- Community Associations Institute: Georgia Chapter

Transcription

Commons
First Quarter 2015
g e o r g i a
A Publication of Community Associations Institute of Georgia, Inc.
Death and Taxes
(and other certainties in our industry)
Inside:
YES
Community
Associations Need
to File Tax Returns!
Death and Injury at
THE POOL
Collections Against a
Deceased owner
The Death of
FACE-TO-FACE
COMMUNICATION
...and more!
©istockphoto.com
CAIGA.1st Qtr. 2015.indd 1
3/6/15 4:26 PM
Congratulations...
Congratulations to The Landings Association in Savannah for recently earning the Green Community Award
from Audubon International for our ongoing sustainability initiatives.
2 0 1 5
C O M M I T T E E S
Community Service Committee
Kelley Moon — Co-Chair
Golf Committee
Mike Dangler — Chair
Celia Ebert,
Parkside Management
Program Committee
Lisa Fuerst, Esq. — Co-Chair
Janet Phillips, CMCA, AMS, PCAM,
Miye Yi, Esq. — Co-Chair
Winter Capriola Zenner, LLC
Darren Thurmond, CMCA, AMS, PCAM —
Board Liaison
Timbers of Vinings Condo Association
Veronica Cuellar — Co-Chair
American Pool Services
Access Management Group
Kent Atzinger, CMCA, AMS,
EPIC Response
NatureScapes
Sean Ruthven, CMCA, AMS — Board Liaison
Atlanta Community Services
Kent Atzinger, CMCA, AMS, PCAM,
Access Management
Melanie Caceres,
Bach, James, Mansour & Co.
Sheila Gray, CMCA,
Arborguard Tree Specialists
Eric Love,
Lazega & Johanson LLC
George Nour,
Gaddis & Lanier, LLC
Shandron Pemberton,
Karts Landscaping
Horizon Painting & Renovations
Community Management Associates
FirstService Residential
Chief Fire Protection Company
CMCA, AMS, POSolutions, LLC
Teddy Russell,
Russell Landscape
Jodi Vasquez,
Education Committee
Jamie Lyons, Esq. — Chair
Neal Bach, CPA,
Kevin Carnes,
Jay Fraiser, Esq.,
Kim Gaddis, Esq.,
Gary Kart,
Julie Ketner,
Mark Moore, Esq.,
Janet Phillips, CMCA, AMS, PCAM,
Homeowner Management Services
Rob Stein, Esq.,
EPIC Response
Winter Capriola Zenner LLC
Winter Capriola Zenner LLC
Sweetwater Pools
Weissman, Nowack, Curry & Wilco, P.C.
Ashlie Bisig — Board Liaison
Stephen A. Winter, Esq.,
Glenda Bromer, CMCA, AMS,
Steven M. Winter, Esq.,
Mike Crew, CMCA, PCAM,
Marc Wise,
Rebecca Drube, Esq.,
Kristalyn Wright,
John Farrell, Esq.,
Green Committee
Bekke White, CMCA — Chair
Union Bank Homeowners Association Services
Ian Mari — Board Liaison
Mickel Graham, PCAM,
Union Bank Homeowners Services Association
Ron Jockers, CMCA, AMS, PCAM,
Liberty Lofts Condominiums
Tamalla Mallet, CMCA,
PDQ Services
Ryan Maki, CMCA, AMS, PCAM,
FirstResidential Services
Richard Maritt, CMCA, AMS,
Homeside Properties
Dee Neighbors, CMCA, AMS,
B Green Services
Becky Schmutzer,
Lueder, Larkin & Hunter, LLC
Julie Stephens, CMCA, AMS,
First Citizens Bank
Learning You Education
Fieldstone Management
Homeowners Advantage
Silverleaf Management Group
Exclusive Association Management
Merrill Walker, CMCA, AMS, PCAM,
Advantage Community Management
Fundraising Committee
Tracy Lanard, CMCA — Chair
ommunity Management Associates
Michele Richards, CMCA, AMS, PCAM —
Co-Chair
Sara Hicks — Board Liaison
Parker Young Construction
Kimberly Addison,
Noreen Balcer,
Jane Beasley, CMCA, AMS, PCAM,
Emil Bekyarov,
Evan Conroy, Esq.,
Carlyle Douglas,
Leslie Fellows, CMCA,
Tolley Community Management
Barry George,
Crabapple LandscapEXPERTS
Jimmy Kim,
Maryann Malena,
Marvin Pastel, Esq.,
Chad Burchfield,
Team Pest USA
Jeff Creecy,
Veronica Cuellar,
Austin Outdoor
Homeside Properties
Dick Patterson,
Northwest Exterminating
Sherry Perrotta,
Greenwood Group
Michael Pullen,
Disaster One
Chris Ruthruff,
SafePlay Systems
Paul Slovisky,
AssociationReady
Brandon Thomas,
Jeanie White, CMCA,
Patrick Hixson,
Aquascape Environmental
Derek Johanson, Esq.,
Russell Landscape Group
Tracy Lettsome, Esq.,
Homeside Properties
Lipshutz Greenblatt
Mary Masi,
Terrence Spires,
Team Pest USA
Brannan Sutherland,
Mike Tolley,
Tolley Community Management
Legislative Action Committee
Lanier Coulter, Esq. — Chair
Coulter & Sierra, LLC
Mindy Waitsman, Esq. — Board Liaison
Moore & Reese, LLC
Sally Butler,
Brown & Brown Insurance of Georgia
Mike Crew, CMCA, PCAM,
Rebecca Drube, Esq.,
David Durgin, CMCA, AMS, PCAM,
Fairfield Plantation Association
David Hill, CMCA, AMS, PCAM,
Access Management
Dennis Hoffman, PCAM,
Community Management Associates, Inc.
Tim Huffman, CMCA, AMS, PCAM,
Colony House Condominiums
Brendan Hunter, Esq.,
Randy Lipshutz, Esq.,
Lipshutz Greenblatt
Stephen A. Winter, Esq.,
Pankey & Horlock, LLC
Disaster One
Mindy Waitsman, Esq. — Board Liaison
Moore & Reese, LLC
Jeff Creecy,
Greenwood Group
Alex Caceres,
Beryl Grall-Petty,
Piedmont Management
Dan Henning, PCAM,
Community Management Associates, Inc.
Glade Johnson,
Magazine Committee
Joe Larkin, Esq. — Chair
Advantage Protective Services
Rick Barnes,
Jason LoMonaco, Esq.,
Kim Blair,
Wendy McMillan,
Faith Brown,
Sarah Pritchard, Esq.,
Gary Caruso, R.S., P.E.,
Becky Schmutzer,
David Hill, CMCA, AMS, PCAM,
Sheri Stebbins
Pat Hillen, CMCA, PCAM,
Rob Stein, Esq.,
Laura Horlock, Esq.,
Public Relations Committee
Kevin Carnes — Chair
Ashlie Bisig — Board Liaison
Clarence Lau, Esq.,
NatureScapes
NFC Amenity Management
OnePoint Technologies
Tower Roofing
Criterium Caruso Engineering
Access Management
4 Seasons Landscape
Alliance Association Bank
Pam Irwin, CMCA, PCAM,
Michael Leavey, Esq.,
Dorough & Dorough, LLC
Kris Leek,
Peachtree Pest Control
Shawn Mayabb,
Marvin Pastel, Esq.,
Candace Pfab,
Brown & Brown Insurance of Georgia
Marilyn Ratzel, Esq.,
The Coulter Law Firm, LLC
RC Shanks, CMCA, AMS, PCAM,
GW & Associates
Lisa Simmons Weibel,
Beacon Management Services
Arborguard Tree Specialists
EPIC Response
Sharon Andersson,
Glenda Bromer, CMCA, AMS,
Mike Dangler,
NatureScapes
Dave Lyons,
Tracy Henson,
Russell Estey,
ROOTERPlus!
Amanda D’Antoni,
Exclusive Association Management, Inc.
Nicole Shirley,
Membership Committee
Elizabeth Alford — Chair
Dale Pendergraft — Board Liaison
Tracy Chambers,
Erin Byers,
Social Committee
Bill Wetter — Chair
Terrence Spires,
Alford & Alford, Certified Public Accountants,
Team Pest USA
P3 Painting & Renovations
HomeOwners Advantage
Crabapple Lake Parc Community Association, Inc. Tracy Chambers,
Chuck Negas,
Homeowners Advantage
Russell Estey,
Ken Baggs, CMCA, AMS, PCAM,
Mike Curtis,
Wayne Forester,
RooterPLUS!
Team Management
Scott Douglas — Board Liaison
Community Funding Corporation
Hollie Battle, CMCA, PCAM,
Chris Goss,
Sarah Jockers,
Tower Roofing
Beacon Management Services
GW & Associates
Tracy Lanard, CMCA,
Community Managment Associates
Kelley Moon,
EPIC Response
Chuck Negas,
Ashley Pafford,
Pat Pou, Esq.,
Ben Rosenquist,
Blueprint Painting & Renovations
Dawn Shaddix,
Nicole Shirley,
Kristalyn Wright,
Faith Brown,
Eleanor Burris, CMCA,
Heritage Property Management Services, Inc.
Amy Davidson,
Aquascape Environmental
Dean Donald, CMCA, AMS, PCAM,
Team Management
Amanda Evans, CMCA, PCAM,
Billy Gray,
Gray Contracting
Julie Hewell,
Mark Johnson,
Kathy Kendrick,
American Disposal
Eric Love,
Lindsey Malone, CMCA,
Dave McCord,
Team Pest USA
Cal McShan,
Sentry Management
Courtney Prausa,
Bob Russell,
Atlanta Landscape Group
Natalie Sanders,
SERVPRO of North Fulton
Michael Sedacca,
Keith Shaddix,
ValleyCrest
Terrence Spires,
Team Pest USA
Jarrod Talley,
Blueprint Painting & Renovations
Jodi Vasquez, CMCA,
Mike Zenner, Esq.,
Tennis Committee
Rhonda Moles, CMCA, PCAM — Chair
Jannette Shockley, Esq. — Board Liaison
Jonathan Benator, Esq.,
Alex Caceres,
Memrie Creswell,
Dan Crossland,
Phoenix General Contracting
Amy Davidson,
Aquascapes Environmental
Sandy Depa, CMCA, AMS, PCAM,
Integrity Association Management
Joe Dreher,
Dreher Insurance
Barbara Graves,
Ray Engineering
Laura Guilmette,
Unique Environmental
Jennifer Hardy Fournier,
Gibson Landscape
Tracy Henson,
Cindy Hodge, Esq.,
Mark Johnson,
Becca Jowers,
Heritage Property Management Services, Inc.
Tammy Quinn, CMCA, AMS,
Heritage Property Management Services Inc.
Tradeshow Committee
Erin O’Connell, Esq. — Chair
Shaune Huysamen, CMCA — Board Liaison
Tribridge Residential
Dotty Bonds, CMCA, AMS,
Lake Arrowhead Resort
Zak Campbell,
The McKinley Group
Emily Cantrelle,
Sandy Depa, CMCA, AMS, PCAM,
Integrity Association Management
Laura Guilmette,
Unique Environmental
Tracy Henson,
Mark Johnson,
Dan Magee,
Greenwood Group
Michelle Riley,
First Citizens Bank
Teddy Russell,
Russell Landscape Group
Lana Shelton,
Sheri Stebbins,
4 Seasons Landscape
David Tishey,
Allgood Pest Control
Bekke White, CMCA,
Cameron Wilsey,
ROOTERPlus!
3/6/15 4:26 PM
Community Associations Institute—Georgia Chapter • www.cai-georgia.org
A Letter from the Chapter President
Georgia Chapter of CAI
2015 precious metals sponsors
PLATINUM
“We are working hard this
year to offer some exciting new
changes for the Chapter...”
Dale Pendergraft
I
am very proud to serve as the President of the Georgia Chapter of CAI
this year and look forward to a great year for the Chapter. First, I would
like to thank my fellow CAI-Georgia board members. We are working
hard this year to offer some exciting new changes for the Chapter, including
enhanced Precious Metal Sponsorship benefits and an enhanced website.
