Q: I live in a Reno community with a homeowners association. I would like some clarification on how owners should receive notices from the management company. Are some notices supposed to be sent by post instead of email? Our new management company has indicated that all notices are sent by email, but in the past some owners did not receive important notices. Example: notice of vacancies on the board of directors; ballots and candidate information; proposals to add an off-leash dog park (for) $50,000; a youth sports field for $250,000; and a storage park for recreational vehicles, motorhomes and boats in the amount of $75,000. These additions were going to be added under the power lines where the builder left open as mandated by the city plans and NV Energy.
My second concern: The owners received notice on December 20 from a new management company. It was a big surprise. I had already sent my January contributions to our previous management company. The mention of the creation of a new management company was never mentioned during our HOA meetings or on any discussion agenda. No bids were opened or RFPs discussed at any of our meetings. I am only aware that our former management company received a verbal complaint at a board meeting from a landlord, who is on the landscape committee regarding the lack of return of her calls.
This owner’s husband recently secured a position on the board and our current management company is terminated. Is it ethical under Nevada’s revised statutes not to include the 200 homeowners in this process when it’s not an emergency? All my correspondence with the previous management company was promptly acknowledged.
The third concern: Our current landscaping company was replaced without any offers being opened at an HOA board meeting, or an RFP being discussed. Again, the same owner who complained about the management company complained about the landscaping company. Is it normal for an owner, just because her husband is a board member, to dictate these changes without input from the other 200 residences? I understand that all offers and changes must be opened and discussed at board meetings. As owners, we don’t know the monthly fees or what their job entails. Is there an NRS statue that I can refer to when addressing this issue since it was not a last minute emergency?
Fourth concern: On November 23, our HOA received an email stating that our last HOA meeting for the year, a scheduled board meeting, was canceled on December 6 and that a ratification of the budget was scheduled for 13 December. At our previous board meeting on October 18, there was no mention of a $15 dues increase or a budget ratification meeting instead of our scheduled board meeting on December 6. Is there any NRS statue I can refer to that says how much notice a landlord is supposed to have and if landlords have the right to discuss these changes?
Finally, this year, owners had the option of attending in person or using the virtual meeting link for all board meetings. At the budget ratification meeting, one council member attended in person, two council members called, and two did not call or attend in person. Several owners wanted to call instead of attend because it was raining heavily that evening, but were told they could only attend in person. I was the only owner to attend in person along with the sole board member and management company. There was no discussion of why our dues were going to be increased by $15 per month, neither at our previous meetings nor at the ratification meeting. Is it considered ethical that only board members can attend a meeting virtually and they don’t have to attend in person, but owners must attend in person? Should there have been a discussion about why our dues increased? Please refer me to an NRS statue. Is it ethical to have notice of a HOA meeting date change and owner dues increase given only 13 days in advance?
A: I will answer each of your questions in order.
■ First, prior to the passage of Senate Bill 186, certain actions required notification by mail. For example, the election and/or removal of a director must be sent by post. As for budgets, the law stipulates that the association must distribute a copy of the budget to each owner. It is not specified that the budget must be mailed to each owner. The violation process requires notification by mail. If an association adopts a policy imposing fines, it must be sent to owners by mail. Prior to the passage of SB 186, under NRS 116.31068(1c), the association could send notices electronically if the owner gave the association an email address.
In 2021, the legislature passed SB 186, which would require associations to send notices both electronically and by mail, amending NRS 116.31068. Now, the new law states that unless a unit owner opts out of receiving electronic communications or has not designated an email address, the association must deliver any notice required to be given by the association and any other communication to the owner by mail and e-mail. The law also permits communication by personal delivery to the Owner or any other method reasonably calculated to provide notice to the Owner.
This section of the law has raised many questions to the point where the Nevada Division of Real Estate has put the section requiring both mail and email on hold so that the division can issue clarification. For example, digital communication may be the best way to let homeowners know that the water will be shut off today from 9 a.m. to noon due to an emergency. Technically, a letter and an email must be sent to the owners. By the time a homeowner receives the mail, the issue will likely be resolved. Once the division provides guidelines, there will be an article in my column.
■ As for your second question, the dismissal and/or selection of a management company should have been on the agenda of a board of directors. According to NRS 116.31086, the association must, where reasonably possible, solicit three bids if the project is expected to cost 3% or more for associations consisting of less than 1,000 units or 1% for associations of 1,000 units or more. Tenders must be opened and read aloud at the board meeting. An association project includes, but is not limited to, a project that involves the maintenance, repair, replacement, restoration of any part of the common elements or that involves the selection of professional services.
■ Regarding the third question, the tendering process is defined by law. The revocation or selection of a seller falls within the jurisdiction of the Régie. The owners can express their opinions, but ultimately it is a decision of the council.
■ With respect to the fourth question, under NRS 116.31151(3), within 60 days of adopting any proposed budget, the board must provide a summary of the budget to each owner and set a date for a meeting of owners to review ratification at least 14 days or more than 30 days after submission of abstracts. Unless at that meeting, a majority of all owners or any greater voting specification in the statement, rejects the proposed budget, the proposed budget is ratified whether or not there is a quorum. You can certainly discuss the changes, but as you can see there are requirements to reject the budget.
■ Finally, according to NRS 116.31151 (3), if the date of the meeting had to be changed, the convocation should have been made 14 days in advance.
You might want to consider running for the board. Many of your concerns are legitimate regarding landlord communications.
Barbara Holland is an author and property management educator. Questions can be sent to [email protected]