The Covenants need to be updated to be consistent with the requirements of Fair Debt Collection Act and to allow the Association a more economical and effective way to collect delinquent dues using a collection agency.  Currently after several notices, a lien is put on the property in order to obtain payment.  Unfortunately, that does not force the delinquent dues to be paid until the property is sold or refinanced, and in the case of a foreclosure, it may never be paid.  To obtain a more timely payment, the association would have to employ a lawyer which the board does not choose to do because of the expense, and this would not be fair to the 97% of the Association members who have to pay extra to cover for the few who do not pay their dues and assessments.  The current Covenants don't allow for collection of “reasonable expenses" associated with collecting dues.  They only allow the collection of the original dues, plus 7% annual interest.  The ability to collect all reasonable expenses associated with effecting payment would enable the Association to employ a collection agency at no cost.  If the homeowner still refuses to pay, it would also allow the Association to foreclose and recover the costs associated with that legal action.  Also, in a similar situation where a homeowner violates a bylaw or covenant and refuses to correct the situation, the Association has to retain a lawyer to enforce the covenants and bylaws.  Again, the Board does not want to incur that level of expense to enforce the Covenants and Bylaws.  A better solution is for the Association to be able to levy a small fine in order to encourage adherence to the restrictions in the Covenants and Bylaws. 

 

A:  In part, this is because the Covenants need to be kept up to date with requirements in the Fair Debt Collection Act, but also because the only mechanism available to collect delinquent dues from homeowners who choose not to pay is to place a lien on the property, which frequently does not force payment for many years, if at all.  Unless the Association pays for a lawyer to start a legal action, payment may never be received from association members who choose not to pay their dues.  As currently written, the Covenants do not allow the Association to recover those legal expenses from the delinquent homeowner.  They would have to be absorbed by the rest of the Association.  This is not fair to the Association members who faithfully pay their dues every year. 

 

Because our annual dues are fairly low and the number of delinquent homeowners have been few, this hasn't been a big financial burden for the Association.  However, if Amendment 1 and/or Amendment 3 pass, and dues rise accordingly or special assessments for road repairs are levied, the monetary loss to the Association from the failure of some homeowners to pay would likely make a trash collection program or a road repair project unworkable.  We couldn't pay Smith's trash hauling service with money that we don't have.  Nor could we hire contractors to repair the roads without the money on hand to cover their bid.  We have to have an effective method of collection to motivate homeowners to pay these dues and assessments. 

 

A: Currently about $1500.  Some of these liens go back as much as seven years.

 

A: NO!  That would be a violation of the covenants. The homeowner would also have the option to meet with the board to explain the situation and the plan to correct it.  

 

A: They would be modest.  The initial fine would be $25 (and only after there is no response to the first notice), and then $50 fine if that request is ignored.

 

A: The Board does not “patrol” the neighborhood; however it will address issues that homeowners identify.  Typically, a homeowner registers a complaint, and then the board investigates.  If appropriate, the board sends a letter (or email) to the homeowner requesting that the situation be corrected.  Of course, board members are homeowners and neighbors too and can bring up concerns as well.  Few homeowners have ever received a request to correct a violation and probably never will. 

 

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