2015 was off to a great start with our Gala event on January 24th. We had a
great crowd at the event, with 280 people registered. Special thanks to the Gala
Committee and the Chair, Veronica Cuellar of DisasterOne, for all of their
hard work. Everyone commented on how much they liked the new Westin
Perimeter location and how much they liked the event. Congratulations to
our award winners: Rita Kennedy Award – Kelley Moon, EPIC Response;
Leadership Award – Jamie Lyons, Esq. of Lazega & Johanson LLC; Rising
Star Award – Tracy Lanard, CMCA of Community Management Associates;
President’s Award – Veronica Cuellar of DisasterOne and Educator of the
Year – Lisa Fuerst, Esq. of Pankey & Horlock, LLC. We decided to bring
back our Hall of Fame Award after a five year break and are grateful to those
winners for all they have done for the Chapter: Dennis Hoffman, CMCA,
AMS, PCAM, Community Management Associates; Laura Lazar, CMCA,
AMS, PCAM, Parkside Management; and Stephen A. Winter, Esq., Winter
Capriola Zenner, LLC.
Our Bowling Tournament on February 19th offered a brand new networking opportunity for CAI members to bowl and play pool together. It
was also a successful fundraiser for our Legislative Action Committee. We
appreciate the efforts of the Fundraising Committee and Co-Chairs, Michele
Richards, CMCA, AMS, PCAM and Tracy Lanard, CMCA of Community
Management Associates in planning and putting together this new event.
The Legislative Action Committee has been working hard for the Chapter
during this legislative session. I would like to thank this committee and
Chair, Lanier Coulter, Esq. of Coulter & Sierra, LLC, for all they do to advocate for community associations throughout the state of Georgia. The committee members put in a huge amount of time during the session monitoring
bills and going down to the Capitol to participate in committee hearings.
We are excited about our new Charity Committee that was just launched
this year. It will give CAI members a chance to support the community
through volunteer efforts. Several opportunities to give back are in the planning stages and more news will follow as the committee makes plans for the
year. Special thanks to the committee and Co-Chairs, Kelley Moon of EPIC
Response and Miye Yi of Winter Capriola Zenner, LLC.
I look forward to working with you in 2015 and welcome your input and
suggestions.
Sincerely,
Dale Pendergraft
CAI-Georgia Chapter President
American Property Restoration, Inc.
Atlanta Landscape Group
Community Association Mgmt., LLC
Community Association Underwriters
Community Club Management, Inc.
EPIC Response
Homeowner Management Services, Inc.
Premier Restoration
Russell Landscape Group, Inc.
Unlimited Landscape & Turf Mgmt., Inc.
GOLD
Association Management Advisory Group
The GreenSeason Group, Inc.
Heritage Property Mgt. Services, Inc.
Homeside Properties, Inc.
Horizon Painting & Renovations, Inc.
Ray Engineering, Inc.
SILVER
Advantage Community Management
Advantage Pool Management Services, Inc.
Alliance Association Bank
American Painting & Renovations
Atlanta Community Services, Inc.
BB&T Association Services
Blueprint Painting & Renovations, LLC
Exclusive Association Management
Gray Contracting
Horizonz Property Management
Moore & Reese, LLC
MTS Sheffield Roofing &
Construction, Inc.
Owens & Mitchell, PC
Pest USA
RooterPLUS!
Shaben & Associates
Silverleaf Management Group, LLC
Stillwater Pool Management
Sweetwater Pool Service, Inc.
Tower Roofing, Inc.
Union Bank Homeowners
Association Services
BRONZE
4 Seasons Landscape
A Tow Atlanta
Abacus Property Management, Inc.
Affinity Pools
Alford & Alford, Certified Public Accountants
American Pool Service
Andersen, Tate, & Carr, P.C.
Arborguard Tree Specialists, Inc.
Association Capital Bank
Bach, James, Mansour & Co., P.C.
Broadband Planning
Brown & Brown Insurance of Georgia, LLC
CertaPro Painters
Color Burst
Construction Solutions of Georgia, Inc.
Criterium-Caruso Engineers
Davis Landscape
Dynamo Pool Management
Gaddis & Lanier, LLC
Georgia Community Management
Greenwood Group
Jowers & Company, Inc.
Marquis Management
The McKinley Group
Meridian Restoration, Inc.
Mutual of Omaha Bank
NatureScapes
POSolutions, LLC
Sears Pool Management
zumBrunnen, Inc.
3
3/6/15 4:26 PM
Georgia Commons • First Quarter 2015
Check Your Budget –
It May Be Killing Your Reserves
By Gary J. Caruso, R.S.,P.E.
Criterium-Caruso Engineers
“Regularly updated reserve studies
ensure the accuracy of the timing and
costs of future capital improvements.”
©istockphoto.com
A
reserve study is a valuable tool in managing capital expenditures and
cash reserves. It is only effective when used properly and updated on
a regular basis. Generally, reserve studies done in accordance with
the standards of the Community Associations Institute (“CAI”) attempt to
quantify anticipated capital expenditures over a 30-year period. Most studies
will incorporate inflation and rate of return on invested funds and factor this
into the calculations.
Annual budgets normally account for the capital needs during the next
year. Budget components include income, operating expenses, capital
expenses and a contribution to the reserves to plan for future expenses. A
balanced budget will ensure that expenses and reserve study contributions do
not exceed income. Pretty simple. So what can go wrong?
Just like the combination of a tree, a ladder and a chainsaw can be dangerous when combined with a homeowner, the combination of borrowing from
the reserves for unforeseen expenses; inadequate funding of the reserves;
inflation and outdated assumptions are dangerous to budgets.
Most experts recommend that Reserve Studies be reviewed and updated
every one to five years. New underwriting requirements for FHA loans put
a renewed emphasis on reserve funding and may oblige you to complete a
new reserve study or update an existing one. Typically, the timing of reserve
study updates will depend on the property type, age and the complexity of
the inventoried components. Regularly updated reserve studies ensure the
accuracy of the timing and costs of future capital improvements.
At the close of every year and before each new budget, you should carefully review your reserve study to ensure that you have properly accounted
for the costs associated with reserve study items. Some costs associated with
reserve study items may have been paid out of operating
expenses and some unforeseen costs or operating
expenses may have been paid out of the reserves.
This would require an adjustment to your reserve
schedule.
Each association should close their year with a review of their operating
budget, reserve funds and documentation of the major capital expenditures
that have occurred over the last year. Your anticipated contributions to the
reserve fund should be compared to the assumptions in the reserve study.
Your actual expenditures should be compared to the anticipated capital
expenditures listed in the reserve study.
Is it time to update your reserve study? Some of the factors to consider
when trying to determine when to update a study are as follows:
• Do FHA lending requirements oblige the Association to have a recent
reserve study?
• Has inflation increased costs significantly since the original study was completed?
• Has the rate of return on invested funds changed? • Have there been significant additional assets or components added to the
inventory?
• Have significant repairs or capital improvements been performed since the
last Reserve Study was performed?
• Have areas of the common property been significantly damaged by fire,
storms etc?
• Have significant improvements and additions been made to the property?
• Did the anticipated capital expenditures occur as planned and scheduled?
• If the Association is using a baseline or threshold funding method, has the
reserve fund balance dropped below the prescribed threshold?
• Have unexpected expenditures occurred during the period since the origi-
Sally Lewis-Butler, CIC, AAI
Executive Vice President/Branch Manager
Brown & Brown Insurance of Georgia, Inc.
f/k/a Insurance Marketing Group
1165 Northchase Parkway SE, Suite 195 • Marietta, GA 30067-6430
EMAIL: [email protected]
Main Office Line: 770-952-7725 • Fax: 770-952-7960
www.criterium-engineers.com
®
4
3/6/15 4:26 PM
AAB_Innov_CAI-GA_Hillen_QtrPg_112114.pdf 1 11/21/2014 10:35:53 AM
nal reserve study was completed?
• Have any circumstances changed which would affect the communities’
ability to fund the reserves?
If one or more of these situations apply to your association, it may be
time to consider an update or even a new reserve study. The general rule
of thumb recommended in the CAI literature is that one should update with
field observations every third year for an association up to 10 years of age and
every other year after 10 years of age.
At the end of the year, the Association should also review their preventative maintenance program. This program can range from an informal
program for properties with few components to a detailed formal schedule
for larger and more complex properties. Review your records to ensure that
the required maintenance has been performed. An effective preventative
maintenance program will ensure that the components reach their expected
useful lives. n
Quarterly Quote
“I’ve learned that people will forget what you said, people will forget
what you did, but people will never forget how you made them feel.”
– Maya Angelou
Mission Statement:
The Georgia Chapter of CAI assists community
associations and their service providers through
educational programs, networking, legislative
advocacy and publications.
Vision Statement:
To be the voice of community associations throughout the state of Georgia.
G e o r g i a C h a p t e r o f C AI
2015 Board of Directors
President............................................................Dale Pendergraft
Past President/Treasurer.......................................Scott Douglas
NCB
Pesident Elect............................................................. Ashlie Bisig
EPIC Reponse
Vice-President.....Darren Thurmond, CMCA, AMS, PCAM
Secretary................................................ Jannette Shockley, Esq.
Directors:
Ian Mari
Liberty Lofts Condominiums
Sara Hicks
Shaune Huysamen, CMCA
Tribridge Residential
Bill Lucas
Westbury at Vining’s/Overlook at Westbury
Sean Ruthven, CMCA, AMS
Access Management
Mindy Waitsman, Esq.
Moore & Reese, LLC
Executive Director.......................................... Julie Jackson
PO Box 2943
Peachtree City, GA 30269
Tel (770) 736-7233
Fax (770) 736-7232
E-mail: [email protected]
Our Mission:
The Georgia Chapter of CAI is the voice of the community association industry in the state. Our purpose is to facilitate the professional creation and operation of community associations through the
delivery of high quality education for our multidisciplinary membership. We are committed to building cohesion, integrity and respect.
■■■
The materials contained in this publication are designed to provide accurate, timely and authoritative information with regard to
the subject matter covered. The opinions reflected herein are the
opinion of the author and not necessarily that of CAI. Acceptance of
an advertisement in Georgia Commons does not constitute approval or
endorsement of the product or service by CAI. CAI-Georgia reserves
the right to reject or edit any advertisements, articles, or items appearing in this publication.
■■■
To submit an article for publication in Georgia Commons, contact
Julie Jackson at (770) 736-7233.
5
3/6/15 4:26 PM
Quality Collections…
By Dot Edwards, PCAM
Access Management
©istockphoto.com
A
re you utilizing the association’s full
collection authority as outlined in your
community’s governing documents?
The governing documents often provide the
association recourse when owners fail to pay
their assessments. Some common collection remedies include revocation of voting rights, shutting
off common area access, delaying leasing privileges,
and/or rent assignment, whereby rent is paid to the
association.
The larger the delinquency list, the greater the collection effort that is
required. If your community is facing collection challenges, you should take
a fresh look at your collection policy. A collection policy provides a systematic, disciplined approach to delinquencies. The association’s attorney should
review any new collection policy before it is formally adopted by the Board.
Are you actively attempting to collect money? Consistency is important for
successful collections. The longer a balance lingers, the greater the risk that
it will go uncollected. Owners who have an outstanding balance either don’t
know they have a balance, they dispute the validity of the balance, or they
have a hardship. If you communicate with delinquent owners on a regular
basis about their ledger, it will significantly increase the likelihood of successfully collecting the money.
For small balances, if the association’s governing documents allow, try
these common collection practices:
• A simple phone call or email may settle these balances quickly.
• If you discover that a person has a hardship, see if they can commit to a
60 or 90 day payment plan.
• If a person is unable to pay their balance, then explain that in accordance
with the collection policy the account will be placed with the attorney for
collection action.
• Disable access devices. Residents respond more quickly to this single collection item than any other action. You cannot prevent ingress or egress
to their unit. However, some documents provide
that delinquent owners can be prohibited from
parking on the property.
“Are you actively
• When owners are delinquent they may also lose
privileges to utilize all common area services,
which could include tennis courts, front desk
services, package pick up, etc.
attempting to
collect money?”
