Home › Forums › Where I Stand › Another HOA Increase???
- This topic has 14 replies, 7 voices, and was last updated 2 weeks, 1 day ago by Nelson Orth.
March 2, 2023 at 8:21 am #7875
Tucked inside the SCA Relay, which is mailed along with the Spirit Magazine, you will find a Resolution announcing another increase in one of the “assessments” owners in this community must live with. The SCA board has opted to hike up the percentage we must pay the HOA when we sell our home, unless the buyer can be convinced to pay it.
There is to be a “one time” account set-up fee of $350.00
A resale certificate/resale package fee of $185.00
Cost to obtain a “statement of demand” $165.00 Total fees $700.00
Plus commission to the selling agent, taxes on any profit, and all the other fees associated with selling, moving, less than asking price in negotiating the sale….. Suddenly that $700 is not chicken feed.
You might read it and say to yourself, “I’m not interested in selling so it doesn’t concern me”, but think about this…. Consider the homeowner living on a fixed income who, already this year, been hit with an assessment increase, and if they live in one of the villa homes, even higher raises for extra grass and tree removal cost.
In addition to all the other fees at closing any seller must pay, unless of course you slip it into the price you set and hope you will get. You might say, well if I’m selling at a profit, does another $700 hurt me? Well, let’s look at the financial commitments this board has made recently.
An agreement with Anthem Community Council to fix the landscaping, sprinkler system, plants, tree removal, grass removal etc. (and hopefully that includes the medians along Anthem Parkway that have sat barren for almost two years). Grass removal with rock replacement along with tiny plants which might grow to a size and look we can be proud of at our main community center while we are still alive.
Then there is renovation of the shuttered restaurant which the board agrees will run at a loss for several years, and we really don’t know the full price of the new “build-out” of the place. The increase in management salaries, legal fees and new hire costs, redo of the theater sound system, etc. etc. and so forth.
I have a question to ask in addition to “what were they thinking piling this all on us at the same time?” the document was signed, approved and adopted the 23 day of February 2023, did any of you hear about this before the arrival of the March Spirit magazine? If not, why was it such a secret? and is this resolution in addition to the percentage we must pay on our sale price to the HOA, I believe it’s called the asset enhancement fee?
The days of buyers bidding over and above asking price seem to be a thing of the past and obviously, based on the spending habits of our “fearless leaders” they have no plans to sell in the near future!March 3, 2023 at 2:20 pm #7881R. WestraParticipant
What does this money used for ($700), Is there an expense for the HOA that this assessment pays for? Are these fees a deduction off of anything regarding anything.
Our society in general has had increases for expenses and fees. Property that my wife and I own has shown increase in taxes and governmental fees. Property taxes in one state where we have purchased property has gone up 17 per cent. New York and California are bad at finding new sources of revenue.
There has been a consistent change in BOD almost each year. That I believe isn’t good for maintaining property management skills on the BOD. Anyone can disagree with me; I am eager to learn.
With the restaurant we must all give our business to this new restaurant. It will become profitable with our participation in this restaurant. Boycotting this restaurant would not be a good idea.
As an individual it is important to plan ahead for additional expenses and fees when planning for your federal taxes.
Piling on is a constant theme because organizations and governments lost revenue because of the shut down in businesses.
For Sun City; there was a lot of requirements with landscaping because of the water shortage.
The increase in management salaries, legal fees and new hire costs, redo of the theater sound system, etc. etc. and so forth. I believe salaries have to be competitive with the outside world or we start losing essential and knowledgeable people. I have had to increase salaries to maintain good people who have great management skills; my experience; good people in management will help to maintain your margins in your business. I have no knowledge about new hire costs. The sound system in the theater was in need of a refresh.
Your right; everything happened at the same time for the BOD and Sun City; which makes everything difficult for people on a fixed income. I have had to help my close relatives because of the increase in so many of their expenses; that they did not have the money to cover them.
