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Old 08-08-2011, 04:23 PM
 
41 posts, read 80,965 times
Reputation: 39

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PLEASE HELP..HOA BORROWING $1.8M

My HOA is trying to borrow $1.8M, to completely tear down and start over building a new club house, swimming pool and fitness center. Can the Board of Directors borrow that much money, pledging the owners assessments? Our neighborhood is in turmoil...about 30% of the owners are senior citizens on a fixed income. The homes in Memorial Northwest are 30-35+ years old, this proposed facility is going to cost $2.5M in a neighborhood where the homes cost $100K-$300K. You can look at the facility proposal at this website http://mnwcenter.com/ The community is so upset that the BOD canceled the Aug. 31 vote. Everything happened so fast, I heard that some of the BOD didn't know anything about the expensive presentation.
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Old 08-08-2011, 04:36 PM
 
2,277 posts, read 3,945,646 times
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I'd expect the necessity of an extensive renovation of the rec facilities that are 30 years old, but a complete teardown and rebuild seems pretty extravagant and irresponsible. My neighborhood's rec facility is 30ish years old, but it perfectly fine condition.
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Old 08-08-2011, 04:47 PM
 
15,632 posts, read 24,319,965 times
Reputation: 22815
I'm so sorry. I dont have any words of wisdom but I understand your concern. I'd be very upset if I were in your shoes. I hope your community can turn this around.
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Old 08-08-2011, 04:48 PM
 
Location: The Greater Houston Metro Area
9,053 posts, read 17,133,927 times
Reputation: 15226
This seems totally irresponsible. Sounds like some on the board just want a brand new facility and don't think anything of others paying for it.
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Old 08-08-2011, 04:50 PM
 
Location: Fondren SW Yo
2,783 posts, read 6,656,788 times
Reputation: 2224
Quote:
Originally Posted by butterflyrobin View Post
PLEASE HELP..HOA BORROWING $1.8M

My HOA is trying to borrow $1.8M, to completely tear down and start over building a new club house, swimming pool and fitness center. Can the Board of Directors borrow that much money, pledging the owners assessments? Our neighborhood is in turmoil...about 30% of the owners are senior citizens on a fixed income. The homes in Memorial Northwest are 30-35+ years old, this proposed facility is going to cost $2.5M in a neighborhood where the homes cost $100K-$300K. You can look at the facility proposal at this website http://mnwcenter.com/ The community is so upset that the BOD canceled the Aug. 31 vote. Everything happened so fast, I heard that some of the BOD didn't know anything about the expensive presentation.
This is what happens when nobody pays attention to a HOA board until they get in to trouble. The short answer is most likely yes, they can do it. What you need to do is raise hell with the rest of the neighbors, and if any of them are attorneys have them go over the HOA by-laws with a fine tooth comb regarding calling new elections. Hopefully the big spenders can be voted out before they do too much damage.
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Old 08-08-2011, 04:57 PM
 
Location: Fondren SW Yo
2,783 posts, read 6,656,788 times
Reputation: 2224
Quote:
Originally Posted by butterflyrobin View Post
PLEASE HELP..HOA BORROWING $1.8M

My HOA is trying to borrow $1.8M, to completely tear down and start over building a new club house, swimming pool and fitness center. Can the Board of Directors borrow that much money, pledging the owners assessments? Our neighborhood is in turmoil...about 30% of the owners are senior citizens on a fixed income. The homes in Memorial Northwest are 30-35+ years old, this proposed facility is going to cost $2.5M in a neighborhood where the homes cost $100K-$300K. You can look at the facility proposal at this website http://mnwcenter.com/ The community is so upset that the BOD canceled the Aug. 31 vote. Everything happened so fast, I heard that some of the BOD didn't know anything about the expensive presentation.
I looked at the "great ideas" page the HOA posted that they want to do with the community center. This definitely is a case of people who are greedy, stupid or both trying to have a bunch of goodies with other peoples' money. I would fight this tooth and nail if they tried this in my HOA. Oh wait, I am on the HOA and this garbage wouldn't fly two feet before getting shot down here...

Read it for yourself. http://mnwcenter.com/documents/2011/...s.pdf#zoom=100
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Old 08-08-2011, 05:36 PM
 
41 posts, read 80,965 times
Reputation: 39
I know loads of homeowners, and none of them were asked what they thought about a new club. One lady asked the chairman of the facility committee why they aren't having public meetings...I think he was too terrified too answer....there are board members fighting this plan, but the President of the board has gone completely rogue, and is ramming this down our throats.

Can a couple of board members (one is the treasurer) borrow that much money?

What gives them the power to force this kind of debt on homeowners?

They have not been honest or open about the actual cost of the loan, which is great concern if they force a vote.
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Old 08-08-2011, 06:05 PM
 
Location: Fondren SW Yo
2,783 posts, read 6,656,788 times
Reputation: 2224
Quote:
Originally Posted by butterflyrobin View Post
I know loads of homeowners, and none of them were asked what they thought about a new club. One lady asked the chairman of the facility committee why they aren't having public meetings...I think he was too terrified too answer....there are board members fighting this plan, but the President of the board has gone completely rogue, and is ramming this down our throats.

Can a couple of board members (one is the treasurer) borrow that much money?

What gives them the power to force this kind of debt on homeowners?

They have not been honest or open about the actual cost of the loan, which is great concern if they force a vote.
I cannot speak to the specifics of the by laws of your HOA. As long as the vote is done with a quorom attending, and is done with whatever is defined as a legal vote (majority, 2/3rds, etc.) they can do it. What gives them the power to take out the debt? They were elected to the HOA board! Bottom line is you need to have an attorney review the by laws and see if how they are conducting the votes and meetings is legal as defined by the by-laws.
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Old 08-08-2011, 06:13 PM
 
739 posts, read 2,128,188 times
Reputation: 362
WOW! What HOA/subdivision is this?
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Old 08-08-2011, 06:21 PM
 
Location: Houston, TX
469 posts, read 1,096,562 times
Reputation: 442
The link says there will be a homeowner vote on it. It seems like there is a lot of interest in the topic since over 500 people showed up to the HOA. This is only getting approved if homeowners vote for it. Just make sure to get your vote cast whether in person or by proxy.
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