Associations are obligated to collect assessments. Failure to collect assessments can ultimately lead to the association’s failure to meet its obligations. The
governing documents obligate every owner to pay assessments. It is important
to remember this while also remembering not to villainize delinquent owners.
Delinquent owners are still members of the community and should be treated
firmly, but with respect. It is important to publish the collection policy at least
once per year and to make it available on a community website. A comprehensive collection strategy that incorporates all of the association’s tools will
ultimately reduce delinquencies and drastically improve collection rates. n
Making Financing Easy for
Condominium and Homeowners Associations
For more than 27 years, BB&T Association Services has been helping
condominiums and homeowners associations navigate the lending
landscape. Making the loan process easier with a simple application,
local underwriting and flexible terms. Talk with us today about your
next project or financing need.
■
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Concrete restoration
Major improvement
Landscaping renovation
Siding replacement
■
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Ron Peck, CAM
Senior Vice President
National Sales Director
772-486-3955
[email protected]
Re-roofing
Window and door replacements
Emergency lines of credit
Insurance premium financing
Association Services
Branch Banking and Trust Company is a Member FDIC and an Equal Housing Lender.
Loans are subject to credit approval. Only deposit products are FDIC insured.
© 2014, Branch Banking and Trust Company. All rights reserved.
6
3/6/15 4:26 PM
3/6/15 4:26 PM
How to Kill Your Insurability as a Community
By Candace Pfab
Brown & Brown Insurance of Georgia, Inc.
©istockphoto.com
T
here is a common misconception that insurance companies are desperate to write coverage and there is an
abundance of providers for association insurance. In fact,
most companies are currently very selective about which communities they will insure. Weather related property damage
claims have been on the rise in Georgia for the last few years,
resulting in big losses and more scrutiny by insurance companies. However, there are many steps you can take to make
your community more appealing to insurance providers so
that you can avoid killing the best offer. Here are a few tips
on how to kill your insurability as a community:
Don’t keep up the appearance of your community – Most companies
use resources like Google Earth™ to determine if the community is in good
shape. They look for deficiencies such as overgrown/diseased trees that
may damage property, cracked pathways that may result in injuries, unstable
fencing, peeling exterior surfaces and distressed roofing on any buildings the
company will be insuring. The board should walk the community at least
once per year, and after severe weather, to survey any repairs needed and
make sure the reserves remain at adequate levels to fund any future maintenance and repairs. High vacancy or rental rates typically lead to higher losses
and may affect insurability. Understand any ordinances or laws that may
require any bank owned properties to be maintained by them and know any
rental restriction provisions in your governing documents to ensure that the
permitted threshold has not been exceeded.
Don’t pay your bills on time or keep continuous coverage – Most
companies will not write insurance for communities that have been cancelled
due to failure to pay on time or if the community is without coverage for a
period of time. Make sure your community knows what policies you have,
when they renew, and how they need to be paid. Sending your payment to
the wrong address can result in late fees or cancellation. Insurance companies consider prompt payment history as an indication that the community is
being effectively managed and has sufficient financial resources to keep the
community in good repair.
Don’t respond – Make sure your insurance providers have a valid email
address that is checked frequently. Avoid using personal email addresses of
board members. Establish an email account for your community that is set
up to forward any incoming messages to all board members and make sure
all board members have access to the account so that no one person has
control of the account. This also enables you to archive correspondence
that can be passed onto future board members. Promptly respond to any
requests for information for your renewal or safety/maintenance requests
from the company. By state law, the insurer must provide a specified number
of days for notice of cancellation or non-renewal. If they do not receive the
information by the date requested, they might issue notice of termination,
which they may not rescind if the conditions are met at a later date. If you
know you cannot meet the conditions, you or your agent will need time to
find the best new provider.
Don’t manage your claims – Insurance companies consider frequency of
claims as well as severity of claims. The first step of the claims process should
be to prevent any further loss, such as water extraction or covering a damaged roof. Second, determine the scope of damage. Most contractors can
provide a rough estimate the same day of evaluation. Understand the deductible on your policy to decide if a claim should be filed. If you file a claim and
then later determine the damage is below your deductible, the company may
C ontinues on page 4 0 .
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Whatever your needs, Union Bank provides solutions that make it easier
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©2015 Mitsubishi UFJ Financial Group, Inc. All rights reserved. Union Bank and Smartstreet are registered trademarks of MUFG Union Bank, N.A., Member FDIC.
8
3/6/15 4:26 PM
To learn more about L&J,
scan the image using your
smartphone’s barcode app or visit:
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Supporting the growth and development of
our Georgia communities.
Lazega & Johanson LLC is a boutique law firm dedicated to excellence in our practice of community
association representation and collections. We value the relationships we have with our clients and believe in
cultivating and maintaining those relationships by providing personal attention, superior services, and results.
Specializing in the following services:
 Collecting Delinquent Assessments
 Advising and Training Boards of Directors
 Enforcing Covenants
 Interpreting and Amending Governing Documents
 Reviewing Contracts
 Resolving Disputes
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Transitioning Communities from the Developer
NEW 24/7 online collection account monitoring and hands-on reporting
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Atlanta, GA 30305
(404) 350-1192 Tel
(404) 350-1193 Fax
[email protected]
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9
3/6/15 4:26 PM
Death and Injury at the Pool –
Are You Properly Covered?
F
ear of water and drowning is one of the top 25 most common fears in
the world today. And although drowning is rare when compared with
the amount of time humans spend in water, it is a common means of
death. In the United States alone, 4,000 people drown annually. Drowning
is the leading cause of accidental death among children ages 1-4, and the
second leading cause among older children.
If you think these numbers are too high, you are not alone.
Organizations such as the National Drowning Prevention Alliance, work
tirelessly to bring awareness to the general public and to increase funding
for learning to swim programs, which are so desperately needed in many
areas.
Not all drowning occurs in swimming pools. Other common locations
are natural bodies of water, bathtubs, buckets and toilets. However, the
most common location for people to drown is a swimming pool without a
lifeguard, usually a home pool. Coroner’s reports do not always contain
information on where the drowning occurred or if supervision was present
at the time, making drowning statistics related to community pools difficult
to come by.
Another reason that accurate statistics on this topic are difficult to find is
that quite often a drowning death isn’t really a drowning in the traditional
sense. It’s often precipitated by another type of medical emergency that just
happens to take place in the water, such as a seizure, stroke, etc. For instance,
an older gentleman had a heart attack while swimming laps in an unguarded
condo pool in Sandy Springs last summer. Unfortunately he was swimming
alone, and no one discovered him in time.
©istockphoto.com
By Craig Sears
Sears Pool Management
“...the most common location for people to drown
is a swimming pool without a lifeguard...”
Unlike how drowning is depicted in movies, it often occurs quickly and
silently, where the people around the victim don’t even realize that he or she
is drowning.
There are a number of things you can do to help make your pool safer
for your community, and reduce liability. Make sure your signage is current
with all relevant codes. A “swim at your own risk” sign should be posted
at all times, regardless of whether you have a lifeguard. Make sure your
pool rules prohibit dangerous activity, including underwater breath-holding
games. Make sure your equipment and facility are well maintained to avoid
C ontinues on page 12 .
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3/6/15 4:26 PM
The pool...from page 10.
injury and that you are compliant with local and federal laws. Make sure your
pool fence does not have gaps, and that your pool gate is self-closing and
self-latching. Close your pool if the water becomes so cloudy you cannot see
the main drains. If you cannot see the bottom, you cannot see a body on the
bottom. Inform your residents via newsletters and blogs on the proper usage
of your facility and general pool safety. May is National Water Safety Month,
the perfect time to remind your residents.
Despite your and your pool company’s best efforts, a drowning may still
occur at your facility. If that happens, are you prepared? Not all drowning
victims die. Many survive, sometimes without consequences. Consequences
range from minor to severe, depending upon the length of time underwater,
temperature of the water, and the age of the victim.
As is typical in other cases of injury related death, lawsuits often follow.
Generally speaking, all potential parties are named, and the court is left to
determine whose fault it is and what (if any) award should be given to the
victim’s family. This begs the question, “Does my association and my pool
company have enough liability coverage to handle a claim?”
Experts report that in the vast majority of drowning deaths, awards are
typically in the hundreds of thousands up to about 1 million. In these cases,
1 million of coverage should be sufficient. If a party is negligent, awards can
be much higher.
What most people don’t realize is that awards are typically larger if the
victim lives, but incurs permanent damage. This is because of the high cost
of post care for non-fatal drowning victims. In the case of children, for every
child that dies drowning, four others are hospitalized for non-fatal drowning,
and three out of those four will suffer permanent brain damage. For those
non-fatal drowning victims who suffer brain damage, their lifespan is usually
shortened dramatically, and their care costs can be significant, up to $180,000
per year and an estimated lifetime cost of $4.5M.
Once a suit is filed, the next step is determining apportionment of liability.
If a plaintiff receives an award, it does not mean they will receive the full
amount. It also does not mean that only one party will be responsible for
payment. Each named party will be apportioned a percentage of the liability,
based upon the court’s estimation of fault. This includes the victim.
If the injured or deceased party contributed to their own injury or death
by acting negligently, they will also receive an apportionment of liability.
Examples include victims who dive in the shallow end of the pool, jump or
dive off the lifeguard stand, leave their children unattended, injure themselves or drown while intoxicated, or break into the facility after hours. In
cases where the victim exhibits negligent behavior contributing toward their
injury or death, the final award is likely to be much lower. In the state of
Georgia, if the victim’s contributory negligence is deemed more than 50%, he
will not be entitled to recover any damages.
In summary, there is no easy answer to the question of how much insurance is enough. However, the standard norm for most associations for
bodily injury and property damage in an amount not less than $1 million for
a single occurrence and $2 million aggregate. The standard norm for most
pool management companies is also $1 million. This should be sufficient
to cover most losses resulting from injury or death at your pool. However,
where negligence on the part of the association or poolcompany plays a role,
it may not be enough.
When evaluating your association’s insurance coverage, make sure you
are covered for how your facility operates and the features on site. If your
pool transitioned from operating only with a lifeguard present to “swim at
your own risk,” make sure that type of usage is covered. If you have a diving
board or waterslide, make sure these features are not excluded from coverage
in your policy. If you have removed a diving board or installed a pool safety
cover, your carrier should be informed, as this may reduce your premium.
When evaluating your pool management company’s insurance coverage,
there are two important steps. First, make sure they have appropriate coverage. Some companies have policies through residential carriers that are not
designed to cover the types of exposures encountered in commercial pool
operations. There are only a handful of carriers that have programs designed
for commercial pool maintenance and management companies. Your pool
company should be with one of these carriers.
Second, consider the coverage to exposure ratio. A company that operates locally managing 50 pools has much less exposure than a company who
operates regionally or nationally managing 500 pools. Naturally, the larger
company has more exposure and should therefore have more coverage.
Comparing the coverage to exposure ratio will help you determine which
company actually has superior coverage.
If you would like more information on reducing liability for your
association, ask a qualified pool management company who understands
the concepts of risk management to do a risk assessment on your facility. In addition, you may contact the non-profit Greater Atlanta Water
Safety Alliance through their Facebook page at www.facebook.com/
GreaterAtlantaWaterSafetyAlliance. They can help you with risk assessments as well as water safety programs and resources for your community
pool. Like their page and send them a message. n
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3/6/15 4:26 PM
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3/6/15 4:26 PM
Yes, Community Associations Need to File Tax Returns!
“Did your HOA file a tax return last year?”
This is one of the first questions I ask when I meet with a new community
association client to conduct an audit or other financial procedure. All too
often the response is “No. Do we have to?”
Community association management companies are diligent about filing
tax returns for their community association clients. I know this because I
prepare a lot of returns for community association management companies.
Unfortunately, self-managed associations often don’t know about the requirement, and therefore don’t file the returns. My estimate is that at least 30% of
self-managed associations don’t file any tax returns, and others don’t follow
the correct process. If your association is not filing tax returns, here is how
you can get caught up and back on track.
