4 Oct 2007
Trabue Woods Homeowners Association
Executive Session Board of Trustee & Officer Meeting
Date: Thursday, October 4th, 2007
Location: Debbie Gordon’s Home
Start Time: 6:40 p.m.-9:59 p.m. The meeting ended at 10:00 p.m. The attorney left at 8:30 p.m.
Attendance: Beth Lintz, Board Member & President; Debbie Gordon, Board Member; Elizabeth Ehret, Board Member; Mike Schlegler, Vice President; and Pam Johnson, Secretary; William L Loveland, Loveland & Brosius, LLC
Meeting opened with introductions of the Board and Officers and William Loveland who provided information regarding his practice and law firm. He was the attorney who turned over the subdivision from Dominion to Sterling. There was discussion regarding specific issues in Trabue Woods Subdivision such as enforcement of deed restriction, homeowners who fail to pay yearly dues, property management possibilities and Attorney Loveland’s fee structure.
The Board & Officers are finalizing the policy and procedures for dues collections and deed enforcements. We will discuss the specifics with Attorney Loveland to begin the process of collecting all outstanding 2007 dues and beginning the process of deed enforcement which will be more time consuming and costly. Attorney Loveland charges $185.00 per hour (bases on 1/10 hour) and will bill monthly. He does not charge a retainer.
By unanimous vote, Attorney Loveland is the Trabuewoods HOA, Inc. attorney.
Reserve B (Vacant Lot): The Board & Officers provided information to Attorney Loveland on Reserve B which is the vacant lot owned by the HOA. The HOA must pays property taxes and insurance and mow this piece of land. It can not be turned into a park or built upon due to its ‘Reserve’ status. Per Attorney Loveland the Board has the power to decide what to do with the Vacant Lot. The Board & Officers feel that this is a topic that we want put to a vote at the Annual Meeting in March. The options are to sell or give away the land or keep the land. Per attorney’s suggestion it is in our best interest to sell or give to the homeowner adjacent to the property who has expressed interest in the property for years.
Dues Collection and Deed Restrictions: The Board & Officers agreed to the following tentative process (to be put into a written policy & procedure with more specific language by next Board & Officer Meeting) with regard to enforcing Dues Collection and Deed Restrictions. The HOA will draft up to three letters to attempt to resolve the issue before being turned over to the attorney for collection. The first letter should notify homeowner of late dues fee/deed violation and provide 30-days to pay or rectify. The second letter should contain notification of late fee and finance charge (12%annum for dues). A third letter will either be from the HOA with additional late fee and finance charges or it will be from the Attorney with notification that the lien process will be initiated in 30-days. The Board & Officers agreed that the first order of business with regard to deed restrictions should be those issues related to safety.
The cost of the lien procedure (which all homeowners pay through their dues) is as follows: First and second letters cost the HOA in ink, paper, postage, envelope and volunteer time. The third letter (demand letter from the attorney) will cost $50.00. Should the balance remain unpaid or the violation not be corrected then the lien process would be initiated. This would cost $160. The homeowner will be assessed all fees and charges associated with collection of dues.
With regard to those properties that are in bankruptcy or foreclosure it is generally not worth going after the monies. The HOA would be the last to get paid in these circumstances and would cost the HOA more money in attorney and filing fees than it would generally recoup. Each will be assessed on a case by case basis by the Board and Officers.
Budget: Beth indicated that the current charges of $53.00 per year (with approximately 65% of the homeowners paying) are not enough to run this HOA. Per the bylaws, the rate can only be raised 5% per year, unless 67% vote to increase rates. That would be $55.65 for next year’s dues. Even with that we can not afford to pay the bills (taxes, electric, water, insurance, etc), landscaping, send out correspondence (paper, envelopes, stamps), pay an accountant and attorney. It will cost more once we start placing liens on homes for unpaid dues and uncorrected deed restriction violations.
The attorney suggested fund raisers to supplement the dues income to cover costs. The Board & Officers have previously discussed this. However, this is only a temporary fix and would not be a long term solution. Additionally, these types of activities require time and with the limited number of volunteers this is not feasible unless we have more volunteers.
