in people refusing to vote for anything because of that intimidation and retaliation factor.
    To post that information on a web site for everyone to see was nothing but an intimidation factor used by the association to silence members complaining about the vote. If I were you, I would ask to view the voting results to make sure that the vote tallies were in fact accurate. I personally hat non-secret balloting and will try to introduce legislation that requires association to only use secret balloting.

    While you could argue that the association violated the privacy rights of all homeowners by posting the results the way they did in court it is not a clear-cut case and no specific law was violated with that posting.

    Dennis

    Go to comment
    2023/03/24 at 3:38 pm

  • From Dennis Legere on Inflation factor and annual contribution increase in the reserve analysis

    DPK,
    Inflation assumption are vital to any reserve analysis. To ignore that would be hiding your head in the sand. You can get a detailed cost estimate today for any project but if you only need to do that work in 5 years the cost in five years will be higher than it is today and if not addressed in your analysis you will end up in a shortage of funds to do the work. The annual contribution increase is simply a ploy used to raise more money by most reserve companies. You can address your funding needs in many ways including fixed contribution to the reserves every year. These are choices that can be made, but the cost of future products or services will always increase. We have never experienced negative inflation in our economy.

    Dennis

    Go to comment
    2023/03/24 at 3:10 pm

    • From DPK Kraul on Inflation factor and annual contribution increase in the reserve analysis

      Thank you for your reply. I thought the annual contribution increase might be unwarranted and unnescessary.

      Go to comment
      2023/03/24 at 6:21 pm

    • From DPK Kraul on Inflation factor and annual contribution increase in the reserve analysis

      Thank you for your reply. Yes, I completely understand the need for the inflation parameter. I didn’t understand the need toalso include a “planned contribution increase” parameter. Why would you want to plan to increase your required contribution after you had already included an inflation factor? It just seemed like you were padding an assessement and not acting with the fiscal responsibity required to be an elected member of the HOA. Thank you for noting that it’s a ploy to raise more money. That was my hunch.

      Go to comment
      2023/03/24 at 6:19 pm

      • From Dennis Legere on Inflation factor and annual contribution increase in the reserve analysis

        DPK,
        The issue is how do you raise the money that you need for the end projects. You can raise the money with an annual contribution model that is consistent but considerably greater than your current contribution level or you can raise the money by a contribution level that is increased over time to limit the pain. There are two different aspects of a reserve plan one deals with the nature and cost of future projects and the other deals with how you get the money for the first part. To get accurate projections for future cost you need an inflation factor, to get the money you need for a future project you can go at it with a fixed contribution rate, or an annual contribution rate that varies every year or any combination of the two extremes. If you apply discipline to the process there is nothing wrong with annual increases to the reserve contribution, as long as the target is to have the money you need when you need it. That is simply responsible planning. The issue is has the association used appropriate compounding calculations or di they take the easy way out and simply applied a compounding factor that is totally unassociated with the desired end point for money raised. If after accounting for an inflation factor you have a project that will cost $1,000,000 in 10 years you can calculate an annual contribution increase factor that results in the total contributions raised in 10 years to be $1,000,000 and that would be perfectly acceptable. But if you applied an annual contribution increase factor that was not calculated out you could end up with $1.5 million and that is exactly what you are concerned about. So the real question is has the association done the math correctly in calculating the annual contribution increase factor. This is where a spreadsheet helps to demonstrate the overall plan. You can look out 40 or more years and include all expected projects in that time frame and the expenditures for that time frame and confirm that you have enough money when you need it for each project. If you don’t you have to adjust your annual contributions to meet the demand or eliminate or alter the projected project cost. it is not an exact science but rather a balancing act. that has to be reviewed every 3-5 years to check and adjust.
        Dennis

        Go to comment
        2023/03/25 at 5:44 am
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