Nothing is certain but death and taxes
But let’s just focus on taxes in this article. Condominium and homeowner
associations, just like any other U.S. corporation, must file federal and state
tax returns each year. Just because most associations are considered nonprofit doesn’t absolve them of their income reporting responsibility. In fact,
late, missing, or incorrect tax returns could result in unnecessary taxes, IRS
penalties, and loss of non-profit status.
To file or not to file, that is the question
Most residential community associations elect to be taxed under Section
528 of the Internal Revenue code. To qualify, your association needs to be
legally organized as an association, generate almost all revenue from homeowner assessments, and use that revenue to maintain the common areas. If
this describes your association, most income is not taxable, including:
• Association dues and assessments
©istockphoto.com
By Neal Bach, CPA
Bach, James, Mansour & Company • www.bjmco.com
“...late, missing, or incorrect
tax returns could result in
unnecessary taxes, IRS penalties,
and loss of non-profit status.”
• Architectural Control/Standards Committee fines and fees, like $25 per
day for not replacing pine straw
• Late fees and interest on late assessment payments
• Resident clubhouse and other facility rentals
Certain community association income is taxable, but often that income
can be offset by expenses used to generate that income. Potentially taxable
income includes:
• Bank account interest and dividends
• Guest fees, such as non-resident pool usage
PROVEN. PERSONAL. PRACTICAL.
Full-service legal counsel to condominium and homeowner associations.
For more information, please contact us at
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Visit our blog: www.georgiaassociationlawblog.com
www.wncwlaw.com
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3/6/15 4:26 PM
The Death Of The Statute of
Limitations As We Know It?
©istockphoto.com
S-D Rira, Llc V. The Outback Property
Owners Association, Inc. (2014 Wl 6538085)
By G. Lanier Coulter, Esq.
H
ave an owner who built a new sunroom on their house without getting architectural approval as required by the governing documents?
An unapproved fence? Paint their house a lovely shade of florescent
orange?
Georgia law is clear that when it comes to enforcing such violations, a
community association or any other person or entity entitled to enforce the
restrictive covenant has two years from the date of the violation in which to
bring a lawsuit to enforce the covenant. (O.C.G.A. § 9-3-29). In other words,
there is a two year statute of limitations for breach of covenant claims. (*Note:
Specifically excluded from this statute of limitations is the violation for failure
to pay assessments or fees—this carries a four year statute of limitations). The
statute of limitations is a legal limitation on the time during which a claim can
be pursued through the court system. The purpose of imposing a statute of
limitations is to ensure diligent pursuit of a remedy by the harmed party, and
to protect the interests of the defendant against stale claims which cannot be
easily disproved after the passage of time. If a lawsuit is not filed within two
years from the date of the violation of a covenant, an association has waived
all rights to pursue enforcement or to seek relief requiring the owner to fix
the violation.
THE LAW OF CONTINUING VIOLATIONS
It is easy to determine when the statute of limitations runs on static, onetime or permanent violations, such as the examples given above. The statute
of limitations will run two years from the date the unapproved fence was
installed or the house was painted orange. However, not all covenant violations involve a permanent structure or improvement. In 2003, the Court
of Appeals of Georgia tackled the question of a covenant violation that did
not arise out of a permanent fixture, but rather from ongoing conduct of
the owner. In the case of Black Island Homeowners Assn. v. Marra, (263 Ga.
App. 559, 588 SE2d 250 (2003), there was a restrictive covenant in place
requiring certain property to remain in its undeveloped, natural state. The
subject property had been mowed at various times spanning three decades.
In January 2001, the Black Island Homeowners Association, Inc. mowed the
subject property and adopted a mowing plan for the area in question. Two
owners filed suit shortly thereafter, claiming a violation of the restrictive covenant requiring the property to remain in its natural state. The Association
responded, asserting that the statute of limitations on this claim had begun
to run the first time the property was mowed in the 1970s and therefore had
long since expired.
The Georgia Court of Appeals, however, looked to the law of continuing
nuisance to find that the running of the statute of limitations would depend
on the specific conduct that allegedly violated the restrictive covenants. It
is established law in Georgia that if a nuisance is not permanent in nature,
but rather is one that can be abated by the person maintaining the nuisance,
every instance of the nuisance would be a fresh nuisance for which a fresh
cause of action would lie. In other words, each separate distinct act of nuisance would trigger a new statute of limitations. The Court compared the
violation in Black Island to the prevailing law on nuisance, drawing a parallel
that each mowing of the property in question constituted a distinct, separate
act which constituted a breach each time it occurred and therefore triggered
a new violation with a two year statute of limitations.
This position was upheld ten years later in the 2013 case of Marino v.
Clary Lakes Homeowners Assn., 322 Ga. App. 839, 747 SE2d 31 (2013).
In the Marino case, the Clary Lakes Homeowners Assn. brought an action
against the Marinos for their violation of a covenant prohibiting garages
from being used as storage and requiring vehicles to be parked in the garage.
The Marinos responded, arguing, among other things, that the Association’s
claim was barred by the statute of limitations, as they had used their garage
as storage and parked their cars in their driveway for over 15 years. While
not the only question in the case, the Court of Appeals of Georgia held that
the statute of limitations had not run, as each instance of parking their vehicle
in a location other than the garage was a separate and distinct act which gave
rise to a new two year statute of limitations.
NO SUCH THING AS A CONTINUING VIOLATION?
The issue of the statute of limitations continuing violations from ongoing
conduct was again recently raised before the Court of Appeals of Georgia in
the case of S-D Rira, LLC v. The Outback Property Owner’s Association, Inc., 2014
WL 6538085 (2014). In this case, S-D Rira LLC (RIRA) and related entities
owned property outside of the Outback Property subdivision. RIRA brought
a lawsuit against The Outback Property Owner’s Association, Inc. seeking an
easement over a private road located within the subdivision for the purpose
of accessing its property outside of the subdivision. RIRA (or a related entity)
also owned a lot, Lot 10, within the Outback subdivision and had, in 2006,
built a road across Lot 10 for the purpose of connecting its property outside
of the subdivision to the private road. Accordingly, in addition to seeking
an easement over the private road, RIRA was also seeking a determination
from the Court as to its right to travel over the road constructed on Lot 10.
The Association filed a counterclaim, seeking, amongst other things, an
order permanently prohibiting RIRA from driving on its private road and
across the road built on Lot 10, arguing that the use of Lot 10 as a road was
a violation of the existing covenants binding all lots within The Outback
subdivision. RIRA argued that the Association’s claim was barred by the two
year statute of limitations, asserting that the Association’s right to challenge
its use of the road on Lot 10 as a violation of the covenants expired two years
after it was built, in 2008.
The Association cited Black Island and Marino in its argument that the
statute of limitations had not run. The Association argued that it was seeking
to enjoin the use of the road itself, and each time the road on Lot 10 was used
in violation of the covenants, it was a separate and distinct act, giving rise to
a new two year statute of limitations.
In a 6-6 tie amongst the judges, there was almost a rejection/overturning of the Court of Appeal’s previous decisions rendered in Black Island
and Marino. Six judges found that Black Island and Marino had taken a
departure from previously established law in using the theory of continued
nuisance to address a claim for a breach of a restrictive covenant. These
judges questioned as to why a tort law concept of continuing nuisance should
be applied to a contractual claim for breach of a restrictive covenant and
found that neither Black Island nor Marino offered any support or reasonable
basis for doing so. They further found that the theory of a continuing violation conflicts with the express language of O.C.G.A. 9-3-29(c) itself, which
provides the statute of limitations begins accruing immediately upon a violaC ontinues on page 18 .
16
3/6/15 4:26 PM
3/6/15 4:26 PM
STATUTE OF LIMITATIONS...from page 16.
tion of any covenant restricting land to certain uses. In other words, these
six judges held that the statute of limitations began to run upon the property
owner’s very first use of the property in a way that violated a restrictive covenant. Accordingly, the opinion of these six judges sought to overrule Black
Island and Marino to the extent both cases used the theory of continuing nuisance to establish a continuing violation of a breach of a restrictive covenant.
SO WHERE DOES THAT LEAVE US? SAFE…FOR NOW.
The Court of Appeals was split 6-6 on the issue as to whether Black Island
and Marino should be overruled and it has clarified that its opinion did not
overrule those cases. This means that, for now, Black Island and Marino
remain good law in Georgia and we can rely on the argument that each
separate and distinct action of a violation of an existing covenant constitutes
a separate violation with a two year statute of limitations. However, this position, for the time being, is tenuous and it may be only a matter of time before
the issues of Black Island and Marino and continuing violations are raised
before and decided by the Georgia Supreme Court. Hopefully, if and when
this matter does go before the Supreme Court of Georgia, it will recognize the
difficulty the overruling of Black Island and Marino will present for community associations and the enforcement of use restrictions. In the meantime,
when it comes to the enforcement of covenants, associations should carefully
consider the facts surrounding a violation and its enforcement options and
should involve counsel when necessary. n
At Shaben & Associates we
“Provide Increased Property
Values one Neighborhood
at a Time”.
Let’s put Professional and
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Mike Shaffer, President & CEO
P.O. Box 3189
Suwanee, GA 30024-0989
Phone: 770-271-2252 Ext. 203
Fax: 770-271–8433
[email protected]
18
3/6/15 4:26 PM
3/6/15 4:26 PM
Plant Death, Irrigation Taxes
& Other Landscape Catastrophes
By Rick Barnes,
NatureScapes
S
ometimes we hear things that have little meaning to us until long after
we hear them. My 9th grade English teacher once said to the class:
“All you live for is to die and pay taxes!” The declaration had little
resonance at the time, but I can sure relate to it now! These and other certainties of life often become objects of procrastination,
avoidance, or total neglect. Unfortunate reactions
like this often result in a myriad of unintended and
unpleasant consequences. My hope is that, after reading this, you will take steps to be ready to deal with
those unpleasant realities that befall the landscape:
plant death, resource expenses, and other catastrophes
that tax our budgets!
©istockphoto.com
Expect the Expected. There once was a
90-foot Tulip Poplar tree about 15 feet off of the right
rear corner of my home. It was a magnificent specimen: straight, tall, massive. I had often thought about
installing lightning protection on that tree as I knew it
was the tallest tree in the area. I procrastinated, and, in
August of 2012, the tree was struck by lightning. Tulip
Poplars have a high water content, and the heat of the
strike immediately caused the water in the tree to boil. With no way for the
steam to escape, the tree basically exploded. Fragments were found as far
away as 60 feet in my neighbor’s yard, and his air-conditioning unit was fried
by the strike. Most of the tree debris that was blown away from the trunk fell
straight down- how nothing went through the roof of the house I still consider
a minor miracle. The lightning arced all through the wiring of the house:
one TV was fried while the other was spared. One garage door opener was
ruined, the other perfectly functional. The dryer was fine, but the washer
was gone. Computer, gone. The moral of the story: the lightning protection
would have cost far less than the expense of repairs
and replacements, even with the help of insurance.
Did I mention the 60-foot crane that was required to
remove the tree over the house from the back? And
after all of that, had I put in the lightning protection,
I would still have the tree! There are three takeaways
here for your property:
1. Budget for arbor-care and protective measures for
feature trees in your landscape.
2. Periodically review the trees on your property for
health, stresses, or potential damage to people or
property.
3. Know that trees die too and have to be removed
and replaced.
Tax the Water? Well, perhaps not literally, but
anyone who pays a water bill is aware of how expensive it is becoming. Even
at the higher prices we are all paying for water, it is still a bargain and vastly
taken for granted. In some of the poorer countries on Earth, some people
spend a third to a half of their waking hours fetching and carrying the water
that they use, often from polluted sources. We should feel privileged that
we have conveniently located, highly purified water that we can even use
on our lawns and shrubs. The rising cost of water may make such practices
infeasible in the future: “gray” water that is less pure will likely become the
norm for outdoor watering. While the cost of water continues to rise, there
are ways to save money on this valuable resource:
1. Manage outdoor irrigation to work with rainfall to provide 1” of water per
week
2.Retro-fit existing irrigation systems with water-saving heads, rain-sensors,
and more advanced controllers with “smart” technology
3.Landscape with xeriscape principles. Segregate the landscape according
to water use: trees and shrubs (lower water use), turf and flowers (higher
water use).
