[profdan_h]

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Hi Angelo,

Currently, Arizona does not require homeowners associations to maintain a reserve fund. However, it is a good idea to do so anyway. Your HOA’s reserves are there to fund any major repairs and replacements in the future. For instance, if you have playground equipment that’s reaching the end of its useful life, your association will be able to pull from the reserves to replace that equipment. This helps maintain the overall character and appeal of your community.

I don’t really see a downside to funding reserves. Perhaps the only superficial downside I can predict others bringing up is that it might affect your assessments. Contributing to the reserve fund means raising assessments a little, and I can see how some homeowners might react to that.

Hope this helps.

[profdan_h]

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Hi hoa_newbie,

It depends on where you live. Some states have allowed virtual meetings to continue, which means boards can conduct business via Zoom and other such platforms. One example is North Carolina. Of course, there are some rules and requirements you must follow. It’s best to check your state laws on this to avoid liability.

[profdan_h]

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Hi maxcme,

Compensation through not having to pay their HOA dues can be a big conflict of interest. Your president and treasurer might not take votes on dues increases and special assessments seriously because these don’t affect them anyway.

It’s a good idea to check your governing documents to see if your association permits this type of setup. If they don’t allow it, talk to your board about changing their ways. Otherwise, they might be breaching their fiduciary duty. You might also want to talk to your HOA manager or HOA attorney (if you have them).

[profdan_h]

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Hi crmdog12,

Since you’re already in litigation, you will need to back up all of your claims with evidence. Any supporting documents will help substantiate your claim. Find a lawyer who has experience dealing with HOA violations. They usually already know what to do. Best of luck to you!

[profdan_h]

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Hi gemini22,

Sounds like you have a real problem there. Fortunately, California law allows you to remove board directors through a vote by secret ballot. If you have less than 50 members, a majority vote is required. If you have 50 or more members, you need to establish a quorum and have a vote by the majority of those represented.

Good luck!

[profdan_h]

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Hi hamstercarrot,

While I agree that running an HOA isn’t free, I don’t think you are getting the point here. Leon said that their treasurer is being paid (i.e. compensated) to do taxes.

What you are describing is reimbursing board members for expenses they paid on behalf of the association. That is called Expense Reimbursement, not Compensation. Compensation is paying board members for services rendered, much like a salary.

Going back to your example, I think the secretary should definitely get reimbursed for the $300 he/she spent on printing and distribution. That is an association expense. But the secretary should definitely NOT get compensated for performing that task since it is just part of their duty as a secretary, at least in Florida.

[profdan_h]

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Hi Leon,

Even if your CCRs don’t say anything about this issue, I believe Florida statutes prohibit it save for a few exceptions. Again, I recommend talking to an attorney.

If the attorney says you can’t do it according to law, then you absolutely MUST inform your BOD. If they refuse to listen, you can initiate mandatory mediation, though that will cost money. It’s completely possible that your BOD will still do whatever they want even after winning the mediation. At this point, you can take them to civil court. You have a high chance of winning since your BOD is going against the law here. Don’t worry about legal fees. Your BOD, not the homeowners, should be ordered to pay those once you win.

A lot of BODs aren’t afraid to bend the rules since they don’t think anyone has the guts to challenge them. But this is a misappropriation of funds and can affect your entire HOA as a whole. Stick to your guns, Leon.

Good luck.

[profdan_h]

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Hi Leon,

Like you, I also live in Florida and an HOA. This is one of those things that always gets to me because you can’t imagine how many BODs ignore the statutes and bylaws and just do whatever they want.

If the state statute says you can’t do something, YOU CAN’T DO IT.

Here are some steps I recommend you take to resolve this problem.

First, find out if the treasurer is actually a volunteer member or if your BOD hired him/her to prepare checks and do your taxes. If he/she is a hired treasurer, then paying him/her a salary is totally fine.

If the treasurer is NOT a hired person and is actually a volunteer, then I don’t think your HOA should be paying him/her. The treasurer might even need to pay your HOA back the money paid to him/her. You can ask an attorney with HOA experience for help sorting this out.

Hope this helps.

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