By-Laws & Deed Restrictions: Beth informed Attorney Loveland that the previous board initiated changing the bylaws and the current Board and Officers followed through and there were not enough votes to pass. Attorney Loveland stated the bylaws and deed restrictions are written to be very difficult to change. It would cost the HOA in time and money and would likely be unsuccessful if the bylaws were attempted again or deed restrictions were attempted. The Board and Officers are in agreement and no attempt will be made to change the Bylaws or deed restrictions at this time.
Property Management Company: due to the increased interest of homeowners the Board and Officers are researching Property Management Companies. Attorney Loveland indicated they are generally more expensive and may not do more than we are able to do. However, this HOA can not be run efficiently with only a few volunteers. He provided several names to contact regarding these organizations. Elizabeth will conduct research and report back to the Board and Officers at the next meeting. We also will provide the homeowners with information in the monthly newsletter in November/December and on the website. It is also a topic we would like to consider for the Annual Meeting in March.
Account/Bookkeeper: Beth will research a variety of accountants and/or bookkeepers to assist with the financial aspect of the HOA business. She will report back at the next meeting with services and costs.
Business Judgment Rule: There was lengthy discussion regarding prioritizing the tasks of the HOA. Attorney Loveland stated the board is entitled to enforce the ‘Business Judgment Rule’. This simply states that resources must be budgeted. It is not possible for this volunteer Board and Officers to perform all the duties and tasks on the limited budget so we must prioritize.
Doggie Day: A homeowner was interested in an event that dogs and their owners could socialize, possibly using MaranathaChurch property for the event. The church is willing to provide the space with the agreement that the HOA be involved. It was the decision of the Board and Officers that we can not commit to this event at this time. This would require contacting the insurance company to inquire on liability and it would take the volunteer’s time which is limited.
Finances: Beth stated there was a deposit made today in bank account which totaled $1,096.00 which makes our current balance $15,389.50. There are 132 homes that have not paid which leave approximately $6,500 in unpaid dues. We will draft a final letter to those who have not paid which will include language reflecting the addition of the 12% annum fees and late fees. The remaining unpaid balances will be turned over to Attorney Loveland to collect or start the lien process. Beth also stated we received a check from Erie Insurance for $100.00 from an overage.
Landscaping: Beth stated that the first phase of landscaping has been completed. The Board & Officers have voted to have Paul Dobner complete Phase II for the cost of $3800.00. This will consist of edging by hand (required because of the electric, gas and sprinkler system that run under ground) plus over 20 yards of mulch.
HUD Homes/Rentals: A homeowner who purchased a HUD home was under the impression that the deed restrictions did not pertain to her. Attorney Loveland stated that deed restrictions and Bylaws stay with the property. Everyone, regardless of whether they are HUD Homes or Rentals, have to abide by the rules.
Threatening Email: Beth informed Attorney Loveland that a previous officer reported she received a threatening email. The attorney agreed to the Board’s position on Zero tolerance. Any and all threats and harassment will be reported to the authorities.
Statutory Agent: Attorney Loveland will become the statutory agent for the HOA. The statutory agent receives notification regarding legal issues including bankruptcies and foreclosures.
Welcome Wagon: The welcome wagon has been approved with $200.00 for baskets and supplies and the Board and Officers are contacting local businesses to obtain donations.
Action Items:
Reserve B: Beth will contact homeowner adjacent to property to inquire about possibility of purchase of property. Report back to Board & Officers at next meeting.
Accountants/Bookkeepers: Beth will research and report back at next meeting.
Property Management Company: Elizabeth will perform research on a variety of companies for comparison. To be discussed at the next meeting.
Deed Violations (with regard to safety issues): Mike will check on deed violations and report back. We will then have a better idea of how many we are talking about and the cost to pursue compliance.
Spreadsheets: Pam will complete the spreadsheets for sales of homes in the neighborhood and type meeting minutes.
Safety/Blockwatch: Debbie will follow up with Safety Committee Chair, Kevin Cross regarding the steps he has taken to restart the Blockwatch and other safety activities. Debbie will also review and edit letters before they are mailed
| 