Beware of other potential Landscape Catastrophes!
Survival of the fittest rules the day in the landscape. Let me illustrate:
last summer, we had another lightning strike on another Tulip Poplar on
a property. Fortunately, this tree was away from people and cars. Within
days the tree was viciously attacked by Asian Ambrosia Beetles- a devastating exotic insect pest that attacks ornamental trees in our landscapes.
The insects sensed the stressed tree from great distances around and took
advantage of its weakened condition. If the lightning didn’t finish off the
tree, the insects sure did!
As surprising as it may seem, humans can inflict damage, too. Careless
use of a grill led to a deck fire, then landscape plants that were charred and
crushed. It seems a weekly occurrence to us to be called to a property where
a wayward car has driven through a shrubbery bed or hit a tree. Trucks with
bad steering seem to be magnetically attracted to flower beds in their prime
of color or turf areas that could be mistaken for a golf green.
We can rest assured that the calamities will never cease, nor will the
expenses to fix them. We can count on that just like, as my 9th grade English
teacher said, we can count on death and taxes. The question then becomes
how we prepare to respond to the inevitable. Do we anticipate death and
taxes, and then prepare and budget? Perhaps we don’t, hide our heads in the
sand, and then spend $3000 to remove the tree that we could have protected
for a thousand. n
20
3/6/15 4:26 PM
Build a Strong & Stable Association
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Email: [email protected]
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The primary goal of our support services is to benet
our Associations. Our secondary goal is to offer our
homeowners a qualied service company to assist them
in repairs and services at a reasonable rate.
www.atlantacommunityservices.com
21
3/6/15 4:26 PM
CAI-GA Gala 2015...
(left) Angie and Travis
Jinright, Scott Cathey and
Amy Robinson of Russell
Landscape Group
(right) Barbara Walters, Joe Mayfield,
Billy Gray and Amy Rader-Gray of Gray
Contracting
(above) Gala sponsor sign
(above) Great Turnout at the Gala
(below) Danielle of Broadband Planning and
Erin O’Connell of Dorough & Dorough, LLC
(above) Mike Crew, CMCA, AMS, PCAM of Homeowner Mgmt.
Services, Dean Donald, CMCA, AMS, PCAM of Team Mgmt.,
and Pat Pou of Lazega & Johanson LLC
(above) Tracy Henson of Homeowner Management Services and
Andrea Roderick of The McKinley Group
(below) Vicky Sand, Bill Gourley and Jimmy Kim of Weissman, Nowack,
Curry & Wilco, P.C.
(above) David Nichols of Community Mgmt. Associates, Chris Dicks of Ed
Castro Landscape and Brandon Jackson of Greenwood Group
22
3/6/15 4:26 PM
(left) Kelley Moon of EPIC Response and
winner of the CAI Rita Kennedy Award, and
Ashlie Bisig of EPIC Response
(below) Eric Henning of Community
Management Associates
(below) Bradley & Shari Griffin of Atlanta
Landscape Group
(above) Dennis Hoffman, CMCA, AMS, PCAM of Community
Mgmt. Associates, winner of the CAI Hall of Fame Award,
and Dale Pendergraft of P3 Painting & Renovations
(right) Tracy Lanard of
Community Management
Associates, Dale Pendergraft
of P3 Painting & Renovations
and Julie Jackson of
CAI-Georgia
(above) Scott Douglas of
Community Funding Corp.,
and Veronica Cuellar of
DisasterOne, winner of the CAI
President’s Award
(right) Jamie Platt Lyons,
Esq., of Lazega Johanson
LLC , winner of the CAI
Leadership Award, and
Dale Pendergraft of P3
Painting & Renovations.
(below) Dale Pendergraft of
P3 Painting & Renovations,
and Laura Lazar, CMCA,
AMS, PCAM of Parkside
Management and winner of
the CAI Hall of Fame Award
(above) Lisa Fuerst of Pankey & Horlock, LLC, Educator
of the Year winner and Dale Pendergraft of P3 Painting &
Renovations
(left) Dale Pendergraft
of P3 Painting &
Renovations and
Stephen A. Winter,
Esq., of Winter
Capriola Zenner LLC,
winner of the CAI Hall
of Fame Award
Continues on
the next pages.
23
3/6/15 4:26 PM
2015 CAI-GA Gala...continued from previous page.
(left) David Nichols and Amanda Evans, CMCA, PCAM of
Community Mgmt. Associates, Russell Estey of RooterPLUS!, and
Hollie Battle, CMCA, PCAM of Community Mgmt. Associates
(above) Silverleaf Management Group
(left) Steve & Lisa Weibel of
Beacon Management
(above) Eric Henning, AMS, PCAM and, Erin Byers of Community
Mgmt. Associates, Tracy Henson and Glenda Bromer, CMCA, AMS of
Homeowner Mgmt. Services, and David Nichols of Community Mgmt.
Associates
(left) Melanie and
Alex Caceres of
Horizon Painting &
Renovations
(below) Scott & Debra Douglas of National
Cooperative Bank
(left) Teresa Womack
of Northwest
Exterminating,
Keith Shaddix of
ValleyCrest and
Dawn Shaddix
of Northwest
Exterminating
(below) Robert
Hopkins and
Ashley Fullenkamp
of DisasterOne,
Sheri Stebbins and
David Kitchens of 4
Seasons Landscape
(below) Judy & Joe Dreher of Dreher Insurance
(above) Elizabeth Heath and Wayne Urqhuart of
Homeowner Management Services and Faith Brown
of Tower Roofing.
24
3/6/15 4:26 PM
(below) Bill Seatz, Leisa Ballew, Dee Stewart and John Stewart of
Association Mgmt. Advisory Group
(above) Shaune Huysamen
of Tribridge Residential, Ella
Huysamen, Dan Magee of
Greenwood Group, Sarah
Magee, Jodi Vasquez, CMCA,
of FirstService Residential,
Marc Vasquez, Jarrod Talley of
Blueprint Painting & Renovations,
Catherine Talley, Darlene Janis of
Atlanta Community Services, Ben
Rosenquist of Blueprint Painting &
Renovations, and Alex Fiero
(above) Nancy and Ian Mari of Liberty
Lofts Condominiums
(above) Russell Estey of RooterPLUS!, Dean Donald, CMCA, AMS, PCAM and Bill Wetter
of Team Mgmt., Craig Sears of Sears Pool, Keith Collopy of Mutual Omaha Bank, Terrence
Spires of Pest USA, Billy Gray and Michael Anthony of Gray Contracting.
(above) Jill and Merrill Walker,
CMCA, AMS, PCAM Advantage
Community Mgmt.
(left) Teddy Russell of Russell
Landscape Group, Kristalyn
Wright of Community Management
Associates, Kevin Carnes of
Arborguard Tree Specialists,
Tracy Chambers of Homeowners
Advantage, Mark Johnson and
Dale Pendergraft of P3 Painting
& Renovations, Chris Johnson
of Ameristar Roofing, and
Mike Sedacca of P3 Painting &
Renovations
(above) Nicole Shirley of Community
Management Associates and her date
(left) DisasterOne group
photo
(right) Julie Ketner of
FirstService Residential,
Emilio Olarto, Mindy
Waitsman of Moore &
Reese and Ashlie Bisig of
EPIC Response
25
3/6/15 4:26 PM
©istockphoto.com
I.O.U.
THE WALKING DEBT:
Collections Against a
Deceased Owner
W
e’ve all heard the expression that “you can’t squeeze blood from a
stone.” The same adage may apply when the sole owner of a property who is obligated to pay assessments dies. An association that
is owed money cannot initiate or maintain a lawsuit against a dead person
and the debts of the deceased are not transferred to his relatives.1 What can
an association do when an owner’s obligation to pay assessments terminates
at death but title lives on in the name of the deceased?
In Georgia, when a person dies without a will, or “intestate,” title to real
property vests immediately in that person’s heirs at law. If an administrator
is appointed, however, title vests in the administrator until distributed back
to the proper heirs.2 When a person dies with a will, or “testate,” property
vests in the personal representative named in the will until distributed to the
beneficiaries.3 This is typically accomplished with a deed from the executor
to the beneficiaries.4
There are two scenarios where liability for assessments due after the death
of the owner is certain. The first is when there is no will and no administrator
is appointed, but the heirs are known. Those known heirs will be responsible
for assessments due after the date of death of the owner.5
The second scenario is where there is an administered will and a deed
conveys the property to the beneficiaries. Those beneficiaries named in the
deed will be responsible for assessments due from the date of conveyance.
Unfortunately, there are several other scenarios where liability is far less
certain.
For instance, what happens when a homeowner dies and no heirs come
forward to claim an interest or to present a will? What happens when there
is a will, but the personal representative does not administer it or does not
convey the property to the beneficiaries? What happens when the heirs or
beneficiaries are determined in a properly administered estate, but they do
not wish to inherit the property? These scenarios are common when a property has little or no equity at the time of death of the owner.
An association’s remedy to collect assessments due at the time of death by
the decedent is generally limited to a claim against the estate.6 If an estate
was opened with the filing of a probate case, the association may give notice
of its claim for payment according to priority relative to other creditors.7 If
no estate was opened, a creditor such as the association, can be appointed
as administrator8 or offer a will for probate.9 There is also a provision for
appointing the county administrator for the purpose of commencing a lawsuit
against the estate.10
As interesting as these options may seem, the bottom line is that a living
heir or beneficiary cannot be forced to take personal responsibility for property owned by the deceased.11 Moreover, it is unlikely that a person of means
will die and not have anyone come forward claiming an interest in inheriting
the deceased’s assets. Typically, if the deceased owned any valuable assets at
the time of death, relatives will immediately act to protect the value of those
By Stephen A. Finamore, Esq.
Lueder, Larkin, & Hunter, LLC • www.luederlaw.com
assets and to preserve any inheritance they may be due. The owners who
were not fulfilling their obligations during life are usually the ones who will
not have any heirs or beneficiaries come forward to administer their estates
after death. In those cases it will not be cost effective to pursue unwilling
heirs or beneficiaries.
Without any realistic or practical options for collecting the sums owed from
the estate of the deceased, the association is left only with its lien rights against
the property itself. For associations subject to the Georgia Condominium
Act or Georgia Property Owners’ Association Act, the most effective course
of action may be to foreclose the association’s lien. Regardless of who may
have an interest in inheriting the property, those rights can be foreclosed for
unpaid assessments secured by the association’s lien.12 Although there will
not be any personal liability attributed to anyone, the association can obtain
possession of the property. This may be particularly prudent when there are
relatives living at the property having no personal obligation to pay assessments. In that situation, the association may also seek to enforce other remedies such as water suspension, towing, and rent assignment when available.
If no such remedies are available, simply waiting for the lender’s foreclosure
may be the next best action.
Information regarding the deceased owner’s assets and family is key. Any
contact made with any individual claiming to be related to the deceased
owner should be documented. Obtaining copies of death certifications, court
orders, and other documents verifying the details of the estate will provide
critical insight regarding the viability of available options the association may
have. The association should consult with its counsel to determine the best
course of action. n
Footnotes:
1 Goff v. Nat. Bank of Tifton, 170 Ga. 691, 153 S.E. 767 (1930)
2 53-2-7
3 53-8-15
4 53-8-13
5 Villas at Stone Mountain Condo. Ass’n, Inc. v. Blair, 311 Ga. App. 718, 719, 716 S.E.2d 718,
719 (2011)
6 53-7-40
7 53-7-41
8 53-6-20
9 53-5-2
10 53-6-40
11 53-1-20
26
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3/6/15 4:26 PM
Do you have a community
that loves to socialize?
The CAI Green Committee with the help of our generous
CAI members would love the opportunity to provide your community
with a container garden. Please reach out to Barry George of Crabapple
Landscape for more details.
