7
August 2017
New Debt Policy (Continued From Previous Page)
the annual KICA assessments to the maximum
available under our existing restrictions. This would
currently deliver about $300/year per KICA member
(approximately $1.25 million/year) adding almost $9 million
to our borrowing capacity.
Borrowing capacity can be increased further if members vote
to allow a dues increase beyond the current maximum. For
example, the board could generate approximately $30 million
of total borrowing capacity if members voted to allow an
additional $1,000/year in KICA annual assessment.
KICA’s debt capacity is limited by its cash flow, which is limited
by its ability to raise annual fees more than about $300 more
per year without a member vote. Because Kiawah is a barrier
island with the constant risk of uninsured storm damage, we
remain at risk of an unexpected funding need that exceeds
our ability to fund via a one-time assessment of members. It
is important to limit borrowings to provide sufficient unused
borrowing capacity for storm damage. This will allow us to
borrow to fund the uninsured repair and replacement costs
and allow us to collect from homeowners over several years to
minimize the burden to our members.
Call to Action: Proposed Bill Aims to Provide Federal
Support to Associations After a Natural Disaster
If another hurricane strikes South Carolina, Rep. Mark Sanford
wants residents in private communities and neighborhoods
with homeowners associations to be eligible for help cleaning
up debris.
Congressman Sanford introduced a bill in early July - the
Disaster Assistance Equity Act - that would allow common
interest communities - neighborhoods, condominium
complexes, and cooperatives that share amenities and
infrastructure typically owned by an homeowners association
(HOA) - to receive Federal Emergency Management Agency
(FEMA) aid following a natural disaster.
“I find it strange that FEMA treats the 70 million Americans
who live in common interest communities differently than
it does those who live in other types of communities,” said
Congressman Sanford. “In my experience, storms don’t
discriminate between different kinds of communities. As such,
it seems to me that FEMA should treat them all equally when
it comes to the assistance available in the wake of a disaster. The
simple aim of the bill is to treat taxpayers the same.”
Under current guidelines, Kiawah, like other HOA’s throughout
the country, is not eligible for FEMA assistance following a
natural disaster (i.e. hurricane, fire, earthquake, etc.). KICA
COO Jimmy Bailey believes this should change and supports
this proposed bill as a step in the right direction.
"Residents in private communities or neighborhoods with
homeowners associations are citizens who pay the same federal
taxes as everyone else. This is an issue of equity."
Sanford’s bill is cosponsored by a bipartisan group of New York
congressmen: Democrats Jerry Nadler and Eliot Engel, and
Republicans Peter King and Lee Zeldin.
The Disaster Assistance Equity Act has been referred to the
House Committee on Transportation and Infrastructure for
discussion and a recommendation.
"I urge association members around the country to contact
their elected officials expressing their support of this bill,"
said Bailey. "We were lucky that Hurricane Matthew resulted
in only a modest supp