If you disagree with me; let me know. That is how I learn.March 3, 2023 at 3:25 pm #7882
Mr. Westra and anyone else with the same or similar thoughts/questions on this: The asset enhancement fee is a percentage of the price an owner in SCA sells their home for. It went to different “wants” and needs for replacing things etc. over time. The $700 in fees one would guess cover the document costs but since we now live in a digital worlds, it seems to me these documents could be generated in the computer by plugging in the name of the new owners etc. and printing it out. I still cannot justify in my mind a total of $700.
The document request is available to all owners on request if you want to learn more about the asset enhancement fee, just ask for it from management.
I agree with the sound system needing an up-grade, I just don’t agree with purchasing all the ‘wants” or “needs” at the same time. I “wanted” a new fridge, dishwasher and microwave but I didn’t buy them all at once…. I wanted pavers in my driveway and back yard but I chose to get it done when little else was “one my plate.”
I would add up the major expenditures from the HOA this year and last, but I’m afraid it would put me in a state of shock, so I’ll end my rebuttal here. Have a great weekend!March 4, 2023 at 7:24 am #7887
written by: Steve Anderson and posted at his request:
(editor’s note: I would like to see the written law that states these increases must be immediate regardless of other raises of fees that we are currently dealing with)
To better understand the issue of HOA cost and fees, you might find the following Las Vegas Review Journal column informative.
The increase of resale fees and costs the was passed at the last board meeting was done for two primary reasons:
1. Our existing fees were very low as they had not been changed for at least the past seven years.
2. The fees that were passed by the action of the board bring us to being what is comparable in the HOA industry today. Please also note that these fees are regulated by law and we cannot just set them at any level.
Yes, the recent fee schedule was a big increase from the past. Ideally these fees and costs should have been adjusted periodically to reflect current HOA business practices. If this action had been done in the past the current increase would have been much smaller. Part of exercising the fiduciary responsibility of the board is to not kick the can down the road and to not deal with issues.
Whether the issue is one dealing with assessments, the restaurant, the rechartering of clubs and committees, etc. this board operates on the belief that by ignoring issues and not dealing with them only create complications and the need to catch up in the future. There were too many years of keeping assessments the same or of then have a small increase and again keeping them the same for a few years.
Then we had the smoke and mirrors of having a surplus and refunding it back to the residents as a way to again reduce their assessments. Common sense tells you that due to inflation and increases in costs and labor that you should have increases of 2 to 5% a year.
Had past boards done this we would not have needed to carry out the larger increases of the past year. You may feel that we are wrong in what we have done. My view is that the Board has made the tough decisions to take fiduciary responsibility to bring us current with where we need to be. Inaction over the past years has finally caught up with us.
SCA adopted this policy within the year after the law changed. Unfortunately, the homeowners were not notified last year in accordance with the law’s notice requirement. Therefore, the Board re-adopted the document and it is being distributed to the homeowners in accordance with the law.March 4, 2023 at 7:42 am #7888alan hParticipant
When we sold 6 months ago to fee to the hoa was 1/3 of 1%. That was a couple thousand dollars and it appears the bureaucrats are always figuring out ways to steal more of the homeowners money. They must stay up late coming up with these new fee names. The lawyers have always tried to suck SCA dry. In the 20 years we lived here they have redone the sound and light system 2 or 3 times. Does it go bad that often? How about the liberty center bocce courts. No body wanted them to begin with and then over $100,000 was wasted “fixing” them only to destroy them for pickleball courts when what is needed in that location is a bathroom facility.March 4, 2023 at 8:13 am #7889Nelson OrthParticipant
Until you answer my questions from your previous post, you have absolutely ZERO credibility with me in anything you say or post.March 4, 2023 at 10:47 am #7890
I would like to put the “new” $700 HOA related fees into perspective, if I may. I am a realtor here in
Sun City. Condo Certs is the third party who generates the HOA docs for many communities. SCA is one of them. There are state laws that define who pays for the HOA resale disclosure package. That falls on the Seller. The current standard charge through Condo Certs is $160. It will now be $165. The current charge for the “demand” is $150 and the new charge is $185. (The demand is a final reckoning of your HOA account to make sure it is clean — no liens or unpaid dues) and that is also a Seller charge. The current charges for setting up a SCA account is $200 and new charge will be $350. That charge can be negotiated by Buyer but it is the Buyer setting up his new account so should be a Buyer charge. There are no taxes on gains unless it’s over the $200,000 per person/$500,000 per couple (I’m not an accountant but this is federal Capital Gains) . $700 is a lot when you just look at the amount but it is a shared expense. The asset enhancement fee (1/3 of 1% of purchase price) is paid by Buyer (though in some markets could be negotiated) Total change is $190 shared with buyer. Hope this helps!March 4, 2023 at 10:59 am #7891
Correction: Standard Resale Package is $150 now going to $185. Demand is $160 going to $165.