November 11th, 2014 was a special day for CAI’s Green Committee! Special thanks to Mary Ann Maleana, Green Committee member & Communications Chair for Crabapple Lake & Parc Community Association, for coordinating homeowners from the community, the CAI Green Committee and Roswell City Councilmember Nancy Diamond for a Community Container Garden Ribbon‐Cutting Ceremony. Representatives from the community were invited to join CAI's Green Committee to share what they have learned about 'going green' and to help promote greener choices in neighborhoods. One of the Green Committee's many annual service projects is to build container gardens in community common areas. Vendors have donated labor and materials needed to install the containers, but it is up to the community to turn the containers into gardens. The containers for this community garden were installed in early October thanks to Barry George of Crabapple Landscape Experts and Paul Slovisky of Aquascape Environmental. Crabapple Lake & Parc Community Pool Committee Chair, Lynn Thomas, serves on the Green Committee and deserves thanks for coordinating this effort with CL&P Community Garden Chair, Jeanie Witcraft‐Shiau and working with both vendors to see this project through. CL&P knows how to get the kids involved in the community; Jeanie Witcraft‐Shiau organized the first planting in mid‐October, and thanks to Jeanie and her crew of volunteers two boxes filled with dirt became a beautiful vegetable garden. Crabapple Lake & Parc Community Association, is managed by Sherry Perrotta, Atlanta Community Services, Inc. Interested in learning more, come to a Green meeting this year! Please contact Committee Chair Bekke White, Union Bank or one of our members: Marvin Pastel, Leslie Fellows, Barry George, Emily Cantrelle, Dick Patterson, Carlyle Douglas, Paul Slovisky, Brandon Thomas, Jeanie White, Noreen Balcer, Chris Ruthruff, Chuck Negas, Emil Bekyarov, Maryann Maleana, Evan Conroy, Lynn Thomas, Sherry Perrotta, Michael Pullen, Jane Beasley, Christy Barber and Board Liaison Ian Mari. 28
3/6/15 4:26 PM
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3/6/15 4:26 PM
Georgia Commons • Third Quarter 2014
The Certainty of Death and Taxes
By Pamela J. Irwin, CMCA, PCAM
D
eath and taxes may not be the most pleasant subject to discuss but it
is an important topic. It can be an unpleasant surprise to take over
the management of a homeowners association only to learn they owe
back taxes. As a point of clarification, property taxes would only apply to
homeowners associations. Common property of a condominium association
is subdivided among the owners.
You may receive a notice of intent to issue FIFA from the city or county.
This notice is not referring to the Fédération Internationale de Football
Association or as Americans call it, soccer. If you receive a notice of FIFA,
(Fieri Facias) it is a directive from the court to the sheriff, marshal, or other
authorized officer, requiring them to seize, levy upon, or sell at public auction
sufficient property to satisfy the amount due on the judgment. This is serious
and needs to be addressed promptly. Call the city/county clerk’s office to
make payment arrangements ASAP!
Sometimes, the city or county will experience some sort of hiccup with
their reporting or billing software and the tax bills are not mailed or maybe
they were lost in the mail. It has happened to me. One year, I received tax
bills for all my parcels. Then, there was some sort of software upgrade and
the new system reverted back to old mailing addresses. Thus, I did not
receive property tax bills the following year since they were sent to the previous address. If you don’t notice, this could go on for years. Then suddenly,
once the city corrects the problem, you receive a notice the homeowners
association owes not only their past due taxes but interest and penalties. This
can be painful. Treasurers aren’t always watching for this sort of discrepancy
either.
There’s not an easy way to track down the tax bills for a property if you
don’t know all the parcel identification numbers. Typically, we rely on historic data to pay the taxes each year. You may find for ten years you’ve been
paying property taxes for three parcels of land then out of the blue you learn
there’s a fourth and you owe ten years of property tax.
In an ideal world, each homeowners association should have all parcel
identification numbers provided to ensure all the property taxes are paid
each year. If you are uncertain you have all the parcel identification numbers
for your property/properties, you may need to enlist some help. Your attorney may be able to pull the applicable tax map with the recorded subdivision plats to determine if all the
common areas of the community
“In an ideal world, each
were accounted for using what
parcel identification numbers you
homeowners association should
do have.
Tax records may show the prehave all parcel identification
vious management firm as the
numbers provided to ensure all the
contact or the developer’s address
so you’ll need to have the inforproperty taxes are paid each year.”
mation updated. The attorney
can help with this as well if you’re
unsuccessful trying to correct the address online.
The other grim topic is death. It affects property management as well. If
an owner of a unit or single family home dies and there is not a partner with
the right of survivorship, then often the property is left to someone, such as a
family member, if there is a will. Following the death, the executor will file the
deceased’s will in probate court, where a judge will determine the validity of
the will. If the will is considered valid, all property and assets are distributed
according to the terms of the will. The rightful heirs or beneficiaries of the
estate will take title through the will. The assessments owed to the association are to be paid by the estate/new owner. This is a sensitive time for the
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31
3/6/15 4:26 PM
Death of a Judgment
By Laura C. Horlock, Esq.
©istockphoto.com
S
o you got your judgment against the delinquent owner who has never
paid a dime of assessments. You dance around with the other Board
members, waiving the judgment in the air, hardly believing that justice
has finally come. But what happens if you can’t collect the judgment? How
long can you wait to enforce the judgment? How long will the judgment last?
Does a judgment ever die?
Judgments will die if you wait too long to do anything, but keeping a judgment
alive is relatively easy. When you get a judgment for past due assessments, ask
the clerk of court to issue a Writ of Fieri Facias (a Fi Fa) on the judgment. A Fi.Fa
is a fancy Latin word for a document that allows the county sheriff to seize and
sell the judgment debtor’s property to satisfy the debt. It also is a document used
to record the judgment in the county records so the judgment will attach as a lien
to the judgment debtor’s property. So the Fi.Fa. is a very important part of the
judgment and requesting the court to issue and record a Fi.Fa. should be the first
thing you do after you get a judgment.
Once you record the Fi.Fa, the judgment is good for seven years from the
date of recording. You can renew the judgment in seven years by sending the
Fi.Fa. to the Sheriff to enter Nulla Bona, which is, for all practical purposes,
a fancy word for “renewing the judgment.” However, this must be done
before the seven year deadline. If you fail to renew the judgment within the
seven year deadline, then the judgment goes dormant and can’t be enforced.
Why would you want to do this? If you haven’t been able to collect the
judgment for seven years, what’s the point? Isn’t it for all practical purposes dead anyway? Maybe. Some debts just can’t be collected or are for
such a small amount, and they aren’t worth the time and trouble to renew.
However, if the judgment is a big judgment, there are good reasons to keep
the judgment alive, even after seven years. Renewing a judgment is easy
and inexpensive, usually less than $50.00 in court and sheriff’s fees. So you
don’t have much to lose by renewing the judgment. But more importantly,
a recorded judgment is a very easy form of passive collection. The recorded
judgment attaches to all of the judgment debtor’s real estate in the county in
which the judgment is recorded. You can also record the judgment in any
other county in Georgia, and it will attach to any real estate owned in those
counties as well. If the real estate sells, then your judgment should get paid
as part of the sale - as long as the judgment hasn’t expired. If the judgment
debtor tries to refinance his existing mortgage, then the lender will require
the debtor satisfy the judgment as part of the refinancing – as long as the
judgment hasn’t expired. Likewise, debtors will occasionally “lay low” for a
long time after your judgment is entered, perhaps hoping that you will forget
about them. You never know when the judgment debtor is going to pop
back up on the radar with a new job. Keeping the judgment alive gives you
an opportunity to collect the old debt. Because of this, you don’t have much
to lose by renewing the judgment.
As with any legal matter, there are a number of ins and outs relating to recording a judgment and keeping it alive. Be sure to consult your attorney when a matter like this comes up so you’ll know how it applies to your specific situation. n
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33
3/6/15 4:26 PM
Death of HVAC
By Shawn Mayabb
Building Performance Institute, Inc. Certified Envelope Professional and Building Analyst, Horizon Painting and Renovations
Here are 10 tips for hiring an HVAC contractor and
making your purchase.
1. Do research through the internet and customer satisfaction websites like
Angie’s Lisa, Kudzu, etc., and check the Better Business Bureau.
2. Ask for referrals from friends, neighbors, and family members.
©istockphoto.com
W
ell guys it’s that time of year again where we are fighting with
ourselves on whether we should repair or replace the Heating,
Ventilation and Air Conditioning (HVAC). Hopefully, this article
will help. Here are three easy and inexpensive ways to keep the system running efficiently with fewer problems.
First, there are different types of filtration options for the HVAC system. A
typical 1” filter, media filters and mechanical air purifiers. These need to have
regular maintenance by either a licensed technician or the homeowner. The
1” filter should be replaced once a month and the media filter and mechanical air purifiers should be serviced according to manufacture specifications.
A dirty filter will slow down the air flow and make the system work harder.
This is an energy waste and it also shortens the life span of the motor.
Second, having a twice yearly system check performed by a licensed professional will keep the system operating efficiently and catch any potential
problems before a system would fail.
Lastly, make sure there is sufficient clearance around the outdoor unit for
air flow. Don’t plant bushes or trees too close to the unit. Don’t build a fence
or in any other way try to conceal the unit by putting a barrier too close. This
will keep the air from being allowed to flow freely through the unit.
There may come a time when you have to decide whether to repair or
replace. Nursing an older unit along may seem like you are saving money,
but in reality, you are spending more on energy costs than what the unit is
worth.
The website “energystar.gov” recommends replacing the air conditioner or
the heat pump after 10 years of service. The gas furnace has a recommendation to replace after 15 years of service. For homes that have electric heat and
air, you need to replace the air handler at the same time you replace the heat
pump. These are a matched set designed to work together. Depending on
what caused the system to go out, by only replacing one item of the set, the
same issue could cause the new piece to stop working due to contamination
of the refrigerant passing between the two.
“...should [we]
repair or replace
the Heating,
Ventilation
and Air
Conditioning
(HVAC)?”
6. The consultant should spend a significant amount of time inspecting
the existing system and asking questions about the performance of your
system and any problem areas you may have with its ability to heat and
cool. A Manual J calculation should be done to examine whether the
existing system is sized correctly. If the system is oversized, it will heat
or cool rapidly. This makes the home feel uncomfortable. It is also an
energy waste. If the system is undersized, it will run longer and it will be
harder to maintain even temperatures and not be able to reach a desired
temperature.
7. Get a written estimate from each consultant. Make sure they include
model numbers of the equipment proposed and the final price. The best
equipment isn’t cheap and cheap is not always the best.
8. Make sure to have a written contract that both parties have signed before
any work begins. If the consultant hasn’t signed the agreement, you don’t
sign the agreement.
9. The company you choose needs to do a Quality Control Audit a couple
of days after installation. This should be performed by a licensed service
technician.
4. Ask the consultants that visit with you if they have any rebates or special
offers. This is one of the biggest purchases you will make for your home.
10. Make sure the company you choose files all your registration for warranties and processes any rebates or incentives with local energy providers.
5. Look for Energy Star qualified products. These products meet strict
energy efficiency guidelines set by the U.S. Environmental Protection
Agency.
The U.S. Department of Energy, U.S. Environmental Protection Agency,
EnergyStar.gov and your local government licensing agencies all have more
information so you can make the best decision for you and your family. n
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PM
2/22/12
Proving Your Collections Case:
The Death of the “Balance Forward” Ledger
By Benjamin Ost, Esq.
“Prove it!”
Whether it is one kid calling another kid’s bluff on the playground or Robert
Kraft, owner of the New England Patriots, demanding proof of “Deflate-gate,” the
idea of backing accusations with evidence is essential to the American ethos. This
spirit arises from the very heart of our justice system – that people are “innocent until
proven guilty.” Anyone who has spent time trying to collect unpaid community
assessments has heard those words – whether they come from the homeowner, the
association attorney, or the Judge. A recent Georgia case has resoundingly issued the
same challenge and the wise association will heed the warning.
A Case Like Any Other
Hayek et al. v. Chastain Park Condominium Association, Inc., No. A14A1134
(Ga. App. Sept. 25, 2014).
