Q: Does a homeowners association state law say that people who don’t vote in a referendum are counted as yes? In our age-qualified community, only 10 percent voted on a recent critical issue. Our community has many very old people, who have neither the means nor the motivation to get involved in these votes. This law gives boards of directors unlimited power. This blatant law leads to board corruption. Do you agree?
A: There are no Nevada Revised Statutes 116 regarding this issue. Under NRS 295.00, state initiatives and referendums, if requirements have been imposed, are listed on a ballot which voters can respond to. You must vote to be included in the count. Further, Robert’s Rules state that an abstention is neither a vote for the motion nor a vote against the motion.
Your association should not count a yes for owners who do not vote.
If your association declares that an abstention is automatically considered a yes, ask them to send you a copy of this law. I would like to see that. From my research, you don’t count as a yes for non-voting owners.
Q: My condo association has a seriously underfunded reserve. The council has reached a point where there is a lot of “can we afford this?” conversations at recorded board meetings. Their contract maintenance company said in a recorded board meeting that they stopped doing their scheduled maintenance for several months because the board failed to pay them. The maintenance company was also reluctant to become full staff to continue maintenance due to fear of future unpaid bills and the council’s inability to provide direction on project priorities and timelines. During this recording, (later) I overheard the board members “discussing” which projects were most urgent and which needed priority. Board members argued over sharing maintenance hours on projects, since projects then take years. One board member was angry that there was an identified safety hazard and the other board members did not recognize that this should be the top priority due to legal responsibilities for not fixing a known safety issue ( for more than six months).
Here’s a bit of history:
All building exteriors are HOA common areas, so the financial burden is heavy on the HOA. A few months ago, I overheard a board member mention in a meeting recording that the buildings hadn’t been painted in 18 years! I’m shocked but they look shabby so I shouldn’t be surprised. A few years ago I asked the HOA board when to repaint the buildings and was told it was “too expensive” and wouldn’t be done. I protested because it had to be done, one day. But I was asked, “Do you know how much it costs to paint a single building?” My response was, “It has to be done eventually.”
I asked the board to increase the annual appraisal amount, but they said some homeowners couldn’t afford an increase that would allow the HOA to cover maintenance costs.
I’m tired of worrying about what the council is doing. I just want to put myself in a legal position where the actions of the HOA board don’t put me in a financial position where I end up owing the HOA more than my property is worth and I can’t sell because Mortgage companies won’t finance because of the state of HOA common areas. The council recently said HOA insurance premiums have increased by $10,000 a year because the council has not properly maintained the buildings.
Would placing my condo under an LLC allow me to move away from my property without further financial obligations created by the inability of the HOA board to maintain the common areas? I own my condo. I pay all my taxes, HOA assessments and other related obligations. I feel like they are leading the community into a future of large financial obligations from individual owners to cover delayed maintenance. I don’t quite understand how much the HOA could send us monthly bonds and it scares me. What if valuations go up from around $250 per month to $6,000 per month (absurdly important example to show my potential fear)? At that point, I would no longer be able to pay the monthly expenses and no one would buy my condo.
What should I do and am I worrying too much? Is an LLC the answer to living without the fear of not being able to break even if the HOA floats into the iceberg on the horizon?
A: If you are so concerned about the responsibilities of the association being passed on to the owners, you may want to sell your unit. Regarding an LLC protecting your personal assets beyond your unit, please consult your attorney.
Barbara Holland is an author and property management educator. Questions can be sent to [email protected]