Tonight was the HOA's annual meeting. We had about 11 residents attend as well as Mr. Lee Mason from CAM. Mr. Mason's assistant, Rhonda Fleming, was unable to attend due to a death in the family.
Mr. Mason provided us with a 2015 budget that raised some questions and discussion (see below) and we re-elected the current board for another year.
It was a short meeting and I was disappointed that there was not more engagement from homeowners. However, it was nice to be able to share the positive things that have occurred this year and to begin strategizing on what the next few years may look like for us.
CAM 2015 Budget:
This budget provoked some questions and discussion regarding the HOA's ability to sustain a partnership with CAM without operating "from paycheck to paycheck" in the outgoing years. There was some discussion on what services are provided by CAM.
Among the services provided by CAM are yearly assessment letters, meeting notifications, accounting, violation reporting and enforcement, contractor negotiation, and collections actions.
It was determined that we should continue this full partnership with CAM for the next year and reconsider a reduced level of service/ payment for outgoing years at our next annual meeting.
Part of the discussion tonight also revolved around the current monetary situation. Mr. Mason and the Board had expected Rhonda to bring the update on current finances. With her unexpected death in the family we were not able to produce the most timely financial information. We expect to be able to share the January and February financials soon. In the meantime, I agreed to summarize the last set of financials that the Board received here on the blog. The information below is based on December data. For the full set of original documentation, just contact me.
WHAT'S UP WITH THE MONEY?
As of last years annual meeting on 3-26, the HOA had $5705.00 in checking and $595.00 in savings.
As of the end of December 2014, the HOA had $4235.00 in checking and $1705.00 in savings.
That means that the cash on hand now is $360 less than we had on hand last year. That is not a substantial difference and looked at alone might indicate that things remained pretty status quo. However, we must look more deeply to see the full picture.
One of the most important details about the past year with CAM has been their ability to collect on past due fees. We began the year with 21 homes in some form of arrears for a total of $13,708.00 recoverable. We lost $2036.00 in unrecoverable fees due to foreclosure. Nothing we can do about that. CAM did recover $2640.00 for us. That leaves us with 18 homes still owing and $9032.00 still waiting to be recovered with the caveat that we will probably lose another $453 as "unrecoverable" due to a pending bankruptcy on 1 home. Of those 17 remaining homes, here is the breakdown:
- 3 have set up on a monthly payment.
- 8 have been sent a demand letter.
- 2 have a claim of lien
- 1 has a statement of lien
- 3 have not been addressed yet
Remember, all of that info was based on December data. It is important to note that several things must have occurred "collections-wise" in January and I simply do not have that report on those yet. I say that because Lee informed us that we only have around $6800.00 left in past due amounts to still be collected at present. That would mean that we collected (or lost to unrecoverable) over $2000.00 in January. I can attest to the HOA collecting almost $700.00 based on a sale I am aware of. I will post that updated data as soon as I receive it.
So, how does that relate to the big picture? It CAM has helped us collect ~$2600.00 between hiring them in March and the end of December...why don't we see that money in our totals? Shouldn't our total cash on hand for this end of year be around $2600.00 more than last year? Those are good questions. Since we don't see that occurring we have to ask: "where did that $2600.00 go?"
Potholes and fences. That is the answer. We had to address two big maintenance issues this year on the Highway 3 side of the HOA. The Highway 3 entrances were falling apart and unkept. We contracted a company to make repairs and to bring the entrances up to standard. We also had to repair a major pothole that had formed on the back access roads behind the house along Highway 3. Those repairs cost us right at the amount that CAM was able to recover from past due homes.
Circling back to the big picture, there should be serious thought given to how we will address future repairs that cost an excessive amount of money (more than budgeted). In fact, we have been alerted to another pothole on the access roads behind our Highway 3 homes. It will have to be addressed and may cost $1500 to $3000 to repair. The only place to get those funds is our cash on hand and, you can see, that would be a significant hit to our "rainy day funds."
We could always amend the covenants to try and raise the dues but that would be difficult and wildly unpopular. I think that the best answer here is that we need to ensure that all 67 homes pay annual dues this year and we need to ask CAM to make sure that they are doing everything possible to recover the remaining past due balance. Beyond that, we will need to look at the options for reduced services from CAM for future years. That was the general consensus of the residents in attendance at the end of the night.
Again, if you are interested in seeing the original documents, or you have questions...do not hesitate to let me know.
Thanks,
Jason