The case began like any of the hundreds, if not thousands, of association
assessment cases pending in Georgia courts at any given time: the condominium association’s ledger showed years of delinquency
for a unit owner. The community association manager
“The unit owner...
sent a letter to the owner. No response. The file was
sent to the association’s attorney who sent another,
filed an answer
sterner, letter threatening litigation. Still no response.
denying the amount
Suit was filed. That got a response. The unit owner,
surprising no one who has worked in collections
owed.”
before, filed an answer denying the amount owed.
In the Hayek case, as often happens, the association filed a motion for summary judgment which was supported by the
affidavit of the property manager and a ledger showing the amounts owed
by the delinquent owner. The trial court granted the Association’s motion
and entered judgment in its favor for almost all of the amounts requested
(after shaving a little off the top of the attorney’s fees and expenses of
the suit). The unit owner appealed the decision, complaining, among
other things, that the evidence of the amounts owed was insufficient and
inadmissible.
Admissible Evidence: a Simplistic Summary of a
Boring, but Important Legal Issue
Evidence is essential to a plaintiff’s case. Not just any evidence will do,
however. Watch any episode of “Law and Order” and you’ll see that just
because the murder victim’s second cousin can attest that his brother’s girlfriend heard the alleged murderer say that they were coming for the victim
with a gun in each hand does not result in a conviction. Evidence must be
admissible. Generally, this means that the person providing evidence has
to have personal knowledge of it and must be available to testify regarding
the facts.
In the context of an association collection case, the evidence of the debt is
usually in the form of a ledger. Therein lies the problem – odds are good that
if an owner has been delinquent for years there is no single board member or
community association manager who has been around long enough to have
personal knowledge of each and every unpaid item on that ledger. Georgia
law lends Associations a hand in the form of the Business Record exception
to the hearsay rule. Overly simplified, any person charged with keeping the
ledger can swear to its accuracy even if they did not personally enter every
item on it as long as it is a record of the Corporation and it meets several
other criteria.
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The Inmates are
Running the Asylum —
A Perspective Shift
CAI-Georgia
2015 Calendar of Events
E
veryone has a custom
currency. An effective
teacher taps into this
to connect with what a student values most: A child
fascinated with Transformers
toys more easily learns the
alphabet if provided ‘transformer’ letters that twist into
characters. As we mature,
these currencies become an
overlooked language, but still shape our interactions. In many ways, they
are our native language.
When we talk about running a transparent organization, we are really
attempting to overcome the confusion and conspiracy that crops up as these
‘languages’ muddy the translation. It is not always easy bridging the gap into
a universal language.
In the two months leading up to the annual meeting for a particular homeowners association, some owners, along with the Board treasurer, were accusing other
Board members of mismanagement. The revolt crystallized due to renewed
enforcement of leasing restrictions and regulating community access.
The discontented shared a common currency of individualism and special
distrust of authority. When it came to determining terms of service for the
election, this group challenged the validity of all meeting Minutes stretching
several years. At a special town hall meeting, the Board, management and
legal counsel attempted to clarify using English. The ‘language’ of the crowd
overshadowed all reasoning.
One failed translation: The term of service is not linked to the office title
(president, secretary, treasurer) held by the person. Over the past year, some
Board members had been appointed into empty spots. Afterward, the Board
reassigned officer positions, but the original length of term for each Director
remained unchanged. To the homeowner group, this was a shell game.
If the leadership had addressed the crowd in the currency of individualism,
not legalism, it might have looked like this: No Board member joyfully inflicts
misery on him or herself by coming up with rules that make mad neighbors.
Board members have to live under the same rules as their neighbors. We all
value the freedom enjoyed within the ‘castle’ of our home and don’t want someone needlessly someone sticking his or her nose in our business.
Communicating this, followed by the reasons for why the regulations were
critically important, would have been more effective: This particular community is in dire need of a one million dollar bank loan to address safety
issues. The banks will refuse to lend unless the leasing situation is reigned in.
In a way, it’s the lending system that is infringing on our individualism. They
have the money and get to call the shots. We homeowners may decide that
giving up this freedom for a bank loan is not worth it. But we then must be
prepared for a huge special assessment.
Sharing the above, not once, but seven times in several different ways to
offset a misinformation campaign, was able to bring the crowd in for a soft
landing at the annual meeting. They were actually able to conduct all their
crucial business within sixty minutes and get everyone out at a decent hour.
Leading up to the meeting, the rogue Board member had tried to worsen
the situation by leaking inaccurate information about the finances. But by
the time of the annual meeting, every homeowner had a copy of the financials and could see that everything was in order. It later came out that this
Treasurer had never reviewed or understood any of the financials, despite
coaching for her duties when she was first appointed.
Although the election placed the ‘crazy’ homeowners on to the Board, they
had learned enough in the final days to move cautiously with a broadened
perspective. It is now up to them to tap into their shared currency with those
that elected them. n
©istockphoto.com
By David Hill, CMCA, AMS, PCAM
Access Management
January
June
M-100 Class –
Community Leadership
01/22/15-01/23/15
Century Center Marriott
8:30 AM – 5:30 PM
Casino Night
06/12/15
Roswell Historic
4:00-8:30 PM
Gala Awards Dinner
01/24/15
The Westin Perimeter
6:00-10:00 PM
CAI National Law Seminar
01/28/15-01/31/15
San Francisco, CA
February
Bowling Tournament
02/19/15
Brunswick Bowling
4:00-8:30 PM
March
Speaker Luncheon
03/20/15
Cobb Energy Center
11:30 AM – 1:30 PM
April
Tennis Tournament
04/24/15
Windward Lake Club
11 AM – 5 PM
July
Manager Luncheon
07/31/15
Location TBD
11:30 AM – 1:30 PM
M-201 Class
07/30/15-07/31/15
8:30 AM – 5:30 PM
August
CAI-Georgia
Neighborhood Expo
08/27/15
The Retreat at Perimeter Summit
1-7 PM
September
Speaker Luncheon
09/18/15
Hyatt at Perimeter
11:30 AM – 1:30 PM
October
CAI National Conference
04/29/15-05/02/15
Las Vegas, Nevada
CAI-Georgia Golf Tournament
10/15/15
Heritage Golf Links
11:00 AM – 5:30 PM
May
November
Social
05/07/15
Location TBD
Time TBD
Social
11/05/15
Location TBD
Time TBD
Speaker Luncheon
05/15/15
The Westin
11:30 AM – 1:30 PM
December
M-203 Class
05/28/15-05/29/15
8:30 AM – 5:30 PM
Luncheon – 12/04/15
Location TBD
11:30 AM – 1:30 PM
38
3/6/15 4:27 PM
PROVING YOUR CASE...from page 36.
The Decision: the Death of the “Balance Forward”
In the case above, the owner appealed the association’s judgment on the
grounds that the ledger was inadequate proof of the amounts alleged. The
specific issue? On the ledger were several large entries with very general
descriptions; including one entry for many thousands of dollars described
only as “balance forward.” The Court of Appeals agreed with the owner and
sent the case back to the trial court for a review of the amounts owed. The
reasoning? The “balance forward” entry was not specific enough in that it did
not provide what the amount was comprised of (was it for interest, late fees,
assessments, or fines? – we may never know) and the community association
manager’s affidavit shed no further light on the subject.
The Implication: Why Associations Should Care
Many collection suits have similar ledgers and it is likely that most board
members or community association managers can adequately prove a
“balance forward.” The reasons for such “balance forward” entries vary,
but commonly arise when (1) an association switches to a new community
association management company; (2) the entry comes from a third-party as
a lump sum, such as a law firm or collection company; or (3) the association
simply has not been doing the best job with its records and the result is annual
or semiannual entries for large, unexplained amounts.
The Court of Appeals has sent a clear message with its unceremonious
treatment of the ledger with a “balance forward.” Associations and their
agents are now on notice that courts will no longer accept ledgers with
amounts that are not adequately described, itemized, and sworn to by a board
member or community association manager. Fear not! Your community
association attorney can help ensure that your association is keeping financial
records sufficient to get your judgment! n
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3/6/15 4:27 PM
kill insurability...from page 8.
death & taxes...from page 30.
family while they are grieving so please be reasonable with the demand for
payment.
If there is no will, the person who is next of kin can file a petition for probate to open the estate and serve as personal representative as the executor
or executrix. He or she must collect the assets, pay or resolve any claims or
bills and the expenses of the estate proceeding, keep other interested persons/
family members informed of the progress of the estate administration, file the
final tax returns, prepare an inventory of accounts, and distribute the assets to
the persons entitled to receive them. This process takes a minimum of eight
months and often takes a year or longer.
In the event the deceased property owner had no heirs, the estate and all
assets would be assumed by the State. To satisfy any taxes/liens owed the
property, it would be sold by the county. This may motivate you to draft
your own personal will if you don’t already have one for peace of mind and
concern for those left behind. n
have already incurred some investigation expense that will impact your loss
history. For any claims paid by the insurance company, complete all repairs
promptly so that the company can close the claim. Typically, estimates, on
the high side, are used for loss history until a claim is closed. When practical,
advise your insurance provider of any steps taken to prevent any repeat of
losses experienced. Address any homeowner reports of potentially hazardous conditions in a timely manner to prevent loss and avoid any claims of
negligence by the board.
In summary – Manage your community like a business and keep the communication flowing with your insurance providers to keep your community’s
insurability alive! n
tax returns...from page 14.
• Non-resident clubhouse or facility rentals
• Payments for easements, like cable lines or cell towers
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We are a full service community association law firm providing collections,
covenant enforcement, litigation and corporate governance services to
condominium, townhome and homeowners association clients.
(404) 459-7055 Main
(404) 459-6001 Fax
[email protected]
www.gaddislanier.com
5555 Glenridge Connector
Suite 200
Atlanta, GA 30342
Filing annual tax returns
Community association tax returns are due by March 15th for most communities, or 2.5 months after the fiscal year-end for communities that don’t
follow calendar year accounting. As an example, if your association’s fiscal
year ends on June 30, your tax return is due September 15. In either case,
you can also file for a six-month extension if you need more time to prepare
your tax returns.
While catching up on missing tax returns can be somewhat daunting, the
process of filing an HOA’s annual federal and state tax returns is fairly simple
and inexpensive. There are two potential IRS forms used. The “standard”
IRS form 1120H applies if your association meets the following criteria:
• 85+% of units (homes, condos, etc.) are used as residential.
• 60+% of revenue is from association members rather than sales of goods
or services.
• 90+% of expenses go to support the operation and maintenance of association property.
The more extensive and complicated Form 1120 may be required if your
association doesn’t meet the above-mentioned criteria, or if it is filing late. It’s
always best to review filing and form options with a CPA who has experience
working with community associations.
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Don’t shoot the messenger
I sometimes receive calls from panicked board members when they first
discover their community association hasn’t filed taxes in years – or ever.
Technically, those associations need to catch up by filing all back tax returns.
But let’s also be reasonable. If an association’s financial records are only available for the previous five years, let’s focus on filing tax returns for those five
years and then keep current going forward. It’s most important to show that
your association is remedying the situation as quickly as possible.
Read this before having tax returns prepared down
the “block”
Recently, the board treasurer of a self-managed community association
asked me to review their tax returns after having them prepared at the strip
mall location of a national tax services provider. The board treasurer questioned why the association had just paid over $5,000 of income taxes. Good
question!
It turns out that the tax preparer incorrectly categorized the community
association and used the wrong tax return form. Once we recalculated the
return using the correct IRS forms and formulas, the tax due was actually $0.
We refiled the correct tax returns and the association received a full refund.
Who let the IRS in?
Don’t be the board member who caused the IRS audit. When you hire
a qualified CPA with community association experience, filing tax returns
(even back returns in most cases) will be a pretty straightforward process.