Sorry for the confusion!March 4, 2023 at 1:58 pm #7892
Thank you Mary Ellen. The only problem I see is that, depending on what a home is priced at, what the investment the owner has in the property and then the asking price, as a potential buyer I would try to negotiate the Asset enhancement fee if it was a high priced property and try to make to seller at least split it with me… Your thoughts?March 4, 2023 at 3:54 pm #7893Robert SternParticipant
Mr. Anderson also known to me as Steve to his credit is willing to write to defend and explain certain actions. Some he will ignore and not comment on if they are too confrontational or controversial. He sees himself as a peacekeeper and consensus builder and while those are good qualities, what if the consensus is really a collective bad decision?
I believe Sandy Seddon’s past and continued employment was and is a bad decision.
She has /had responsibilities to be up with current law to ensure that the BOARD got things right the first time. She didn’t pass muster on this critical financial matter while the law firm was making money on other matters.
The fact that the reserves are underfunded and you indicated the need for catch up demonstrates that past performance was subpar and you are just making excuses and yet the Main Reserves are still underfunded. No catch up there as you are funding restaurant’s deficit financing mostly from reserves. In fact the 2023 Reserve Study will cause additional pressure for more assessments if the board uses an independent inflation factor assumption as it should of no less than 5%.
The Payroll and Benefits increases over the last two years are outrageous and are not consistent with either good management nor market conditions. Sandy Seddon’s outrageous salary package coupled with creating a fiefdom are inexcusable. Her documented abuse of power is well known with the unholy alliance with the Clarkson Law firm who also is making big bucks at homeowners expense and you say blessed by the Board of Directors. Well shame on all of you.
The board has had an abysmal record on financial matters and yet this board approved abandoning monthly financial reporting to make it quarterly. If you explain one thing explain how less oversight and less transparency is better especially for management and the community given the major investment and risk for Yorktown. And speaking of Yorktown when I tried to examine the 2023 Budget’s $316,800 detail for Restaurant Expense using the proper request process I was STONEWALLED. It became clear 2023 Budget assumptions on the restaurant were incompetent and your CFO and Sandy Seddon thought the best approach was to lawyer up and not to expose their own incompetence. It’s like taking the 5th. And you support it.
Apparently it will take a new board majority to fix most of SCA’s ills.
BUT : If there is one thing you can do please reverse the board’s terrible decision so that the community will have access to monthly financial statements and put rules and people in place that prevents the STONEWALLING!March 5, 2023 at 8:14 am #7895
By Forrest Quinn (former SCA board member & treasurer)
This is my partial response to Steve Anderson’s post. His remarks are in black text, my responses are in italics.
Whether the issue is one dealing with assessments, the restaurant, the rechartering of clubs and committees, etc. this board operates on the belief that by ignoring issues and not dealing with them only create complications and the need to catch up in the future.
