Condo Association Management Blog

What is reason for closure of the pool and equipment room? Was this decision subject to vote by ciouncil of unit owners? Those questions aside=yes the noard can establisj and fund a reserve.In fact in most states the law requiores that such a find be formed.

Why has the access to the pool and equipment room been denined? Is it closed to everyone in your association? And your association should have had a 'reserve fee' already in place. How much money does the condo board need to collect and what future projects? Have you been attending the meetings?

IMO, the biggest mistake that many boards make is to fail to communicate with the members. The BOD should let the members know the reasons for these changes. 
 
In a nutshell, yes, the board most likely has the authority to close down the amenities and to also determine what the association fees will be, in this case, that they will remain the same. Too many condo assn's do not have adequate reserves to meet the maint, repair and/or replacement of fixed assets. Even though the pool and equipment room will be closed there are still consideral reserve expenses, namely the maint of the exterior of all buildings, including roofs and the private streets. Your board is to be commended for wanting to adequately fund the reserves; which is a much better plan than to ask for special assessments each time a maint project is required to be undertaken. 
 
Don't be afraid to ask the board the reasons for shutting down these amenities. A look at the financial statements should shed light on the reasons for maintaining the existing assessment fee.

Ask for the financials and go over them with a fine-toothed comb. They will probably say it's inflation. Inflation may play a part but it's not the whole story. Surely there are other owners who are miffed at this turn of events. Protest at every opportunity. Ask them to lay out the reasons, with figures. Owners can demand either a return of devices or a reduction in fees. You may need a lawyer eventually, but start the protest first. Male yourselves heard, loudly and often.

Apparent facts: 1) condo has financial challenge; 2) amenities are assets that are part of the condo facilities; 3) reserves may be underfunded; 4) board trying to maintain current rate of assessments.  
 
Board is faced with financial challenge - there is a fiducial requirement to set aside sufficient funds for future maintenance and replacement (reserves).  
 
There is a need to have complete open communication by the board to members regarding the financial challenges facing the condo. It is possible that the reserves have been spent down and not refunded; that the reserve account was never adequately funded; that there are member delinquencies affecting the condo; that the closing of these amenities are only for a specific time frame to balance the budget. Many items not included in the summary of this issue.  
 
This was discussed in a similar inquiry recently regarding a MD condo where owners had expressly expected the board to NOT RAISE assessments. The cost of running and maintaining a condo facility is expensive and escalates over the years. Budgets developed to initially sell a project are often (usually) inadequate over time. Buyers have little to no idea what is realistic.  
 
There also is another problem - there is an expectation by buyers and their lenders regarding amenities which affect the value of property. There also will be a larger problem when a pool is not maintained (due to closing by a board without knowing what must be done to maintain the unused pool). There also has been court rulings that the amenities offered must be available.  
 
The owners collectively need to have clarity on the current financial situation and the options available to maintain the condo. If it involves a temporary shut-down of amenities, the equipment must be maintained in working order; if it is a raise in assessments, the members need to consider this. The board needs to communicate!  
 
Organize - get the information necessary and volunteer to assist in developing a plan for the next year and for the next five years. Attend educational seminars especially those put on by Community Associations Institute to learn more about condo management - not just professional management but more management of the physical facility.  

To understand what and why your Association charges a high or low Condo Assessment you need to refer tothe operating budget and possibly look at financial statements. Although your question is somewhat open ended, there could be many reasons. Condo Associations as far as I know are "Not For Profit" so they should charge as necessary to operate the Association and maintain the Common Elements.

Just a quick note about pool amenities. Our 130 unit south Seattle community shares the cost of a pool and spa (amoung other things). These two expenses put a major drain on our annual budget. Besides the regular cost of maintaining, filling, and providing chemicals, the biggest cost is the results of the annual inspections done by the city. Once in a great while we will get an honest and fair inspector but more often we get agresive inspectors that search hard for items that don't meet the new codes they are constantly passing. We comply every year and implement the new upgrades but find that the next year we are once again woefully below standards in new and different areas. We (the board) have given in to the notion that we must budget at least $10,000/year just for the city inspector projects. Closing down a pool for a year or so can save a weak reserve quite a bit of money. I'll bet that is your board's thinking as well. Find out and maybe you will agree that this is actually helping your monthly dues from sky-rocketing.

Pick up phone and call or go visit your mortgage lender. Tell them that the amenities are not being "maintained and preserved" in accordance with Federal Housing Administration regulations. Cite Letter to Mortgagees 2009-46b (the lenders). The Letter requires that there be "sufficient reserves to maintain and perserve all amenties unique to the project." Note that even if you don't have an FHA insured mortgage your neighbor or your buyer might have. Bring copies the HOA budget, meeting minutes and any other financials you can get. (Typically state law allows homeowners to request/demand copies or access to files where you can make copies of these items.) 
 
 
 
Your association fees should be enough to maintain the property, provide for the regular maintenance, repair and eventual replacement of those items which will deteriorate over time. Do not assume you have to live with unnecessarily high fees or a broken down property. These things might signal a serious problem of funds being "misdirected." (Hint, hint.)  
 
 
 
If your condo board is like most, they don't welcome people asking tough questions. Organize. The more homeowners you can get involved and asking questions, the better.  
 
 
 
Finally, know your other legal rights, too. There are Fair Housing and Civil Rights protections you can use to prevent the board from harassing, threatening, intimidating or interfering with you as you exercise the "enjoyment of your dwelling."  
 
 
 
We're dealing with the same problem here in NM, so I feel for you. GET UP! STAND UP! FOR YOUR RIGHTS!