Make annual tax returns the first agenda item for the first board meeting of
every year. Please let me know if you have specific questions. n
40
3/6/15 4:27 PM
The Death of Face-to-Face Communication
By Kim Blair
NFC Amenity Management
A
few years ago, I shared an office with the community association
manager for an active adult community of 800 homes. Most of the
residents were retired and spent their leisure hours exercising, playing
games, socializing or attending meetings for numerous committees. Because
the community association manager’s office was located near the entrance of
the community clubhouse, it was not uncommon for residents to stop by the
front desk to say hello, pick up an activities calendar or sign up for an upcoming social activity. On many occasions, residents would use this time as an
opportunity to ask a question about a recent Board decision or inquire about
landscaping or other services that involved their homes and community. As
was customary, the residents often asked to speak to the community association manager who, despite sitting on the other side of the wall, instructed his
staff to say he was busy or unavailable. The residents would then go home
and call or email him, but he wouldn’t respond. Day after day, the same
residents would come by, ask to speak to the community association manager, and then walk away upset that once again, he never talked to them. In
fact, the staff and I used to take bets on how many messages he would have
to receive before responding to a resident on any given day. Would it take
five messages? Five phone calls? Ten emails? The more the community
association manager ignored the residents, the more emails and calls his staff
had to field. We became experts at helping angry retirees calm down when
they were ignored. After a while, the difficulty of dealing with the absentee
community association manager took a toll and many employees left. The
community association manager was eventually let go.
Working as a lifestyle director for the active adult community gave me an
opportunity to get to know the residents and hear their life stories. Many
had successful careers and were retired CEO’s, business owners, physicians,
decorated war veterans, or deacons at their church. Many had endured painful losses: the loss of a spouse, a child, a job, or their health. Many loved
to talk about their grandchildren, their travels, their pets and their gardens.
Many were lonely and just wanted to be heard. For them, being heard was
more than just an email, particularly since some didn’t have a computer,
and more than just a phone call since many had difficulty hearing. These
residents wanted an in person, face-to-face conversation with each other and
with the manager of their community. Being ignored just exaggerated the fact
that they were not being heard, which translated into not being needed. Being
needed, after all, is essential for their happiness.
Community association management is a difficult job and I can’t imagine
how stressful it must be handling the long list of complaints and requests that
come through a manager’s office on a daily basis. I don’t pretend to know
how to handle the communication that is so essential to one’s job. What I do
know is that a friendly handshake and warm smile can only be exchanged
in person. Wouldn’t five minutes of face-to-face dialog that acknowledges a
resident’s voice be much more effective then thirty minutes of hastily written
email exchanges or ten minutes of “phone tag” with voice mails that never
get heard? Imagine that the community association manager for the active
adult community agreed to set aside a time each week for coffee with the residents or allowed a three-hour window of time devoted solely to meeting with
folks in his office. Imagine that he said little, but listened intently to resident
suggestions or complaints while nodding and smiling with understanding.
Imagine that the residents were greeted with a warm handshake and made
“Wouldn’t five minutes of face-to-face dialog that
acknowledges a resident’s voice be much more
effective then thirty minutes of hastily written
email exchanges...”
to feel important. Think how much time would be saved in multiple email
exchanges, voice mail retrievals and constant interruptions daily as the staff
had to tell the residents, once again, that the community association manager
was unavailable.
If face-to-face communication is valuable to residents of an active adult
community, then surely it is valuable to most communities managed by
homeowners associations. With face-to-face communication, body language
and nonverbal cues often give clarity and help calm people that are upset.
It is much more effective when handling a disgruntled resident to nod one’s
head in acknowledgement, smile if appropriate and say ‘yes, I understand’
then engage in confrontational electronic dialog. With emails and texts, the
message is often sent in haste, causing it to be misread or misunderstood.
How many times have we all hit ‘send’ and instantly regretted our mistake?
Research has shown that a warm handshake and smile lowers blood pressure
and makes us happy. According to neurologist Shekar Raman, MD, “a hug,
pat on the back, and even a friendly handshake are processed by the reward
center in the central nervous system, which is why they can have a powerful impact on the human psyche, making us feel happiness and joy. And it
doesn’t matter if you’re the “touch-er” or “touch-ee”. The more you connect
with others -- on even the smallest physical level -- the happier you’ll be.”
When residents are happy, they truly feel part of a community. And in a
community, face-to-face communication should not be dead. n
41
3/6/15 4:27 PM
Sustainable Washing — Myth Busters
By Marvin Pastel, Esq.
Winter Capriola Zenner, LLC • [email protected]
A
fter dinner have you ever wondered what’s more sustainable: washing
the dishes by hand or using the dishwasher? Mused when setting the
breakfast table: should I use ceramic plates or paper plates? Or when
washing clothes: is there any benefit to the new cloth washing detergents, or
using hot water instead of cold water? We all probably have an instinctual
answer, or an answer we believe we heard somewhere (i.e.; a myth). The
answer to these questions/myths may surprise you. More surprisingly, the
answers are not the same for all of us.
Framing the sustainable question is important. A lot more goes into the production of a clean plate than simply the running of a dishwasher or the scrubbing
by hand. Consider also the ‘cradle to grave’ footprint of the dishwasher. Much
energy and resources are used in the manufacture and distribution. Consider
the impacts of when the dishwasher reaches the end of its lifecycle and becomes
waste. In contrast, a kitchen sink is a multipurpose item that you already have in
your house, versus the additional dishwasher footprint.
Individual sustainability is often hard to quantify. The answer to this
question may depend on several different factors, including size of household, amount of dishes used per day, efficiency of the home’s water heater
(boiler vs. flash), fuel source of energy provided to the household, the city’s
wastewater treatment plant capacity/advanced treatment and other possible
unnamed factors.
The question we need to make sure we are always examining is: taking
into account all sources of sustainability: water, energy, manufacturing, distribution, product duration, product reuse, etc., and our personal use, which
method is more sustainable?
Straight away from the above, we know the dishwasher starts this environmental ‘race’ far behind. Does it catch up? New dishwashers are very energy
efficient and use very little water. Most people wash their dishes while constantly running hot water, and that method uses more water and more energy
than a dishwasher. Choosing the light wash or air dry cycles, can further
reduce your dishwasher’s energy substantially; lowering the household water
temperature favors hand washing.
Let’s dig deeper. Dishwashers typical use one gallon of water per person
per day. New efficient dishwashers use significantly less energy, as well as
water, compared with machines from 10 years ago. The benefits of installing
an efficient machine will be realized through both energy and water savings.
Dishwashers are used between 0.1 and 0.2 times per person per day. Many
new dishwashers do not require pre-wash or pre-rinse of the dishes before
loading. Clearly the potential water savings from dishwasher efficiencies
greatly vary in different households.
When comparing only the water used inside the dishwasher, hand washing
uses an average of 23 gallons more per session or up to five times that of a new
dishwasher. However, this is based on (1) a single sink method of hand washing
versus a separate wash and rinse tub; and (2) fully loading the dishwasher and
assumes no pre-rinsing or pre-washing dishes before loading them into the automatic dishwasher; habits that vary from household to household.
So which method of cleaning your dishes is better for the environment,
dishwasher or hand-washing? As we see, the water and energy savings realized from new efficient dishwashers or methods of hand washing can vary
greatly depending upon the practices of a household. If you’re an average
household following average practices (i.e.; dishwasher older than 10 years
and single sink dish-washing), neither method is very sustainable. Clearly,
installing a new automatic dishwasher offers the potential for significant sustainability over hand-washing, especially when dishwashers are fully loaded
when operated and the user does not pre-rinse the dishes unnecessarily. On
the other hand, if you’re up to the task and have a double sink, you can conserve now by double sink washing until you replace your dishwasher.
What’s greener: Ceramic or Paper plates?
As with dishwashers, ceramic plates start behind, but not by nearly as
much. Paper plates are usually made from around 40 to 60% post-consumer
paper and most of the rest comes from lumber by-products. While its takes a
lot of energy to make, package, and ship them, let’s compare that to ceramic
plates. Ceramic plates are generally made from recycled glass or mined. Here
to, much energy is used to make, package, and ship them. On top of this,
ceramic plates have got to be washed. Paper plates of course do not need to
be washed, but then there is the waste issue.
As for the paper plates and similar disposable items (plastic utensils), you
have transporting costs again and again over long distances. Recycling may
appear to be the easy way out for the disposal of those paper plates and plastic forks. Paper plates, if soiled, often cannot be recycled. Many paper plates
have coatings that make it impossible to reprocess. Not all grades of plastic
can be recycled. And even if your community could recycle each and every
disposable fork or cup, they still require energy–and water–to create new
batches of paper or plastic goods. Then we have the issue of landfills and the
methane gases that result from millions of tons of garbage simmering over
hundreds of years.
What’s the verdict? If you have an old dishwasher, and you’re not up to
double-sink washing, paper plates are your clear winner. On the other hand,
if you have a state of the art dishwasher, and use it sustainably, ceramic
plates are a clear winner. For those in-between, your individual factors will
determine. Likely it’s a draw.
Sustainable Cloth Washing
Looking at laundry in the context of the life cycle of clothes, up to 80 percent of our clothing’s lifecycle impact comes from washing and drying. It takes a
lot of energy to heat the wash water and run the dry cycle. So let’s clear one myth
right out of the box. According to Harvard University, washing in cold water is
every bit as effective as washing in hot for everyday loads; it helps your clothes
last longer (hot wears them out), and it uses 1/10th of the energy needed to run
a hot wash! Switching to cold water washing will contribute to dramatic energy
savings. If all U.S. loads of laundry were switched to cold washing for 1 year, it
could power the Empire State Building for up to 86 years.
When looking at water consumption, the average household does almost
400 loads of laundry each year, consuming about 13,500 gallons of water (7
swimming pools worth). A ten year old top-loading washing machine uses
twice the amount of water as a newer front-loading washing machine.
Cloth washing uses a lot of chemicals in detergents, fabric softeners, and
drying sheets. Conventional detergents contain ingredients that aren’t good
for you, your clothes, or the aquatic ecosystems. The phosphates in conventional laundry soaps cause algal blooms that negatively affect ecosystems and
marine life. Eco-friendly detergents are readily biodegradable and phosphatefree and are made from plant- and vegetable-based ingredients (instead of
petroleum-based), which means they’re healthier for the planet, from production to rinse cycle. These are often gentler on the skin, too.
Fabric softeners can be replaced with a cup of white vinegar added to the
washer during the rinse cycle. Vinegar naturally balances the pH of soap,
leaving your clothes soft and free of chemical residue. Ditching the dryer
sheets is a must. They are full of cancer-causing chemicals and neurotoxins
such as toluene and styrene. They also break down organic fibers, shortening
the life of your fabrics. If you want, toss a sachet of dried organic lavender in
the dryer for a healthy, sweet scent.
Concentrated laundry detergents offer an extra green boost. They have
reduced packaging and a smaller carbon footprint (because more useful
product can be shipped using less space and fuel). Wal-Mart now sells only
concentrated laundry detergents; soon it may be the only kind you can get.
Drying racks can significantly reduce your drying energy. Air cloth drying
doesn’t have to be an all or nothing choice. Using a drying rack for those few
items that take forever to dry or for the delicate items can significantly reduce
your drying cost. Cleaning the lint filter frequently will increase efficiency
and shorten drying time.
From these examples we can see the question isn’t so much, which is
better. Rather, often it’s how we preforming these tasks. Being sustainable
doesn’t mean we have to change our habits from dishwasher to hand washing. Rather it means being conscientious about washing the dishes. Run it at
night and let the dishes air dry, instead of using the drying cycle. Buy green
detergent and cloth wash in cold water. Try these changes. Not only will it
help the planet, but your pocketbook as well. n
42
3/6/15 4:27 PM
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Main Main
Number:
(770)(770)
446-6364,
ext. Fax:
105 (770)
Fax: (770)
441-9061
Number:
446-6364
441-9061
Cell Phone: (770) 560-2315 Email: [email protected]
Cell Phone: (770) 231-3718 E-mail: [email protected]
www.russelllandscape.com
www.russelllandscapegroup.com
ATLANTA • BIRMINGHAM • CHARLESTON • DESTIN
ATLANTA – NASHVILLE – SAVANNAH – HILTON HEAD
HILTON HEAD • NASHVILLE • SAVANNAH
3/6/15 4:27 PM

- Community Associations Institute: Georgia Chapter

Transcription

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