This is off topic about antennas and HOA's, but some TT members might
find it interesting anyway. It was printed in Saturday's Dallas Morning
News.
Tom, WW5L
http://www.dallasnews.com/latestnews/stories/092003dnccohoadues_hp.128163e8.html
Some homeowner groups hit by steep rise
in dues
Inaccurate estimates by exiting developers called
growing problem
09:14 PM CDT on Friday, September 19, 2003
By PAULA LAVIGNE / The Dallas Morning News
Ken Nelson sought to become the first elected president
of his Plano homeowners
association, believing that his experience as a small
businessman could help him
scour the budget and lower the $420 annual dues he and
256 others were paying.
But Mr. Nelson soon discovered that his Wolf Creek
Estates Homeowners
Association was several hundred dollars in the hole and
had no money set aside
for big repairs and projects, such as dredging a series
of lakes.
Instead of lowering dues, he and his board had to
persuade homeowners to raise
dues to $800, said Mr. Nelson, who is now president of
Texas Neighborhoods
Together, a statewide organization that represents
neighborhood groups such as
homeowners associations. Today, the dues stand at $835.
Mr. Nelson faced the problem four years ago, when the
developer turned the
association over to residents, as is customary when
most homes in a
neighborhood have been sold. In his position with Texas
Neighborhoods, Mr.
Nelson terms the problem "widespread" ? and he expects
it to grow.
Homeowners, developers and property managers agree that
most developers set
residents' dues based on a realistic budget for present
and future amenities.
Those who don't ? the exact number experts don't know,
but they say it's far
more than a renegade few ? have set up their
homeowners, and their
neighborhoods, for an uncertain future.
The issue has caught the attention of state
legislators, who say they're considering
ways to make sure homeowners aren't caught off guard
when it comes time for
them to begin paying to keep the community pools clean,
the lawns mowed and
the hedges trimmed.
"What can occur is a situation where a developer
refuses to have any
pre-transition activity and won't let the homeowners
become involved," said Fred
Shapiro, owner of Dallas-based SBB Management, which
manages associations
for homeowners and developers. "Next thing the
homeowners know, they're being
nominated, or they volunteer, and they have no idea of
how a homeowners
association works."
Growing trend
Homeowners associations have been growing in popularity
across the nation, yet
their concept remains new to some homebuyers.
Developers generally form and
govern an association when they plan a new community ?
and some cities, such
as Allen, even require them for new subdivisions.
In some communities, associations are responsible for
minor features, such as an
entryway, fountain or shared grassy area. Elsewhere,
associations maintain pools,
equestrian centers, golf courses and other full-time
facilities.
When developers get close to finishing a development,
usually when two-thirds of
the lots have been sold, they turn the association over
to a board of elected
residents. The residents' board is then responsible for
all amenities and
maintenance, and for setting dues.
$35,000 debt
A debt of almost $35,000 surprised residents in a
Parker neighborhood when they
took over their association last year, said president
Jeff Harrison. Mr. Harrison
said he knew that dues had been falling short, but he
was stunned to find such a
large difference.
Dues totaled $70,000, but the association's expenses
exceeded $100,000, he said.
"We were running out of money," Mr. Harrison said. "We
were fixing to have to
quit watering and quit paying the mowing company."
Homeowners approved an extra $182 one-time assessment,
and the association
cut back where possible, he said. Homeowners blamed the
developer, Prosper
Land Co., which bought the subdivision in its early
stages from another developer.
David Garrett, senior manager of Premier Communities,
managed the subdivision
for Prosper. The initial developer had set the dues too
low, he said, and Prosper
was spending thousands of dollars to make up the
difference. Mr. Garrett said he
warned residents that once the developer left, they
would likely have to raise their
dues.
Problem not uncommon
Jim Wilck, former president of the Plano Homeowners
Council, said that of the
roughly 150 mandatory dues-paying associations he has
worked with, he has
heard of this type of problem 10 to 20 percent of the
time.
Most developers do a good job, and some will even leave
money behind, he said.
He said in his subdivision, the developer left
residents with more than $20,000 in
reserve.
Mr. Shapiro advises developers to set their dues based
on how much it will cost to
maintain and improve the amenities and common areas and
keep the association
running. And residents should be part of the homeowners
association from the
beginning, he said. Letting residents see the bills and
contracts and make
suggestions will smooth the transition, he said.
Turning a neighborhood over to residents who don't know
anything about their
homeowners association can be damaging to the
developer, said Douglas
Gilliland, president of Triwest Group, a development
company in North Richland
Hills.
As a developer, Mr. Gilliland said he wants his
neighborhoods to stay in good
shape.
"But if I don't have a tool to make sure my homeowners
buy into that philosophy,
then they will cause my investment to deteriorate," he
said.
Unregulated process
The creation and transition of homeowners associations
is a largely unregulated
process in Texas. People who buy homes in a community
with a mandatory
homeowners association are required to abide by the
rules and restrictions
drafted by the developer, but there are no state or
local laws that detail what
needs to be in those documents or what homeowners are
entitled to from the
developer.
Six states ? Alaska, Connecticut, Minnesota, Nevada,
Vermont and West Virginia ?
have adopted the Uniform Common Interest Ownership Act,
designed to clarify
the relationship between the developer and homeowners
and make it easy for
developers to involve owners in governing associations.
State Sen. John Carona, R-Dallas, said he plans to
introduce legislation in the next
session that would require more financial disclosure,
specifically that annual
budgets be posted 10 days before any meeting. He also
wants to require that
associations meet at least once a year.
Homeowner association leaders say they're exploring
whether cities can demand
certain provisions of developers in order to get the
city to approve their plans.
Plano, for example, requires developers who are
designing neighborhoods with
private streets to put money into a reserve account for
future street maintenance.
Mr. Carona, who owns a large, national management
company, said some states
require that developers set aside a reserve account for
maintenance of the entire
subdivision. Texas doesn't need that now, he said, "but
as we see the continued
growth and expansion of size and complexity of
amenities, then I think that day
may come."
E-mail plavigne@dallasnews.com
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