A Primer for Consideration
Achieving the Budget
It ’ s necessary to take into consideration the potential extent of hidden costs and adjust the scope of work accordingly to keep within budget .
only mastered with years of experience . HOAs need a professional Construction Manager who “ speaks the language ” and isn ’ t afraid to get his / her hands dirty when issues arise . There are a lot of moving parts when it comes to reconstruction . Make sure you have someone in your corner who understands all of them .
Assistance with Contractor Selection
From the correct license to the correct insurance to successful experience with your size of project ; who will be the foreman ; what is the extent of their time on site ; what tools will be provided to the employees ; are they employees or subcontractors … just some of the questions to pursue .
Contractual Issues
A professional Construction Manager drafts a contract for the association . He or she does not let the association sign the contractor ’ s contract .
Scheduling
Understanding the sequence of construction events and coordination among the subcontractors is an art
Progress Payment Approval
Wood replacement can look complete , but if the nails have not been set and the wood filler has not been applied - it ’ s not complete . Contractors need to be paid timely and correctly , but paying ahead is always a recipe for disappointment . HOA
Barrera And Company has been in business since 1980 and specializes in Reserve Studies and Construction Management . They can be reached at :
COMPANY OWNED UNITS
QUESTION : I serve on the board of a townhouse association .
We have a potential buyer of a unit that is a limited liability company . If the LLC becomes an owner and the LLC has 50 members , will all 50 members have rights to use the common area facilities ?
ANSWER : Good question . Because of the uncertainty and to avoid potential litigation over the issue , we address it when we restate CC & Rs and bylaws for our clients . We define who does and does not hold voting and common area usage rights for ( i ) those who merely hold a security interest in the property , ( ii ) tenants , ( iii ) trusts , ( iv ) corporations , ( v ) partnerships , and ( vi ) other ownership entities . Doing so eliminates the problem . Your association should consider doing the same .
NOTICE OF RULE CHANGE
QUESTION : We are changing several rules . May we send only the rules that are changing to homeowners ? Our manager says we must send out all the rules for the 30-day homeowner comment period , not just the ones being changed or added . I do not read Civil Code 1357.130 that way . Who is correct ?
ANSWER : You ’ re correct . The statute only speaks to proposed changes not the entire package .
The board of directors shall provide written notice of a proposed rule change to the members at least 30 days before making the rule change . The notice shall include the text of the proposed rule change and a description of the purpose and effect of the proposed rule change . ( Civ . Code 1357.130 ( a ).)
Once the rule change has been approved by the board , notice of the approval must be given to the membership before the change can take effect . Ideally , changes are incorporated into the rule book and a full set is mailed or delivered to the membership . For some associations that can be quite costly . An alternative is to mail the changes to the membership and post a full set of revised rules on the association ’ s website . HOA
Contact us at ( 800 ) 464-2817 or info @ adamskessler . com
Adrian J . Adams , Esq . Adams Kessler PLC
Spring 2013 | Issue # 5 | The HOA Board Quarterly | 9