Past Boards did not ignore these issues. I’m not sure how Steve missed it because it was daily news, but the COVID pandemic froze society for over two years. Is it his advice that the Board should have reopened the restaurant during the pandemic? Furthermore, he is ignoring the COO’s inaction on these matters.
There were too many years of keeping assessments the same or of then have a small increase and again keeping them the same for a few years. Then we had the smoke and mirrors of having a surplus and refunding it back to the residents as a way to again reduce their assessments.
This is complete bunk. There was no smoke and mirrors. NRS 116 stipulates that HOA assessments must equal expenses. Steve has been on the Board for nearly three years. If he felt expenses were missing, why didn’t he say something?
SCA’s operating surpluses were created by the COVID pandemic, not by Board action. Furthermore, Steve ignores that NRS 116 and SCA’s CC&Rs require operating surpluses to be returned to homeowners. Finally, IRS regulations treat unreturned operating surpluses as taxable income. For example, one year, SCA had a $925,000 surplus. As Steve suggests, if we had kept the money, SCA’s residents would have had a $277,500 tax bill. As a fiduciary, it’s the Board’s duty to minimize costs, not increase them by ignoring tax law.
Common sense tells you that due to inflation and increases in costs and labor that you should have increases of 2 to 5% a year.
Common sense also says if you are grossly overpaying for labor, see the COO and CFO salaries, you can cut back salaries and not increase assessments.
Had past boards done this we would not have needed to carry out the larger increases of the past year.
Again, past surpluses were primarily caused by COVID and they were returned to residents as a matter of law.
You may feel that we are wrong in what we have done. My view is that the Board has made the tough decisions to take fiduciary responsibility to bring us current with where we need to be. Inaction over the past years has finally caught up with us.
Again, COVID prevented any “action.” BTW, our COO has been at SCA for over seven years. Where are her restaurant startup and operating budgets? Oh right, she and her CFO never prepared one. She always sits back until the Board takes the initiative. For example, where are her rewritten club rules and policy manuals?
SCA adopted this policy within the year after the law changed. Unfortunately, the homeowners were not notified last year in accordance with the law’s notice requirement.
And something tells me that Steve will make sure the Board does absolutely nothing to hold staff accountable for their failure to keep home owners informed. It’s a lot easier to blame past Boards.March 5, 2023 at 1:53 pm #7897
This is for Rana. Thank you for your thoughts and that asset enhancement fee is negotiable especially in a Buyer’s market where the Seller might want to offer additional incentives, as you stated.
Different market conditions always play into negotiations. However that upfront fee is for the Buyer to enjoy all the amenities SCA has to offer while living in our community so I think of it as benefitting the Buyer. And Seller probably paid that fee upfront when purchasing. But yes — negotiable!March 5, 2023 at 9:37 pm #7898Stephen AndersonParticipant
My reply to Mr. Orth.
How very silly his response is in saying that I control the day to day decisions and operations of our HOA. I would agree that if I was the Emperor and ruled by decree and edict that the situation would be very different. Maybe you need to realize that I am but one of six to seven board members. As President I have no more nor less impact than the other directors. My role as President is that of being voted to that position by the other board members who recognize my ability to bring people together and work in a collaborative manner. Mr. Orth greatly exaggerates my power and influence. Frankly I serve the residents of this HOA. While I do not always do what everyone wants me to do, I respect each resident, will listen to them and work toward engaging in activities that will bring value to our community. In that process of dialog I am one of few who will post on social media sites.March 5, 2023 at 9:41 pm #7899Stephen AndersonParticipant
Reply to Forrest Quinn in his last sentence:
Or to past Treasurers!March 6, 2023 at 7:45 am #7902Nelson OrthParticipant
Obviously Mr. Anderson does not understand the role of the president of SCA. The difference between the president and the other board members is that the role of the president is to be the face of our HOA, and set the agenda for board meetings. This latter responsibility provides him with much greater power than the other board members.
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